<PAGE>


                  Zhong Shan Torch High & New Tech Industrial &
                              Commercial Co., Ltd.
                           Contract on Dormitory Lease

Lessor (Referred to henceforth as Party A): Zhong Shan Torch High & New Tech
Industrial & Commercial Co., Ltd.

Lessee (Referred to henceforth as Party B): LEPI (Zhongshan) Manufacturing
Company Limited

So as to support Party B in its effort to conduct business in the Zhong Shan
High-Tech Development Zone, Parties A & B, following consultation, have agreed
of choice to the following terms according to the needs of Party B:

1.  Party A agrees to lease to Party B the sections in the High-tech Residential
    Zone (See Appendix for details), with a built-up area of 40 rooms per
    dormitory as the residence of Party B's employees. Party B agrees to
    undertake the lease by choice.

2.  Duration of the Lease: From March 1, 1999 to March 1, 2000 for one year.

3.  Rent, Maintenance Charge and Payment Method 1) Rent Computation: The
    dormitory Party A leases to Party B shall be handed over for use upon
    inspection and acceptance by Parties A & B. For monthly rent, see Appendix.
    (Electricity and water facilities and toilet are included. Lamps and
    fluorescent lights are provided on a one-time basis and the lessee shall be
    responsible for replacement and repair in the future.) Party A virtually
    leases sixty-nine rooms to Party B, and Party B shall pay to Party A a total
    of RMB (Yuan)33,350 per month for rent. 2) Throughout the duration of the
    lease, Party A shall collect a general maintenance fee of (Yuan)0.50/M2 per
    month based on floor space. Since Party B rents dormitories equaling
    2,760M2, it shall pay Party A (Yuan)1,380/month as general maintenance fees.

4.  Payment Method On the day Parties A&B sign this contract, Party B shall pay
    Party A, on a lump sum basis, one month's rent and general maintenance fees
    totaling RMB (Yuan)34,730, with the rent being (Yuan)33,350 and the general
    maintenance fee being (Yuan)1380, which totals RMB (Yuan)34,730. Starting
    from the fourth month, Party B shall pay rent to Party A on a quarterly
    basis prior to the tenth day of the month. In the event that Party B is late
    in paying the rent or does not pay for up to one month, Party A has the
    right to repossess the leased property and set the deadline for Party B to
    pay the overdue rent and other charges so as to compensate Party A for its
    financial loss.

5.  Date of Dormitory Transfer The transfer formalities for the dormitory Party
    A leases to Party B shall be completed on March 1, 1999 by representatives
    of both parties. After the lease takes effect, Party B shall be responsible
    for arranging for the residence of its employees and for maintaining the
    public facilities.


6.  Certain Rules and Regulations Regarding the Execution of this Contract 1)
    During its use of the dormitory, Party B shall instruct its employees to
    abide by the law and edicts of the People's Republic of China, observe
    social ethics, safeguard public facilities and interests, comply with all
    the management and regulations of Zhong Shan Torch High & New Tech
    Industrial and Commercial Co., Ltd., be obligated to maintain social order
    in the residential zone and pay the general maintenance fees and water,
    electricity charges in time. 2) Party B shall not, without permission, make
    changes in the structure and the function of the dormitory. If decoration of
    the interior structure is necessary, Party B must apply for approval by
    Party A in advance; otherwise, Party B shall assume full responsible for the
    consequences arising therefrom. 3) Party B shall not move or change
    facilities in the dormitory. In the event that facilities need to be moved
    or changed, the facilities shall be provided by Party A; otherwise, Party B
    shall be held accountable for the compensation. 4) Kitchens and cooking are
    strictly forbidden in the dormitory. 5) Upon signing of this contract, both
    parties must rigorously abide by all the terms in this contract and shall
    not unilaterally alter or terminate this contract. In the event that there
    are matters that are not covered by the terms in this contract or that the
    contract needs to be terminated, both parties shall seek proper resolution
    through concerted consultation. In the event that the contract is changed or
    terminated unilaterally, the party that breaches the contract shall
    compensate the other party for the virtual financial loss. 6) For those
    matters regarding repairs and maintenance, please contact the General
    Service Department at 5596818-2003.

7.  Party B shall pay a security deposit equal to two months' rent. Party A
    shall return the deposit to Party B on a lump sum basis when the dormitory
    is returned on condition that no damage has been done to the facilities in
    the dormitory.

8.  This contract takes effect on the day of signing.

9.  This contract shall be in duplicate copies, with each party holding one
    copy. Both copies shall have equal legal power.
<PAGE>


Seal of Party A: Zhong Shan Torch High & New Tech Industrial & Commercial Co.,
Ltd.
Signature of representative:
Telephone:

Seal of Party A: LEPI (Zhongshan) Manufacturing Company Limited

Signature of representative:

Telephone:

                                            Date: year 199__ month_____ day_____












<PAGE>

       ZHONG SHAN TORCH HIGH & NEW TECH INDUSTRIAL & COMMERCIAL CO., LTD.
                                    Appendix
<TABLE>
<CAPTION>

<S>                                           <C>                  <C>               <C>
High-tech Residential Zone
Bldg. 1: Apt 908                            1 bedroom          (Yuan)450/rm/month     Total:  (Yuan)  450
Bldg. 2: Apt 801, 808                       2 bedroom          (Yuan)500/rm/month     Total:  (Yuan)1,000
         Apt 901-908                        8 bedroom          (Yuan)450/rm/month     Total:  (Yuan)3,600
Bldg. 3: Apt 201, 206, 209, 403-406         9 bedroom          (Yuan)500/rm/month     Total:  (Yuan)4,500
         703, 704
         Apt 108                            1 bedroom          (Yuan)400/rm/month     Total:  (Yuan)  400
         Apt 905-912                        8 bedroom          (Yuan)450/rm/month     Total:  (Yuan)3,600
Bldg. 4: Apt 207, 208                       2 bedroom          (Yuan)500/rm/month     Total:  (Yuan)1,000
         Apt 811, 812                       2 bedroom          (Yuan)500/rm/month     Total:  (Yuan)1,000
         Apt 906, 910, 911, 912             4 bedroom          (Yuan)450/rm/month     Total:  (Yuan)1,800
Bldg. 6: Apt. 202,207                       2 bedroom          (Yuan)500/rm/month     Total:  (Yuan)1,000
         Apt 601-608                        8 bedroom          (Yuan)500/rm/month     Total:  (Yuan)4,000
Bldg. 7: Apt 205, 208                       2 bedroom          (Yuan)500/rm/month     Total:  (Yuan)1,000
         Apt 301-310                        10 bedroom         (Yuan)500/rm/month     Total:  (Yuan)5,000
         Apt 501-505, 507, 509, 510         8 bedroom          (Yuan)500/rm/month     Total:  (Yuan)4,000
         Apt 601, 606                       2 bedroom          (Yuan)500/rm/month     Total:  (Yuan)1,000
                                    Total   96 bedrooms                         Total   (Yuan)33,350
</TABLE>

Remark: Apartments total 69 rooms, with a total monthly rent of (Yuan)33,350 and
a maintenance fee of 1380 Yuan.

70 double bunks X  (Yuan)70 =  (Yuan)4900                   Total:  (Yuan)37,160




<PAGE>


       ZHONG SHAN TORCH HIGH & NEW TECH INDUSTRIAL & COMMERCIAL CO., LTD.
                                    Appendix
<TABLE>
<CAPTION>

<S>                                                <C>              <C>             <C>
High-tech Residential Zone
Bldg. 1: Apt 908                            1 bedroom          (Yuan)450/rm/month     Total:  (Yuan)  450
Bldg. 2: Apt 801, 808                       2 bedroom          (Yuan)500/rm/month     Total:  (Yuan)1,000
         Apt 901-908                        8 bedroom          (Yuan)450/rm/month     Total:  (Yuan)3,600
Bldg. 3: Apt 201, 206, 209, 403-406         9 bedroom          (Yuan)500/rm/month     Total:  (Yuan)4,500
         703, 704
         Apt 108                            1 bedroom          (Yuan)400/rm/month     Total:  (Yuan)  400
         Apt 905-912                        8 bedroom          (Yuan)450/rm/month     Total:  (Yuan)3,600
Bldg. 4: Apt 207, 208                       2 bedroom          (Yuan)500/rm/month     Total:  (Yuan)1,000
         Apt 811, 812                       2 bedroom          (Yuan)500/rm/month     Total:  (Yuan)1,000
         Apt 906, 910, 911, 912             4 bedroom          (Yuan)450/rm/month     Total:  (Yuan)1,800
Bldg. 6: Apt. 202,207                       2 bedroom          (Yuan)500/rm/month     Total:  (Yuan)1,000
         Apt 601-608                        8 bedroom          (Yuan)500/rm/month     Total:  (Yuan)4,000
Bldg. 7: Apt 205, 208                       2 bedroom          (Yuan)500/rm/month     Total:  (Yuan)1,000
         Apt 301-310                        10 bedroom         (Yuan)500/rm/month     Total:  (Yuan)5,000
         Apt 501-505, 507, 509, 510         8 bedroom          (Yuan)500/rm/month     Total:  (Yuan)4,000
         Apt 601, 606                       2 bedroom          (Yuan)500/rm/month     Total:  (Yuan)1,000
                                    Total   96 bedrooms                         Total   (Yuan)33,350
</TABLE>


Remark: Apartments total 69 rooms, with a total monthly rent of (Yuan)33,350 and
a maintenance fee of 1380 Yuan.

70 double bunks X  (Yuan)70 =  (Yuan)4900                   Total:  (Yuan)37,160