<PAGE>
                           UNITED STATES
                 SECURITIES AND EXCHANGE COMMISSION
                      WASHINGTON, D.C.  20549
                ------------------------------------
                             FORM 10-Q

(Mark One)

[X]    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934

            For the quarterly period ended September 30, 1997
                                           ------------------
                                 OR

[ ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934

            For the transition period from                 to
                                           ---------------    ----------------

                   Commission File Number 0-22529
                                          -------
                                
                           inTEST Corporation
- ------------------------------------------------------------------------------
          (Exact Name of Registrant as Specified in its Charter)
                                
            Delaware                                   22-2370659
- ---------------------------------          -----------------------------------
(State or other jurisdiction of           (I.R.S. Employer Identification No.)
 incorporation or organization)

2 Pin Oak Lane, Cherry Hill, New Jersey                             08003
- -----------------------------------------                     ----------------
(Address of principal executive offices)                         (Zip Code)

Registrant's Telephone Number, Including Area Code:     (609) 424-6886         
                                                       ---------------

Indicate by check X whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.

                          Yes   X     No   
                              -----      -----

Number of shares of Common Stock, $.01 par value, outstanding as of September
30, 1997:
                           5,911,034


<PAGE>
                         INTEST CORPORATION
                                
                               INDEX
                                
                                

Part I.  Financial Information
                                                                          Page
                                                                          ----

         Item 1.  Financial Statements                          

            Consolidated Balance Sheets as of September 30, 1997
            (unaudited) and December 31, 1996                              1

            Consolidated Statements of Earnings (unaudited) for the
            three months and nine months ended September 30, 1997
            and 1996                                                       2

            Consolidated Statement of Stockholders' Equity (unaudited)
            for the nine months ended September 30, 1997                   3

            Consolidated Statements of Cash Flows (unaudited) for the
            nine months ended September 30, 1997 and 1996                  4

            Notes to consolidated financial statements (unaudited)       5 - 8


         Item 2.  Management's Discussion and Analysis of Financial
                  Condition and Results of Operations                    9 -13



Part II. Other Information



         Item 1.  Legal Proceedings                                       14


         Item 2.  Changes in Securities and Use of Proceeds             14 -15


         Item 3.  Defaults Upon Senior Securities                         15


         Item 4.  Submission of Matters to a Vote of Securities
                     Holders                                              15


         Item 5.  Other information                                       15


         Item 6.  Exhibits and Reports on Form 8-K                        16


<PAGE>
                               inTEST CORPORATION AND SUBSIDIARIES
                                   CONSOLIDATED BALANCE SHEETS
                                (In thousands, except share data)


<TABLE>
<CAPTION>
                                                                        Sept. 30,       Dec. 31,
                                                                          1997            1996
                                                                        ---------      ---------
                                                                       (Unaudited)     (Audited)
<S>                                                                    <C>             <C>
ASSETS
Current Assets:
  Cash and cash equivalents                                              $10,247        $ 3,692
  Trade accounts and notes receivable, net of allowance for doubtful 
     accounts of $96 at December 31, 1996 and $146 at September 30,
     1997                                                                  4,521          1,953
  Inventories                                                              1,308          1,313
  Other current assets                                                       318             70
                                                                         -------        -------
     Total current assets                                                 16,394          7,028
                                                                         -------        ------- 
Property and equipment:
  Machinery and equipment                                                  1,103          1,096
  Leasehold improvements                                                     170            173
                                                                         -------        -------
                                                                           1,273          1,269
  Less: accumulated depreciation                                            (773)          (676)
                                                                         -------        -------
     Net property and equipment                                              500            593
                                                                         -------        -------
Other assets                                                                 139             95
Goodwill                                                                   1,312              -
                                                                         -------        -------
     Total assets                                                        $18,345        $ 7,716
                                                                         =======        =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Current installments of long-term debt                                 $     -        $    34
  Accounts payable                                                         1,126            574
  Dividends payable                                                            -            973
  Accrued wages and expenses                                                 770            595
  Domestic and foreign income taxes payable                                1,013            475
                                                                         -------        -------
     Total current liabilities                                             2,909          2,651  
Long-term debt                                                                 -            155
Minority interest                                                              -            323
                                                                         -------        -------
     Total liabilities                                                     2,909          3,129
                                                                         -------        -------
Stockholders' equity:
  Preferred stock, $0.01 par value; 5,000,000 shares authorized; 
     no shares issued or outstanding                                           -              -
  Common stock, $0.01 par value; 20,000,000 shares authorized;
     5,911,034 shares issued and outstanding at September 30, 1997;
     3,790,591 shares issued and outstanding at December 31, 1996             59             38
  Additional paid-in capital                                              13,961            689
  Retained earnings                                                        1,464          3,833
  Foreign currency translation adjustment                                    (48)            27
                                                                         -------        -------
     Total stockholders' equity                                           15,436          4,587
                                                                         -------        -------
     Total liabilities and stockholders' equity                          $18,345        $ 7,716
                                                                         =======        =======
</TABLE>

               See accompanying Notes to Consolidated Financial Statements.
                                
                                       - 1 -
                                

<PAGE>
                          inTEST CORPORATION AND SUBSIDIARIES
                                  
                          CONSOLIDATED STATEMENTS OF EARNINGS
                           (In thousands, except share data)

<TABLE>
<CAPTION>

                                               Three Months Ended      Nine Months Ended
                                                   Sept. 30,               Sept. 30,
                                              --------------------    --------------------
                                                1997        1996        1997        1996
                                              --------    --------    --------    --------
<S>                                          <C>         <C>         <C>         <C>
Revenues                                      $ 6,212     $ 4,780     $14,719     $15,912
Cost of revenues                                2,319       1,850       5,756       5,438
                                              -------     -------     -------     -------
      Gross profit                              3,893       2,930       8,963      10,474
                                              -------     -------     -------     -------
Operating expenses:
   Selling expense                                706         586       1,799       1,922
   Research and development expense               455         425       1,230       1,275
   General and administrative expense             666         453       1,567       1,326
                                              -------     -------     -------     -------
      Total operating expenses                  1,827       1,464       4,596       4,253
                                              -------     -------     -------     -------
Operating income                                2,066       1,466       4,367       5,951
                                              -------     -------     -------     -------
Other income (expense):
   Interest income                                138          41         204          98
   Interest expense                                (6)         (1)        (14)         (7)
   Other                                           (8)         (1)         (6)        (20)
                                              -------     -------     -------     -------
      Total other income (expense)                124          39         184          71
                                              -------     -------     -------     -------
Earnings before income taxes and
 minority interest                              2,190       1,505       4,551       6,022
                                              -------     -------     -------     -------
Provision for income taxes:
   Domestic                                       673          26         827         137
   Foreign                                        251         154         546         688
                                              -------     -------     -------     -------
      Income tax expense                          924         180       1,373         825
                                              -------     -------     -------     -------
Earnings before minority interest               1,266       1,325       3,178       5,197
Minority interest                                   -         (67)        (25)       (247)
                                              -------     -------     -------     -------
      Net earnings                            $ 1,266     $ 1,258     $ 3,153     $ 4,950
                                              =======     =======     =======     =======
Net earnings per share (actual for three
  months ended 9/30/97 and pro forma for
  nine months ended 9/30/97)(Note 3)          $  0.21                 $  0.53

Weighted average shares outstanding (actual
  for three months ended 9/30/97 and pro
  forma for nine months ended 9/30/97)
  (Note 3)                                  5,969,334               4,804,417

</TABLE>


             See accompanying Notes to Consolidated Financial Statements.

                                          - 2 -


<PAGE>
                             inTEST CORPORATION AND SUBSIDIARIES
                                  
                       CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                        FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997
                                  
                               (In thousands, except share data)
                                  
                         (Unaudited except Balance, December 31, 1996)


<TABLE>
<CAPTION>
                                                                        Foreign
                                 Common Stock   Additional              Currency      Total
                              -----------------   Paid-In   Retained  Translation  Stockholders'
                               Shares    Amount   Capital   Earnings   Adjustment     Equity
                              ---------  ------ ----------  --------  -----------  -------------
<S>                          <C>         <C>     <C>        <C>          <C>         <C>

Balance, December 31, 1996    3,790,591   $ 38    $   689    $ 3,833      $ 27        $ 4,587

Dividends                             -      -          -     (5,522)        -         (5,522)

Net earnings                          -      -          -      3,153         -          3,153

Acquisition of minority
  interest                      300,443      3      1,655          -         -          1,658

Issuance of common stock,
  net                         1,820,000     18     11,617          -         -         11,635

Foreign currency translation
  adjustment                          -      -          -          -       (75)           (75)
                              ---------   ----    -------    -------      ----        -------


Balance, September 30, 1997   5,911,034   $ 59    $13,961    $ 1,464      $(48)       $15,436
                              =========   ====    =======    =======      ====        =======



</TABLE>


                 See accompanying Notes to Consolidated Financial Statements.
                                  
                                             - 3 -


<PAGE>  
                       inTEST CORPORATION AND SUBSIDIARIES
                                
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                        (In thousands, except share data)


<TABLE>
<CAPTION>
                                                           Nine Months Ended
                                                               Sept. 30,
                                                          --------------------
                                                            1997         1996
                                                          -------      -------
<S>                                                      <C>          <C>
CASH FLOWS FROM OPERATING ACTIVITIES
  Net earnings                                            $ 3,153      $ 4,950
  Adjustments to reconcile net earnings to net cash:
    Depreciation and amortization                             157           24
    Minority interest                                          26          244
    Allowance for bad debts                                    50           50
    Changes in assets and liabilities:
      Inventories                                             (10)         (58)
      Accounts and notes receivable                        (2,640)        (286)
      Other current assets                                   (250)        (150)
      Accounts payable                                        567         (449)
      Dividends payable                                      (973)           -
      Accrued wages and expenses                              166          292
      Domestic and foreign income taxes payable               553           70
                                                          -------      -------
  Total adjustments                                        (2,354)        (263)
                                                          -------      -------
Net cash provided by operating activities                     799        4,687
                                                          -------      -------
CASH FLOW PROVIDED BY (USED IN) INVESTING ACTIVITIES:
  Purchase of property and equipment                          (50)        (391)
  Other long-term asset                                       (49)         (24)
                                                          -------      -------
Net cash provided by (used in) investing activities           (99)        (415)
                                                          -------      -------
CASH FLOW PROVIDED BY (USED IN) FINANCING ACTIVITIES:
  Dividends paid                                           (5,551)      (2,156)
  Principal debt borrowing (repayment)                       (189)         197
  Net proceeds from public offering                        11,635            -
                                                          -------      -------
Net cash provided by (used in) financing activities         5,895       (1,959)
                                                          -------      -------
Effects of exchange rates on cash                             (40)         (11)
                                                          -------      -------
Net cash provided by (used in) all activities             $ 6,555      $ 2,302
                                                          =======      =======
Cash at beginning of period                               $ 3,692      $ 1,919

Cash at end of period                                     $10,247      $ 4,221

</TABLE>


              See accompanying Notes to Consolidated Financial Statements.
                                
                                       - 4 -


<PAGE>
                  inTEST CORPORATION AND SUBSIDIARIES


               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
      (Information as of September 30, 1997 and for the three months
      and nine months ended September 30, 1997 and 1996 is unaudited)
                                
                 (In thousands, except for share data)
                                
                                
(1)  NATURE OF OPERATIONS

     inTEST Corporation (the "Company") designs, manufactures and markets
     docking hardware and test head manipulators used by semiconductor
     manufacturers during the testing of wafers and packaged devices.
     The Company also designs and markets related automatic test equipment
     interface products.  The Company operates in a single industry segment.

     The consolidated entity is comprised of inTEST Corporation (parent) and
     three 100% owned foreign subsidiaries: inTEST Limited (Thame, UK), inTEST
     Kabushiki Kaisha (Kichijoji, Japan) and inTEST PTE, Limited (Singapore).
     All significant intercompany accounts and transactions have been
     eliminated upon consolidation.

     The Company manufactures its products in the U.S. and the U.K.  Marketing
     and support activities are conducted worldwide from the Company's
     facilities in the U.S., U.K., Japan and Singapore.

     On June 20, 1997, the Company completed an initial public offering of
     2.275 million common shares through which the Company issued 1.82 million
     new shares of common stock (the "Offering").   Simultaneous with the
     closing of the Offering, the Company acquired the 21% minority interests
     in each of its three foreign subsidiaries in exchange for an aggregate of
     300,443 shares of the Company's common stock (the "Exchange").  Prior to
     the Offering the Company owned 79% of each of the three foreign
     subsidiaries.  In addition, upon the effective date of the Company's
     registration statement, the grant of options to purchase a total of
     150,000 shares of the Company's common stock became effective.  Such
     options are exercisable at a price of $7.50 per share.


(2)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Interim Financial Reporting
     ---------------------------

     In the opinion of management, the accompanying unaudited consolidated
     financial statements include all adjustments (consisting only of normally
     recurring adjustments) necessary to present fairly the financial
     position, results of operations, and changes in cash flows for the
     interim periods presented.

     Certain footnote information has been condensed or omitted from these
     financial statements.  Therefore, these financial statements should be
     read in conjunction with the consolidated financial statements and


                                  - 5 -


<PAGE>
                  inTEST CORPORATION AND SUBSIDIARIES
                                
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                              (Unaudited)


(2)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 

     Interim Financial Reporting (Continued)
     ---------------------------

     accompanying footnotes included in the Company's Prospectus dated
     June 17, 1997.

     Use of Estimates
     ----------------

     The preparation of financial statements in conformity with generally
     accepted accounting principles requires management to make estimates
     and assumptions that affect the reported amounts of assets and
     liabilities and disclosure of contingent assets and liabilities at the
     date of the financial statements and the reported amounts of revenues and
     expenses during the reporting period.  Actual results could differ from
     those estimates. 

     Net Earnings Per Common Share
     -----------------------------

     Net earnings per common share is computed by dividing net earnings by the
     weighted average number of shares of common stock and common stock
     equivalent shares outstanding during the period.  Common stock
     equivalents include stock options using the treasury stock method.

     Income Taxes
     ------------

     Just prior to the closing of the Offering, the Company terminated its
     status as an S corporation for Federal tax purposes and in the State of
     New Jersey.  As an S corporation, any Federal and certain New Jersey
     state income tax liabilities were those of the former S corporation
     stockholders, not of the Company.  All tax liabilities on income earned
     subsequent to the revocation of the S corporation election are
     liabilities of the Company.  The Company accounts for income taxes in
     accordance with the Statement of Financial Accounting Standard No. 109, 
     Accounting for Income Taxes.

     Foreign Currency
     ----------------

     The accounts of the foreign subsidiaries are translated in accordance
     with the Statement of Financial Accounting Standard No. 52, Foreign
     Currency Translation, which requires that assets and liabilities of
     international operations be translated using the exchange rate in effect
     at the balance sheet date.  The results of operations are translated
     using an average exchange rate for the period.  The effects of rate
     fluctuations in translating assets and liabilities of international

                              - 6 -


<PAGE>
                  inTEST CORPORATION AND SUBSIDIARIES
                                
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                              (Unaudited)


(2)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 

     Foreign Currency (Continued)
     ----------------

     operations into U.S. dollars are accumulated and reflected as a foreign
     currency translation adjustment in the consolidated statements of
     stockholders' equity.  Transaction gains or losses are included in net
     earnings.

     New Accounting Pronouncements
     -----------------------------

     In February 1997, the Financial Accounting Standards Board (FASB) issued
     Statement of Financial Accounting Standard No. 128, Earnings per Share
     (SFAS 128).  This Statement introduces new methods for calculating
     earnings per share.  The adoption of this Statement will not affect
     results of operations, financial condition, or long-term liquidity, but
     will require the Company to restate earnings per share reported in prior
     periods.  Compliance with this Statement, which will be effective for
     periods ending after December 31, 1997, is not expected to have a
     material effect on the Company's earnings per share amounts.  

     In June 1997, the FASB issued SFAS 130, Reporting Comprehensive Income. 
     This Statement requires that all items that are required to be recognized
     under accounting standards as components of comprehensive income be
     reported in a financial statement that is displayed with the same
     prominence as other financial statements.  The Company plans to
     adopt this Statement on January 1, 1998, as required.  The adoption of
     this Statement will not affect results of operations, financial
     condition, or long-term liquidity, but will require the Company to
     classify items of other comprehensive income in a financial statement and
     display the accumulated balance of other comprehensive income separately
     in the equity section of the balance sheet.

     In June 1997, the FASB issued SFAS 131, Disclosures About Segments of an
     Enterprise and Related Information.  This Statement established standards
     for reporting information about operating segments in annual financial
     statements and requires selected information about operating segments in
     interim financial reports issued to shareholders.  It also establishes
     standards for related disclosure about products and services, geographic
     areas and major customers.  The Company plans to adopt this Statement on
     January 1, 1998, as required.  The adoption of this Statement will not
     affect results of operations, financial condition or long-term
     liquidity.

                              - 7 -


<PAGE>
                  inTEST CORPORATION AND SUBSIDIARIES
                                
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                              (Unaudited)

(3)  PRO FORMA STATEMENT OF EARNINGS INFORMATION

     The Company terminated its status as an S corporation just prior to the
     closing of the Offering, and is subject to Federal and additional state
     income taxes for periods after such termination.

     Accordingly, for informational purposes, the following pro forma
     information for the nine months ended September 30, 1997 is presented
     to show pro forma earnings on an after-tax basis, assuming the Company
     had been taxed as a C corporation since January 1, 1997.  The results
     of operations for the three months ended September 30, 1997 do not
     require pro forma adjustment because the Company was a C corporation
     throughout such period.  The difference between the Federal statutory
     income tax rate and the pro forma income tax rate are as follows:

<TABLE>
<CAPTION>
                                                                9 Months
                                                                  Ended
                                                                Sept. 30,
                                                                  1997
                                                                --------
       <S>                                                        <C>
       Federal statutory tax rate                                  34%
       State income taxes, net of Federal benefit                   3
       Foreign income taxes                                         7
       Non-deductible goodwill amortization                         1
       Research credits                                            (1)
                                                                   --
       Pro forma income tax rate                                   44%

                                                                9 Months
                                                                  Ended
                                                                Sept. 30,
                                                                  1997
                                                                --------
       Pro forma earnings before income taxes                    $4,511  
       Pro forma income taxes                                     1,964  
       Pro forma net earnings                                     2,547  
       Pro forma net earnings per common share                   $ 0.53  
       Pro forma weighted average common and common
         stock equivalent shares outstanding                  4,804,417
</TABLE>


     In addition, the pro forma results for the nine months ended September
     30, 1997 also reflect goodwill amortization resulting from the acquisition
     of minority interests in foreign subsidiaries, net of the elimination of
     the minority interest charge reflected in the historical financial
     statements, as if the Exchange had occurred on January 1, 1997.  The
     goodwill resulting from the Exchange, which totaled $1.3 million, is being
     amortized over 15 years.

     Pro forma net earnings per common share was calculated by dividing pro
     forma net earnings by the pro forma weighted average number of shares of
     common stock and common stock equivalent shares outstanding during the
     period calculated as if the Exchange had occurred on January 1, 1997.

                                   - 8 -


<PAGE>
                   inTEST CORPORATION AND SUBSIDIARIES


I
tem 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS.

Overview

     The Company designs, manufacturers and markets docking hardware and test
head manipulators, which are used with automatic test equipment ("ATE") by
semiconductor manufacturers during the testing of wafers and packaged devices.
The Company also designs and markets related ATE interface products including
high performance test sockets, interface boards and probing assemblies.  The
Company's products are designed to improve the utilization and cost-
effectiveness of ATE (including testers, wafer probers and device handlers)
during the testing of linear, digital and mixed signal integrated circuits.

     The Company's revenues have fluctuated generally as a result of
cyclicality in the semiconductor manufacturing industry.  The Company believes
that purchases of the Company's docking hardware and manipulators are
typically made from its customers' capital expenditure budgets, while related
ATE interface products, which must be replaced periodically, are typically
made from its customers' operating budgets.  When semiconductor manufacturing
activity generally slowed during much of 1996, many semiconductor
manufacturers reduced their capital expenditure budgets and, correspondingly,
postponed or canceled orders for ATE and related equipment.  As a result,
starting in the second quarter of 1996 through the fourth quarter of 1996,
orders for and sales of docking hardware and manipulators declined
substantially.  During this same period, orders for and sales of related ATE
interface products also declined, but to a lesser extent.  Starting in the
first quarter of 1997, orders for and sales of docking hardware and
manipulators began increasing from the sequential quarterly declines
experienced during 1996.  The increase in order activity during 1997 is
reflected in the growth in the Company's backlog, which increased from $1.8
million at December 31, 1996 to $5.0 million at September 30, 1997.  
Backlog represents orders for the Company's products, but because there can
be no assurance that the Company's customers will purchase the products
subject to such orders, backlog is not necessarily indicative of sales for
any future period.  The increase in order activity is due to renewed demand
for ATE by semiconductor manufacturers.  During 1997, the Company's quarterly
revenues grew from $3.9 million in the first quarter to $6.2 million in the
third quarter, an increase of approximately 60%.  Although the Company
experienced a record level of sales during the third quarter of 1997, its
revenues for the nine months ended September 30, 1997 are still less than
those of the comparable period in 1996.

     On June 20, 1997 the Company completed an initial public offering of
2.275 million common shares through which the Company issued 1.82 million new
shares of common stock (the "Offering").  Prior to the Offering the Company
was an S corporation, and the net earnings of the Company were taxed as income
to the Company's stockholders for Federal and certain New Jersey state income
tax purposes.  The Company terminated its status as an S corporation prior to
the closing of the Offering and is subject to Federal and additional state
income taxes for periods after such termination.

Results of Operations
- ---------------------
Three Months Ended September 30, 1997 Compared to Three Months Ended
September 30, 1996:



                                  - 9 -


<PAGE>
                   inTEST CORPORATION AND SUBSIDIARIES

Item 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS (Continued)


     Revenues.  Revenues were a record $6.2 million for the quarter ended
September 30, 1997 compared to $4.8 million for the same period in 1996,
an increase of $1.4 million or 30%.  The significant increase in revenue
over the comparable prior period reflects the aforementioned increased
demand for ATE experienced during 1997.

     Gross Margin.  Gross margin increased to 63% for the quarter ended
September 30, 1997 compared to 61% for the comparable period in 1996.  The
improvement in gross margin was the result of lower incremental material
costs due to increased purchasing volume, which was partially offset by a
significant increase in the level of sales to ATE manufacturers, which
increased from approximately one fifth of total sales in the comparable
period in 1996 to approximately one third of total sales during 1997.  Sales
to ATE manufacturers generally result in lower gross margin than direct
sales to semiconductor manufacturers because the Company offers larger sales
discounts to ATE manufacturers than on sales to semiconductor manufacturers
for which the Company may also pay sales commissions.  While the Company
believes this shift in customer mix is not indicative of a trend, it cannot
reasonably predict future shifts in the mix of sales.

     Selling Expense.  Selling expense was $706,000 for the quarter ended
September 30, 1997 compared to $586,000 for the same period in 1996, an
increase of $120,000 or 21%.  The increase was primarily attributable to
higher salary expense resulting from the allocation of additional personnel
costs to selling expense and, to a lesser extent, salary increases for
existing personnel.  In addition, commission expense increased over the
comparable period in 1996 due to an increase in the level of commissioned
sales to semiconductor manufacturers in the third quarter of 1997 compared
to the same period in 1996.  The increase in selling expense also reflects
an increase in advertising expense over the comparable prior period.  These
increases were offset by reductions in travel expense, warranty costs and
freight expense.

     Research and Development Expense.  Research and development expense
was $455,000 for the quarter ended September 30, 1997 compared to $425,000
for the same period in 1996, an increase of $30,000 or 7%.  The increase
was due to increased levels of spending on research and development
materials in 1997 as compared to 1996.

     General and Administrative Expense.  General and administrative 
expense was $666,000 for the quarter ended September 30, 1997 compared to
$453,000 for the same period in 1996, an increase of $213,000 or 47%.  The
increase was attributable to accruals for investor relations costs,
additions to the provision for bad debts, amortization of goodwill
resulting from the acquisition of the minority interests in the Company's
three foreign subsidiaries in connection with the offering and salary
increases of administrative staff.

     Income Tax Expense.  Income tax expense increased to $924,000 for
the quarter ended September 30, 1997 from $180,000 for the comparable


                             - 10 -


<PAGE>
                  inTEST CORPORATION AND SUBSIDIARIES

Item 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS (Continued)


period in 1996, an increase of $744,000.  The Company's effective tax rate
was 42% for the third quarter of 1997 compared to 12% for the same period in
1996.  The significant increase in the effective tax rate was caused by the
accrual of Federal income tax on the Company's earnings due to the change of
tax status from S corporation to C corporation prior to the Offering and, to
a lesser extent, to a greater percentage of earnings before income taxes and
minority interest being attributable to the Company's Japanese subsidiary.

Nine Months Ended September 30, 1997 Compared to Nine Months Ended September
30, 1996:

     Revenues.  Revenues were $14.7 million for the nine months ended
September 30, 1997 compared to $15.9 million for the comparable period in
1996, a decrease of $1.2 million or 8%.  While revenues have declined on a
year-to-year basis, the quarterly trends in 1997 have shown sequential
revenue growth which reflect the increased demand for ATE experienced
in 1997.

     Gross Margin.  Gross margin declined to 61% for the nine months ended
September 30, 1997 from 66% for the same period in 1996.  The decline was
primarily attributable to a higher percentage of sales to ATE manufacturers,
which increased from approximately one fifth of total sales in the 
comparable period in 1996 to approximately one third of total sales during
1997.  The reduced gross margin also reflects higher incremental costs, due
to lower manufacturing levels in the first two quarters of 1997 than during
the same periods in 1996, and higher fixed costs (principally rent,
depreciation and salaries) during 1997 compared to the same period in 1996.

     Selling Expense.  Selling expense was $1.8 million for the nine months
ended September 30, 1997 compared to $1.9 million for the same period in 
1996, a decrease of $0.1 million or 6%.  The decline was due principally to
a decrease in commissions attributable to the lower percentage of sales to
semiconductor manufacturers on which the Company pays sales commissions.
The decline in selling expense also reflects reductions in travel expense,
warranty costs, and freight expense.  These declines were offset by increases
in salary expense due to the allocation of additional personnel costs to
selling expense and higher levels of advertising expense.

     Research and Development Expense.  Research and development expense was
$1.2 million for the nine months ended September 30, 1997 compared to $1.3
million for the comparable period in 1996, a decline of 4%.  The decrease
was primarily due to reduced levels of spending on research and development
materials in 1997 as compared to 1996.

     General and Administrative Expense.  General and administrative expense
was $1.6 million for the nine months ended September 30, 1997 compared to
$1.3 million for the same period in 1996, an increase of 18%.  The increase
was attributable to increased compensation expense related to additional


                             - 11 -


<PAGE>
                  inTEST CORPORATION AND SUBSIDIARIES

Item 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS (Continued)


staff in accounting, MIS and finance, accruals for investor relations costs
and amortization of goodwill resulting from the acquisition of the minority
interests in the Company's three foreign subsidiaries in connection with the
offering.

     Income Tax Expense.  Income tax expense increased to $1.4 million for
the nine months ended September 30, 1997 from $825,000 for the comparable
period in 1996, an increase of $548,000.  The Company's effective tax rate
was 30% for the first nine months of 1997 compared to 14% for the same
period in 1996.  The increase is attributable to the accrual of Federal
income tax on the Company's earnings due to the change of tax status from
S corporation to C corporation prior to the Offering and a greater
percentage of earnings before income taxes and minority interest being
attributable to the Company's Japanese subsidiary.


Liquidity and Capital Resources
- -------------------------------

     The Company realized net cash proceeds of $11.6 million (after payment
of direct expenses of the Offering) from the sale of 1.82 million newly
issued shares in the Offering.  The proceeds from the Offering are 
expected to be used for working capital, general corporate purposes and
possible acquisitions of businesses, technologies or products complementary
to the Company's business.

     Net cash provided by operations for the nine months ended September 30,
1997 was $799,000.  Accounts receivable increased $2.6 million from
December 31, 1996 to September 30, 1997 due to increased sales generally
and also due to an increase in the percentage of consolidated sales by one
of the Company's foreign subsidiaries where trade practices permit longer
credit terms.  Other current assets increased $250,000, primarily as a
result of increases in prepaid expenses including insurance premiums.
Accounts payable and accrued expenses increased $567,000 and $166,000,
respectively, as a result of higher sales levels.  Domestic and foreign
income taxes payable increased $553,000 primarily as a result of the
accrual of Federal income tax on earnings subsequent to the offering
and, to a lesser extent, to a greater percentage of earnings before income
taxes and minority interest being attributable to the Company's Japanese
subsidiary.

     During the nine months ended September 30, 1997, the Company repaid the
balance of a term loan.  At January 1, 1997, the outstanding balance of
such term loan was $189,000.

     In connection with the termination of the Company's status as an
S corporation, the Company paid dividends of $3.4 million on June 23, 1997
and $886,000 on September 5, 1997 to its former S corporation shareholders
which represented the final distribution of previously taxed but undistributed
retained earnings.

                             - 12 -


<PAGE>
                  inTEST CORPORATION AND SUBSIDIARIES

Item 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS (Continued)


     Simultaneous with the Offering, the Company acquired the 21% minority
interests in each of its three foreign subsidiaries in exchange for an
aggregate of 300,443 shares of the Company's common stock.  This acquisition,
which was accounted for using the purchase method, created goodwill of
approximately $1.3 million, which is being amortized over a period of 15
years.

     The Company believes that existing cash and cash equivalents, its $1.5
million line of credit and the anticipated net cash provided from operations
will be sufficient to satisfy the Company's cash requirements for the
foreseeable future.  However, if the Company were to make any acquisitions,
the Company may require additional equity or debt financing to meet working
capital requirements or capital expenditure needs.  Although the Company,
as an S corporation, has historically paid cash dividends to its
stockholders, the Company does not anticipate that it will pay dividends
in the foreseeable future.

     Statements of a forward-looking nature relating to future events or
the future financial performance of the Company are only predictions and
may be affected by various risks and uncertainties, including without
limitation, the effect of general economic and market conditions in the
United States and foreign markets, industry market conditions, changes in
supply and demand for the Company's products, competitor pricing and other
factors.  Actual events or results may be materially different.  In addition,
the Company cannot reasonably predict what effect, if any, the current
economic conditions in the Far East may have on its business.


                                    - 13 -


<PAGE>
                    inTEST CORPORATION


P
art II.  Other Information



     Item 1.  Legal Proceedings

              None


     Item 2.  Changes in Securities and Use of Proceeds
              
              On June 17, 1997, the Company's Registration Statement on
              Form S-1 covering the Offering of 2,275,000 shares of the
              Company's Common Stock, Commission file number 333-26457,
              was declared effective.  The Offering commenced on
              June 20, 1997, managed by Janney Montgomery Scott, Inc.
              and Needham & Company, Inc. as representatives of the
              several underwriters named in the Registration Statement
              (the "Underwriters").

              Of the 2,275,000 shares sold pursuant to the Offering,
              1,820,000 shares were sold by the Company and 455,000 were sold
              by certain selling stockholders (the "Selling Stockholders").
              In addition, the Underwriters exercised an over-allotment option
              to purchase an additional 341,250 shares of the Company's Common
              Stock from the Selling Stockholders.  The total price to the
              public for the shares offered and sold by the Company and the
              Selling Stockholders was $13,650,000 and $5,971,875,
              respectively.

              The amount of expenses incurred for the Company's account in
              connection with the Offering are as follows:


<TABLE>
              <S>                                               <C>
              Underwriting discounts and commissions:            $1,023,750
              Finders' fees:                                           None
              Expenses paid to or for the Underwriters:              16,650
              Other expenses:                                       975,000
                                                                 ----------
              Total expenses:                                    $2,015,400
                                                                 ==========
</TABLE>

              All of the foregoing expenses were direct or indirect payments
              to persons other than (i) directors, officers or their
              associates; (ii) persons owning ten percent (10%) or more of the
              Company's Common Stock; or (iii) affiliates of the Company.

              The net proceeds of the Offering to the Company (after deducting
              the foregoing expenses) was $11,634,600.  From the effective
              date of the Registration Statement, the net proceeds have been
              used for the following purposes:


                                      - 14 -


<PAGE>       
                    inTEST CORPORATION


Part II.  Other Information (Continued)


     Item 2.  Changes in Securities and Use of Proceeds (Continued)


<TABLE>
              <S>                                                <C>
              Construction of plant, building and facilities     $         -
              Purchase and installation of machinery
                and equipment                                         13,894
              Purchase of real estate                                      -
              Acquisition of other business                                -
              Repayment of indebtedness                              173,266
              Working capital                                        599,725
              Temporary investments, including cash &
                cash equivalents                                  10,246,950
              Other purposes (for which at least $100,000
                has been used), including:
                   Payment of final S corporation distribution       600,765
                                                                 -----------
                                                                 $11,634,600
                                                                 ===========
</TABLE>


              In connection with the termination of the Company's status as
              an S corporation, the Company used $601,000 of the net proceeds
              to pay a portion of the $4.3 million final distribution of
              previously taxed but undistributed earnings of the Company.

              All of the foregoing payments with the exception of the final S
              corporation distribution were direct or indirect payments to
              persons other than (i) directors, officers or their associates;
              (ii) persons owning ten percent (10%) or more of the Company's
              Common Stock; or (iii) affiliates of the Company.


     Item 3.  Defaults Upon Senior Securities

              None


     Item 4.  Submission of Matters to a Vote of Securities Holders

              None


     Item 5.  Other Information

              None

                                 - 15 -


<PAGE>

                   inTEST CORPORATION

PART II.  Other Information (Continued)


     Item 6.  Exhibits and Reports on Form 8-K

              (a) Exhibits:

                  3(i)  Articles of Incorporation: Previously filed by the
                        Company as an Exhibit to the Company's Registration
                        Statement on Form S-1, File No. 333-26457, and
                        incorporated herein by reference.

                  3(ii) By-Laws: Previously filed by the Company as an Exhibit
                        to the Company's Registration Statement on Form S-1,
                        File No. 333-26457, and incorporated herein by
                        reference.

                  10    Lease Agreement between the Company and Cherry Hill
                        Industrial Sites, Inc. dated August 22, 1997.

                  27    Financial Data Schedule

              (b) Reports on Form 8-K

                  None           

                               - 16 -


<PAGE>


                            Signatures
                                 
                                 
                                 
                                 
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.




                                        inTEST Corporation



Date:  November 14, 1997                /s/ Alyn R. Holt
       ---------------------            -------------------------------------
                                        Alyn R. Holt
                                        Chairman and Chief Executive Officer



Date:  November 14, 1997                /s/ Hugh T. Regan, Jr.
       ---------------------            -------------------------------------
                                        Hugh T. Regan, Jr.
                                        Treasurer and Chief Financial Officer


<PAGE>

                         Index to Exhibits
                                 
                                 

Item 6.   Exhibits and Reports on Form 8-K

          10   Lease Agreement

          27   Financial Data Schedule








<PAGE>
                                                                   Exhibit 10

LEASE AGREEMENT

THIS LEASE AGREEMENT, made this 22nd day Of August 1997 between CHERRY HILL
INDUSTRIAL SITES, INC., a New Jersey Corporation having its principal
office at 1998 Springdale Road, Cherry Hill, New Jersey 08003, (hereinafter
referred to as Landlord), and MS

INTEST, INC.   (hereinafter referred to as Tenant)

having an office at
Building #16
2 Pin Oak Lane
Cherry Hill Industrial Center
Cherry Hill, New Jersey 08003,

Contacts:  Alyn Holt, President,
Tel: 609-424-6886

(hereinafter referred to as TENANT).

Landlord and Tenant hereby covenant as follows: 

     1.   LEASED PREMISE.  Landlord hereby agrees to lease to Tenant, and
Tenant hereby agrees to rent from Landlord approximately 11,082 square
feet, in building #24 and land adjacent thereto, situated in Cherry Hill
township, Block 468.04, Lot 1 as shown and defined on exhibit A attached
hereto and made a part hereof (hereinafter referred to as the PREMISES) for
the term of 5 years and 4 months (64 months inclusive, or until such prior
termination as hereinafter provided to commence February l, 1998 and end on
May 31, 2003 (inclusive).

          Tenant agrees that this Lease unless sooner terminated, pursuant
to the covenants hereof, shall expire absolutely on the expiration
 date
without the requirement of any further notice from Landlord.

     2.   USE.  Tenant shall use the Premises for offices, warehousing,
distribution and related uses as permitted in an I-R zone of Cherry Hill
Township.

     3.   Base RENT.  The Base Term rental shall be $221,632.00 except as
same may be modified elsewhere in this Lease, payable by Tenant to
Landlord, in lawful money of the United States in base monthly rental
installments $3,463.00 during the term.

          Rent is payable on the first day of each month, in advance,
during the Term, at the office of the Landlord or such other place as
Landlord may designate.  Tenant shall assume the risk of lateness or
failure of delivery of the mails, and no lateness or failure of the mails
will excuse Tenant from its obligation to have made any payment of rent or
additional rent as required under this Lease.

          No payment by Tenant or receipt or acceptance by Landlord of a
lesser amount than the correct rent or additional rent shall be deemed to

                                 - 1 -


<PAGE>

be other than a payment on account, nor shall any endorsement or statement
on any check or any letter accompanying any check or payment be deemed an
accord and satisfaction, and Landlord may accept such check or payment
without prejudice to Landlord's right to recover the balance or pursue any
other remedy in this Lease or at law provided.

          The basic rent and the CAM rent for the first full month of the
Term shall be paid upon the signing of this Lease.

     4.   SECURITY.  Lease, Tenant has deposited with Landlord the sum of
$4,848.00 as security for the faithful performance and observance by Tenant
of the covenants of this Lease.  The depositing of said sum with the
Landlord is a condition precedent to the valid execution of the Lease. 
Landlord, at its option, may use, apply or retain the whole or any part of
the security so deposited for the payment of any sum for which Tenant is in
default or for any sum which Landlord, at its option, may expend by reason
of Tenant's default of any of the covenants of this Lease.  Any
expenditures made by Landlord as herein stipulated shall be paid by Tenant
as additional rent.  Landlord shall be permitted to co-mingle Tenant
security funds with other funds of Landlord and shall not be required to
pay interest on any sum so held.

          In the event that Tenant shall fully and faithfully comply with
all the covenants of this Lease, the security shall be returned to Tenant
after the date fixed as the end of the Lease and after delivery of the
Premises by Tenant to Landlord pursuant to the covenants of this Lease.

          In the event of a sale of the Premises, Landlord shall have the
right to transfer the security to the buyer and Landlord shall thereupon be
relieved by Tenant from all liability for the return of such security and
Tenant agrees to look to the buyer solely for the return of said security.
The provisions hereof shall apply to every transfer or assignment made of
the security to a new buyer.  Tenant further covenants that it will not
assign or encumber or attempt to assign or encumber the monies deposited
herein as security and that neither the Landlord nor its successors or
assigns shall be bound by any such assignment and/or encumbrance.

     5.   CAM RELATED CHARGES.  Tenant shall pay to Landlord during the
Term, in advance, as additional rent, except as same may be modified
herein, in lawful money of the United States, the amount of $638.00 per
month as Tenants contribution towards Landlords costs for the following
charges, expenses and/or services related to the Premises:

          a.  real property taxes and assessments under or by virtue of
the lawful authority having jurisdiction over the Premises.

          However real property taxes during the Term ensuing from added
assessments related to alterations and improvements made to the Premises on
behalf of, or by Tenant, shall be payable by Tenant, as additional rent, in
the month following Landlords giving Tenant notice of same.

          b.  work arranged by Landlord related to grass cutting and
landscape maintenance pursuant to standards as established by Landlord.

                                  - 2 -


<PAGE>

          However:  Tenant shall keep the lawn, landscaped areas, paved
surfaces, sidewalks and similar areas free of debris and other waste/
discarded material at all times.

          In the event Landlord, at its option, removes any trash, wood
pallets, debris and similar material from any such areas Tenant shall pay
all expenses incurred by Landlord related to such removal and disposal as
additional rent.  Landlord may, at its option, utilize Tenants canisters/
dumpsters for the disposal of any such materials.

          c.  removal of snow from the exterior paved areas of the Premises
within 24  hours after the cessation of any particular snowstorm provided
the average accumulation from said storm exceeds two inches  on the paved
surfaces, as measured by Landlord.

          However:

          (i)     In the event Landlord is unable to remove the snow by
                  reason of vehicles thereon, or other obstructions/
                  blockages or similar occurrences not caused by Landlord
                  or Landlord's contractor, there shall be no further
                  obligation or responsibility on the part of Landlord or
                  Landlord's contractor to remove snow from that particular
                  snowstorm.  In such event no credit or abatement shall be
                  due Tenant.

          (ii)    Snow of less than a 2 inch average accumulation on the
                  paved surfaces of the Premises, as measured by Landlord,
                  are not subject to removal by Landlord or Landlord's
                  contractor, but are the sole responsibility of Tenant.

          (iii)   The responsibility of Landlord and Landlord's contractor
                  is restricted to the work specified herein.  Work related
                  to the clearing of snow from sidewalks, platforms, steps
                  or other similar items is excluded and shall be the sole
                  responsibility of Tenant.

          (iiii)  Tenant is responsible for all sanding, salting and
                  de-icing operations related to the Premises.

          d.  sprinkler supervisory service and sprinkler standby charges/
expenses.

          e.  Landlord's fire and casualty insurance policy insuring
Landlord's property.

          In regards to Landlords policy, Tenant agrees:  (i) it will not
do nor permit any acts or things which will invalidate or be in conflict
with any provisions thereof or which shall cause the insurance rate on the
Premises to be higher than on the date of the commencement of this Lease;
(ii) it shall comply with all present and future rules, regulations and
recommendations thereof and shall promptly make all changes, modifications,


                                  - 3 -


<PAGE>

replacements and alterations as are necessary and/or required; (iii)
Landlord will not be responsible for charges and/or costs related to
damage, loss, or repair and/or replacement of any property caused by
conditions exclusions or reasons not covered therein and/or for any
property not owned by Landlord.

     6.   UTILITIES.  Tenant shall pay for all deposits, costs and charges
relating to heat, electricity, gas, water, and similar services (except as
specifically provided for elsewhere in this Lease) rendered or supplied to
or upon the Premises, or in connection with the use and occupation of the
Premises on or prior to the date same are due.

          Tenant shall not be released or excused from the performance of
any of its obligations under this Lease for any failure, interruption or
curtailment of any utilities or services, nor shall any such failure,
interruption or curtailment constitute a constructive or partial eviction.

     7.   PERSONAL PROPERTY TAXES.  Tenant shall pay all personal property
taxes and other taxes and assessments pertaining to its goods, chattels,
machinery, equipment, fixtures, personal property and similar items on or
prior to the date same are due.

     8.   TENANT'S INSURANCE OBLIGATIONS.  Tenant, as a minimum, shall
carry the following insurance policies applicable to the Premises (and
other areas as may be required herein) with reputable companies authorized
to issue policies in the State of New Jersey having a Moody rating of at
least A.  The Certificate of Insurance shall indicate Cherry Hill
Industrial Sites, Inc. as the additional insured under the "description"
portion of the certificate, as follows:  "Cherry Hill Industrial Sites,
Inc. as additional insured relative to any and all lease/rental premises
utilized by the Tenant".

          a.  Comprehensive Public Liability Insurance.  Such insurance
shall be for a Combined Single Limit (CSL) for bodily injury (including
death) and property damage or loss (for occurrences in or about the
Premises or arising out of Tenants ownership, maintenance, use or occupancy
of the Premises) in the amount of $1,000,000 for each occurrence, and
$3,000,000 in the aggregate.

          b.  Personal Property Insurance in amounts and types of coverage
to insure against damage or loss to any property including, but not limited
to any Tenant alterations, improvements or betterments in or about the
Premises that is not the property of Landlord caused by:  (1) water, rain,
sleet, snow, or ice entering seeping or leaking into or through the
Premises or any portion thereof; (2) fire, explosion, tornado, wind,
earthquake or any other casualty or any other similar occurrences; (3)
theft, burglary, vandalism, malicious mischief, or other similar
occurrences; (4) accidents of any kind, type or nature; (5) electrical, gas
or water failure, cutoffs, surges or similar occurrences; (6) loss or
damage to property not owned by Landlord by any similar reason.



                                 - 4 -


<PAGE>

          c.  Boiler and pressure vessel insurance (when equipment relating
to this type of insurance is located in/and or upon the Premises) with
Landlord as a named insured in sufficient amount to insure against damage
or loss to any property whether belonging to Tenant, Landlord, or others.

          d.  Such other insurance, and in such amount, as may from time to
time be reasonably required by Landlord or required by law.  No insurance
requirements as set forth in this Lease shall preclude Tenant from
obtaining whatever additional insurance coverages Tenant shall deem
necessary or prudent.

          e.  NOTE:  Tenant shall have the right to procure its required
insurance on a blanket master policy basis and/or an umbrella basis;
provided, however, that all such coverage shall otherwise comply with all
of the requirements contained herein.

          f.  Prior to the commencement date of this Lease and by the
fifteenth day of March of each year thereafter Tenant shall deliver to the
Landlord proof that all the insurance coverages required of Tenant pursuant
to the covenants of this Lease are in force and that premiums related
thereto are paid.

          All insurance policies required of Tenant shall:  (a) provide at
least thirty (30) days prior notice to Landlord and Tenant of any change,
modifications or cancellation and (b) contain a waiver of subrogation of
the rights of the Tenant's insurance carrier to proceed against the
Landlord for matters which are required to be or are covered by the
Tenant's insurance policies.

          Tenant shall give prompt notice to Landlord in case of any
fire, casualty, accident or similar occurrence.

     9.   FIRE.  If the Premises shall be partially damaged by fire or
similar casualty as is covered under insurance policies carried by
Landlord, the damage shall be repaired by and at the expense of Landlord to
the extent provided for pursuant to the provisions thereof.  Any fire or
similar casualty damage to the Premises, within the deductible limits of
the aforementioned policies shall be repaired by Landlord, but paid for by
Tenant as additional rent.

          The rent, until such repairs are made, shall be apportioned
according to the portion of the Premises which was damaged or which has
been made unusable, whichever is less.  Nevertheless the Lease shall
continue in full force and effect. 

          If the Premises are totally or substantially damaged by fire or
similar casualty as is covered under policies required of Landlord pursuant
to the covenants of this Lease, and if Landlord, at its option, decides not
to restore or not to rebuild same, Landlord shall then, within sixty (60)
days after such fire, give Tenant notice of such decision, and thereupon
this Lease shall expire by lapse of time upon the fifth day after such
notice is given.  Tenant shall then vacate the Premises and surrender same
to Landlord. 

                                 - 5 -


<PAGE>

          For the purpose of this Lease substantial damage is defined as
that which is greater than thirty (30%) percent of the insured value of the
premises as determined by the cost estimate of Landlord.

          Tenant acknowledges that Landlord will not carry insurance on
the furniture, furnishings, inventory, fixtures, equipment, improvements,
alterations, additions, property, appurtenances, or similar items that are
not the property of Landlord in or upon the Premises and agrees that
Landlord is not and shall not be obligated to repair any damage or loss
thereto, nor replace same, nor compensate any person or party for any loss,
damage, or destruction regardless of cause and/or reason.

          In the event Landlord, at its option, decides to restore or
rebuild the Premises, no penalty shall accrue for reasonable delay which
may arise by reason of adjustment of insurance on the part of Landlord
and/or Tenant, or for delays on account of labor troubles or other reasons
or causes beyond Landlord's control.

          In accordance with this paragraph, Tenant explicitly waives
applicability of N.J.S.A. 46:8-6 and N.J.S.A. 46:8-7.

     10.  FIRE PREVENTION SYSTEMS.  If the National Board of Fire
Underwriters or any local Board of Fire Underwriters or Insurance Exchange
(or other bodies hereafter exercising similar functions), and/or if any
law, regulation, or order by/of any Federal, State, and/or Municipal
Government having Jurisdiction shall require or recommend the installation
of fire extinguishers, a "sprinkler system", fire detection and prevention
equipment (including, but not limited to, smoke detectors and heat
sensors), or any changes, modification, alterations, or the installation of
additional sprinkler heads or other equipment for any existing sprinkler
system, fire extinguishing system, and/or fire detection system for any
reason, whether or not attributable to Tenant's use of the Premises or
alterations performed by or on behalf of Tenant and/or; if any such
installations, changes modifications, alterations, sprinkler heads, or
other equipment become necessary to prevent the imposition of a penalty, an
additional charge, or an increase in the fire insurance rate: 

          then Tenant shall promptly make such installation, changes,
modifications, alterations as required or recommended.

     11.  REPAIRS, REPLACEMENTS.  Tenant shall keep the entire Premises in
good order and condition and shall promptly make any and all repairs,
maintenance, and replacements to the Premises of whatever nature, ordinary
and extraordinary, foreseen and unforeseen, except as is specifically
provided for in this Lease.  All repairs, maintenance and replacements
shall be in quality, usefulness, and class at least equal to the original
installation.

          Landlord shall not be required to furnish any services,
improvements, alterations, or similar items, nor to make any repairs
maintenance, or replacements to the Premises except as is specifically
provided for in this Lease.


                                  - 6 -


<PAGE>

          Landlord may enter the Premises, but shall not be obligated to do
so, at any reasonable time on reasonable notice to Tenant for the purpose
of making such repairs, maintenance or replacements to the Premises
required of Tenant, which Tenant has failed to perform.  Tenant shall have
no claims or cause of action against Landlord for interruption to Tenant's
business, however occurring, including but not limited to that arising from
the negligence of Landlord, its agents, servants or invitees, or from
defects, errors or omissions in the construction or design of the Premises,
or any portion thereof.

     12.  ALTERATIONS.  Tenant shall not make any alterations, additions or
improvements without Landlord's approval, which shall not be unreasonably
withheld or delayed.

          In the event Tenant proposes any alterations, additions, or
improvements, it shall submit a complete set of plans and specifications
relating thereto, prepared by any architect or professional engineer
registered in the State of New Jersey to Landlord.  Landlord may impose any
reasonable conditions and/or requirements upon Tenant as Landlord
reasonably considers necessary or prudent to protect Landlord's interest in
the Premises.

          If Landlord shall grant approval for the proposed work and
provided Tenant has agreed to any conditions and/or requirements made a
part of such approval, the following additional conditions shall apply:

          a.  Prior to making any alterations, additions, or improvements
Tenant shall assure itself that the work will not impair the structural
integrity of the Premises, or any portion thereof.  Approval of the
proposed work by Landlord shall not constitute or imply a warranty or
representation by Landlord that the existing Premises, or any part thereof,
is adequate to withstand work proposed by Tenant.  By making any
alterations, additions, or improvements, Tenant expressly warrants that the
same will not impair the structural integrity of the Premises nor any part
thereof and are in full compliance with the requirements of all
governmental agencies or authorities having jurisdiction.

          b.  All costs related to the proposed work, irrespective of their
nature, are the sole responsibility of Tenant and shall be promptly paid by
Tenant at such time as they may be due.

          c.  All contractors, labor and/or material suppliers; and similar
parties shall agree, in writing, prior to the commencement of any work or
procurement of materials (i) to jointly comply with Tenant with the
mechanics lien restrictions contained elsewhere in this Lease; (2) that
they are entering into any agreements for labor and/or material with Tenant
and not on behalf or for the benefit of Landlord; (3) that the work to be
done shall be in substantial conformance with the last plans and
specifications approved by Landlord and that no material changes shall be
made thereto without the prior approval of Landlord and Tenant; and (4)
that they, and their employees and other agents, shall comply with all


                                    - 7 -


<PAGE>

rules and regulations contained in Tenant's Lease regarding their conduct
on the Premises.  Proof of such agreements shall be given to Landlord prior
to the commencement of the proposed work.

          d.  Tenant shall insure, indemnify and hold Landlord harmless for
any loss to which Landlord may be subject or which Landlord may sustain
relating to accidents, injury to persons (including death), property loss
or damage of any nature whatsoever, regardless of cause, arising during or
ensuing from the work undertaken by Tenant.

          e.  All such alterations, additions and improvements upon
completion shall immediately become the property of Landlord, without
compensation by Landlord to Tenant or any other party, simultaneously
become part of the Premises, and Tenant's obligations and responsibilities
pursuant to the teems and conditions of this Lease shall thenceforth apply
to the aforementioned alterations, additions or improvements.  Prior to the
termination of Tenant's lease and/or Tenant's vacating of the Premises,
Tenant shall remove said alterations, additions and improvements (or any
portion thereof) at Tenant's expense, if so requested by Landlord.

          f.  Upon completion of the work, Tenant will submit to Landlord
as-built drawings and certifications of inspections certifying the
completion of the alteration, addition or improvement.

     13.  COMPLIANCE WITH LAWS.  With respect to the Premises or the use
and occupation thereof Tenant shall promptly comply with all laws orders,
regulations, and requirements now in force, or which may hereafter be in
force, of (a) Federal, State, County, and Municipal authorities and (b)
private, quasi-public and public utility companies and similar parties
providing services.

          Tenant acknowledges that during the term of this Lease, a
system, or materials or components thereof, now existing on the Premises
may be legally banned or subject to mandatory modification or conversion to
some other system, material or component.  Tenant agrees that it will not,
on the basis of such legal ban or mandatory modification or conversion,
claim frustration of purpose, seek termination of the Lease, or seek
abatement of rent.

          Tenant shall immediately notify Landlord upon receipt of notice
of a ban, conversion requirement, violation or alleged violation of any of
the foregoing.  Tenant shall also provide Landlord, upon Landlord's
request, affidavits and/or representations executed by a knowledgeable
officer or principal of the company concerning Tenant's best knowledge and
belief regarding Tenant's compliance with particular laws, orders,
regulations and requirements as may be cited by Landlord In its request.

     14.  RULES AND REGULATIONS.  Without limiting or reducing Tenant's
obligations pursuant to any of the terms and conditions of this Lease,
Tenant has the following duties:

                                   - 8 -


<PAGE>

          a.  Between April 15 and May 15 of each year Tenant shall provide
to Landlord, in form and content satisfactory to Landlord, a certification
and HVAC unit location schematic from a reputable heating, ventilating and
air conditioning contractor acceptable to Landlord, or a professional
engineer licensed to practice in the State of New Jersey, confirming that
all heating, ventilating and air conditioning systems within the Premises
are in good working order and repair and are being properly serviced by
Tenant.  Tenant understands that Landlord may rely on the accuracy of such
certification and agrees to be primarily responsible for any
misrepresentations contained therein.

          b.  Tenant shall keeps:  (1) the roof and exterior wall systems
in a watertight condition; (2) gutters, downspouts, drainage, and sewerage
systems free from obstructions and blockages; (3) all yard and exterior
wall mounted lighting on during night-time hours; (4) walkways, platforms
and similar items free from ice and snow hazards; (5) the Premises in a
clean, safe, and orderly condition free from debris, refuse, trash, wood
pallets (and/or similar storage systems), vermin, pests, and similar items;
(6) the dissemination of smoke, dust, odors, fumes and other noxious gases
within the limits of the industrial tolerance standards of the State
Department of Health, Bureau of Adult and Industrial Health.

          c.  Tenant shall not cause, commit or permit:  (1) areas
allocated for driveways, walkways, or the parking of automobile vehicles to
be used for any other purpose; (2) any public or private nuisance; (3) use
or occupancy in a manner reasonably offensive or objectionable to the
Landlord by reason of, but not limited to, noise and/or vibrations; (4)
debris, dirt, holes, scuff marks, smears, graphics and/or similar items on
wall, floor, or ceiling surfaces; (5) any utility service or equipment to
be overloaded; (6) anything that will impair or tend to impair, in
Landlord's reasonable judgment, the character, value, or appearance of the
Premises; (7) outside storage of any kind except as is specifically
provided for herein; (8) parking of inoperable vehicles, non-motorized
vehicles or trailers in or about the Premises; (9) any part or the whole of
the sidewalks, entrances, passages, stairways, corridors or halls of the
premises to be obstructed or encumbered or used for any purpose other than
ingress and egress to and from the Premises; (10) any signs,
advertisements, objects, notices or other lettering to be exhibited,
inscribed, painted, or affixed on any part of the outside or inside of the
Premises, so as to be visible from the exterior without prior approval of
Landlord; (11) any show cases or other items to be put in front of or
affixed to any part of the exterior of the building; (12) any water and
wash closets and other plumbing fixtures to be used for any purposes other
than those for which they were designed/ constructed, or sweepings,
rubbish, rags or similar substances shall be thrown/discarded therein; (13)
disturbance or interference with other Tenants or occupants of the building
or neighboring buildings; (14) canvassing, soliciting or peddling within
the Premises; (15) installation of a television, radio, or two-way radio
antenna, or any other similar antenna, on the roof, in the windows or upon
the exterior of the Premises, without the prior approval of Landlord; (16)
unusual or objectionable odors to be produced upon or emanate from the


                                - 9 -


<PAGE>

Premises; (17) storage, manufacture or sale of liquor, narcotics or illegal
drugs; (18) any portion of the Premises to be used for lodging or sleeping
or for any immoral or illegal purpose; (19) animals of any kind to be
brought or kept about the Premises without Landlord's prior approval; (20)
 burning of trash or garbage in or about the Premises.

          d.  Tenant shall:  (1) store discarded material being placed
outside of the floor space of the Premises in appropriate waste storage
containers at locations approved by Landlord.  Such containers/canisters
shall:  (i) have lids kept in a closed position except when being loaded,
(ii) not be allowed to overflow, (iii) shall be removed and replaced in a
timely fashion; (2) arrange for and enforce good housekeeping procedures
and practices satisfactory to Landlord; (3) arrange for liquid wastes and
effluents to be discharged into an approved existing sewage treatment plant
in accordance with that plant's regulations and state and federal
regulations, or shall treat its own wastes and effluents in a treatment
plant or process which is in compliance with the New Jersey State and
Federal Statutes and with the requirements of the New Jersey State
Department of Health; (4) comply with the New Jersey State Statutes and
requirements of the New Jersey State Department of Labor and Industry
precaution against fire hazards, radiation, explosion, proper handling and
storage of materials and structural design, and safeguards for the health
of workers.

          e.  Tenant, its agents, employees, contractors, invitees,
licensees, and similar parties shall not:  (1) interfere with the business
of Landlord or other Tenants or persons on any other property owned by
Landlord; (2) bring or keep within the Premises any flammable, combustible
or explosive fluid, chemical or substance of types or quantities not
permitted by law and/or Landlord's fire and casualty insurance carrier.


          f.  Tenant, its agents, employees, contractors, invitees,
licensees, and similar parties shall:  (1) obey speed limit, warning and
related type signs posted within the road/driveway system of the Cherry
Hill Industrial Center; (2) obey fire regulations and procedures governing
the Premises. 

          g.  Landlord shall have the right to prohibit any advertising by
any Tenant which, in Landlord's reasonable judgment, tends to impair the
reputation of said Tenant's Premises or the Cherry Hill Industrial Center,
and upon notice from Landlord, such Tenant shall refrain from or
discontinue such advertising.  Landlord shall have the right to enforce
this provision by injunction.

          h.  Landlord's employees shall not be required to perform, and
shall not be required by tenant to perform, any work outside of their
regular duties, unless under specific instructions from the office of
Landlord.

          i.  Tenant shall immediately notify Landlord of any serious
breakage, fire, accident, vandalism or disorder, occurring within the
Premises.

                                - 10 -


<PAGE>

          j.  Landlord reserves the right to rescind, amend, alter or waive
any of the foregoing Rules and Regulations at any time when, in its
judgment, it deems it necessary, desirable or proper for its best interest
and/or for the best interest of the tenants, and no such recission,
amendment, alteration or waiver of any rule or regulation in favor of one
Tenant shall operate as an alteration or waiver in favor of any other
Tenant.  Any such rescission, amendment, alteration, or waiver shall become
effective ten (10) days after notice by Landlord to Tenant.

          k.  Nothing contained in this Lease shall be construed to impose
upon Landlord any duty or obligation to impose the rules and regulations
against any other Tenant or any employees or agents of any other Tenant,
and Landlord shall not be responsible or liable to Tenant or others for
non-observance or violation of the rules and regulations by any other
Tenant or its employees, agents, invitees, licensees or similar parties at
any time.

          l.  Tenant its employees, contractors, agents, assignees,
sublessees, invitees, licensees and similar parties shall obey and observe
all reasonable rules and regulations established by Landlord from time to
time for the conductor Tenant and/or the welfare, care, cleanliness,
preservation of good order, and/or safety of the Cherry Hill Industrial
Center.  Landlord shall give Tenant at least (10) days notice of the
establishment thereof.

     15.  EMINENT DOMAIN.  If the Premises or any portion thereof are taken
under the power of eminent domain, this Lease shall terminate as to the
part so taken as of the date the condemning authority takes title.  If more
than 10% of the floor area of the Premises, or more than 25% of the non
floor area of the Premises is taken by condemnation, Tenant may, at
Tenant's option, to be exercised by written notice to the Landlord within
10 days after the Landlord shall have given Tenant notice of such taking,
terminate this Lease as of the date the condemning authority takes title. 
If Tenant does not terminate this Lease in accordance with the foregoing,
this Lease shall remain in full force and effect as to the portion of the
Premises remaining, except that the rent shall be reduced in proportion to
the floor area of the Premises taken to the total floor area of the
Premises.  Any award for the taking of all or any part of the Premises
under the power of eminent domain or any payment made under threat of the
exercise of such power shall be the property of the Landlord, whether such
award shall be made as compensation for diminution in value of the
Leasehold or for the taking of the fee, or as severance damages, or other
compensation to which Landlord may be entitled.  Tenant may make a separate
application for compensation relating to its trade fixtures or personal
property.

     16.  FORCE MAJEURE.  Force Majeure shall mean and include those
situations beyond Landlord's control, including by way of example and not
by way of limitation, acts of God; accidents; repairs; strikes; shortage of
labor; supply or materials; inclement weather; or where applicable, the
passage of time while waiting for an adjustment of insurance proceeds.  Any
time limits required to be met by Landlord hereunder, except as the effect


                                - 11 -


<PAGE>

of Force Majeure may be expressly excluded elsewhere in this lease, shall
be automatically extended by the number of days by which any performance
called for is delayed due to Force Majeure.

     17.  LANDLORD'S NON-LIABILITY.  Except when caused by acts of
affirmative negligence by Landlord without any contributory negligence by
Tenant or as specifically provided for in this Lease.

          Landlord shall not be liable or responsible for any loss or
damage to any property regardless of its nature or ownership at any time on
or about the Premises.

          Landlord shall not be liable or responsible for any harm or
injury (including death) to any person at any time on or about the
Premises.  Tenant shall not hold Landlord in any way responsible or liable
therefor and hereby releases and remises Landlord therefrom.

          Without limiting or diminishing Landlord's non-liability as
provided for herein, Landlord shall not be responsible or liable to Tenant,
its employees, invitees, agents, or any other party for any loss or damage
to any property or harm or injury to any persons (including death):  (a)
which is and/or should have been covered by an insurance policy required of
Tenant or which Tenant failed to obtain or keep in force and effect; (b)
caused by work stoppages, business interruptions, or similar events; (c)
caused by other Tenants, its agents, invitees, employees, and similar
parties; (d) caused by operations in construction of any private, public or
quasi-public works; (e) caused by any latent or patent defects in the
Premises or in any part of the building of which the Premises may form a
part; (f) arising out of the design or construction of the Premises; (g)
caused by snow, wind, rain, leakage, and similar events into or out of any
portion of the Premises; (h) caused by leakage, overflows, obstructions,
blockages, explosions, collapse bursts, surges, and similar events of any
mechanical, structural, or other component and/or part thereof; (i) arising
from or caused by Tenant's business operation, occupancy and/or use of the
Premises and/or the streets, rights of way, and walkways adjacent thereto,
or any other similar reason.

          All non-liability, waivers of liability, and save and hold
harmless references in this Lease given Cherry Hill Industrial Sites, Inc.,
as Landlord, shall apply to:  (a) Cherry Hill Industrial Sites, Inc., as
General Contractor, Designer, Contractor, or Subcontractor; and (b) any
partner, joint venturer, director, officer, agent, stockholder, and
employee of Cherry Hill Industrial Sites, Inc.

     18.  INDEMNIFICATION.  Tenant shall not do, nor permit to be done, any
act or thing in or upon the Premises, which may, will, or does subject
Landlord to any claims, penalties, expenses, judgments, responsibility,
liability, damages or similar occurrence by reason of damage or loss to any
property or harm and/or injury (including death) to any persons at any
time.



                               - 12 -


<PAGE>

          Except when caused by acts of affirmative negligence by Landlord
without any contributory negligence by Tenant or as specifically provided
for in this Lease:

          Tenant agrees to and shall hold and save harmless and indemnify
the Landlord from and for any and all payments, expenses, costs, attorney
fees, claims and liability for losses or damage to property and/or injury
to any person (including death) resulting from any acts or omissions by the
Tenant, or its agents, employees, guests, licensees, invitees, sub-tenants,
contractors and similar parties, or for any cause or reason arising out of
or by reason of Tenant's use and/or occupancy of the Premises and/or the
conduct of Tenant's business and/or the breach by Tenant of any of the
terms and conditions of this Lease and/or similar reason.

      19.  FAILURE TO GIVE POSSESSION.  If Landlord, for any reason, shall
be unable to give possession of the Premises on the date set for the
commencement of the Term, Landlord shall not be subject to any liability
for such failure.  Under such circumstances, provided the delay is not
caused or contributed to by Tenant, the rent payments shall not commence
until possession of the Premises is given or the Premises are available for
occupancy by Tenant, whichever occurs first.  Failure to give possession on
the date of commencement of the term shall in no way affect the validity of
this Lease or the obligations of Tenant hereunder.

          If Landlord, at its option, grants Tenant permission to enter
into the possession of the Premises prior to the date specified as the
commencement of the Term, Tenant agrees that such occupancy shall be
pursuant to the terms and conditions of this Lease.

     20.  LIENS.  Tenant shall not do anything which shall interfere with
Landlord's rights of ownership in the Premises.  Tenant shall not permit
nor allow any notice of intention to file any type of lien (including, but
not limited to, mechanics liens) to be filed against the Premises. 
However, in the event any notice of intention to file a lien is filed for
work to be performed, material to be furnished, or a lien is filed for work
claimed to have been done or for materials claimed to have been furnished
to Tenant, same shall be discharged of record and satisfied by Tenant
within five (5) days thereafter at Tenant's own cost and expense, or Tenant
shall file a bond pursuant to statute releasing such liens failure to do so
shall entitle Landlord to resort to such remedies as are provided herein in
case of any default of this Lease, in addition to such as are permitted by
law.

     21.  ACCESS TO PREMISES.  Landlord, its employees and agents shall
have the right to enter the Premises at all reasonable times for the
purpose of:  (a) examining or inspecting the Premises; (b) showing the
Premises to prospective purchasers, mortgagees or Tenants; (c) making such
alterations, repairs, improvements or additions to the Premises or to the
Building as may be required of Landlord as specifically provided for
elsewhere in this lease, or as Landlord may have the option to perform (if
Landlord elects to exercise such option) as provided for elsewhere in this
lease, (d) any other similar or reasonable purpose.


                                  - 13 -


<PAGE>

          If representatives of Tenant shall not be present to open and
permit entry into the Premises at an time when such entry by Landlord is
 necessary or permitted hereunder, Landlord may enter by means of a master
key (or forcibly in the event of an emergency) without:  (a) liability to
Landlord, its employees, agents, invitees and similar parties, (b)
hindrance or molestation from Tenant, its employees, and agents; and (c)
such entry constituting an eviction of Tenant or termination of this Lease.

     22.  ASSIGNMENT.

          a.  Tenant shall not assign, mortgage, pledge, encumber or in any
manner transfer this Lease or any portion thereof, or any interest herein,
or sublet the whole or any part of the Premises, without obtaining the
approval of Landlord.  In the event of any such occurrence, with or without
Landlord's approval, Tenant shall, nevertheless, remain liable for the
performance of all of the terms and conditions of this Lease and will
require any assignee/sublessee to execute and deliver to Landlord an
assumption of all of the terms and conditions of this Lease in form
satisfactory to Landlord.  Landlord shall be entitled to, and Tenant shall
promptly remit to Landlord, any profit which may inure to the benefit of
Tenant as a result of any partial or entire subletting of the Premises or
assignment of this Lease, whether or not approved by Landlord.

          b.  For the purposes of this paragraph, Tenant understands that
the transfer of a majority of Tenant's stock is tantamount to an
assignment.

          c.  As a condition precedent to Tenant's right to sublease the
Premises or to assign this Lease, Tenant shall, at Tenant's own expense,
first comply with ECRA and fulfill all of Tenant's environmental
obligations pursuant to this Lease.  If this condition is not satisfied,
then Landlord shall have the right to withhold consent to sublease or
assignment.

          Tenant shall promptly furnish to Landlord true and complete
copies of all documents, submissions and correspondence provided by Tenant
to the Element and all documents reports, directives and correspondence
provided by the Element to Tenant.  Tenant shall also promptly furnish to
Landlord true and complete copies of all sampling and test results obtained
from samples and tests taken at and around the Premises.  Tenant shall
notify Landlord in advance of all meetings scheduled between Tenant and
NJDEP, and Landlord may attend all such meetings.

          d.  Should Tenant make an assignment or sublet the Premises or
any portion thereof without the approval of Landlord, then Landlord may, at
its option, terminate this Lease by giving Tenant five (5) days notice of
Landlord's intention to do so and, upon the expiration of five (5) days,
this Lease shall terminate, and Tenant shall peaceably quit and surrender
the Premises to Landlord; nevertheless Tenant shall remain liable as
provided elsewhere in this Lease.  This Lease shall not, nor shall any
interest therein, be assignable as to the interest of Tenant by operation
of law, without the approval of Landlord.


                                 - 14 -


<PAGE>

          e.  Subletting or assigning this Lease to anyone other than an
actual user of the Premises is positively prohibited.

     23.  SUBORDINATION.  This Lease shall be subject and subordinate at
all times to the lien of any mortgages and/or other encumbrances, common
right-of-way's, easements and similar items existing or hereafter placed
upon the Premises by Landlord, or with the permission of Landlord, without
the necessity of any further instrument or act on the part of Tenant to
effectuate such subordination.  Tenant agrees, however, at the election of
a mortgagee, to attorn to any holder of any mortgage to which this Lease is
subordinate.  Tenant agrees to execute and deliver promptly upon demand,
and without charger such further instrument or instruments evidencing such
subordination of this Lease to the lien of any mortgage and/or other
encumbrance.  Tenant hereby irrevocably appoints Landlord as Tenant's
attorney-in-fact to execute and deliver such instrument or instruments for
and in the name of the Tenant provided same have not been executed by
Tenant within ten (10) days after Landlord's notice to Tenant.

     24.  CERTIFICATIONS.  Tenant agrees, within ten (10) days after
Landlord's notice, to execute, acknowledge and deliver to Landlord a
written instrument in recordable form certifying:  (1) that this Lease is
unmodified and in full force and effect (or if there have been
modifications, that the same are in full force and effect as modified and
stating the modifications); (2) that the Tenant has accepted possession of
the Premises and the date on which the term of the Lease commenced; (3) the
dates to which rent and additional rent have been paid in advance, if any;
(4) whether or not to the best knowledge of the signer of such certificate,
Landlord is in default in the performance of any covenant of this Lease,
and, if so, specifying each such default of which the signers may have
knowledge; (5) any other reasonable stipulation as may be required and/or
requested by Landlord.  It is understood that such instrument may be relied
upon by a prospective purchaser of the fee or any mortgagee of the
Premises.

          Tenant shall provide to Landlord, if requested, its latest
audited financial statement, accurately reflecting its financial condition
for the latest fiscal year of Tenant.  It is understood that such statement
may be relied upon by a prospective purchaser of the fee or any mortgagee
of the Premises.

     25.  DEFAULT AND REMEDIES.

          a.  Default.  The occurrence of any of the following shall
constitute a material default and breach of this Lease by Tenant: 

              (1)  Failure of Tenant to accept possession of the Premises
within thirty (30) days after the effective date of the Lease;

              (2)  The vacating or abandonment of the Premises by Tenant;

              (3)  The failure by Tenant to pay, when due, any installment
of rent hereunder or any additional rent or any such other sum herein
required to be paid by Tenant;

                                 - 15 -


<PAGE>

              (4)  A failure by Tenant to observe and perform any other
covenant of this Lease to be observed or performed by Tenant, where such
failure continues for fifteen (15) days (or a lesser time period when an
emergency or law requires or makes such a reduction for abatement and/or
correction prudent, or when a lesser or non-notice provision is
specifically provided for in any covenant of this Lease) after written
notice thereof from Landlord to Tenant.

          However, if the nature of the default is such that the same
cannot reasonably be cured within such fifteen (15) day period, Tenant
shall not be deemed to be in default if Tenant shall within such period
commence such cure and thereafter diligently prosecute the same to
completion;

          b.  Remedies.  Upon the occurrence of any such event of default
set forth above: 

              (1)  Landlord may (but shall not be required to) perform for
the account of Tenant the curing of any default of Tenant and immediately
recover as additional rent any expenditure made and the amount of any
obligations incurred in connection therewith, plus interest at the rate of
four percent (4%) per annum over the Commerce Bank N.A. prime rate from the
date of such expenditure;

              (2)  Tenant may cure any monetary default by making payment
of the monies due, together with a late charge of 5% of the amount due not
later than ten (10) calendar days after notice of the default has been
given to Tenant.  If said default should continue for a longer period,
Landlord may accelerate all rent and additional rent due for the term of
this Lease and declare the same to be immediately due and payable.

              (3)  Tenant may cure any non-monetary default by correcting
the default condition described in Landlord's notice to Tenant if said
corrections are completed within twenty (20) calendar days after notice of
the default has been given to Tenant.  If said default should continue for
a longer period, Landlord may accelerate all rent and additional rent due
for the term of this Lease and declare the same to be immediately due and
payable.

              (4)  In the event of default, and the failure of Tenant to
cure same within the designated time period, Landlord at its option, may
serve notice upon Tenant that this Lease and the then unexpired term hereof
and all renewal options (if any) shall cease and expire and become
absolutely void on the date specified in such notice, to be not less than
five (5) days after the date of such notice without any right on the part
of the Tenant to save the forfeiture by payment of any sum due or by the
performance of any terms, provision, covenant agreement or condition
broken; and, thereupon and at the expiration of the time limit in such
notice, this Lease and the term hereof granted, as well as the right, title
and interest of the Tenant hereunder, shall wholly cease and expire and
become void in the same manner and with the same force and effect (except



                                  - 16 -


<PAGE>

as to Tenant's liability) as if the date fixed in such notice were the date
herein granted for expiration of the term of this Lease.  Thereupon, Tenant
shall immediately quit and surrender to Landlord the Premises, and Landlord
may enter into and repossess the Premises by summary proceedings, detainer,
ejectment or otherwise and remove all occupants thereof and, at Landlord's
option any property thereon without being liable to indictment, prosecution
or damages therefor.  No such expiration or termination of this Lease shall
relieve Tenant of its liability and obligations under this Lease, whether or
not the Premises shall be relet.  

              (5)  Landlord may, at any time after the occurrence of any
event of default, re-enter and repossess the Premises and any part thereof
and attempt in its own name and to relet all or any part of such Premises
for and upon such terms and to such persons, firms or corporations and for
such period or periods as Landlord, in its sole discretion, shall
determine, including the term beyond the termination of this Lease, and
Landlord shall not be required to accept any tenant offered by Tenant or
observe any instruction given by Tenant about such reletting or do any act
or exercise any care or diligence with respect to such reletting or to the
mitigation of damages.  For the purpose of such reletting, Landlord may
decorate or make repairs, changes, alterations or additions in or to the
Premises to the extent deemed by Landlord desirable or convenient; and the
cost of such decoration, repairs, changes, alterations or additions shall
be charged to and be payable by Tenant as additional rent hereunder, as
well as any reasonable brokerage and legal fees expended by Landlord; and
any sums collected by Landlord from any new tenant obtained on account of
the Tenant shall be credited against the balance of the rent due hereunder
as aforesaid.  Tenant shall pay to Landlord monthly, on the days when the
rent would have been payable under this Lease, the amount due hereunder
less the amount obtained by Landlord from such new Tenant; 

              (6)  The parties recognize and agree that the damage to
Landlord resulting from any failure by Tenant to timely surrender
possession of the Premises will be substantial, will exceed the amount of
the monthly installments of the Rent payable hereunder, and will be
impossible to measure accurately.  Tenant therefore agrees that if
possession of the Premises is not surrendered to Landlord upon the
expiration date or sooner termination of the Lease, in addition to any
other rights or remedies Landlord may have hereunder or at law, Tenant
shall pay to Landlord, as liquidated damages, for each month and for each
portion of any month during which Tenant holds over in the Premises after
the expiration date or sooner termination of this Lease, a sum equal to two
times the aggregate of that portion of Base Annual Rent and Additional Rent
that was payable under this Lease during the last month of the Term.


              (7)  Nothing herein contained shall be deemed to permit
Tenant to retain possession of the Premises after the expiration date or
sooner termination of the Lease.

              (8)  In addition to all remedies provided herein or by law,
Tenant shall pay to Landlord reasonable attorneys fees and court costs and
any other expenses incurred as a result of such breach or default.

                                  - 17 -


<PAGE>

     26.  BANKRUPTCY.

          a.  Anything elsewhere in this lease to the contrary
notwithstanding, this Lease may be canceled by Landlord by the sending of a
written notice to Tenant within a reasonable time after the happening of
any one or more of the following events:  (1) the commencement of a case in
bankruptcy or under the laws of any state naming Tenant as the debtor which
case is not dismissed within 60 days; or (2) the making by Tenant of an
assignment or any other arrangement for the benefit of creditors under any
state statute.  Neither Tenant nor any person claiming through or under
Tenant, or by reason of any statute or order of court, shall thereafter be
entitled to possession of the premises demised but shall forthwith quit and
surrender the premises.

          b.  It is stipulated and agreed that in the event of the
termination of this Lease pursuant to (a) hereof, Landlord shall forthwith,
notwithstanding any other provisions of this Lease to the contrary, be
entitled to recover from Tenant as and for liquidated damages an amount
equal to the difference between the rent reserved hereunder for the
unexpired portion of the term demised and the fair and reasonable rental
value of the demised premises for the period for which such installment was
payable discounted to the date of termination at the rate of four percent
(4%) per annum over the prime rate of Commerce Bank, N.A. in effect on the
date of termination.  If such premises or any part thereof be re-let by the
Landlord for the unexpired term of said Lease, or any part thereof, before
presentation of proof of such liquidated damages to any court, commission
or tribunal, the amount of rent reserved upon such reletting shall be
deemed to be the fair and reasonable rental value for the part or the whole
of the premises so re-let during the term of the re-letting.  Nothing
herein contained shall limit or prejudice the right of the Landlord to
prove for and obtain as liquidated damages by reason of such termination,
an amount equal to the maximum allowed by any statute or rule of law in
effect at the time when, and governing the proceedings in which such
damages are to be proved, whether or not such amount be greater, equal to,
or less than the amount of the difference referred to above.

     27.  EXPIRATION.  Upon the expiration date of this Lease or prior
termination specified by Landlord pursuant to notice as provided for
elsewhere in this Lease:  (a) Tenant shall remove all of its personal
property from the Premises; (b) Tenant shall peacefully quit and surrender
to Landlord the Premises, broom clean and in the same condition in which
Tenant hat agreed to keep it during the Term.  Tenant's obligation to
observe or perform this covenant shall survive the expiration or prior
termination date of this Lease; (c) Tenant, for itself and on behalf of any
and all persons claiming through or under it, including, but not limited
to, creditors of every kind, shall and does hereby waive and surrender all
rights and privileges which it may have under or by reason of any present
or future law, to redeem the Premises or to have a continuance of this
Lease; (d) Landlord may enter and repossess the Premises as of Landlord's
former estate and expel Tenant, and those claiming through or under Tenant
from the Premises; (e) Any property not-owned by Landlord remaining on the
Premises after the last day of the Term or after the last day of any prior


                                   - 18 -


<PAGE>

lease termination date shall be conclusively deemed abandoned. Landlord, at
Landlords option, may remove from the Premises any property of Tenant
and/or the property of those claiming through or under Tenant and, without
notice to Tenant or others and without being liable to indictment,
prosecution or damages therefor, sell such property or any part thereof at
public or private sale or Landlord may treat such property or any part
thereof as abandoned and dispose of same in any manner as Landlord, at its
option, elects, all at the risk and cost of Tenant and without any
liability to Landlord whatsoever.  Tenant shall reimburse Landlord for the
cost of such removal and disposal.  Landlord, at its option may have any
such property stored at Tenants risk and expense.

          If during the last month of the term or prior termination, Tenant
has removed all or substantially all of the Tenant's property from the
Premises, Landlord may, without notice to Tenant, immediately enter the
Premises to renovate and decorate the Premises, without liability to tenant
and without reducing or otherwise affecting Tenant's obligations hereunder.

     28.  NON-WAIVER BY LANDLORD.  Landlord may restrain any breach or
threatened breach of any covenant of this Lease by Tenant.  However, the
recitation herein of any particular remedy shall not preclude the Landlord
from any other remedy it may have, either at law or in equity.  Landlord,
at its option, may pursue more than one remedy available either
concurrently or separately.  The failure of Landlord to insist upon the
strict performance of any covenant of this Lease or to exercise any right,
remedy or election provided for in this Lease, or permitted by law, shall
not constitute or be construed as a waiver or relinquishment of such right,
remedy or election.  Landlord may, at its option, mitigate any damages
caused or arising out Tenant's breach of any of the covenants of this
Lease, but shall not be under any obligation or duty to do so.  Any rights
and remedies of Landlord, whether created by the terms of this Lease or
existing at law, in equity, or otherwise, shall be distinct, separate and
cumulative and no one of them, whether exercised by Landlord or not, shall
be deemed to be in exclusion of any other.

          No covenant of this Lease shall be deemed to have been waived by
Landlord unless such waiver is in writing, signed by Landlord.

     29.  QUIET ENJOYMENT.  Landlord covenants that upon Tenant observing
and performing all the terms and conditions of this Lease, Tenant shall and
may peaceably and quietly have, hold and enjoy the Premises for the term
aforementioned.

     30.  BILLS/NOTICES.  Except as otherwise provided for in this Lease,
any bill, statement, or notice shall be deemed sufficient if written and
delivered to Tenant personally or sent by certified mail, return receipt
requested, to Tenant at the Premises.  The time of mailing of such bill or
statement and of the giving of such notice or communication shall be deemed
to be the time when same is mailed to Tenant as herein provided.  Any
notice by Tenant to Landlord must be served by certified mail, return
receipt requested, to Landlord at the address herein given or at such other
address as Landlord shall designate.


                                    - 19 -


<PAGE>

     31.  WAIVER OF TRIAL BY JURY.  Landlord and Tenant agree that the
respective parties shall and hereby do waive trial by Jury in any action or
proceeding brought by either of the parties hereto against the other on any
matters arising out this Lease.

          This Lease shall be construed without regard to any presumption
or other rule requiring construction against the party causing this Lease
to be drafted.

          If Landlord institutes a dispossess or eviction action in
response to Tenant's refusal to vacate the Premises, Tenant waives its
right to invoke N.J.S.A. 2A:18-60.  In any action brought by the Landlord
against the Tenant, Tenant shall not interpose any counterclaim against
Landlord, but same shall be subject to an independent action which is not
to be consolidated with the Landlord's action.

     32.  SIGNS.  The Tenant shall not place nor allow to be placed any
signs upon or about the exterior of the building or the grounds of the
Premises, or other property of Landlord unless of a design and structure
and at such locations as shall be first approved by the Landlord and then
the appropriate governmental authorities and/or agencies, if required.

     33.  NO REPRESENTATIONS.

          Except as specifically provided for herein:  (a) Tenant has
rented the Premises after a complete inspection and examination of its
present condition and without any representation on the part of the
Landlord, its agents, employees, and similar parties as to the condition or
usefulness of the Premises; (b) Tenant does not acquire any rights,
easements or licenses by implication or otherwise; (c) Tenant's possession
of the Premises shall be conclusive evidence that the Premises were in good
and satisfactory condition at the time Tenant took possession and that
Tenant accepted same "as is" and in its present condition without any
express or implied warranties; (d) upon execution of this Lease or anytime
thereafter Tenant assumes the full and sole responsibility for the
condition, safety, operation and management of the Premises pursuant to the
terms and conditions contained herein.

     34.  LANDLORD'S APPROVAL.  Except where specifically stated otherwise:

          Whenever Landlord's approval or consent is required pursuant to
any term or condition of this Lease, such approval shall be in writing and
in advance for each occurrence.  Landlord is under no duty or obligation to
grant approvals.

          Whenever this Lease provides for a Landlord's option, it is
agreed such does not imply or constitute a duty or an obligation of
Landlord.

          Whenever this Lease provides for Landlord's approval which shall
not be unreasonably withheld, it is agreed that Tenant's remedy in the
event of Landlord's non-approval is limited to specific performance.


                                  - 20 -


<PAGE>

     35.  NET LEASE.  It is intended that the rent and additional rent
 reserved hereunder shall be an absolutely net return to the Landlord
throughout the Term.  The rent and additional rent reserved hereunder shall
be paid to the Landlord without any claim on the part of Tenant, or those
claiming under Tenant, for diminution, setoff, deduction, or abatement
except as is specifically provided for herein.

          Tenant's obligation to pay rent and additional rent hereunder,
and to perform the terms and conditions of this Lease shall in no way be
affected, impaired or excused because Landlord is unable to fulfill any of
its obligations hereunder, or because Tenant's use and occupancy of the
Premises is disturbed for any reason other than as is specifically provided
for herein.

     36.  LANDLORD'S BREACH.  Tenant shall look solely to a sum that shall
not exceed five percent (5%) of the net annual rental during any calendar
year for the satisfaction of the remedies of Tenant in the event of a
breach by Landlord of any of the covenants of this Lease.

     37.  TENANTS WARRANTY.  Tenant warrants that:  (a) it is duly
incorporated and/or qualified under the laws of the State of NEW JERSEY and
is authorized to do business in the State of New Jersey and is in good
standing; (b) all necessary action to authorize the execution of this Lease
upon the terms and conditions set forth herein have been duly taken; and
(c) the officer(s) executing and delivering this Lease have been duly
authorized to bind Tenant to the covenants herein contained.

     38.  ADVERSE POSSESSION.  Tenant shall not suffer or permit the
Premises, or any portion thereof, to be used without restriction or in such
a manner as might reasonably tend to impair Landlord's title to the
Premises or in such manner as might reasonably make possible claims of
adverse usage or adverse possession, or of implied dedication of the
Premises or any portion thereof.  

     39.  COMPLIANCE WITH THE NJ INDUSTRIAL SITE RECOVERY ACT, FORMERLY
KNOWN AS THE ENVIRONMENTAL CLEANUP RESPONSIBILITY ACT.  Tenant shall comply
with the Industrial Site Recovery Act, formerly known as the Environmental
Cleanup Responsibility Act, N.J.S.A. 13:1K-6 et seq., the regulations
promulgated, thereunder and any successor legislation and regulations, and
any amendments or additions thereto (hereinafter referred to as "ISRA"). 
Tenant shall make all submissions to, provide all information to, and
comply with all requirements of the New Jersey Department of Environmental
Protection ("NJDEP") or any successor thereto.

          a.  Without diminishing any other of Tenant's obligations
pursuant to this lease, Tenant's obligation shall arise if there is any
closing, terminating or transferring of operations or transfer of ownership
of an industrial establishment at the Premises pursuant to ISRA, whether
triggered by Landlord or Tenant.


                                  - 21 -


<PAGE>

          Provided this Lease is not previously terminated, pursuant to the
covenants hereof, Tenant shall commence its submission to the NJDEP in
anticipation of the end of the lease term, no later than one (1) year prior
to the normal expiration of the lease term.  Tenant shall promptly furnish
to Landlord true and complete copies of all documents, submissions,
correspondence and written communications provided by Tenant to and from
NJDEP.  Tenant shall promptly furnish to Landlord true and complete copies
of all sampling and test results and reports obtained and prepared from
samples and tests taken at and about the Premises.

          b.  Should NJDEP determine that a cleanup plan be prepared and
that a cleanup be undertaken because of a spill or discharge of a hazardous
substance or waste at the Premises which occurred during the term of the
Lease, Tenant shall promptly prepare and submit the required plan and
financial assurances and shall promptly carry out the approved plans.  

          c.  Tenant shall promptly provide all information requested by
Landlord or NJDEP for preparation of a non-applicability affidavit, de
minimus quantity exemption application, negative declaration application,
limited conveyance application or other submission and shall promptly sign
such affidavits and submissions when requested by Landlord or the NJDEP.

          d.  Should Tenant's operations at the Premises be outside of
those industrial operations covered by ISRA, Tenant shall, at Tenant's own
expense, obtain a letter of non-applicability or de minimus quantity
exemption from NJDEP prior to termination of the Lease term and shall
promptly provide Tenant's submission and the NJDEP's exemption letter to
Landlord.  Should Tenant obtain a letter of non-applicability or de minimus
quantity exemption from NJDEP, then Tenant shall, at Landlord's option,
hire a consultant satisfactory to Landlord to undertake sampling at the
Premises sufficient to determine whether or not Tenant's operations have
resulted in a spill or discharge of a hazardous substance or waste at or
around the Premises.  Should the sampling reveal any spill or discharge of
a hazardous substance or waste, then Tenant shall promptly cleanup the
Premises to the satisfaction of Landlord and NJDEP.

          e.  If Tenant fails to obtain either:  (i) a non-applicability
letter; (ii) a de minimus exemption; (iii) a negative declaration; or (iv)
final approval of cleanup; (collectively referred to as "ISRA Clearance")
from NJDEP; or fails to clean up the Premises pursuant to the requirements
of this Lease prior to the expiration or earlier termination of the lease
term, then upon the expiration or earlier termination of the lease term
Landlord shall have the option either to consider the Lease as having ended
or to treat Tenant as a holdover tenant in possession of the Premises.  If
Landlord considers the Lease as having ended, then Tenant shall
nevertheless be obligated to promptly obtain ISRA clearance and to fulfill
the obligations set forth herein.  If Landlord treats Tenant as a holdover
tenant in possession of the Premises, then Tenant shall monthly pay to
Landlord double the regular and additional monthly rent which Tenant would
otherwise have paid, until such time as Tenant obtains ISRA clearance and
fulfills its obligations hereunder, and during the holdover period all of
the terms of this Lease shall remain in full force and effect.


                                  - 22 -


<PAGE>

          f.  Tenant represents and warrants to Landlord that Tenant
intends to use the Premises for the uses specified in this lease pursuant
to the laws, rules and regulations of governmental authorities having
jurisdiction; which operations have the following Standard Industrial
Classification ("SIC") numbers as defined by the most recent edition of the
Standard Industrial Classification Manual-published by the Federal
Executive Office of the President, Office of Management and Budget:  3999. 
Tenant's use of the Premises shall be restricted to the classifications set
forth above unless Tenant obtains Landlord's written prior written consent
to any change in use of the Premises.  Following commencement of the lease
term, Tenant shall notify Landlord by way of an Officer's Affidavit, as to
any changes in Tenant's operation, SIC number or use or generation of
hazardous substances and wastes.  Tenant shall also supplement and update
the Officer's Affidavit upon each anniversary of the commencement of the
lease term.  Tenant shall not commence or alter any operations at the
Premises prior to (i) obtaining all required operating and discharge
permits or approvals, including, but not limited to, air pollution control
permits and pollution discharge elimination system permits from NJDEP, all
governmental or public authorities having jurisdiction over Tenant's
operations or the Premises, and (ii) providing copies of permits and
approvals to Landlord.

          g.  Tenant shall permit Landlord and Landlord's agents, servants
and employees, including, but not limited to, legal counsel and
environmental consultants and engineers, access to the Premises for the
purposes of environmental inspections and sampling during regular business
hours, or during other hours either by agreement of the parties or in the
event of any environmental emergency.  Tenant shall not restrict access to
any part of the Premises, and Tenant shall not impose any conditions to
access.  In the event that Landlord's environmental inspection shall
include sampling and testing of the Premises, Landlord shall use its best
efforts to avoid interfering with Tenant's use of the Premises, and upon
completion of sampling and testing shall repair and restore the affected
areas of the Premises from any damage caused by the sampling and testing.

          h.  Tenant's indemnification of Landlord as set forth elsewhere
within this Lease shall extend to any and all claims, liabilities, losses,
damages and costs, foreseen or unforeseen, including without limitation
counsel, engineering and other professional or expert fees, which Landlord
may incur by reason of Tenant's action or non-action with regard to
Tenant's obligations under this paragraph.

          i.  This paragraph shall survive the expiration or earlier
termination of this Lease.  Tenant's failure to abide by the terms of this
paragraph shall be restrainable by injunction without limiting Landlord's
right to remedy as provided for elsewhere in this Lease.

          j.  Landlord represents and warrants that as of the date of the
Lease, there are no outstanding/unresolved notice(s) of violations of any
Environmental Laws pertaining to the Premises.


                                - 23 -


<PAGE>

          k.  Notwithstanding anything in this Lease to the contrary,
Landlord agrees that Tenant shall not be responsible for any environmental
conditions on, under or about the Premises arising or occurring prior to
the commencement date of this Lease.

     40.  RESPONSIBILITY FOR HAZARDOUS SUBSTANCES.

          a.  Hazardous Substances.  The term 'Hazardous Substances', as
said in this Lease, shall included but shall not be limited to, flammables,
explosives, radioactive materials, asbestos, polychlorinated biphenyls
(PCBs), chemicals known to cause cancer or reproductive toxicity,
pollutants, contaminants, hazardous wastes toxic substances or related
materials petroleum and petroleum products, and substances declared to be
hazardous or toxic under any law or regulation now or hereafter enacted or
promulgated by any governmental authority having jurisdiction.

          b.  Tenant shall not cause or permit to occur: 

          (i)  Any violation of any federal, state, or local law,
               ordinance, or regulation now or hereafter enacted,
               related to environmental conditions on, under, or about
               the Premises, or arising from Tenant's use or occupancy
               of the Premises, including, but not limited to, soil and
               ground water conditions; or

          (ii) The use, generation, release, manufacture, refining,
               production, processing, storage, or disposal of any
               Hazardous Substance, on, under or about the Premises, or
               the transportation to or from the Premises of any Hazardous
               Substance, except as specifically required during the lawful
               conduct of Tenant's permitted use, as such is defined
               elsewhere herein.

     41.  ENVIRONMENTAL CLEANUP.  Tenant shall:  

          a.  comply with all laws regulating the use, generation, storage,
transportation, or disposal of Hazardous Substances.

          b.  prepare, provide and submit any cleanup plan to be undertaken
because of any deposit, spill, discharge, or other release of Hazardous
Substances that occurs during the term of the Lease, at or from the
Premises, or which arises at any time from Tenant's use or occupancy of the
Premises.  Tenant Shall provide all required bonds and other financial
assurances and Tenant shall carry out all such cleanup plans in a timely
manner.

          c.  promptly provide all information regarding the use,
generation, storage, transportation, or disposal of Hazardous Substances
that is requested by the Landlord.  If Tenant fails to fulfill any such
request within a reasonable time, Landlord may do so; and in such case,
Tenant shall cooperate with Landlord in order to prepare all documents
Landlord deems necessary or appropriate to determine the applicability of


                                 - 24 -


<PAGE>

the Laws to the Premises and Tenant's use thereof, and for compliance
therewith, and Tenant shall execute all documents promptly.  No such action
by Landlord and no attempt made by Landlord to mitigate damages tinder any
Law shall constitute a waiver of any of Tenant's obligations.

     42.  TENANT'S ENVIRONMENTAL INDEMNITY.  Tenant shall indemnify, defend
and hold harmless Cherry Hill Industrial Sites, Inc. as Landlord, Landlord
and Contractor, and its officers, directors, beneficiaries, shareholders,
partners, agents, and employees from all fines, suits, procedures, claims,
and actions of every kind, and all costs associated therewith (including
attorneys' and consultants' fees) arising out of or in any way connected
with any deposit, spill, discharge, or other release of Hazardous
Substances that occurs during the term of this Lease, at or from the
Premises, or which arises at any time from Tenant's use or occupancy of the
Premises, or from Tenant's failure to provide all information, make all
submissions, and take all steps required by all Authorities under the Laws
and all other environmental laws.

          Tenant's obligations and liabilities under this paragraph shall
survive the natural expiration or sooner termination of this Lease.

     43.  ENVIRONMENTAL LIENS.  Tenant shall promptly notify Landlord as to
any liens threatened or attached against the Premises pursuant to the Spill
Act or any other environmental law.  In the event that such a lien is filed
against the Premises, then Tenant shall, within thirty (30) days from the
date that the lien is placed against the Premises, and at any rate prior to
the date any governmental authority commences proceedings to sell the
Premises pursuant to the lien, either:  (a) pay the claim and remove the
lien from the Premises; or (b) furnish either (i) a bond satisfactory to
Landlord in the amount of the claim out of which the lien arises, (ii) a
cash deposit in the amount of the claim but of which the lien arises, or
(iii) other security satisfactory to Landlord in an amount sufficient to
discharge the claim out of which the lien arises.

     44.  BINDING OFFER.  It is understood and agreed by the Landlord and
Tenant that this Lease is an offer only and is submitted to Tenant for
signature with the understanding that it shall not bind Landlord unless and
until it has been executed by Landlord.

     45.  ENTIRE AGREEMENT.  This Lease constitutes the entire agreement
between the parties.  No representative, agent, or employee of the Landlord
has been authorized to make any representations or promises or to vary,
alter or modify the covenants hereof.  No addition, changes, modifications,
renewals or extensions of this Lease shall be binding unless reduced to
writing and signed by the Landlord and the Tenant.

          This Lease may not be canceled or terminated by Tenant without
the consent of Landlord except as is specifically provided for elsewhere in
this Lease.

     46.  APPLICATION AND DURATION.  Wherever in this Lease an obligation
is imposed upon or required of Tenant, same shall be at Tenant's sole cost
and expense.

                                 - 25 -


<PAGE>

          Obligations of Tenant pursuant to the terms and conditions of
this Lease are:  (a) for the Premises as set forth in exhibit "A" unless
extended in scope pursuant to any particular provision and/or as the sense
and circumstances of the text may require; (b) for the duration/term of the
Lease unless having application before the commencement date and/or if they
survive the expiration date or prior termination date pursuant to any
provision contained herein.

     47.  VALIDITY.  The terms and conditions of this Lease shall be deemed
severable, if any clause or provision herein shall be adjudged to be
invalid or unenforceable by a court of competent jurisdiction or by the
operation of any applicable law, such an occurrence shall not affect the
validity of any other clause and/or provision herein, and this Lease and
such other clauses and provisions shall remain in full force and effect.

          Landlord, however, at its option, may pursue the relief or remedy
sought in any invalid clause by conforming the said clause with the
provisions of the statutes or the regulations of any governmental agency as
if the particular provisions of the applicable statutes or regulations were
set forth herein at length.

     48.  COUNTERPARTS.  This Lease may be executed in several counterparts
each of which shall be deemed to be an original copy, and all of which
taken together shall constitute one agreement binding on all parties
hereto, notwithstanding that the parties shall not have signed the same
counterpart.

     49.  GENDER NEUTER.  In all references herein to any pronouns,
parties, persons, entities, or corporation, the use of any particular
gender or the plural or singular number is intended to include the
appropriate gender or number as the sense and circumstances of the context
may require.

     50.  BINDING AGREEMENT.  All the terms and conditions contained herein
shall be for and shall inure to the benefit of and shall bind the
respective parties hereto, their heirs, successors and assigns.

     51.  APPLICABLE LAW.  Landlord and Tenant agree that this Lease and
any suits and/or special proceedings under it will be governed and
construed-pursuant to the laws of the State of New Jersey.

     52.  ADDITIONAL RENT.  Additional rent charges shall be paid to
Landlord within 10 days of notice of a bill sent by Landlord to Tenant.

     53.  CAPTIONS.  The captions are inserted only as a matter of
convenience and in no way define, limit or describe the scope of this Lease
nor the intent of any covenant thereof.

     54.  BROKER.  Tenant represents to Landlord that it has not dealt with
any brokerage company this Lease.  Tenant shall hold and keep Landlord
harmless from and against any claim for brokerage commissions and all
liabilities and expenses arising therefrom from any other broker or similar
party.

                                 - 26 -


<PAGE>

     55.  LANDLORDS WORK.  Landlord shall effect the following alteration
work on behalf of Tenant:

          Put the Premises into a CCO condition prior to the commencement
date of this lease.

     56.  TENANT'S OPTION TO LEASE ADDITIONAL ADJACENT SPACE IN BUILDING
#16.  In the event that during the original term, or any renewal of this
Lease, the westerly adjacent 12,300 square feet Premises in building #16
presently occupied by London Textiles or the easterly adjacent 10,300
square foot Premises in building #16 presently occupied by General Floor
Mechanic becomes available; Landlord shall provide Tenant with the Lease
terms and conditions related thereto.  Tenant has the option of Leasing the
space submitted by Landlord by executing Landlord's proposed Lease within
15 days of submission thereof by Landlord to Tenant.  If this option is
executed, this lease shall terminate the month following tenant's lease
commencement date for the option space within building #16.  If Tenant does
not return any such Lease proposal to Landlord, as provided herein, then
Landlord shall be free to lease such adjacent Premises in building #16 to
any other person or entity.

          IN WITNESS WHEREOF, Landlord and Tenant have respectively
signed and sealed this Lease as of the date written.

                                         CHERRY HILL INDUSTRIAL SITES, INC.


/s/H. Regan                              /s/Paul Heise
- ------------------------                 -------------------------------
Witness as to Landlord                   Paul Heise, President


                                         INTEST CORP.

/s/ H. Regan                             /s/Jack Edmunds
- ------------------------                 -------------------------------
Witness as to Tenant                     Jack Edmunds, Operating Manager




                                 - 27 -





<TABLE> <S> <C>

<ARTICLE>           5
<CIK>               0001036262
<NAME>              INTEST CORPORATION
<MULTIPLIER>        1,000

       

<S>                         <C>
<PERIOD-TYPE>                9-MOS
<FISCAL-YEAR-END>                    DEC-31-1997
<PERIOD-START>                       JAN-01-1997
<PERIOD-END>                         SEP-30-1997
<CASH>                                    10,247
<SECURITIES>                                   0
<RECEIVABLES>                              4,521
<ALLOWANCES>                                 146
<INVENTORY>                                1,308
<CURRENT-ASSETS>                          16,394
<PP&E>                                     1,273
<DEPRECIATION>                               773
<TOTAL-ASSETS>                            18,345
<CURRENT-LIABILITIES>                      2,909
<BONDS>                                        0
<PREFERRED-MANDATORY>                          0
<PREFERRED>                                    0
<COMMON>                                      59
<OTHER-SE>                                15,377
<TOTAL-LIABILITY-AND-EQUITY>              18,345
<SALES>                                   14,719
<TOTAL-REVENUES>                          14,719
<CGS>                                      5,756
<TOTAL-COSTS>                              4,596
<OTHER-EXPENSES>                               0
<LOSS-PROVISION>                               0
<INTEREST-EXPENSE>                            14
<INCOME-PRETAX>                            4,551
<INCOME-TAX>                               1,373
<INCOME-CONTINUING>                        3,178
<DISCONTINUED>                                 0
<EXTRAORDINARY>                                0
<CHANGES>                                      0
<NET-INCOME>                               3,153
<EPS-PRIMARY>                                .53
<EPS-DILUTED>                                .53
        


</TABLE>