EXHIBIT 10.36

                        1997 ADDENDUM TO LEASE AGREEMENT
                   WITH PACIFIC COAST TECHNOLOGIES, INC. 1993

     This addendum ("Addendum") is entered into this date between the PORT OF
CHELAN COUNTY, a Washington municipal corporation, hereafter referred to as
"Landlord" and PACIFIC COAST TECHNOLOGIES, INC., a Washington corporation,
hereafter referred to as "Tenant," (collectively the "Parties").

                                    RECITALS

     A. On or about February 1, 1993, the Parties entered into a "Lease
Agreement Pacific Coast Technologies, Inc. 1993" (the "1993 Lease"); on or about
April 22, 1993, the Parties entered into an "Addendum to Lease Agreement with
Pacific Coast Technologies, Inc. 1993" (the "1993 Addendum"); on or about May
11, 1995, the Parties entered into an "Amendment to "Lease Agreement with
Pacific Coast Technologies, Inc., 1993" (1994 Amendment)" (the "1994
Amendment"); and on September 19, 1995, the Parties entered into an "Addendum to
Lease Agreement with Pacific Coast Technologies, Inc., 1993, 1995 Addendum" (the
"1995 Addendum") (all of which documents are collectively referred to as the
"Lease").

     B. The Lease set forth certain real property which was the subject of the
Lease, together with Facilities (as Facilities is defined in the Lease) and the
Addition (as Addition is defined in the Lease) which as of the date of this
Agreement has been constructed on the real property described in the Lease. For
purposes of this Addendum and the Lease reference to "Facilities" includes the
Addition.

     C. Tenant has been and now is in possession of the Leased Premises (as
defined in the Lease) which includes the Facilities on the real property.

     D. The Parties wish to execute an addendum to the Lease to extend the term
of the Lease, to increase the amount of real property and improvements which are
subject to the Lease and to allow Tenant to build improvements on the real
property which is leased to Tenant under the Lease and this Addendum, which
improvements will be attached to the existing Facilities and owned by Tenant.

                                    AGREEMENT

     1. Additional Premises.

          1.1 Landlord hereby leases to Tenant and Tenant leases from Landlord,
     upon the terms and conditions set out in this Addendum and in the Lease,
     except as otherwise provided in this Addendum, the real property described
     on Exhibit "A," and the


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     improvements thereon not owned by Tenant, which exhibit is incorporated
     herein by this reference as if set forth herein. The legal description for
     all of the real property leased to Tenant pursuant to the Lease and this
     Addendum is described on Exhibit "B" to this Addendum.

          1.2 The real property described on Exhibit A includes a house and
     improvements associated with the house (the "House"). The House shall be
     considered as part of the Facilities, and the provisions of the Lease
     relative to the Facilities and all improvements on the Leased Premises
     apply to the House, except as the context clearly requires otherwise.
     Landlord hereby consents to the use of the House as a residence and to the
     Tenant subletting the House to an employee or agent of Tenant or of a
     company or business related to Tenant, provided that Tenant shall provide
     written notice to Landlord of the name and telephone number of the Tenant
     and shall provide Landlord a copy of any lease agreement between Tenant and
     the subtenant within 15 days of the subtenant having the right to occupy
     the House.

          1.3 The real property described on attached Exhibit "B," together with
     the Facilities already existing on that real property, and together with
     the new building and improvements to be constructed by Tenant on the Leased
     Premises (which new building and other improvements are referred to as the
     "Tenant's New Facility" or "Tenant's New Facilities") are collectively
     referred to in the Lease and this Addendum as the "Property," "Leased
     Premises," or "Premises," except as otherwise provided or limited in this
     Addendum.

     2. Cross-Incorporation by Reference. All of the provisions of the Lease are
incorporated within this Addendum as if fully set forth in this Addendum, except
to the extent modified or altered by this Addendum; and all of the terms and
provisions of this Addendum are incorporated within the Lease, subject to the
provisions of the Lease being modified or altered by this Addendum. (By way of
example and not by way of limitation the provisions of the Lease relative to
such things as the term of the Lease, the option to renew, indemnities,
insurance, assignment and subletting are intended to apply to all the real
property described on Exhibit "A" together with all improvements, including
Tenant's New Facility and the Facilities on such real property, except as
otherwise provided in this Addendum). The following provisions of the Lease
shall not apply to Tenant's New Facility: Paragraphs 5, 6, 7, 8, 11, 13, 15.2,
15.3, 15.4, and 32 of the 1993 Lease; the entirety of the 1993 Addendum; and the
entirety of the 1995 Addendum. References in this Addendum to "Lease" and
"Addendum" are intended to apply to both the Lease and the Addendum, unless the
context clearly requires the reference to apply only to one of such agreements.

     3. Term. The Term of the Lease is hereby amended so that the term of the
Lease is for a period ending December 31, 2007.

     4. Option to Renew. Section 3 of Lease, as previously amended, is hereby
further amended to read as follows:


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          4.1 Tenant shall have the option to renew this Lease for one
     additional ten-year term and following the expiration of that ten-year term
     shall have the option to further renew this Lease for an additional
     five-year term, each term to commence immediately upon the expiration of
     the preceding term. In each case the option to renew shall be exercised in
     writing and delivered to Landlord not less than 180 days prior to the
     expiration of the then current Lease term. Each renewal term shall be on
     the same terms and conditions applicable to the original lease term, except
     for the rent, which, during the first renewal term of ten years shall be
     adjusted as provided for in Paragraph 4.6 of the Lease, as amended hereby,
     and during the second renewal term of five years shall be adjusted as
     provided below in this Addendum.

     5. Rent.

          5.1 During the term of the Lease the Tenant shall pay monthly rent for
     the real property described on Exhibit "A" and improvements thereon, in an
     initial amount equal to seven percent (7%) of the fair market value of that
     real property divided by twelve (12), plus Nine Hundred Fifty-Three Dollars
     ($953.00) (being the amount of rent currently being received by Landlord
     for the home located on that real property) per month ("Additional Base
     Rent"), plus leasehold tax. This Additional Base Rent is in addition to the
     rental amount payable by Tenant for the month of May, 1997, pursuant to the
     Lease prior to the execution of this Addendum (the "Initial Base Rent").
     The collective amount of the Initial Base Rent plus the Additional Base
     Rent becomes the Base Rent, upon execution of this Addendum.

               5.1.1 The Parties shall meet to attempt to agree upon the fair
          market value of the real property described on Exhibit "A." If no
          agreement is reached within 60 days from the date of this Agreement,
          the fair market value of that property shall be determined pursuant to
          the procedure established in Paragraph 5.4.1 below for valuing the
          Tenant's New Facility.

               5.1.2 In the event Tenant desires to remove the home located on
          the real property described on Exhibit "A" Tenant shall provide a
          written request to Landlord asking Landlord's approval for the
          removal, which notice shall state the business purpose of the Tenant
          for the removal. Landlord shall have a period of 30 days following
          receipt of the written request to evaluate Tenant's request and to
          approve or deny the request. In the event Tenant's request for the
          removal of the home is related to the Tenant's projected use of the
          Leased Premises in a manner reasonably calculated to have a meaningful
          increase (as reasonably determined by Landlord) in the number of
          employees at the Leased Premises, Landlord shall not unreasonably
          withhold the approval. In the event the removal is not tied to a
          projected use which is reasonably projected to generate meaningful
          additional employment at the Leased Premises, or to otherwise meet
          economic development goals that may be consistent with the Port's
          goals at that time, the


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          Port may either deny the request to remove the home, or approve
          removal of the home on the condition that there shall be no reduction
          or abatement of Base Rent following removal of the home. In the event
          the Port grants approval for removal of the home, and there is a
          meaningful increase in the number of employees of the Tenant at the
          Leased Premises, the rental amount shall be reduced by the amount of
          the rent attributable to the home, as that rent may have been
          increased from time to time consistent with the provisions of the
          Lease, effective on the date agreed upon between the Parties, or in
          absence of agreement, effective at the time objective evidence of the
          meaningful increase of employment at the Leased Premises is presented.

          5.2 The Initial Base Rent shall be adjusted beginning in September of
     1999 and again on September 1 on each year thereafter as provided in
     Paragraph 4.6 of the Lease, through the last year of the final renewal
     term.

          5.3 The Additional Base Rent shall be adjusted at the same time and in
     the same manner as the Initial Base Rent is adjusted except that the
     denominator of the fraction used in adjusting the Additional Base Rent
     shall be the semi-annual CPI-U for the period ending June of 1997 for
     Seattle.

          5.4 If Tenant exercises the option for the second renewal term of five
     years, the rent for the first year of the second renewal term shall be
     determined as follows:

               5.4.1 Landlord shall cause the Leased Premises, excluding the
          Tenant's New Facility, to be valued by an appraiser familiar with and
          experienced in valuing real property and improvements in North Central
          Washington similar to the Leased Premises. The appraisal shall be
          complete within sixty (60) days after Tenant has provided written
          notice of Landlord of its intent to exercise the option for the second
          renewal term. Landlord shall provide Tenant with a copy of the
          appraisal setting forth the value assigned by the appraiser to the
          Leased Premises. Tenant shall have a period of ten (10) days after
          receipt of the appraisal to notify Landlord, in writing, if Tenant
          objects to the value assigned to the Leased Premises by the appraiser.
          If the Tenant objects to the value, the Tenant may have the Leased
          Premises valued by an appraiser selected by the Tenant, which
          appraiser shall be familiar with and experienced in valuing real
          property and improvements in North Central Washington similar to the
          Leased Premises. Tenant shall, within sixty (60) days after notifying
          Landlord it objects to the appraised value, provide a copy of the
          appraisal by Tenant's appraiser to Landlord, setting forth the value
          of the Leased Premises. Landlord shall have a period of ten (10) days
          after receipt of the appraisal from the Tenant's appraiser to notify
          Tenant if it objects to the value set by Tenant's appraisal. If
          Landlord objects, the appraiser selected by Landlord and the appraiser
          selected by Tenant shall confer to determine if they can agree on a
          fair market value of the Leased Premises and if they cannot agree, the
          two shall select a third appraiser who shall


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          determine the value, which determination shall be binding upon the
          Landlord and the Tenant. Landlord and Tenant shall each pay one-half
          of the cost of all appraisals.

               5.4.2 Once the value of the Leased Premises has been determined,
          the rent for the first year of the second renewal term shall be an
          amount equal to seven percent (7%) of the appraised value of the
          Leased Premises (for example, if the fair market value of the Leased
          Premises is $3,000,000, the annual rent for the first year of the
          second renewal term shall be $210,000).

               5.4.3 The Base Rent for the first year of the second renewal
          term, as determined in this Paragraph 5.4, shall be adjusted September
          of each year of the second renewal term beginning with September 1,
          2018, in the same manner as the Base Rent is adjusted in the Lease
          except that the denominator of the fraction used for adjusting the
          Base Rent during the second renewal term shall be the semi-annual
          CPI-U for the period ending June of 2017 for Seattle.

     6. Construction of Additional Improvements.

          6.1 Tenant shall have the right to construct a building which shall
     connect to the exiting Facility and shall make other improvements on the
     Leased Premises, consistent with plans and specifications approved by
     Landlord (the "plans and specifications"). Such building and improvements
     to be constructed by the Tenant are collectively referred to as the
     "Tenant's New Facility" or "Tenant's New Facilities." Prior to commencement
     of construction of Tenant's New Facility, the Landlord shall review and,
     when acceptable, approve all plans and specifications for the Tenant's New
     Facility and the use of the Property, including review of landscaping and
     parking plans, and review for consistency with the Protective Covenants
     applicable to the Landlord's property in the Olds Station area of Chelan
     County. Landlord shall not unreasonably withhold its approval.

          6.2 It is understood that the plans and specifications will call for
     the Facilities to be structurally and aesthetically altered. The Landlord
     agrees to not unreasonably withhold consent to such alteration. Tenant
     understands and agrees that the cost and responsibility for any such
     alteration shall be Tenant's.

          6.3 Tenant shall use its good faith efforts to have all work provided
     and called for by the plans and specifications done in a good and
     workmanlike manner and in compliance with all applicable laws, ordinances,
     regulations or requirements of governmental authority, Landlord's
     protective covenants, and the reasonable requirements of the insurers of
     the Tenant's New Facility.

          6.4 Tenant shall indemnify Landlord from and against any and all
     claims, demands, causes of action, suits, judgments, or liabilities
     (including attorneys' fees,


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     costs, and expenses (including attorneys' fees in enforcing this
     indemnity)) for any matter, including death or injuries to persons or loss
     or damage to property, arising out of or in connection with the
     construction of Tenant's New Facility, except as caused by Landlord's
     negligence, willful misconduct, or breach of the terms of this Lease. This
     indemnification does not limit Tenant's indemnification under Paragraph 16
     of the Lease, and includes, without limitation, any liability for injury to
     the person or property of Tenant, its agents, officers, employees,
     invitees, or licensees.

          6.5 Tenant shall provide plans and specifications to Landlord within
     ninety (90) days from the date of this Addendum and shall commence
     construction of the Tenant's New Facilities within sixty (60) days after
     Landlord has approved the plans and specifications. Tenant shall proceed to
     completion of the construction in a reasonable and diligent manner.

          6.6 Additional or altered improvements to the Leased Premises may be
     added at Tenant's expense, upon prior written approval by the Landlord of
     plans and specifications for the new improvements. Such improvements shall
     be considered as part of the Tenant's New Facility and shall be constructed
     and kept as such, consistent with this Lease.

               6.6.1 All approved alterations or improvements shall be at the
          Tenant's sole cost and expense; and Tenant shall use a licensed and
          bonded contractor for them. Tenant agrees that any alterations or
          improvements made shall not abate the rent. In the performance of such
          work Tenant agrees to comply with all laws and ordinances and to hold
          Landlord harmless from any damage, loss or expense caused by work
          performed by the Tenant.

               6.6.2 Except as provided in Paragraph 7.1 below, Tenant shall
          keep the Leased Premises free from any liens and shall indemnify and
          hold Landlord harmless and defend it from any liens or encumbrances,
          damage loss or expense arising out of any work performed or materials
          furnished by or at the direction of the Tenant, or otherwise, or the
          Tenant's new facilities and to the Leased Premises.

          6.7 Tenant is solely responsible for all aspects of the proposed
     Tenant's New Facility and is not relying on representations or warranties
     from Landlord regarding the proposed Tenant's New Facility.


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     7. Ownership.

          7.1 Tenant shall own and have all right, title, and interest in and to
     the Tenant's New Facility, including, without limitation, the right to
     encumber the Tenant's New Facility, to make repairs and do remodeling, the
     right to sell the Tenant's New Facility, subject to all the provisions of
     the Lease, and subject to Landlord's right to approve an assignee or a
     subtenant, and shall have all other rights incident to ownership, except as
     otherwise limited by this Addendum.

          7.2 Except as specifically provided in this Addendum, the Landlord has
     no right to the Tenant's New Facility and has no responsibility or
     liability for any cost associated with the Tenant's New Facility or for any
     changes to the existing Facilities resulting from the construction or use
     of the Tenant's New Facilities.

          7.3 The Tenant shall indemnify and hold Landlord harmless from costs
     and expenses associated with the Tenant's New Facility and any costs and
     expenses to the existing Facility incurred during the Lease term or caused
     by Tenant's demolition as a result of the construction or use of the
     Tenant's New Facility.

          7.4 Notwithstanding the foregoing, the Landlord's responsibilities
     under the Lease for the Leased Premises, excluding the Tenant's New
     Facility, including the Landlord's obligation for repair and maintenance,
     as set out in Paragraphs 13 and 14 of the Lease, for portions of the
     existing Facilities not affected by the Tenant's New Facility are not
     altered or diminished, except as specifically set forth in this Addendum.

          7.5 Unless otherwise agreed, Tenant is responsible for and shall, at
     its own expense, make all necessary repairs and replacements to the
     Tenant's New Facility. Tenant shall repair and maintain the aesthetic
     appearance of the exterior and the structural integrity of the Tenant's New
     Facility consistent with the Tenant's responsibility for the repair and
     maintenance of the remainder of the Leased Premises, except that all
     expenses related to maintenance, repair and condition of the Tenant's New
     Facility, including that related to the exterior and the roof, shall be the
     responsibility of the Tenant.

     8. Possession. Possession of the real property described as Parcel 1 on
attached Exhibit "A" shall be delivered to Tenant upon execution of this
Addendum by the Tenant and the Landlord.

     9. Purchase by Landlord. Tenant shall not sell or convey the Tenant's New
Facility, or the Tenant's leasehold interest in the Leased Premises, or any part
thereof without first offering such property to Landlord, and Tenant hereby
grants to Landlord the option and right to purchase the Tenant's New Facility
and the leasehold interest of Tenant in the Leased Property as set forth below:


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          9.1 At any time during the Lease Term or any renewal thereof, Tenant
     may provide written notice to Landlord of Tenant's offer to sell to
     Landlord the Tenant's New Facility, and if Tenant elects, Tenant's
     leasehold interest in the Leased Premises, or any portion of either
     ("Offered Property"). If Landlord desires to pursue the purchase of the
     Offered Property, Landlord and Tenant shall meet and negotiate in an effort
     to agree on price and terms for the sale of the Offered Property. If the
     Parties cannot reach agreement on the price and terms within forty-five
     (45) days from the date Landlord receives Tenant's written offer, Landlord
     may, within ten (10) days after the expiration of the forty-five (45) days,
     set forth in a notice in writing to the Tenant the price and terms that
     Landlord is willing to pay for the Offered Property. If the Parties have
     not reached agreement for the sale of the Offered Property within the
     forty-five (45) days, Tenant may for a period of 180 days after the
     expiration of the forty-five (45) days sell all, but not less than all, of
     the Offered Property to a third party at a price and on terms which are not
     more favorable to the buyer than those set out in the Landlord's notice to
     Tenant; provided that if a proposed sale within the 180 days is more
     favorable to the proposed buyer than the price and terms set out in
     Landlord's notice, Tenant shall first offer the property it is proposing to
     sell to the third party, to Landlord on the same price and at the same
     terms as offered to the third party, and Landlord shall have fifteen (15)
     days after receipt of the written offer from Tenant to accept or reject the
     offer; and provided further that if no sale of the Offered Property or any
     part thereof is completed within the 180 days, Tenant shall not sell the
     Tenant's New Facility or the Tenant's leasehold interest in the Leased
     Premises, or any part thereof, without first complying with this Paragraph
     9 and offering to sell such property to the Landlord.

          9.2 A sale by Tenant to any third party shall be conditioned on such
     third party agreeing to be bound by and comply with the provisions of
     Lease, including the provisions regarding the sale of the Tenant's New
     Facility or leasehold interest, and the Landlord's right of approval to any
     assignee or sub-tenant, as applicable.

     10. Rights at Lease Termination

          10.1 At the end of the initial term or at the end of any renewal term,
     if Tenant has not exercised the option of further renewal or if there are
     no other options for renewal, Tenant shall have the right to remove the
     Tenant's New Facility, repair the Leased Premises, including the Facility,
     and restore the Facility and the Leased premises to essentially the
     condition they were in prior to the addition of the Tenant's New Facility,
     damage caused by the Landlord or resulting from condemnation, and normal
     wear and tear excepted, all at Tenant's expense; provided, however, Tenant
     shall have no duty to repair, restore or replace damage caused by an
     insured casualty when Landlord has received the insurance proceeds and when
     Tenant has no further obligation under other provisions of the Lease for
     responsibility for repair and maintenance which is not offset by the
     insurance proceeds, and Landlord's remedy shall be limited to the insurance
     proceeds; provided further, however, that if the responsibility to repair
     or restore any damage caused by casualty is the responsibility of the
     Tenant under the Lease


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<PAGE>
     and the insurance proceeds are insufficient to restore the Facility or the
     Leased Premises, Tenant shall be responsible for the cost for repair and
     restoration in excess of the insurance proceeds. Alternatively, Tenant may
     leave the Leased Premises intact and not remove the Tenant's New Facility,
     in which case all right, title and interest in and to the Tenant's New
     Facility shall transfer automatically to and without payment of
     consideration by, the Landlord, in which case the Landlord shall then be
     the owner of the Tenant's New Facility, free from any interest of the
     Tenant.

          10.2 If the Tenant elects to remove the Tenant's New Facility, such
     removal shall occur pursuant to plans and specifications approved in
     advance, in writing, by Landlord, and Landlord agrees not to unreasonably
     withhold its approval. Tenant shall proceed promptly, with reasonable
     diligence, to complete the removal and restoration, provided that the
     removal shall be complete and the Leased Premises repaired and restored
     within one hundred twenty (120) days after the end of the Lease term,
     unless a longer period is reasonably required because of weather conditions
     or other acts of God. If Tenant fails to commence or pursue the removal and
     restoration in a reasonable manner, Landlord may, upon providing Tenant
     fifteen (15) days written notice of its intent to do so, undertake the
     removal and restoration itself, at the expense of the Tenant, and Tenant
     agrees to reimburse Landlord for all Landlord's reasonable costs and
     expenses, direct and indirect, for the removal and restoration, promptly
     upon Landlord billing Tenant for them.

          10.3 If Landlord terminates the Lease because of Tenant's default,
     then, notwithstanding the termination, the Landlord shall have the option
     to purchase the Tenant's New Facility at the fair market value, without
     considering the value of any prior interest of Tenant in the Leased
     Premises, as the Lease shall have been terminated. If the Landlord and
     Tenant have not agreed upon the fair market value of the Leased Premises
     within thirty (30) days after Landlord has given Tenant written notice of
     its election to purchase the Tenant's New Facility, then the Tenant shall
     have the rights and responsibilities set out below. If the Parties agree on
     the fair market value the closing of the purchase shall occur within thirty
     (30) days after the agreement. The purchase price shall be paid in full at
     closing.

          10.4 If Landlord does not exercise its option to purchase, or if the
     Parties do not agree on the fair market value as provided above, then,
     notwithstanding the termination of the Lease, Tenant shall have an
     additional sixty (60) days after the expiration of the period during which
     Landlord has the right to exercise its option to find a new tenant for the
     Tenant's New Facility, and the Leased Premises, which new tenant and the
     use to which the new tenant intends to put the Leased Premises must be
     acceptable to the Landlord. In the event the Tenant has located a new
     tenant for a use which is acceptable to the Landlord within the time period
     set forth above, Tenant may sell the Tenant's New Facility to the new
     tenant on such terms and conditions as the parties agree. Tenant
     understands that since the Lease shall have terminated, the Landlord's
     right to determine whether a proposed new tenant, and/or the use to which


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     the proposed tenant intends to put the Leased Premises are acceptable to
     the Landlord under circumstances which exist at the time is not subject to
     the provisions of the Lease, and that the Landlord may withhold consent to
     an approval of a proposed new tenant for reasons which the Landlord
     determines at the time, are reasonable, and which are based on the sole and
     exclusive judgment of the Landlord.

          10.5 If the Tenant has not sold the Tenant's New Facility to the
     Landlord or to an acceptable new tenant within ninety (90) after the Lease
     has been terminated, the Tenant shall have the right to remove the Tenant's
     New Facility, as set forth in Paragraph 10.2 above, or to leave the
     Tenant's New Facility and convey all of the Tenant's right, title and
     interest in the Tenant's New Facility to the Landlord.

          10.6 In the event of conveyance of the Tenant's New Facility to the
     Landlord, Tenant shall execute appropriate conveyance documents to transfer
     title of the Tenant's New Facility to Landlord, including Special Warranty
     Deed, Warranty Bill of Sale, and the like, free of encumbrances, defects
     and claims of any party other than Landlord, and other than those commonly
     excepted on the printed form portion of an ALTA owner's form of title
     insurance policy and those existing at the date of this Addendum.

          10.7 At the time of closing of Tenant's conveyance of Tenant's New
     Facility to Landlord, except for any condition or damage caused by Landlord
     or resulting from condemnation, or as a result of a casualty for which the
     Landlord has received insurance proceeds sufficient to restore or repair
     the Tenant's New Facility to the condition it was in prior to the damage,
     the Tenant's New Facility shall be free from toxic or environmental waste
     or hazards for which Tenant has responsibility under Paragraph 23 of the
     Lease, shall be free from internal defects not known by or disclosed to the
     Landlord and which are not obvious by casual inspection (and have therefore
     been considered in valuing the Tenant's New Facility), shall not be in
     disrepair and shall be clean.

          10.8 The Tenant shall be responsible for any transfer taxes associated
     with the sale, and shall pay the costs of any Title Insurance. The Parties
     shall divide equally the document preparation fee and the closing fee. The
     Landlord shall be responsible for and pay costs of recording of the
     documents.

     11. Alterations, Improvements and Encumbrances.

          11.1 Landlord acknowledges that the Tenant may need to make
     alterations to portions of the Leased Premises. Tenant shall make no
     changes, improvements or alterations to the Leased Premises without the
     Landlord's prior written consent, as set out in the Lease. Notwithstanding
     the foregoing, Tenant may make non-structural changes to the Tenant's New
     Facility without the Landlord's prior written approval, provided that such
     changes are consistent with this Lease, including the Protective Covenants.


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<PAGE>
          11.2 Landlord agrees not to unreasonably deny approval for changes,
     improvements or alterations; provided design plans are submitted to
     Landlord for prior review and approval. Approval for structural changes,
     including structural changes to the Tenant's New Facility, must be approved
     in advance by Landlord's engineer. Tenant shall bear Landlord's reasonable
     costs of investigation of requested structural changes, including
     engineer's and other expert's fees.

          11.3 All such approved changes shall be at the Tenant's sole cost and
     expense; and Tenant shall use a licensed and bonded contractor or
     contractors to do the work for such changes. In the performance of such
     work, Tenant agrees to comply with all laws and ordinances and to hold
     Landlord harmless from any damage, loss or expense caused by work performed
     by or on behalf of Tenant.

          11.4 Except as provided in this Addendum, Tenant shall keep the Leased
     Premises free from any liens. Tenant shall indemnify and hold Landlord
     harmless and defend it from any liens or encumbrances, damage, loss or
     expense arising out of any work performed or materials furnished by or at
     the direction of Tenant, to the Leased Premises. Tenant shall be entitled
     to encumber its leasehold interest in the Leased Property, and the
     Facilities, provided that any such encumbrance is limited to the value of
     the purchase price as set out in Section 9, and is subject to the rights
     and duties of the Landlord hereunder, including, without limitation,
     Landlord's right to purchase set out in this Lease. Tenant has no interest
     in and therefore no right to encumber the Leased Premises or the Tenant's
     New Facility for an amount in excess of the purchase price set out in
     Section 9 of this Addendum. Any lien or encumbrance of the Tenant's New
     Facility or Tenant's leasehold interest, voluntary or involuntary, shall be
     subject and subordinate to the provisions of this Lease, and shall be
     terminated and released of record by the holder of such lien or encumbrance
     upon termination of the Lease or upon the purchase price determined as set
     out in Section 9 of this Addendum, being paid to the agent closing the sale
     from Tenant to Landlord, regardless of whether or not the purchase price
     pays the lien or encumbrance in full.

     12. Other Agreements. Paragraph 10 of the Lease is hereby amended to read
as follows:

          Tenant is owned by Pacific Aerospace and Engineering, Inc.,
          a Washington corporation which is the parent company of the
          Tenant and Cashmere Manufacturing, Inc. Pacific Aerospace
          and Engineering, Inc., Pacific Coast Technologies, Inc., and
          Cashmere Manufacturing, Inc., are referred to as the "PA&E
          Companies." All PA&E Companies have agreements with Landlord
          by way of other leases or guarantees of other leases, as
          well as a guarantee of the Lease. It is anticipated the PA&E
          Companies may have additional agreements in the future with
          Landlord. The default and remedy provisions of other leases
          or agreements which have been


                                 -11-
<PAGE>
          or may in the future be entered into between Landlord and
          any of the PA&E Companies are incorporated herein by this
          reference. A default in any one of the leases or agreements
          between the Landlord and any of the PA&E Companies shall be
          deemed a default in any and all of the other leases or
          agreements between them at Landlord's election, and such
          default shall entitle Landlord to exercise the remedies set
          out in favor of the Landlord in any and all of such
          agreements or leases.

     13. Damage or Destruction. If the Tenant's New Facility is damaged or
destroyed Tenant shall promptly repair and restore the Tenant's New Facility to
substantially the condition it was in prior to the destruction, or to such other
condition as may be approved by Landlord in advance in writing, consistent with
plans and specifications approved by Landlord which approval Landlord will not
unreasonably withhold. Alternatively, Tenant may remove the Tenant's New
Facility, repair the Leased Premises, including the Facility, and restore the
Facility and the Leased Premises to essentially the condition they were in prior
to the addition of the Tenant's New Facility, damage from condemnation or caused
by Landlord, and normal wear and tear excepted, all at Tenant's expense;
provided, however, that to the extent Landlord has received insurance proceeds
as a result of damage to Landlord's Facility or the Leased Premises other than
Tenant's New Facility, Landlord shall utilize the insurance proceeds for the
repair of the Facility and Tenant shall be relieved from the financial
responsibility for such repair to the extent of the insurance proceeds received
by Landlord.

     14. Casualty and Condemnation. In the event of any fire or other casualty
or condemnation, Tenant shall be entitled to the portion of the insurance
proceeds or condemnation award related to the value of the Tenant's New
Facilities and to the loss of the value of its leasehold interest, if any.
Landlord shall be entitled to recover for the value of the Facilities and the
real property. In the event of such casualty or condemnation, Tenant shall have
no obligation to rebuild the New Facilities.

     15. Reasonableness. Any consent or approval required to be given by any
party hereto shall not be unreasonably withhold, delayed or conditioned.

     16. Execution in Counterparts. This Addendum may be executed in two ore
more counterparts, each of which shall be deemed an original and all of which
together shall constitute but one and the same contract.

     17. No Partnership, Co-Venture, Agency, Employment. This Lease shall not
create any partnership, joint venture, or other joint undertaking between the
parties hereto, and neither party shall be liable for the debts or have the
authority to make any representations, enter into any agreements or admit,
compromise, modify or waive any obligations on behalf of the other.


                                      -12-
<PAGE>
     18. Brokers. Each party hereto warrants that it has had no dealings with
any broker or agent in connection with the negotiation of this Addendum and it
knows of no broker or agent who is entitled to a commission in connection with
this Addendum.

     19. Waivers. The failure of Tenant at any time to require performance of
any provision of this Lease shall not limit Tenant's right to enforce said
provision. The waiver of any breach of any provision in this Lease shall not
constitute a waiver of any succeeding breach thereof or the breach of any other
provision.

Dated effective June 14, 1997


PORT OF CHELAN COUNTY                   PACIFIC COAST TECHNOLOGIES, INC.

By: /s/   Mark Urdahl                   By: /s/ Donald A. Wright
    --------------------------------        ------------------------------------
Name: Mark Urdah                        Name: Donald A. Wright
      ------------------------------          ----------------------------------
Its:  Director                          Its:  Executive Vice President
      ------------------------------          ----------------------------------



STATE OF WASHINGTON           )
                              )ss.
County of Chelan              )

     On this 14th day of June, 1997, before me personally appeared Donald A.
Wright, to me known to be the Executive Vice President of the corporation
described herein and that he executed the within and foregoing instrument, and
acknowledged said instrument to be the free and voluntary act and deed of said
corporation, for the uses and purposes therein mentioned, and on oath stated
that he was authorized to execute said instrument.

     IN WITNESS WHEREOF, I have hereto set my hand and affixed my official seal
the day and year first above written.


                                       /s/ STEPHANIE D. SCHILLER
                                       -----------------------------------------
                                       NOTARY PUBLIC, State of Washington
                                       Residing at: Seattle, Washington
                                                    ----------------------------
                                       My appointment expires 1-10-01
                                                              ------------------

STATE OF WASHINGTON           )
                              )ss.
County of Chelan              )

     On this 19th day of June, 1997, before me personally appeared Mark Urdahl,
to me known to be the Director of the Port of Chelan County, a municipal
corporation, and that he executed the within and foregoing instrument, and
acknowledged said instrument to be the free


                                      -13-
<PAGE>
and voluntary act and deed of said corporation, for the uses and purposes
therein mentioned, and on oath stated that he was authorized to execute said
instrument.

     IN WITNESS WHEREOF, I have hereto set my hand and affixed my official seal
the day and year first above written.


                                       /s/ DARLENE LUFT (Darlene Luft)
                                       -----------------------------------------
                                       NOTARY PUBLIC, State of Washington
                                       Residing at: Wenatchee, WA
                                                    ----------------------------
                                       My appointment expires 12-7-98
                                                              ------------------


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