<PAGE>
 
                                  COVER PAGE
                                  ----------

     The capitalized terms in this Lease shall have the meaning ascribed to them
below, and each reference to such term in the Lease shall incorporate such
meaning therein as if fully set forth therein.

Terms:
------

LANDLORD:  Highwoods/Forsyth Limited Partnership, a North Carolina limited
           partnership with its principal office at 2200 Century Parkway, Suite
           800, Atlanta, Georgia 30345.

TENANT:    ACT Manufacturing, Inc., a corporation duly organized and existing
           under the laws in the state of Massachusetts with his principal
           office a place of business at 2005 Newpoint Place Parkway, Suite 100,
           Lawrenceville, Georgia.

PREMISES: (a) Suite:  100

          (b) Rentable Area:  62,453 square feet

          (c) See Floor Plan attached hereto as Exhibit "A."

BUILDING: The building counting approx. 84,106 rentable square feet known as
          2005 Newpoint Place Parkway, Gwinnett County Georgia, which is located
          within the Project.

PARCEL:   The certain tract or parcel of land on which the Building is located,
          owned by Landlord containing 5.54 acres and being more particularly
          described and shown as Block "B," Lot 2 on Exhibit "B," together with
          all Improvements located thereon or which may hereafter be constructed
          thereon.

PROJECT:  Those parcels of land, including the Parcel, and all improvements
          thereon, collectively known as "Newpoint Place," shown on Exhibit B-1.

COMMENCEMENT DATE:  Defined in Section 2 of the Lease.

TERMINATION DATED:  Seven (7) years after the Commencement Date.

BASE TAXES AND ASSESSMENTS:  See Section 4(a).

BASE INSURANCE:  See Section 4(b).

PERMITTED USES:  General office, assembly, light manufacturing and warehouse

FIRST LEASE YEAR BASE RENT (PER YEAR):  $281,038.50

FIRST MONTHS RENT:  $23,419.88

SECURITY DEPOSIT:  $27,964.56

Agent:  Grubb & Ellis - John Crawford
<PAGE>
 
                                LEASE AGREEMENT
                                ---------------

     THIS LEASE AGREEMENT, made and entered into as of this ___ day of May,
1998, by and between Highwoods/Forsyth Limited Partnership a North Carolina
limited partnership ("Landlord"), and ACT Manufacturing Inc., a Massachusetts
corporation ("Tenant").

     In consideration of the premises and covenants contained herein and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:

     1.  Premises.  Landlord does hereby rent and lease to Tenant, and Tenant
         --------                                                            
does hereby rent and hire from Landlord, during the Lease Term (as hereinafter
defined), the Premises located in the Building , together with the right in
common with others to use:  (a) the landscaped areas, roadways, driveways,
parking and loading areas and sidewalks on the Project; (b) the entrances,
lobbies, stairs, and corridors necessary for access to the Premises; (c) the
heating, ventilating, air conditioning, plumbing, electrical, emergency and
other mechanical systems and equipment serving the Premises in common with other
portions of the Building, if any; and (d) the common lavatories in the Building,
if any (collectively the "Common Areas").  Tenant shall have the exclusive right
to use 200 parking spaces (88 spaces in front and on the side of Building and
the balance in the truck court) and 6 loading spaces on the Parcel as shown on
Exhibit A attached hereto and incorporated herein by reference.  The Premises
are deemed to contain 62,453 rentable square feet ("Rentable Area").  The
Project is deemed to contain 84,106 rentable square feet.  As used herein,
"Tenant's Share" shall mean a fraction, the numerator of which shall be the
Rentable Area of the Premises, and the denominator of which shall be the gross
rentable area of the Building.  No easement for light and air is included in the
Premises.  For purposes of this Lease, Tenant's Share is deemed to be seventy
four percent (74%).

     2.  Possession.
         ---------- 

     a.  "Lease Term" means a term commencing on the Commencement Date (as
hereinafter defined) and continuing for 84 full calendar months (plus any
partial calendar month if the Commencement Date is not the first day of a
month), unless sooner terminated or extended hereunder.

     b.  "Commencement Date" means the earlier of the date Tenant first occupies
the Premises for the Permitted Uses, as opposed to performing Tenant's Work, as
defined in Exhibit D, attached hereto and made a part hereof, or October 1. If
by October 1, 1998 Landlord has not "substantially completed" (as defined in
Exhibit D) Landlord's Work and the Base Building Work pursuant to Exhibit "D"
attached hereto and made a part hereof, then the Commencement Date shall be
postponed (and the Rent herein provided shall not commence) until the earlier of
either (i) the date of actual occupancy of the Premises by Tenant for the
Permitted Uses, as opposed to performing Tenant's Work, as defined in Exhibit D,
attached hereto and made a part hereof or (ii) the date immediately following
the day Landlord has achieved substantial completion as defined in Exhibit D of
Landlord's Work and the Base Building Work.  Landlord and Tenant shall each have
the option to terminate this lease by written notice to the other if the
Commencement Date has not occurred within six (6) months from the date hereof.
Provided, further, this lease shall automatically terminate without action on
the part of any party hereto if the Commencement Date has not occurred within
twelve (12) months from the date hereof.  Landlord shall have no liability for
any delay in delivering possession of the Premises to Tenant.  Notwithstanding
any provision in this Lease to the contrary, Landlord shall deliver possession
of the Premises to Tenant on the Commencement Date free of all tenants and
occupants in broom clean condition and in the condition described in Exhibit D,
subject, however, to force majeure events and Tenant Delay (hereinafter
defined).

     c.  If, and to the extent, Landlord's substantial completion of the
Landlord's Work and the Base Building Work pursuant to Exhibit "D" attached
hereto is delayed past October 1, 1998 solely due to any act or omission of
Tenant or anyone acting under or for Tenant as set forth 
<PAGE>
 
in Exhibit D (any such delay being hereinafter referred to as "Tenant's Delay"),
then the Commencement Date shall be the date specified in subsection (b) above,
subject to adjustment as provided therein, but without extension as a result of
Tenant's Delay; provided that from the Commencement Date, as so determined,
until the earlier of (i) the date of actual occupancy of the Premises by Tenant
or (ii) the date immediately following the date past October 1, 1998 that
Landlord would have achieved Substantial Completion of the Landlord's Work and
the Base Building Work but for Tenant's Delay, Tenant's obligations under this
Lease shall be limited to the payment of any and all Rent due hereunder.

     d.  Within five (5) days of written request by Landlord, Tenant agrees to
execute and deliver to Landlord a commencement date agreement setting forth the
exact Commencement Date of the Lease Term and, if true, stating that all
Landlord's Work and the Base Building Work has been Substantially Completed,
subject to the completion of any outstanding "Punchlist Items."

     3.  Base Rent.
         ----------

     a.  Tenant shall pay to Landlord at Highwoods/Forsyth Limited Partnership,
P.O. Box 100488, Atlanta, Georgia 30384-0488 or at such other place as Landlord
may designate, from and after the Commencement Date, an initial annual Base Rent
of $281,038.50 plus sales tax, if applicable, (not currently applicable) to be
paid without notice, demand, deduction, or set-off on the first day of each
month, in advance.  The Base Rent shall be payable during the Lease Term in
equal monthly installments and shall be adjusted as set forth in the Special
Stipulations attached hereto.

     b.  As used in this Lease, the term "Rent" shall include Base Rent,
Additional Rent, and all other sums and obligations due Landlord hereunder.

     c.  Payments of Rent not received by Landlord within five (5) calendar days
of the due date thereof shall be subject to a late charge due and payable by
Tenant to Landlord on the sixth (6th) calendar day after the due date thereof in
an amount equal to twenty five dollars ($25.00) or five percent (5%) of such
past due amount, whichever amount is greater.

     4.  Additional Rent.  Tenant shall pay to Landlord, as Additional Rent, the
         ---------------                                                        
amounts set forth herein:

     a.  "Taxes and Assessments" shall mean every type of tax, charge or impost
assessed against the Parcel or the operations thereof, including, but not
limited to, sales taxes, ad valorem taxes, special assessments and governmental
charges, excepting only income taxes imposed upon Landlord.  On or about January
1, 2000, assuming the Building is fully assessed in 1999, and annually
thereafter during the Lease Term, Landlord shall deliver to Tenant a statement
setting forth the estimated Taxes and Assessments for the calendar year then
commencing, and the amount thereof in excess of the actual taxes and assessments
assessed against the Building, as a fully assessed and constructed building (in
accordance with Exhibit D).  Tenant shall pay Tenant's Share of such estimated
excess in equal monthly installments with payments of Base Rent during the
remaining months of such calendar year, which shall be adjusted to reflect
actual excess over the 1999 taxes and assessments following receipt of actual
tax bills.  Promptly following receipt of the actual tax bills, Landlord shall
notify Tenant of any necessary adjustments to the remaining payments for such
calendar year and provide Tenant with a copy of such bills.  If, upon receipt of
the actual tax bills, it is determined that the estimated excess paid by Tenant
during any calendar year was greater than the actual excess based on the actual
tax bills, then Landlord shall promptly refund any such overpayments to Tenant.

     b.  "Insurance" shall mean any "all risk," "fire and extended coverage," or
other casualty insurance covering the Parcel and the Building, any comprehensive
general liability insurance covering the ownership, maintenance, use and
occupancy of the Parcel and the Building, and "rent" or "business interruption"
insurance, in such amounts and with such coverage as Landlord deems necessary.
On or about January 1 following the Commencement Date and annually thereafter
during the Lease Term, Landlord shall deliver to Tenant a statement setting
forth the estimated cost for the insurance for the calendar year then
commencing, and the amount thereof in excess of the initial premium based on the
fully constructed Building.  Tenant shall pay 
<PAGE>
 
Tenant's Share of such excess in equal monthly installments with payments of
Base Rent during the remaining months of such calendar year. Promptly following
receipt of the actual insurance costs, Landlord shall notify Tenant of any
necessary adjustments to the remaining payments for such calendar year. If, upon
receipt of the actual insurance bills, it is determined that the estimated
excess paid by Tenant during any calendar year was greater than the actual
excess based on the actual insurance bills, then Landlord shall promptly refund
any such overpayments to Tenant.

     c.  "CAM Charges" shall mean all expenses reasonably incurred by Landlord
in the maintenance, repair and operation of the Common Areas of the Project,
including, but not limited to, electrical and security charges, landscaping,
planting and lawn care, and all repairs, maintenance and replacement of
sidewalks, driveways, and loading and parking areas.  Notwithstanding any
provision in this Lease to the contrary, Tenant shall only pay Tenant's Share of
CAM Charges for services solely benefiting the Building and the Parcel and
"Tenant's Project Share" (hereinafter defined) for those services provided by
Landlord and benefiting all tenants in the Project or the Common Areas of the
Project.  Tenant's CAM Charges shall not exceed $.35 psf for calendar year 1999.
Landlord represents that Schedule 1 attached hereto lists all of the operating
expenses for the Building, the Parcel and the Project for the calendar year
1998.  For purposes of this Lease, "Tenant's Project Share" shall mean a
fraction, the denominator of which shall be the Rentable Area of the Premises
and the numerator of which shall be the gross rentable area of all buildings now
or hereafter located on the Project.  Landlord agrees to furnish the following
services and amenities to Tenant, the cost of which shall be charged to Tenant
as CAM Charges for which Tenant shall pay Tenant's Share or Tenant's Project
Share, as the case may be, unless the Premises is separately metered for any of
the utilities listed below, in which case Tenant shall pay the provider of any
such utility directly for the costs of such utility:  (1) landscaping, planting
and lawn care on the Project; (2) Common Area and parking area lighting; and (3)
such maintenance and repair work required to be performed by the Landlord under
Section 11 of this Lease.  In no event shall the CAM Charges in any calendar
year during the Lease Term increase by more than 10% over the preceding calendar
year's CAM Charges.  CAM charges will also include Tenant's Project Share of
association dues, currently $0.00.  On or about the date hereof, and on or about
January 1 of each calendar year during the Lease Term, Landlord shall deliver to
Tenant a statement setting forth the estimated CAM Charges for the calendar
year.  Tenant shall pay Tenant's Share of such estimated CAM Charges in equal
monthly installments with payments of Base Rent during the remaining months of
such calendar year.  No later than sixty days after the end of each calendar
year during the Lease Term as Landlord shall determine the actual CAM Charges
for such calendar year, and deliver to Tenant a statement thereof and any
adjustment necessary shall be made to Additional Rent payments next coming due
under this section, or, if this Lease has terminated, be adjusted as between
Landlord and Tenant within thirty (30) days of delivery of such statement.  No
failure of Landlord to give statements as required by paragraphs 4(a) through
4(c) hereof shall be construed as, or deemed to constitute, a waiver by Landlord
of the right to require payment of Additional Rent as required herein and, until
delivery of such statement(s), Tenant shall continue to make all Additional Rent
payments in effect for the previous calendar year.

CAM Charges shall not include the following:

1)  principle payments on account of loans secured by a mortgage or deed of
    trust encumbering the Building or the Parcel and interest of any kind;

2)  rent, additional rent or other charges payable under any ground lease or
    superior lease affecting the Building or the Parcel;

3)  costs of leasehold improvements made in connection with the preparation of
    any portion of the Project for occupancy by a new or existing tenant which
    is not generally beneficial to all tenants of the Building;

4)  costs or expenses arising from efforts to lease portions of the Project or
    to procure new tenants for the Building, including advertising expenses,
    brokerage commissions and attorney's fees;

5)  expenses arising from any expansion of the rentable area of the Building or
    the parking areas on the Project or new buildings on the Project;
<PAGE>
 
6)  costs, expenses or charges properly chargeable or attributable to a
    particular tenant or tenants;

7)  charges for any utility or other service used or consumed in premises leased
    to any tenant or occupant of the Building if (i) Tenant does not use or
    consume such utility or service or (ii) Tenant's use or consumption of such
    utility or service is separately metered or charged;

8)  expenses arising from negotiations or disputes with any tenant of the
    Project;

9)  Landlord's general overhead not directly related to the management or
    operations of the Building or the Project;

10) expenses arising from Landlord's or Landlord's managing agent's breach or
    violation of a law, lease or other obligation, including fines, penalties
    and attorneys' fees;

11) any charge for which Landlord is entitled to receive reimbursement from
    insurance proceeds or from a third party;

12) costs of environmental testing, remediation and compliance, unless caused
    by the act or omission of Tenant, unless required by the act or omission of
    the Tenant;

13) costs of repairs and replacements arising out of an exercise of eminent
    domain affecting the Building, the Parcel or the Project;

14) fees for licenses, permits or inspections that are not part of routine
    maintenance of the Building or the Project or result from the act or
    negligence of Landlord, its managing agent, employees, licensees and
    contractors or any other tenant of the Building or Project;

15) costs of repairs, replacements, alterations and improvements necessary to
    bring the Building or the Project into compliance with laws existing as of
    the date of this Lease, including without limitation the Americans with
    Disabilities Act of 1990 and the regulations and standards promulgated
    thereunder, unless caused by Tenant or Tenant's use of the Premises;

16) costs of any repairs necessary to cure defects in the construction of any
    portion or component of the Premises, the Building or the Project; and

17) the cost of "capital improvements," except those "capital improvements"
    made to the Building or the Project which reduce the CAM Charges or
    otherwise improve the operating efficiency of the Project or the Building,
    which costs shall be amortized over the useful economic life of such
    improvements, as determined under applicable regulations of the United
    States Internal Revenue Service, with only the annual amortized portion of
    such costs including a reasonable interest rate charged to Tenant as a CAM
    charge.  "Capital improvements" shall mean any improvement which can be
    deemed a "capital improvement" under the applicable regulations of the
    United States Internal Revenue Service.

     Tenant shall have the right, within ninety (90) days after receiving such
statement from Landlord, to review the Landlord's books and records concerning
CAM Charges covered by such statement.  Tenant shall, within sixty (60) days
after such books and, records are made available to Tenant, give Landlord
written notice stating in reasonable detail any objection to such Landlord's
statement.  Upon Landlord's receipt of such objection from Tenant, Landlord and
Tenant shall work together in good faith to resolve the discrepancy between
Landlord's statement and Tenant's review.  If the Landlord and Tenant are unable
to resolve any such discrepancy, then either party may submit the matter to
binding arbitration under the rules of the American Arbitration Association.  If
Landlord and Tenant determine that the CAM Charges for the calendar year in
question are less than reported by Landlord, Landlord shall provide Tenant with
a credit against future Rent payments, provided that if the Term of this Lease
expires prior to the determination of such overpayment or such determination is
made during the last calendar month of the term of this Lease, Landlord shall
refund such overpayment within ten (10) days of such determination.

     5.  Utilities.  Tenant shall promptly pay Tenant's Share of the cost of all
         ---------                                                              
utility services furnished to the Premises in common with other portions of the
Building, including, but not limited to, gas, water, electricity, garbage
collection and other sanitary services, and any initiation or 
<PAGE>
 
connection fees for any of the foregoing. Landlord shall cause the Premises to
be separately metered for all utilities prior to Commencement Date and Tenant
shall promptly pay directly to such utility provider the cost of any such
utility.

     6.  Security Deposit.  Tenant shall deliver to Landlord a Security Deposit
         ----------------                                                      
in the amount of $27,964.56 ("Security Deposit").  Landlord shall deposit the
Security Deposit in a segregated account designated as holding Tenant's funds,
shall give Tenant notice of the bank holding such deposit and the identification
of such account.  The Security Deposit shall be held by Landlord as security for
performance by Tenant of Tenant's covenants and obligations under the Lease and
the Security Deposit shall not constitute, or be considered, an advance of
payment of rent, or a measure of Landlord's damages in the case of default by
Tenant.  Without waiving or releasing any liability or obligation of Tenant to
perform under the terms of the Lease, Landlord may from time to time, but only
after a default by Tenant hereunder, beyond applicable notice and cure periods,
without prejudice to or waiving or releasing any of the other remedies, use such
deposit to the extent necessary to offset any arrearages of rent or any other
damages, injury, expense, or liability incurred by Landlord as a result of any
event of default by Tenant.  Upon receipt of notice from the Landlord that the
Security Deposit or any portion of the Security Deposit has been so applied,
Tenant shall pay to Landlord the amount of the Security Deposit so applied in
order to restore the Security Deposit to its original amount.  Within a
reasonable time after termination of the Lease, if Tenant is not then in default
under the terms of the Lease, any remaining balance of the Security Deposit
shall be returned by Landlord to Tenant less amounts necessary to cover any
default by Tenant.

     7.  Use.  The Premises shall be used by Tenant for the Permitted Uses and
         ---                                                                  
related purposes and no other.  The Premises shall not be used for any illegal
purposes, nor shall the Premises be used in violation of any governmental
regulation, in any manner which would be deemed an extra-hazardous use by any
insurance company insuring the Premises or the Building or would otherwise
vitiate or increase the rate of insurance carried by either Landlord or Tenant
on the Premises or the Building unless Tenant agrees to pay such increase.
Tenant shall not do or permit anything to be done in or about the Premises which
would in any way obstruct or interfere with the rights of other tenants of the
Building.  Tenant hereby agrees to comply with any and all municipal, county,
state and federal statutes, regulations, and ordinances, all restrictive
covenants to which the Building is subject, and other legal requirements
applicable or in any way relating to the use and occupancy of the Premises.
Notwithstanding the foregoing provisions, Landlord represents and warrants to
Tenant that the Permitted Uses are allowed in the Premises and on the Project
without any permits, special permits and the like under, or variances from, any
applicable laws, codes, ordinances, by-laws, rules and regulations.

     8.  Alterations by Tenant.  Tenant shall make no alterations, additions or
         ---------------------                                                 
improvements to the Premises without first obtaining the written consent of
Landlord, which consent shall not be unreasonably withheld, conditioned or
delayed.  Tenant shall conduct any permitted work in such a manner as not to
interfere with the operation of the Building or the business of other tenants
and shall, prior to commencement of the work, submit to Landlord copies of all
necessary permits.  Landlord reserves the right to have final approval of the
general contractors hired by Tenant which approval shall not be unreasonably
withheld, conditioned or delayed.  Tenant will refer all general contractors,
contractors representatives and installation technicians rendering any service
on or to the Premises for Tenant, above $5,000 in costs, to Landlord for its
reasonable approval and supervision before performance of any service.  This
provision shall apply to all work performed in the Building, including, but not
limited to, installation of electrical devices and attachments and installations
of any nature affecting floors, walls, woodwork, trim, windows, ceilings,
equipment or any other physical portion of the Building.  All alterations,
additions or improvements, whether temporary or permanent in character, made in
or upon the Premises, either by Landlord or Tenant, shall be Landlord's property
and at the end of the lease Term shall remain in or upon the Premises without
compensation to Tenant provided Landlord has so notified Tenant in writing at
the time Landlord approves Tenant's plans for any such alterations, additions or
improvements.  If, however, Landlord shall request in writing, at the time
Landlord approves Tenant's plans of any such alterations, additions or
improvements, Tenant will, prior to termination of this Lease, remove any and
all alterations, additions and improvements placed or installed by Tenant in the
Premises, and will repair any damage caused by such removal unless Landlord
notifies Tenant prior to the removal that Landlord wants the alterations,
additions or improvements to remain.
<PAGE>
 
     9.  Tenant's Equipment.  Any trade fixtures, equipment and other personal
         ------------------                                                   
property of Tenant not permanently affixed to the Premises ("Personal Property")
shall remain the property of Tenant.  Tenant shall remove all of the Personal
Property from the Premises prior to any expiration or any termination of this
Lease.  Any Personal Property remaining on the Premises after expiration or
termination of this Lease shall be deemed abandoned and may be removed and
disposed of by Landlord, all costs for which shall be paid by Tenant.  Tenant at
its sole expense shall immediately repair any damage occasioned to the Premises
by reason of the installation or removal of any Personal Property.  Tenant
assumes the risk of any and all damage from any casualty whatsoever to, or theft
or any other loss of, its improvements to, and the Personal Property within, the
Premises.

     10.  Maintenance and Repair by Landlord.
          ---------------------------------- 

     a.  Landlord shall, except as provided elsewhere herein and subject to the
negligence of Tenant, its agents or employees, maintain and make necessary
replacements of and repairs to:  (i) the foundation, exterior walls (excluding
windows, window glass, plate glass and doors), roof of the Building, columns and
other structural elements of the Building; (ii) the heating, ventilating, air
conditioning, plumbing, electrical, emergency and other mechanical systems and
equipment serving the Building generally or the Premises in common with other
portions of the Building; (iii) the parking areas on the Project or otherwise
serving the Building; (iv) the driveways and sidewalks necessary for access to
the Building or such parking areas; (v) the loading docks appurtenant to the
Building; and (vi) any other common areas and facilities provided by Landlord
from time to time, all of which maintenance, replacement and repair work
Landlord shall perform as required to keep the Premises, the Building and the
Project in good condition and working order and in compliance with all
applicable laws, ordinances, codes, rules, regulations, orders and permits,
including, without limitation, the Americans with Disabilities Act of 1990 and
the regulations and standards promulgated thereunder unless caused by the act or
omission of Tenant.  Notwithstanding any provisions in this Lease to the
contrary, Landlord shall be solely responsible for making all so-called "capital
improvements" to the Premises, the Building and the Project, including without
limitation all systems located thereon.  When Landlord performs such
maintenance, repair and replacement work, Landlord shall take care not to
unreasonably interfere with Tenant's use of the Premises and shall have such
work performed during off hours, if possible.  Tenant shall promptly report to
Landlord any defective condition in the Premises known to Tenant which Landlord
is required to repair hereunder, and failure to so report shall relieve Landlord
of liability for damages to any personal property, fixtures or Tenant
Improvements located in the Premises resulting from or in connection with such
defective condition.

     b.  Landlord shall maintain the Common Areas.

     c.  Notwithstanding any provisions in this Lease to the contrary, if Tenant
suffers a material adverse effect on its use and occupancy of the Premises for
more than five consecutive days, because of:  (i) Landlord's failure to perform
its obligations under this Section 10:  (ii) unreasonable interference with
Tenant's use of the Premises arising from the Landlord's performance of its
obligations under this Section 10; or (iii) the unavailability of any utility
service provided to the Premises due to Landlord's failure under this Section
10, then Tenant shall be entitled to an equitable abatement of rent, according
to the nature and extent of the effect of such failure, interference and/or
unavailability on Tenant's business operations, for each consecutive day (after
such five-day period) that such material adverse effect continues.  If any such
material adverse effect on Tenant's use or occupancy of the Premises continues
for more than 30 days, Tenant may elect to terminate this Lease by written
notice to Landlord.

     11.  Maintenance and Repair by Tenant.  Tenant shall, at its sole expense,
          --------------------------------                                     
repair, maintain and replace as necessary and keep in good, clean and safe
condition all portions of the Premises which are not, pursuant to Paragraph 5,
10, 15 and 16 hereof, or Landlord's obligations set forth in Exhibit D
(concerning the delivery condition of the Premises and the Base Building Work
and the Landlord's Work as defined therein) specifically the responsibility of
Landlord as set forth herein, including, without limitation, all windows, doors
and partitions, and utility and HVAC systems serving only the Premises as
opposed to the Common Areas or premises leased to other tenants.  Tenant shall
maintain in force at all times a maintenance contract for the HVAC systems in a
form and with a contractor reasonably acceptable to Landlord subject to
Landlord's maintenance, repair and replacement obligations and warranties set
forth elsewhere in this Lease.  A copy of the maintenance agreement shall be
given to Landlord within the first 60 days of 
<PAGE>
 
Tenant's occupancy. Tenant is responsible for all repairs to the mechanical
systems serving only the Premises as opposed to the Common Areas or premises
leased to other tenants. Landlord may, at its option, so long as there is no
added cost to Tenant and without relieving any duty or obligation of Tenant to
perform under the Lease, and after appropriate notice to Tenant, perform any
duty of Tenant under this Section 11 and Tenant shall pay the cost thereof to
Landlord as Additional Rent and shall be subject to any other remedy or right
Landlord may have should the failure to perform constitute a default under the
Lease. Tenant will not injure the Premises, or commit or allow to be committed
any waste therein. Tenant shall repair any damage to the Premises or the
Building caused by Tenant or Tenant's agents, contractors, employees, invitees
and visitors.

     12.  Mechanic's Liens.  Tenant shall keep the Premises, the Building and
          ----------------                                                   
the Parcel free from liens for any work performed, material furnished or
obligations incurred by or for Tenant by causing any such liens to be discharged
or bonded over.  Within twenty (20) days after receiving written notice of its
filing; if not so removed, Landlord may cause same to be discharged and any
amount paid by Landlord shall bear interest at the rate of twelve percent (12%)
per annum from the date of payment by Landlord and shall be payable by Tenant to
Landlord upon demand.

     13.  Insurance.
          --------- 

     a.  Tenant shall obtain and maintain in force throughout the Lease Term
commercial general liability insurance, premises and operations insurance in the
amount of not less than $1,000,000.00 for any one injury (including death) and
not less than $2,000,000.00 for any bodily injury (including death) annual
aggregate and not less than $2,000,000.00 for property damage.  Said policy
shall list the Landlord as an additional insured and shall contain a provision
requiring the insurer to give Landlord at least thirty (30) calendar days prior
written notice before any termination or expiration of said policy for any
reason.  Prior to occupancy of the Premises and prior to the expiration of each
term on such policy Tenant shall deliver to Landlord the original of such policy
or a proper certificate from the insurer.

     b.  Tenant shall, at its own cost and expense, obtain and keep in force
during the Lease term all risk coverage on its improvements (except Landlord's
Work and Base Building Work, which shall be insured by Landlord, as set forth in
sub-paragraph d. below), fixtures, furnishings, equipment and inventory in and
upon the Premises for the full replacement value thereof.

     c.  Tenant understands that Landlord may furnish the Insurance
Questionnaire attached hereto as Exhibit "C" and made a part hereof to
Landlord's insurance carrier.  Landlord's execution hereof shall not constitute
acknowledgment, approval or the acceptance of responsibility for the materials
and conditions stated therein, nor vitiate any of Tenant's obligations
hereunder.  Tenant shall promptly notify Landlord of any change to the truth or
accuracy of the information contained therein promptly upon learning of same.
The operation by Tenant of its business on the Premises other than in accordance
with the information contained in the Insurance Questionnaire, as may be amended
from time to time with Landlord's prior written consent, shall be a default
hereunder which Tenant may cure as set forth in Section 20(ii) hereof.  If any
information contained in the Insurance Questionnaire is or becomes false or
inaccurate, or if a use not revealed by Tenant in the Insurance Questionnaire
causes Landlord's insurance costs to increase, Tenant shall be liable to
Landlord for any such increase in insurance cost arising from or in connection
therewith and shall be deemed to be in default under the Lease which Tenant may
cure as set forth in Section 20(a)(ii) hereof.

     d.  Landlord's Insurance.  During the Lease Term, Landlord shall secure and
         --------------------                                                   
carry (a) a policy of commercial general liability insurance covering Landlord
on an amount not less than $2,000,000.00 based on bodily injury (including
death), personal injury and property damage relating to the Building and the
Project; and (b) a policy of insurance covering the Building, Common Areas,
Landlord's Work (as defined in Exhibit "D") and all other improvements now or
hereafter located on the Project for direct risk of physical loss, in an amount
equal to the full replacement cost thereof.  If Landlord carries any such
insurance as part of a blanket policy, such policy shall include an endorsement
that the aggregate limit of such policy shall not be reduced below the minimum
limit required under this Lease due to claims relating to other properties.
<PAGE>
 
     14.  Waiver of Subrogation.  All policies of casualty insurance obtained by
          ---------------------                                                 
Landlord or Tenant with respect to the Premises, the Building, or the contents
thereof shall contain a waiver by the insurer of all right of subrogation in
connection with any loss or damage insured against by such policy.  Landlord and
Tenant, to the fullest extent permitted by law, each waive all right of recovery
against the other for, and agree to hold the other harmless from liability, for
all losses or damages to the extent of insurance proceeds actually available or
that would have been available (if such policies are not obtained in accordance
with the provisions hereof under policies required hereby.  If such waiver of
subrogation shall not be obtainable or shall be obtainable only at a premium
over that charged without such waiver, the party seeking such waiver shall so
notify the other in writing, and the latter party shall have ten (10) days in
which either (i) to procure on behalf and at the cost of the notifying party
insurance with such waiver from a company or companies reasonably satisfactory
to the notifying party or (ii) to agree to pay such additional premium (in each
case, in equitable proportions, if permitted by the insurer).

     15.  Casualty.  If the Premises or any portion thereof are damaged by fire
          --------                                                             
or other casualty or the elements to the extent that, in the reasonable judgment
of a duly licensed architect or engineer selected by the Landlord, the damage
cannot be repaired within one hundred eighty (180) days, or if the Building is
so damaged in the good faith opinion of such architect or engineer the Building
must be demolished, and rebuilt or reconstructed, this Lease shall, at the
option of Landlord or Tenant, terminate as of the date of such casualty, and
Tenant shall immediately surrender the Premises to Landlord and pay Rent up to
the date of such surrender and any prepaid Rent shall be refunded.  Landlord
shall promptly provide Tenant with written notice of its architect's or
engineer's determination.  If this Lease is not so terminated, Landlord shall,
within a reasonable time but no more than 180 days after such fire or casualty
to rebuild or repair the Premises to substantially the same condition in which
they existed prior to such damage; provided, however, Landlord's obligation
hereunder shall be limited to the insurance proceeds available, and paid, to
Landlord on account of such damage and to improvements initially constructed at
Landlord's cost.  Notwithstanding any provision in this Lease to the contrary,
if such repairs are not completed within such 180 day period subject to the
force majeure provisions hereof, then Tenant may terminate this Lease by
delivering written notice to Landlord at any time before such repairs are
complete.  All such repairs shall be made in compliance with all applicable
laws, codes, ordinances, rules, regulations, orders and permits, including, but
not limited to, the American with Disabilities Act of 1990 and the regulations
and standards promulgated thereunder and using materials of like kind and
quality as were used in the Building and/or the Premises immediately prior to
such damage.  Promptly upon completion of Landlord's repairs, Tenant shall
repair and replace all other alterations and improvements installed in the
Premises by or for Tenant, excluding Base Building Work and Landlord's Work, and
the Personal Property of Tenant.  After any casualty to the Premises, Tenant
shall continue to owe and pay Rent, but, subject to the next succeeding
sentence, Rent shall be equitably abated until the earlier of the date
possession of the entire reconstructed Premises is restored to Tenant or the
Lease terminates.  If the Premises or any other portion of the Building is
damaged by fire or other casualty resulting from the negligent or willful acts
or omissions of Tenant or any of Tenant's agents, contractors, employees, or
invitees, the Rent shall not be so abated.  Landlord shall not be liable to
Tenant for inconvenience, annoyance, loss of profits, expenses or other type of
injury or damage resulting from the repair of any such damage, or any delay in
making such repairs, or for the termination of this Lease as herein provided.
Landlord may terminate this Lease upon any damage or destruction to the Premises
which cannot be repaired within such 180 day period occurring during the final
one (1) year of the Lease Term.

     16.  Condemnation.
          ------------ 

     a.  In the event of a taking of all of the Premises, or such portion
thereof as to substantially impair the use thereof in the reasonable judgment of
Landlord and Tenant, then this Lease shall automatically terminate on, and all
Rent payable by Tenant shall be apportioned and paid through, the date of such
taking.  Tenant shall have no right or claim to any part of any award made to or
received by Landlord for such taking, it being understood, however, that
Landlord does not reserve to itself, and Tenant does not assign to Landlord, any
damages payable for (i) Personal Property, as defined in Section 9 of this
Lease, or (ii) relocation expenses recoverable by the Tenant.
<PAGE>
 
     b.  In the event of a partial taking for which this Lease is not
terminated, the Rent hereunder shall be equitably reduced, and Landlord shall
restore and reconstruct the Premises (to the extent of the improvements
initially constructed at Landlord's cost, including Landlord's Work to the
extent necessary to make it usable by Tenant for the Permitted Uses, but
Landlord shall not be required to spend for such work an amount in excess of the
amount received by Landlord for such restoration.

     17.  Indemnity.
          --------- 

     Tenant shall indemnify and hold harmless Landlord and Landlord's partners,
officers, employees and agents from and against any and all liabilities,
damages, losses, and expenses (including attorney's fees) arising in whole or in
part by reason of or in connection with:

     (i) any injury to or death of persons or damage to property (a) in or on
     the Premises, or; in or on the Building or the Project, but only to the
     extent arising out of the negligence or willful misconduct of Tenant or its
     partners, officers, employees, agents, licensees or contractors or (b) in
     any manner arising out of, by reason of or in connection with, the use,
     nonuse or occupancy of the Premises;

     (ii)  the violation or breach of, or the failure of Tenant to fully and
     completely observe and satisfy, any term or condition of this Lease; or

     (iii)  the violation by Tenant of any law affecting the Premises or the use
     or occupancy thereof.

     This contract provision notwithstanding, Tenant shall in no way be liable
to Landlord for any of the foregoing proximately caused by gross negligence or
willful malfeasance or misconduct of Landlord, its employees, partners,
officers, agents, licensees or contractors.

     Landlord shall indemnify, defend and hold harmless Tenant from all
liabilities, damages, losses and expenses (including attorney's fees) arising in
whole or in part by reason of any death, personal injury or damage to property
occurring in or on the Building (other than the Premises) the Common Areas, or
on the Project, but only to the extent arising out of the negligence or willful
misconduct of Landlord, or its partners, officers, employees, agents, licensees
or contractors.

     18.  Subletting and Assignment.
          ------------------------- 

     a.  Tenant shall not assign this Lease or sublet the Premises or any
portion thereof without obtaining in each instance the prior written consent of
Landlord.  Landlord's consent to Tenant's request to an assignment or sublease
shall not be unreasonably withheld, conditioned or delayed; provided, however,
in determining whether or not to give or withhold its approval of any proposed
assignee or sublessee hereunder, Landlord shall be entitled to consider, without
limitation, the impact of such assignee or sublessee and its business on the
image of the Project, and whether or not such assignee or sublessee will
favorably coexist and mix with and not detract from the character and quality of
the Project.

     b.  If Tenant should desire to assign this Lease or sublet the Premises or
any part thereof, Tenant shall make prior written request to Landlord, which
request shall specify (i) the name and business of the proposed assignee or
sublessee, (ii) the size and location of the space affected, (iii) the proposed
effective date and duration of the assignment or sublease and (iv) the proposed
rental or other consideration to be paid to Tenant by such sublessee.  Landlord
shall have a period of fifteen (15) days following receipt of such notice with
which to notify Tenant of its decision regarding the proposed assignment or
sublease.  Tenant agrees to reimburse Landlord for Landlord's reasonable
attorney's fees and costs incurred in connection with the processing and
documentation of any request made pursuant to this section, not to exceed
$1,000.00.

     c.  The occupancy of the Premises by any division, subsidiary, affiliate or
other related entity of Tenant or by any successor firm of Tenant or by any firm
into which or with which Tenant may become merged or consolidated or which
acquires all or substantially all of Tenant's assets shall not be deemed an
assignment of this Lease and shall not require the prior written 
<PAGE>
 
consent of Landlord in accordance with this section; provided however said
assignee shall have a net worth greater than or equal to Tenant's and the
permitted uses shall remain the same.

     d.  Any consent to subletting or assignment shall not be deemed a waiver of
Landlord's right to withhold its consent to any further subletting or
assignment.  Notwithstanding any permitted subletting or assignment, Tenant
shall remain obligated to Landlord to discharge all the obligations of Tenant
herein contained and Landlord shall be afforded all remedies provided hereunder
in the event of an uncured default by Tenant.  In the event of any assignment of
the Lease or any subletting of the Premises by Tenant, permitted by Landlord
under subparagraphs (a) and (b) above, in addition to Tenant's other obligations
hereunder, Tenant shall pay to Landlord 50% of the excess, if any, of (i) the
rentals and all other charges or consideration of any nature actually received
by Tenant from Tenant's assignee or subtenant under the terms and provisions of
such assignment or sublease or in any manner connected therewith at the time
such rentals and other charges are paid thereunder, over (ii) the total Rent
paid by Tenant to Landlord hereunder, pro-rated based upon the number of square
feet assigned or subleased, in the case of an assignment or a sublease of a
portion, but not all, of the Premises less broker's commissions, leasehold
improvements and other out of pocket expenses incurred by Tenant.

     19.  Subordination.
          ------------- 

     a.  Landlord represents that there is currently no Mortgagee (hereinafter
defined).  Landlord shall cause the holder of any Mortgage (as herein defined)
to provide Tenant a written agreement under which the holder of any Mortgage (a
"Mortgagee") agrees, in the event of a foreclosure or other exercise of rights
under such Mortgage, not to disturb Tenant's occupancy of the Premises, to
recognize Tenant's rights under this Lease and to assume Landlord's obligations
under this Lease (a "Non-Disturbance Agreement"), and Tenant shall agree in such
a Non-Disturbance Agreement that this Lease is, and shall be, subordinate to any
mortgage or deed to secure debt ("Mortgage") which might now or hereafter
constitute a lien upon the Building or the Parcel.  Notwithstanding the
foregoing, however, any holder of a Mortgage may elect that this Lease shall be
superior to its Mortgage, and upon written notification of such election this
Lease shall automatically be superior to said Mortgage whether this Lease is
dated prior to or subsequent to the date of the Mortgage.

     b.  Upon any assignment of this Lease by Landlord, or upon a foreclosure of
any Mortgage or sale in lieu of foreclosure and at the election of the purchaser
at such foreclosure sale or sale in lieu of foreclosure (provided said purchaser
has executed a Non-Disturbance Agreement), Tenant shall be bound to said
assignee or any such purchaser under all of the terms, covenants and conditions
of this Lease for the balance of the Lease Term.  Tenant hereby attorns to such
succeeding party as its landlord under this Lease, and agrees to execute all
instruments required by such purchaser affirming such adornment (provided said
purchaser has executed a Non-Disturbance Agreement).

     20.  Defaults.  Tenant shall be in default under this Lease upon the
          --------                                                       
occurrence of any one or more of the following events or occurrences, each of
which shall be deemed to be a material default:

     (i) Tenant fails to pay the full amount of Rent or any other sum due
     hereunder punctually on the due date thereof, which failure is not cured
     within ten (10) days after written demand by Landlord.

     (ii) Tenant fails to fully and punctually observe or perform any of the
     terms, conditions or covenants of this Lease, which failure is not cured
     within thirty (30) days after written demand by Landlord; provided, that if
     such failure cannot reasonably be cured within such thirty-day period and
     Tenant is diligently pursuing such cure, Tenant shall have an additional
     period, as reasonably determined by Landlord to exceed thirty (30) days to
     cure such failure but in no event 120 days from the date of such failure.

     (iii)  Tenant fails to take possession or occupancy of, the Premises.

     (iv) Any material representation, statement, or warranty made by Tenant, in
     this Lease, or in any information sheet or document furnished by Tenant
     with respect to the net 
<PAGE>
 
     worth, liabilities, assets, or financial condition of Tenant or any other
     matter, shall be or prove to be untrue or misleading.

     (v) The filing or execution or occurrence of:  (aa) a petition by or
     against Tenant or any guarantor hereof in bankruptcy or seeking any
     reorganization, arrangement, composition, readjustment, liquidation,
     dissolution or similar relief under any bankruptcy or insolvency statute or
     law, provided that if Tenant caused any such petition filed against Tenant
     to be discharged within sixty (60) days after its filing, such filing shall
     not be deemed a default hereunder, (bb) adjudication of Tenant or any
     guarantor hereof as a bankrupt or insolvent, or insolvency in the
     bankruptcy or equity sense, (cc) an assignment by Tenant or any guarantor
     hereof for the benefit or creditors, (dd) a petition or proceeding by or
     against Tenant or any guarantor hereof for, or the appointment of a
     trustee, receiver, guardian, conservator or liquidator with respect to any
     portion of Tenant's or guarantor's property, or (ee) any attachment against
     Tenant's leasehold interests hereunder, or (ff) any transfer or passage of
     any interest of Tenant under this Lease by operation of law.

     (vi) Tenant fails to fully and punctually observe or perform any of the
     terms, conditions or covenants of this Lease, for which Tenant has already
     received two (2) written notices and effected cure within the preceding
     six months.

     21.  Remedies.
          -------- 

     a.  Upon occurrence of any one or more of the aforesaid events of default,
Landlord shall have the option to pursue any one or more of the following
remedies without any demand or notice whatsoever (except as expressly provided
in this Lease):

     (i) Terminate this Lease by giving Tenant notice of termination, in which
     event this Lease shall expire and terminate on the date specified in such
     notice of termination, and Tenant shall remain liable for all obligations
     under this Lease arising up to the date of such termination, and Tenant
     shall surrender the Premises to Landlord on the date specified in such
     notice.

     (ii) Terminate this Lease as provided in subparagraph (a) (i) hereof and
     recover from Tenant all obligations arising up to the date of such
     termination and all damages Landlord may incur by reason of Tenant's
     default, including, without limitation, a sum which, at the date of such
     termination represents the present value (discounted at a rate equal to the
     greater of eight percent (8%) per annum or the then applicable rate of
     interest as specified in the financing outstanding on the Project) of the
     excess, if any, of (aa) the Rent and all other sums which would have been
     payable hereunder by Tenant for the period commencing with the day
     following the date of such termination and ending with the date
     hereinbefore set for the expiration of the full term hereby granted,
     excluding any extension periods not in effect at the time of any such
     default, over (bb) the aggregate reasonable rental value of the Premises
     for the same period, all of which present value of such excess sum shall be
     deemed immediately due and payable; provided, however, that such sum shall
     not be deemed a penalty or forfeiture, actual damages being difficult or
     impossible to measure, and such sum represents the parties' reasonable best
     estimate of the damages which would be incurred by Landlord in the event of
     a breach by Tenant.

     (iii)  Without terminating this Lease, declare immediately due and payable
     all Rent and other amounts due and coming due under this Lease for the
     entire remaining Term hereof, excluding any extension periods not in effect
     at the time of any such default, together with all other amounts previously
     due, at once, which total amount shall be discounted to the present value
     (at a rate equal to the greater of eight percent (8%) per annum or the then
     applicable rate of interest specified in the financing outstanding on the
     Project); provided, however, that such payment shall not be deemed a
     penalty or liquidated damages but shall merely constitute payment in
     advance for Rent for the remainder of said Term.  Upon making such payment,
     Tenant shall be entitled to receive from Landlord all rents received by
     Landlord from other assignees, tenants, and subtenants on account of said
     Premises during the Term of this Lease provided that the monies to which
     Tenant shall so become entitled shall in no event exceed the entire amount
     actually paid by Tenant to Landlord pursuant to the preceding sentence less
     all costs, including 
<PAGE>
 
     refurbishing the Premises and new lease commissions, expenses and
     reasonable attorney's fees of Landlord incurred in connection with the
     reletting of the Premises.

     (iv) After terminating this Lease, and with notice to Tenant, Landlord may
     in Landlord's own name, but as agent for Tenant, enter into and upon and
     take possession of the Premises or any part thereof, and, at Landlord's
     option, remove persons and property therefrom, and such property, if any,
     may be removed and stored in a warehouse or elsewhere at the cost of, and
     for the account of, Tenant, all without being deemed guilty of trespass or
     becoming liable for any loss or damage which may be occasioned thereby, and
     Landlord may rent the Premises or any portion thereof as the agent of
     Tenant with or without advertisement, and by private negotiations and for
     any term upon such terms and conditions as Landlord may deem necessary or
     desirable in order to relet the Premises.  Landlord shall in no way be
     responsible or liable for any part thereof, or for any failure to collect
     any rent due upon such reletting.  Upon each such reletting, all rentals
     received by Landlord from such reletting shall be applied:  first, to the
     payment of any indebtedness (other than any Rent due hereunder) from Tenant
     to Landlord; second, to the payment of any costs and expenses of such
     reletting, including without limitation, brokerage fees and attorneys' fees
     and costs of alterations and repairs; third, to the payment of Rent and
     other charges then due and unpaid hereunder; and the residue, if any, shall
     be held by Landlord to the extent and for application in payment of future
     Rent as the same may become due and payable hereunder.  If the rentals
     received from such reletting shall at any time or from time to time be less
     than sufficient to pay to Landlord the entire sums then due from Tenant
     hereunder, Tenant shall pay any such deficiency to Landlord.  Such
     deficiency shall, at Landlord's option, be calculated and paid monthly.

     (v) Pursue such other remedies as are available at law or in equity.
     Notwithstanding the foregoing, Landlord hereby waives any and all liens,
     interests and/or security interests Landlord now has or hereafter may have,
     whether statutory or otherwise on and/or in Tenant's equipment, trade
     fixtures, inventory and/or other tangible and intangible personal property.

     b.  Landlord's pursuit of any remedy or remedies, including, without
limitation, any one or more of the remedies stated in the foregoing subparagraph
(a), shall not (i) constitute an election of remedies provided in this Lease or
any other remedy or remedies provided by law or in equity, separately or
concurrently or in any combination, or (ii) serve as the basis for any claim of
actual or constructive eviction, or allow Tenant to withhold any payments under
this Lease.

     c.  No termination of this Lease prior to the normal expiration thereof, by
lapse of time or otherwise, shall affect Landlord's right to collect Rent for
the period prior to termination thereof.  No surrender of the Premises or any
part thereof by delivery of keys or otherwise shall operate to terminate this
Lease unless and until expressly accepted in writing by an authorized officer of
Landlord.

     d.  The foregoing provisions shall apply to any renewal or extension of
this Lease.

     22.  Notice to Mortgagee.  Prior to the exercise by Tenant of any remedy
          -------------------                                                
afforded for Landlord's default hereunder, Tenant shall give the holder of any
Mortgage written notification of such default by Landlord and thirty (30) days
within which to cure the same; provided, Tenant's obligation hereunder is
limited to those Mortgage holders of which it has received written notice.

     23.  Hazardous Substances.  Tenant represents and warrants that it will
          --------------------                                              
not, on or about the Premises, make, store, use, treat, transport or dispose of
any hazardous or toxic waste, contaminants, oil, explosives, gasoline, kerosene,
oil, acids, caustics or any other flammable, explosive or radioactive or other
materials removal of which is required or the maintenance of which is
prohibited, regulated (unless such regulations are adhered to and Landlord is
notified thereof) or penalized by any local, state or federal agency, authority
or governmental unit.
<PAGE>
 
     24.  Signage.  Tenant shall not install or maintain any signs visible from
          -------                                                              
outside the Premises except in accordance with the Rules and Regulations.
Tenant may attach one sign, subject to Landlord's sign specifications, to the
outside of the Building, identifying its business in the area designated by
Landlord.  Tenant shall be responsible to Landlord for any damage caused by the
installation, use or removal of any sign.

     25.  Attorney's Fees.  In the event that litigation results from an attempt
          ---------------                                                       
by either party hereto to enforce its rights under this Lease, the prevailing
party in such litigation shall be entitled to reimbursement by the non-
prevailing party for any and all reasonable attorneys' fees, and expenses
incurred in connection with such enforcement.  Provided, further, in the event
that Landlord utilizes services of an attorney to collect rent due and payable
hereunder Landlord shall be entitled to collect from Tenant reasonable
attorney's fees, in connection therewith.  Additionally, Tenant agrees to
reimburse Landlord for any and all reasonable costs and expenses (including
attorneys' fees) which Landlord may incur or pay in connection with negotiations
in which Landlord shall become involved through or on account of the Lease or in
connection with any request by Tenant for review or approval by Landlord,
provided, however, that this obligation shall not apply to any negotiations
between Landlord and Tenant respecting this agreement any amendments,
modifications, or renewals thereof.

     26.  Time of Essence.  Time is of the essence of this Lease.
          ---------------                                        

     27.  Landlord and Tenant Relationship.  This Lease shall create the
          --------------------------------                              
relationship of landlord and tenant between Landlord and Tenant; no estate shall
pass out of Landlord; and Tenant has only a usufruct not subject to levy and
sale.

     28.  Sale by Landlord.  In the event of any sale, conveyance, transfer or
          ----------------                                                    
assignment by Landlord of its interest in and to the Premises, all obligations
and liabilities under this Lease of the party so selling, conveying,
transferring or assigning the Premises arising after the date of such
disposition shall terminate, subject to the following sentence.  Tenant shall,
thereafter look only and solely to the party to whom or which the Premises were
sold, conveyed, transferred, or assigned for performance of all of Landlord's
duties and obligations under this Lease, including the return of any Security
Deposit, provided Tenant has received written confirmation from Landlord and any
such purchaser, transferee or assignee that the Security Deposit has been
transferred to such purchaser, transferee or assignee and will be held in
accordance with the terms of this Lease.

     29.  Surrender of the Premises.  At the termination of this Lease, Tenant
          -------------------------                                           
shall surrender the Premises and keys thereof to Landlord in at least as good a
condition as on the Commencement Date, excepting only ordinary wear and tear and
damage arising from any cause not required to be repaired by Tenant.

     30.  Parties.  "Landlord" as used in this Lease shall include Landlord's
          -------                                                            
assigns and successors in title to the Premises.  "Tenant" shall include Tenant
and, if this Lease shall be validly assigned or the Premises sublet, shall
include such assignee or subtenant, its successors and permitted assigns.
"Landlord" and "Tenant" shall include male and female, singular and plural,
corporation, partnership or individual, as may fit the particular parties.

     31.  Estoppel Certificate.  At any time and from time to time, Tenant,
          --------------------                                             
within ten (10) days of written request therefore, shall execute, acknowledge
and deliver to Landlord a certificate evidencing whether or not (i) this Lease
is in full force and effect; (ii) this Lease has been amended in any way; (iii)
there are any existing defaults on the part of Landlord hereunder, to the
knowledge of Tenant, and specifying the nature of such defaults, if any; (iv)
the date to which Rent and other amounts due hereunder, if any, have been paid;
and (v) such other matters reasonably requested by Landlord.  Each certificate
delivered pursuant to this paragraph may be relied on by any prospective
purchaser of the Building or transferee of Landlord's interest hereunder or by
any holder or prospective holder of any mortgage instrument or deed to secure
debt now or hereafter encumbering the Building.  Tenant's failure to deliver
such statement, in addition to being a default hereunder, shall be deemed to
establish conclusively that this Lease is in full force and effect except as
declared by Landlord, that Landlord is not in default of any of its obligations
under this Lease, and that Landlord has not received more than one month's rent
in advance.
<PAGE>
 
     32.  Successors and Assigns.  The provisions of this Lease shall inure to
          ----------------------                                              
the benefit of and be binding upon Landlord and Tenant and their respective
successors, heirs, legal representatives and assigns, subject, however, in the
case of Tenant, to the restrictions on assignment and subletting contained in
this Lease.

     33.  Limitation of Liability.  Landlord's obligations and liability to
          -----------------------                                          
Tenant with respect to this Lease shall be limited solely to Landlord's interest
in the Project, and neither Landlord, nor any joint venturer, partner, officer,
director or shareholder of Landlord or any of the joint venturers of Landlord
shall have any personal liability whatsoever with respect to this Lease.

     34.  Rules and Regulations.  Tenant accepts the Premises subject to and
          ---------------------                                             
hereby agrees with Landlord to abide by the Rules and Regulations attached to
this Lease and incorporated herein by reference, together with such additional
Rules and Regulations or amendments thereto as may hereafter from time to time
be reasonably established by Landlord, and such additions or amendments shall be
binding on Tenant upon receipt of same by Tenant, provided Landlord enforces
such Rules and Regulations and any amendments thereto uniformly against all
tenants of the Building.

     35.  Right of Entry.  Landlord shall have the right, but not the
          --------------                                             
obligation, to enter the Premises at reasonable hours and upon reasonable
advance notice, except in the case of emergency where no notice is required, to
exhibit same to prospective purchasers or tenants, but only during the last six
(6) months of the Lease Term; to inspect the Premises to see that Tenant is
complying with all Tenant's obligations hereunder; and to make repairs required
of Landlord under the terms of this Lease or repairs or modifications to any
adjoining space.

     36.  Notices.  Any notice required or permitted to be given hereunder shall
          -------                                                               
be in writing and either personally delivered, sent by U.S. Certified or
Registered Mail, return receipt requested, postage prepaid, or sent by Federal
Express, or any similar service, to the party being given such notice at the
following addresses:

     LANDLORD:      Highwoods/Forsyth Limited Partnership
                    2200 Century Parkway, Suite 800
                    Atlanta, Georgia 30345
                    Attn.: Chet Koenig

     WITH A
     COPY TO:       Elrod & Thompson, P.C.
                    225 Peachtree Street, Suite 1500
                    Atlanta, Georgia 30303
                    Attn.:  Kenneth M. Weiss, Esq.

     TENANT:        ACT Manufacturing, Inc.
                    2000 Newpoint Place Parkway, Suite 600
                    Lawrenceville, GA 30043

     WITH A
     COPY TO:       ACT Manufacturing, Inc.
                    108 Forest Avenue
                    Hudson, MA 01749-2892
                    Attn.: Douglass C. Greenlaw

     COURTESY
     COPY TO:       Testa, Hurwitz & Thibeault, LLP
                    High Street Tower
                    125 High Street
                    Boston, MA  02110
                    Attn:  Real Estate Dept.

The time period in which a response to any notice, demand or request must be
given, if any shall commence to run from the date of receipt of the notice,
demand or request by the addressee 
<PAGE>
 
thereof as evidenced by written proof of receipt issued by such courier service.
Rejection or failure to claim delivery of any such notice, demand or request, or
the inability to deliver because of changed address of which no notice was
given, shall be deemed to be receipt of the notice, demand or request as of the
date of deposit in the United States Mail or the date of attempted personal
delivery, as the case may be. By giving at least thirty (30) days written notice
thereof, any party shall have the right from time to time and at any time to
change their respective addresses.

     37.  Holding Over.  If Tenant remains in possession of the Premises after 
          ------------ 
expiration of the Lease Term, without Landlord's acquiescence and without any
distinct agreement of the parties, Tenant shall be a tenant at will at a rental
rate equal to one and a half times the rate in effect at the end of this Lease
(in addition to all Additional Rent). There shall be no renewal of the Lease by
operation of law.

     38.  Miscellaneous.  This Lease contains the entire agreement of Landlord 
          ------------- 
and Tenant and no representations or agreements, oral or otherwise, between the
parties not embodied herein shall be of any force or effect. No failure of
Landlord or Tenant to exercise any power given Landlord or Tenant hereunder, or
to insist upon strict compliance by Landlord or Tenant of any obligation
hereunder, and no custom or practice of the parties at variance with the terms
hereof, shall constitute a waiver of Landlord's or Tenant's right to exercise
any right hereunder or demand exact compliance with the terms hereof. If any
clause or provision of this Lease is illegal, invalid or unenforceable under
applicable present or future laws or regulations effective during the term of
this Lease, the remainder of this Lease shall not be affected. In lieu of each
clause or provision of this Lease which is illegal, invalid or unenforceable,
there shall be added as a part of this Lease a clause or provision as nearly
identical as may be possible and as may be legal, valid and enforceable. This
Lease shall be governed by, construed under and interpreted and enforced in
accordance with the laws of the State of Georgia. Neither this Lease, nor any
memorandum of this Lease or reference hereto, shall be recorded by Tenant
without Landlord's consent endorsed thereon. Landlord and Tenant shall be
excused from the performance of any of its obligations under this Lease except
the payment of Rent hereunder for the period of any delay resulting from any
cause beyond its control, including, without limitation, all labor disputes,
governmental regulations or controls, fires or other casualties, inability to
obtain any material or services or acts of God.

     39.  Disclaimer.  Tenant has made its own independent inspection and
          ---------- 
review of the Premises and the terms and conditions of this Lease and
acknowledges and agrees that Tenant has not, in any way, relied upon any
brochure, literature, representation, guaranty or warranty (whether express or
implied, oral or written) made by Landlord or any agent or representative or
employee or attorney on behalf of Landlord in connection with any aspect of the
Premises or the Project or the terms and conditions of the Lease, except as set
forth in this Lease.

     40.  Special Stipulations.  In the event any Special Stipulations are
          --------------------                                        
attached to this Lease the terms thereof shall control in the event of a
conflict between the provisions of this Lease and the provisions thereof.
<PAGE>
 
IN WITNESS WHEREOF, the parties hereto have caused this Lease to be executed,
under seal, in their respective names and on their behalf by their duly
authorized officials, the day and year indicated below.


                            "LANDLORD"

                            HIGHWOODS/FORSYTH LIMITED PARTNERSHIP

                            By:  Highwoods Properties, Inc., general partner

                            By: /s/ Gene Anderson
                               -----------------------------------
                                 5-26-98
                            --------------------------------------
                            Date Executed by Landlord

                            (CORPORATE SEAL)

                            "TENANT"

                            ACT MANUFACTURING, INC.
                            -----------------------

                            By: /s/ John A. Pino
                               ------------------------------------
                            Its:  President
                                -----------------------------------
                            Attest: /s/ Douglass C. Greenlaw
                                   --------------------------------
                            Its:  CFO/VP Finance
                                -----------------------------------
                                  Secretary/Clerk
                            ---------------------------------------
                            Date Executed by Tenant

                               (CORPORATE SEAL)
<PAGE>
 
                             RULES AND REGULATIONS
                             ---------------------

  Sign Display.  Tenant will provide its own signage for the Premises.  Such
  ------------                                                              
signage will be coordinated throughout the park for uniformity and
attractiveness.  No sign, tag, label, picture, advertisement or notice shall be
displayed, distributed, inscribed, painted or affixed by Tenant on any part of
the outside or inside of the Building or of the Premises without the prior
written consent of Landlord.  All permitted signage shall be maintained in
compliance with applicable governmental rules and regulations, and all
restrictive covenants, governing such signs.  Tenant shall be responsible for
any damage caused by the installation, use or removal of any sign.  Landlord may
require Tenant to remove all signage at the termination of the Lease and to
repair any damage occasioned by such removal.

  Drives and Parking Areas.  All parking shall be within the Parcel boundaries
  ------------------------                                                    
and within marked parking spaces as shown on Exhibit "A." There shall be no on-
street parking and at no time shall any Tenant obstruct drives and loading areas
intended for the use of all Tenants.  The drives and parking areas are for the
joint and nonexclusive use of Landlord's tenants, and their agents, customers
and invitees, unless specifically marked.  In the event Tenant, its agents,
customers, and/or invitees use a disproportionate portion of the parking,
Landlord shall have the right to restrict Tenant, its agents, customers and/or
invitees to certain parking areas.  Tenant shall not permit any fleet trucks to
park overnight in the Building's parking areas.

  Storage.  Unless specifically approved by Landlord in writing, no materials,
  -------                                                                     
supplies or equipment shall be stored anywhere except inside the Premises.  In
no event shall Tenant cause or allow any outside storage of trash, refuse or
debris, whether in the area of the dumpster or otherwise.

  Lodging.  No Tenant shall at any time occupy any part of the Building as
  -------                                                                 
sleeping or lodging quarters.

  Regulation of Operation and Use.  Tenant shall not place, install or operate
  -------------------------------                                             
on the Premises or in any part of Building, any engine, stove or machinery, or
cook thereon or therein except a microwave oven.

  Window Coverings.  Windows facing the Building exterior shall at all times be
  ----------------                                                             
wholly clear and uncovered (except for such blinds or curtains or other window
coverings Landlord may provide or reasonably approve) so that a full
unobstructed view of the interior of the Premises may be had from outside the
Building.

  Modifications.  Landlord shall have the right from time to time to modify, add
  -------------                                                                 
to or delete any of these Rules and Regulations at Landlord's sole discretion so
long as they are uniformly enforced against all tenants.
<PAGE>
 
                              SPECIAL STIPULATIONS
                              --------------------


RENTAL SCHEDULE
---------------

The following schedule is the Base Rent payable per Paragraph 3a. of this lease:
                                                              ---               

     Beginning September 1, 1998 through September 30, 1999, the monthly sum of
     twenty three thousand four hundred nineteen and 88/100 Dollars ($23,419.88)
     for a total annual base rental of two hundred eighty one thousand thirty
     eight and 50/100 Dollars ($281,038.50).
                              ------------- 

     Beginning October 1, 1999 through September 30, 2000, the monthly sum of
     twenty four thousand one hundred twenty two and 47/100 Dollars ($24,122.47)
     for a total annual base rental of two hundred eighty nine thousand four
     hundred sixty nine and 66/100 Dollars ($289,469.66).

     Beginning October 1, 2000 through September 30, 2001, the monthly sum of
     twenty four thousand eight hundred forty six and 15/100 Dollars
     ($24,846.15) for a total annual base rental of two hundred ninety eight
     thousand one hundred fifty three and 75/100 Dollars ($298,153.75).

     Beginning October 1, 2001 through September 30, 2002, the monthly sum of
     twenty five thousand five hundred ninety one and 53/100 Dollars
     ($25,591.53) for a total annual base rental of three hundred seven thousand
     ninety eight and 36/100 Dollars ($307,098.36).

     Beginning October 1, 2002 through September 30, 2003, the monthly sum of
     twenty six thousand fifty nine and 28/100 Dollars ($26,359.28) for a total
     annual base rental of three hundred sixteen thousand three hundred eleven
     and 31/100 Dollars (316,311.31).

     Beginning October 1, 2003 through September 30, 2004, the monthly sum of
     twenty seven thousand one hundred fifty and 05/100 Dollars ($27,150.05) for
     a total annual base rental of three hundred twenty five thousand eight
     hundred and 65/100 Dollars ($325,800.65).
                                ------------- 

     Beginning October 1, 2004 through September 30, 2005, the monthly sum of
     twenty seven thousand nine hundred sixty four and 56/100 Dollars
     ($27,964.56) for a total annual base rental of three hundred thirty five
     thousand five hundred seventy four and 67/100 Dollars (335,574.67).

Tenant's obligation to pay Base Rent as set forth above shall be subject to the
following credits:

a.   Tenant shall receive a credit against the payment of Base Rent in the form
     of rent abatement applied to the Base Rent starting in the first calendar
     month (or the first partial calendar month) and continuing each month
     thereafter, to reduce the respective month's actual Base Rent until reduced
     in full, equal in the aggregate as hereafter set forth to the amount of
     holdover rent Tenant is obligated to pay St. Paul Properties, Inc.,
     pursuant to that certain Lease signed by the parties thereto on May 15,
     1992 and April 10, 1992, by and between Tenant, as assignee, and St. Paul
     Properties, Inc., successor in title to Metropolitan Life Insurance
     Company, as landlord for premises located at Northeast Parkway, Norcross,
     Georgia, as amended ("Current Lease"), that exceeds the base rent payable
     thereunder which amount equals $15,237.50 ("Holdover Rent Credit").  The
     calculation of said credit shall commence August 1, 1998, subject to
     adjustment as set forth below, and end on the Commencement Date hereof.
     The Holdover Rent Credit shall be reduced one day's rent for each day
     caused by Tenant's Delay.  Within five (5) days of the Commencement Date,
     Landlord and Tenant shall agree in writing as to the exact amount of the
     Holdover Rent Credit and absent said agreement, Landlord's calculation
     shall control; provided, however, Landlord shall be entitled to
     independently verify, to its sole satisfaction, Tenant's holdover rent
     obligation and actual payments to St. Paul Properties, Inc., including but
     not limited to requesting written information such as St. Paul Properties,
     Inc.'s representations and canceled checks.
<PAGE>
 
b.   In addition to the foregoing, a Base Rent abatement equal to $80,000.00 to
     be applied as set forth in subparagraph a above; provided, however, the
     $80,000.00 abatement shall not be subject to the Tenant Delay adjustment
     set forth above.

AS-IS CONDITION
---------------

Subject to Landlord's obligations, representations and warranties contained in
Exhibit "D" attached hereto, Tenant agrees to accept the leased premises on the
Commencement Date in an "as-is" condition.  Landlord agrees that the HVAC,
doors, electrical and plumbing fixtures will be in a satisfactory working
condition at the time of occupancy and warrants their condition (except for
doors) for one (1) year.

DISCLOSURE STATEMENT
--------------------

Real Estate Brokers and Agents.  Tenant warrants and represents that Tenant has
------------------------------                                                 
had no dealings with any real estate broker or agent, other than
HIGHWOODS/FORSYTH LIMITED PARTNERSHIP and GRUBB & ELLIS, in connection with the
                                          -------------                        
negotiation or execution of this Lease. GRUBB & ELLIS has represented TENANT in
                                        -------------                          
this transaction and will be paid a commission by LANDLORD.  Tenant agrees to
indemnify and hold Landlord harmless from and against any and all cost, expense
or liability for commissions or other compensation or fees claimed by any other
broker or agent acting or claiming to act for Tenant with respect to this Lease.

FIRST RIGHT OF REFUSAL
----------------------

Tenant shall have first right of refusal ("Right of Refusal") to rent the
adjacent space in the Building adjacent to the Premises containing, 21,653
R.S.F. and shown on Exhibit "A-1" attached hereto ("Adjacent Space").  If
Landlord receives a bona fide written offer from a third party for the Adjacent
Space, Landlord will provide notice to Tenant of the receipt of the bona fide
written offer from a third party and Tenant shall have five business days to
match the third party offer.  If Tenant fails to respond to the third parties
offer within five business days, and Landlord fails to consummate the third
party offer within six (6) months after giving such notice to Tenant, Tenant's
Right of Refusal shall be reinstated for the balance of the Lease Term;
provided, however, Tenant shall have two (2) business days to match any
subsequent third party offer.