Document:

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EXHIBIT 10.8

                  AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION

           STANDARD INDUSTRIAL/COMMERCIAL SINGLE-TENANT LEASE - NET
               (DO NOT USE THIS FORM FOR MULTI-TENANT BUILDINGS)

1.  Basic Provisions ("Basic Provisions")

     1.1  Parties: This Lease ("Lease"), dated for reference purposes only,
August 11, 1997, is made by and between Edwin A. Helwig and Barbara G. Helwig
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("Lessor") and The SMT Centre, Inc., a California Corporation ("Lessee"),
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(collectively the "Parties," or individually a "Party").

     1.2  Premises: That certain real property, including all improvements
therein or to be provided by Lessor under the terms of this Lease, and commonly
known as 2302 Trade Zone Boulevard, located in the County of Santa Clara, State
         -------------------------                           -----------
of California, and generally described as (describe briefly the nature of the
   ----------
property and, if applicable, the "Project", it the property is located within a
Project) 64,800 square foot industrial building ("Premises"). (See also
         --------------------------------------
Paragraph 2)

     1.3  Term: 5 years and 0 months ("Original Term") commencing see Work
                -           -                                     --------
Letter ("Commencement Date") and ending on the 5th anniversary of the
                                               ---------------
Commencement Date ("Expiration Date"). (See also Paragraph 3)

     1.4  Early Possession: _____________________  ("Early Possession Date").
(See also Paragraphs 3.2 and 3.3)

     1.5  Base Rent: $ 58,320.00 per month ("Base Rent"), payable on the first
                     -----------                                         -----
day of each month commencing on the Commencement Date. (See also Paragraph, 4)
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[X] If this box is checked, there are provisions In this Lease for the Base Rent
to be adjusted. See addendum

     1.6  Base Rent Paid Upon Execution: $ 58,320.00 as Base Rent for the period
                                         -----------
commencing on the Commencement Date.
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     1.7  Security Deposit: $ 71,280.00 ("Security Deposit"). (See also
                            -----------
Paragraph 5)

     1.8  Agreed Use:  Contract assembly, outsource manufacturing and storage
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(See also Paragraph 6)

     1.9  Insuring Party. Lessor is the "Insuring Party" unless otherwise stated
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herein. (See also Paragraph 8)

     1.10 Real Estate Brokers: (See also Paragraph 15)

          (a) Representation: The following real estate brokers (collectively,
the "Brokers") and brokerage relationships exist in this transaction (check
applicable boxes):
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[X]  Cornish & Carey Commercial  represents Lessor exclusively ("Lessor's
   -----------------------------
Broker");

[X]  Colliers Parrish, Inc.      represents Lessee exclusively ("Lessee's
   -----------------------------
Broker"); or

[_]                              represents both Lessor and Lessee ("Dual
   _____________________________
Agency").

          (b) Payment to Brokers: Upon execution and delivery of this Lease by
both Parties, Lessor shall pay to the Broker the fee agreed to in their separate
written agreement (or if there is no such agreement, the sum of N/A % of the
                                                                ---
Total Base Rent for the brokerage services rendered by said Broker).

     1.11  Guarantor. The obligations of the Lessee under this Lease are to be
guaranteed by Surface Mount Technology Centre, Inc. a Canadian (Ontario)
              ----------------------------------------------------------
Corporation (See Guarantee of Lease ("Guarantor"). (See also Paragraph 37)
-----------------------------------

     1.12  Addenda and Exhibits. Attached hereto Is an Addendum or Addenda
consisting of Paragraphs 50 through 57 and Exhibits A and Guarantee of Lease,
                         --         --              ------------------------
all of which constitute a part of this Lease.

2.  Premises.

     2.1   Letting. Lessor hereby leases to Lessee, and Lessee hereby leases
from Lessor, the Premises, for the term, at the rental, and upon all of the
terms, covenants and conditions set forth in this Lease. Unless otherwise
provided herein, any statement of size set forth in this Lease, or that may have
been used in calculating rental, is an approximation which the Parties agree is
reasonable and the rental based thereon is not subject to revision whether or
not the actual size is more or less.

     2.2   Condition. Lessor shall deliver the Premises to Lessee broom clean
and free of debris on the Commencement Date ("Start Date"), and, so long as the
required service contracts described in Paragraph 7.l(b) below are obtained by
Lessee within thirty (30) days following the Start Date, warrants that the
existing electrical, plumbing, fire sprinkler, lighting, heating, ventilating
and air conditioning systems ("HVAC"), loading doors, if any, and all other such
elements in the Premises, other than those constructed by Lessee, shall be in
good operating condition on said date and that the structural elements of the
roof, bearing walls and foundation of any buildings on the Premises (the
"Building") shall be free of material defects. If a non-compliance with said
warranty exists as of the Start Date, Lessor shall, as Lessor's sole obligation
with respect to such matter, except as otherwise provided in this Lease,
promptly after receipt of written notice from Lessee setting forth with
specificity the nature and extent of such non-compliance, rectify same at
Lessor's expense.

     2.3   Compliance. Lessor warrants that the improvements on the Premises
comply with all applicable laws, covenants or restrictions of record, building
codes, regulations and ordinances ("Applicable Requirements") in effect on the
Start Date. Said warranty does not apply to the use to which Lessee will put the
Premises or to any Alterations or Utility Installations (as defined in Paragraph

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7.3(a)) made or to be made by Lessee.  If the Premises do not comply with said
warranty, Lessor shall, except as otherwise provided, promptly after receipt of
written notice from Lessee setting forth with specificity the nature and extent
of such non-compliance, rectify the same at Lessor's expense. If the Applicable
Requirements are hereafter changed (as opposed to being in existence at the
Start Date, which is addressed in Paragraph 6.2(e) below) so as to require
during the term of this Lease the construction of an addition to or an
alteration of the Building, the remediation of any Hazardous Substance, or the
reinforcement or other physical modification of the Building ("Capital
Expenditure"), Lessor and Lessee shall allocate the cost of such work as
follows:

          (a) Subject to Paragraph 2.3(c), if such Capital Expenditures are
required as a result of the specific and unique use of the Premises by Lessee as
compared with uses by tenants in general, Lessee shall be fully responsible for
the cost thereof, provided, however that if such Capital Expenditure is required
during the last two (2) years of this Lease and the cost thereof exceeds six (6)
months' Base Rent, Lessee may instead terminate this Lease unless Lessor
notifies Lessee, in writing, within ten (10) days after receipt of Lessee's
termination notice that Lessor has elected to pay the difference between the
actual cost thereof and the amount equal to six (6) months' Base Rent. If Lessee
elects termination, Lessee shall immediately cease the use of the Premises,
which requires such Capital Expenditure and deliver to Lessor written notice
specifying a termination date at least ninety (90) days thereafter. Such
termination date shall, however, in no event be earlier than the last day that
Lessee could legally utilize the Premises without commencing such Capital
Expenditure.

          (b) If such Capital Expenditure is not the result of the specific and
unique use of the Premises by Lessee (such as, governmentally mandated seismic
modifications), then Lessor and Lessee shall allocate the obligation to pay for
such costs pursuant to the provisions of Paragraph 7.1(c); provided, however,
that if such Capital Expenditure is required during the last two years of this
Lease or if Lessor reasonably determines that it is not economically feasible to
pay its share thereof, Lessor shall have the option to terminate this Lease upon
ninety (90) days prior written notice to Lessee unless Lessee notifies Lessor,
in writing, within ten (10) days after receipt of Lessor's termination notice
that Lessee will pay for such Capital Expenditure.  If Lessor does not elect to
terminate, and fails to tender its share of any such Capital Expenditure, Lessee
may advance such funds and deduct same with Interest, from Rent until Lessor's
share of such costs have been fully paid. It Lessee is unable to finance
Lessor's share, or it the balance of the Rent due and payable for the remainder
of this Lease is not sufficient to fully reimburse Lessee on an offset basis,
Lessee shall have the right to terminate this Lease upon thirty (30) days
written notice to Lessor. See addendum

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          (c) Notwithstanding the above, the provisions concerning Capital
Expenditures are intended to apply only to non-voluntary, unexpected, and new
Applicable Requirements. If the Capital Expenditures are instead triggered by
Lessee as a result of an actual or proposed change in use, change in intensity
of use, or modification to the Premises then, and in that event, Lessee shall be
fully responsible for the cost thereof, and Lessee shall not have any right to
terminate this Lease.

     2.4  Acknowledgments. Lessee acknowledges that: (a) it has been advised by
Lessor and/or Brokers to satisfy itself with respect to the condition of the
Premises (including but not limited to the electrical, HVAC and fire sprinkler
systems, security, environmental aspects, and compliance with Applicable
Requirements), and their suitability for Lessee's intended use, (b) Lessee has
made such investigation as it deems necessary with reference to such matters and
assumes all responsibility therefor as the same relate to its occupancy of the
Premises, and (c) neither Lessor, Lessor's agents, nor any Broker has made any
oral or written representations or warranties with respect to said matters,
other than as set forth in this Lease. In addition, Lessor acknowledges that:
(a) Broker has made no representations, promises or warranties concerning
Lessee's ability to honor the Lease or suitability to occupy the Premises, and
(b) it is Lessor's sole responsibility to investigate the financial capability
and/or suitability of all proposed tenants.

     2.5  Lessee as Prior Owner/Occupant. The warranties made by Lessor in
Paragraph 2 shall be of no force or effect if immediately prior to the Start
Date Lessee was the owner or occupant of the Premises. In such event, Lessee
shall be responsible for any necessary corrective work.

3.  Term

     3.1  Term. The Commencement Date, Expiration Date and Original Term of this
Lease are as specified In Paragraph 1.3.

     3.2  Early Possession. It Lessee totally or partially occupies the Premises
prior to the Commencement Date, the obligation to pay Base Rent and all other
sums hereunder shall be abated for the period of such early possession. Any such
early possession shall not affect the Expiration Date.

     3.3  Delay in Possession.  Lessor agrees to use its best commercially
reasonable efforts to deliver the Premises to Lessee by the Target Commencement
Date. If, despite said efforts, Lessor is unable to deliver possession as
agreed, Lessor shall not be subject to any liability therefor, nor shall such
failure affect the validity of this Lease. Lessee shall not, however, be
obligated to pay Rent or

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perform its other obligations until it receives possession of the Premises. If
possession is not delivered within sixty (60) days after the Target Commencement
Date, Lessee may, at its option, by notice in writing within ten (10) days after
the end of such sixty (60) day period, cancel this Lease, in which event the
Parties shall be discharged from all obligations hereunder. If such written
notice is not received by Lessor within said ten (10) day period, Lessee's right
to cancel shall terminate. Except as otherwise provided, if possession is not
tendered to Lessee when required and Lessee does not terminate this Lease, as
aforesaid, any period of rent abatement that Lessee would otherwise have enjoyed
shall run from the date of delivery of possession and continue for a period
equal to what Lessee would otherwise have enjoyed under the terms hereof, but
minus any days of delay caused by the acts or omissions of Lessee. If possession
of the Premises is not delivered within four (4) months after the Target
Commencement Date, this Lease shall terminate unless other agreements are
reached between Lessor and Lessee, in writing.

     3.4  Lessee Compliance. Lessor shall not be required to tender possession
of the Premises to Lessee until Lessee complies with its obligation to provide
evidence of insurance (Paragraph 8.5). Pending delivery of such evidence, Lessee
shall be required to perform all of its obligations under this Lease from and
after the Start Date, including the payment of Rent, notwithstanding Lessor's
election to withhold possession pending receipt of such evidence of insurance.
Further, if Lessee is required to perform any other conditions prior to or
concurrent with the Start Date, the Start Date shall occur but Lessor may elect
to withhold possession until such conditions are satisfied.

4.  Rent.

     4.1  Rent Defined. All monetary obligations of Lessee to Lessor under the
terms of this Lease (except for the Security Deposit) are deemed to be rent
("Rent").

     4.2  Payment. Lessee shall cause payment of Rent to be received by Lessor
in lawful money of the United States, without offset or deduction, on or before
the day on which it is due. Rent for any period during the term hereof which is
for less than one (1) full calendar month shall be prorated based upon the
actual number of days of said month. Payment of Rent shall be made to Lessor at
its address stated herein or to such other persons or place as Lessor may from
time to time designate in writing. Acceptance of a payment which is less than
the amount then due shall not be a waiver of Lessor's rights to the balance of
such Rent, regardless of Lessor's endorsement of any check so stating.

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5.   Security Deposit. Lessee shall deposit with Lessor upon execution hereof
the Security Deposit as security for Lessee's faithful performance of its
obligations under this Lease. If Lessee fails to pay Rent, or otherwise Defaults
under this Lease, Lessor may use, apply or retain all or any portion of said
Security Deposit for the payment of any amount due Lessor or to reimburse or
compensate Lessor for any liability, expense, loss or damage which Lessor may
suffer or incur by reason thereof. If Lessor uses or applies all or any portion
of said Security Deposit, Lessee shall within ten (10) days after written
request therefor deposit monies with Lessor sufficient to restore said Security
Deposit to the full amount required by this Lease. If the Base Rent increases
during the term of this Lease, Lessee shall, upon written request from Lessor,
deposit additional moneys with Lessor so that the total amount of the Security
Deposit shall at all times bear the same proportion to the increased Base Rent
as the initial Security Deposit bore to the initial Base Rent. Should the Agreed
Use be amended to accommodate a material change in the business of Lessee or to
accommodate a sublessee or assignee, Lessor shall have the right to increase the
Security Deposit to the extent necessary, in Lessor's reasonable judgment, to
account for any increased wear and tear that the Premises may suffer as a result
thereof. Lessor shall not be required to keep the Security Deposit separate from
its general accounts. Within fourteen (14) days after the expiration or
termination of this Lease, if Lessor elects to apply the Security Deposit only
to unpaid Rent, and otherwise within thirty (30) days after the Premises have
been vacated pursuant to Paragraph 7.4(c) below, Lessor shall return that
portion of the Security Deposit not used or applied by Lessor. No part of the
Security Deposit shall be considered to be held in trust, to bear interest or to
be prepayment for any monies to be paid by Lessee under this Lease.

6.   Use.

     6.1  Use. Lessee shall use and occupy the Premises only for the Agreed Use,
or any other legal use which is reasonable comparable thereto, and for no other
purpose. Lessee shall not use or permit the use of the Premises in a manner that
is unlawful, creates damage, waste or a nuisance, or that disturbs owners and/or
occupants of, or causes damage to neighboring properties. Lessor shall not
unreasonably withhold attorneys' and consultants' fees or delay its consent to
any written request for a modification of the Agreed Use, so long as the same
will not impair the structural integrity of the improvements on the Premises or
the mechanical or electrical systems therein, is not significantly more
burdensome to the Premises. If Lessor elects to withhold consent, Lessor shall
within five (5) business days after such request give written notification of
same, which notice shall include an explanation of Lessor's objections to the
change in use.

     6.2  Hazardous Substances.

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          (a) Reportable Uses Require Consent. The term "Hazardous Substance" as
used in this Lease shall mean any product, substance, or waste whose presence,
use, manufacture, disposal, transportation, or release, either by itself or in
combination with other materials expected to be on the Premises, is either: (i)
potentially injurious to the public health, safety or welfare, the environment
or the Premises, (6) regulated or monitored by any governmental authority or
(iii) a basis for potential liability of Lessor to any governmental agency or
third party under any applicable statute or common law theory. Hazardous
Substances shall include, but not be limited to, hydrocarbons, petroleum,
gasoline. and/or crude oil or any products, by-products or fractions thereof.
Lessee shall not engage in any activity in or on the Premises which constitutes
a Reportable Use of Hazardous Substances without the express prior written
consent of Lessor and timely compliance (at Lessee's expense) with all
Applicable Requirements. "Reportable Use"shall mean (i) the installation or use
of any above or below ground storage lank, (ii) the generation, possession,
storage, use, transportation, or disposal of a Hazardous Substance that requires
a permit from, or with (respect to which a report, notice, registration or
business plan is required to be filed with, any governmental authority, and/or
(iii) the presence at the Premises of a Hazardous Substance with respect to
which any Applicable Requirements requires that a notice be given to persons
entering or occupying the Premises or neighboring properties. Notwithstanding
the foregoing, Lessee may use any ordinary and customary materials reasonably
required to be used in the normal course of the Agreed Use, so long as such use
is in compliance with all Applicable Requirements, is not a Reportable Use, and
does not expose the Premises or neighboring property to any meaningful risk of
contamination or damage or expose Lessor to any liability therefor. In addition,
Lessor may condition its consent to any Reportable Use upon receiving such
additional assurances as Lessor reasonably deems necessary to protect itself,
the public, the Premises and/or the environment against damage, contamination,
injury and/or liability; including, but not limited to, the installation (and
removal on or before Lease expiration or termination) of protective
modifications (such as concrete encasements) and/or increasing the Security
Deposit.  see addendum

          (b) Duty to Inform.  If Lessee knows, or has reasonable cause to
believe, that a Hazardous Substance has come to be located in, on, under or
about the Premises, other than as previously consented to by Lessor, Lessee
shall immediately give written notice of such fact to Lessor, and provide Lessor
with a copy of any report, notice, claim or other documentation which it has
concerning the presence of such Hazardous Substance. see addendum

          (c) Lessee Remediation.  Lessee shall not cause or permit any
Hazardous Substance to be spilled or released in, on, under, or about the
Premises

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(including through the plumbing or sanitary sewer system) and shall promptly, at
Lessee's expense, take all investigatory and/or remedial action reasonably
recommended, whether or not formally ordered or required, for the cleanup of any
contamination of and for the maintenance, security and/or monitoring of the
Premises or neighboring properties', that was caused or materially contributed
to by Lessee, or pertaining to or involving any Hazardous Substance brought onto
the Premises during the term of this Lease, by or for Lessee, or any third
party. see addendum

          (d) Lessee Indemnification.  Lessee shall indemnify, defend and hold
Lessor, its agents, employees, lenders and ground lessor, if any, harmless from
and against any and all loss of rents and/or damages, liabilities, judgments,
claims, expenses, penalties and attorneys' and consultants' fees arising out of
or involving any Hazardous Substance brought onto the Premises by or for Lessee,
or subsequent to the Commencement Date any third party (provided, however, that
Lessee shall have no liability under this Lease with respect to underground
migration of any Hazardous Substance under the Premises from adjacent
properties). Lessee's obligations shall include, but not be limited to, the
effects of any contamination or injury to person, property or the environment
created or suffered by Lessee, and the cost of investigation, removal,
remediation, restoration and/or abatement, and shall survive the expiration or
termination of this Lease. No termination, cancellation or release agreement
entered into by Lessor and Lessee shall release Lessee from its obligations
under this Lease with respect to Hazardous Substances, unless specifically so
agreed by Lessor in writing at the time of such agreement.

          (e) Lessor Indemnification.  Lessor and its successors and assigns
shall indemnify, defend, reimburse and hold Lessee, its employees and lenders,
harmless from and against any and all environmental damages, liabilities,
judgments, claims, expenses, penalties and attorneys' and consultants' fees
which existed as a result of Hazardous Substances on the Premises prior to the
Start Date or which migrate in, on or under the Premises from outside the
Premises or which are caused by the gross negligence, or intentional acts of
Lessor, its agents or employees. Lessor's obligations, as and when required by
the Applicable Requirements, shall include, but not be limited to, the cost of
investigation, removal, remediation, restoration and/or abatement, and shall
survive the expiration or termination of this Lease.

          (f) Investigations and Remediations.  Lessor shall retain the
responsibility and pay for any investigations or remediation measures required
by governmental entities having jurisdiction with respect to the existence of
Hazardous Substances on the Premises prior to the Start Date.  Lessee shall
cooperate fully in any such activities at the request of Lessor, including
allowing Lessor and Lassor's agents to have reasonable access to the Premises at

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reasonable times in order to carry out Lessors investigative and remedial
responsibilities.  see addendum

     6.3  Lessee's Compliance with Applicable Requirements.  Except as otherwise
provided in this Lease, Lessee, shall, at Lessee's sole expense, fully,
diligently and in a timely manner, materially comply with all Applicable
Requirements, the reasonable requirements of any applicable fire insurance
underwriter or rating bureau, and the reasonable recommendations of Lessor's
engineers and/or consultants which relate in any manner to the Premises, without
regard to whether said requirements are now in effect or become effective after
the Start Date. Lessee shall, within ten (10) days after receipt of Lessor's
written request, provide Lessor with copies of all permits and other documents,
and other information evidencing Lessee's compliance with any Applicable
Requirements specified by Lessor, and shall immediately upon receipt, notify
Lessor in writing (with copies of any documents involved) of any threatened or
actual claim, notice, citation, warning, complaint or report pertaining to or
involving the failure of Lessee or the Premises to comply with any Applicable
Requirements. see adden.

     6.4  Inspection; Compliance.  Lessor and Lessor's Lender and consultants
shall have the right to enter the Premises at any time, in the case of an
emergency, and otherwise at reasonable times, for he purpose of inspecting the
condition of the Premises and for verifying compliance by Lessee with this
Lease.  The cost of any such inspections shall be paid by Lessor, unless a
violation by Lessee of Applicable Requirements, or a contamination is found to
exist or be imminent, or the inspection is requested or ordered by a
governmental authority.  In such case, Lessee shall upon request reimburse
Lessor for the cost of such inspections, so long as such inspection is
reasonably related to the violation or contamination.

7.   Maintenance; Repairs, Utility Installations; Trade Fixtures and
Alterations.

     7.1  Lessee's Obligations.

          (a) In General.  Subject to the provisions of Paragraph 2.2
(Condition), 2.3 (Compliance), 6.3 (Lessee's Compliance with Applicable
Requirements), 7.2 (Lessors Obligations), 9 (Damage or Destruction), and 14
(Condemnation), and the Addendum and Work Letter, Lessee's shall, at Lessee's
sole expense, keep the Premises, Utility Installations and Alterations in good
order, condition and repair (whether or not the portion of the Premises requires
repairs, or the means of repairing the same, are reasonably or readily
accessible to Lessee, and whether or not the need for such repairs occurs as a
result of Lessee's use, any prior use, the elements or the age of such portion
of the Premises), including, but not limited to, all equipment or facilities,
such as plumbing, HVAC, electrical, lighting facilities, boilers, pressure
vessels, fire protection system, fixtures, walls (interior and exterior),
ceilings, floors, windows,

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doors, plate glass, skylights, landscaping, driveways, parking lots, fences,
retaining walls, signs, sidewalks and parkways located in, on, or adjacent to
the Premises. Lessee, in keeping the Premises in good order, condition and
repair, shall exercise and perform good maintenance practices, specifically
including the procurement and maintenance of the service contracts required by
Paragraph 7.1(b) below. Lessee's obligations shall include restorations,
replacements or renewals when necessary to keep the Premises and all
improvements thereon or a part thereof in good order, condition and state of
repair. Lessee shall, during the term of this Lease, keep the exterior
appearance of the Building in a first-class condition consistent with the
exterior appearance of other similar facilities of comparable age and size in
the vicinity, including, when necessary, the exterior repainting of the
Building.

          (b) Service Contracts.  Lessee shall, at Lessee's sole expense,
procure and maintain contracts, with copies to Lessor, in customary form and
substance for, and with Contractors specializing and experienced in the
maintenance of the following equipment and improvements. ("Basic Elements"), if
any, as and when installed on the Premises: (i) HVAC equipment, (ii) boiler, and
pressure vessels, (iii) life protection systems, (iv) landscaping and irrigation
systems, (v) tool covering and drains, and (vi) asphalt and parking lots, (vii)
clarifiers and (viii) any other equipment, if reasonably required by Lessor.

          (c) Replacement.  Subject to Lessee's indemnification of Lessor as set
forth in Paragraph 8.7 below, and without relieving Lessee of liability
resulting from Lessee's failure to exercise and perform good maintenance
practices, if the Basic Elements described in Paragraph 7.1(b) cannot be
repaired other than at a cost which is in excess of 50% of the cost of replacing
such Basic Elements, then such Basic Elements shall be replaced by Lessor, and
the cost thereof shall be prorated between the Parties and Lessee shall only be
obligated to pay, each month during the remainder of the term of this Lease, on
the date on which Base Rent is due, an amount equal to the product of
multiplying the cost of such replacement by a fraction, the numerator of which
is one, and the denominator of which is the number of months of the useful life
of such replacement as such useful life is specified pursuant to Federal income
tax regulations or guidelines for depreciation thereof (including interest on
the unamortized balance as is then commercially reasonable in the judgment of
Lessor's accountants), with Lessee reserving the right to prepay its obligation
at any time. see addendum

     7.2  Lessor's Obligations.  Subject to the provisions of Paragraphs 2.2
(Condition), 2.3 (Compliance), 9 (Damage or Destruction), 7.1 (Lessee's
Obligations and 55 and 14 (Condemnation), it is intended by the Parties hereto
that Lessor have no other obligation, in any manner whatsoever, to repair and

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maintain the Premises, or the equipment therein, all of which obligations are
intended to be that of the Lessee.  It is the intention of the Parties that the
terms of this Lease govern the respective obligations of the Parties as to
maintenance and repair of the Premises, and they expressly waive the benefit of
any statute now or hereafter in effect to the extent it is inconsistent with the
terms of this Lease.

     7.3. Utility Installations; Trade Fixtures; Alterations.

          (a) Definitions; Consent Required.  The term "Utility Installations"
refers to all floor and window coverings, air lines, power panels, electrical
distribution, security and fire protection systems, communication systems,
lighting fixtures, HVAC equipment, plumbing, and fencing in or on the Premises.
The term "Trade Fixtures" shall mean Lessee's machinery and equipment that can
be removed without doing material damage to the Premises. The term "Alterations"
shall mean any modification of the improvements, other than Utility
Installations of Trade Fixtures, whether by addition or deletion. "Lessee Owned
Alterations and/or Utility Installations" are defined as Alterations and/or
Utility Installations made by Lessee that are not yet owned by Lessor pursuant
to Paragraph 7.4(a).  Lessee shall not make any Alterations or Utility
Installations to the Premises without Lessor's prior written consent.  Lessee
may, however, make non-structural Utility Installations to the interior of the
Premises (excluding the roof) without such consent but upon notice to Lessor, as
long as they are not visible from the outside, do not involve puncturing,
relocating or removing the roof or any existing walls, and the cumulative cost
thereof during this Lease as extended does not exceed $50,000 in any one year.
see addendum.

          (b) Consent.  Any Alterations or Utility Installations that Lessee
shall desire to make and which require the consent of the Lessor shall be
presented to Lessor in written form with detailed plans.  Consent shall be
deemed conditioned upon Lessee's: (i) acquiring all applicable governmental
permits, (ii) furnishing Lessor with copies of both the permits and the plans
and specifications prior to commencement of the work, and (iii) compliance with
all conditions of said permits and other Applicable Requirements in a prompt and
expeditious manner.  Any Alterations or Utility Installations shall be performed
in a workmanlike manner with good and sufficient materials.  Lessee shall
promptly upon completion furnish Lessor with as-built plans and specifications.
For work which costs an amount equal to the greater of one month's Base Rent,
Lessor may condition its consent upon Lessee providing a lien and completion
bond in an amount equal to one and one-half times the estimated cost of such
Alteration or Utility Installation and/or upon Lessee's posting an additional
Security Deposit with Lessor.

                                      -11-
<PAGE>

          (c) Indemnification.  Lessee shall pay, when due, all claims for labor
or materials furnished or alleged to have been furnished to or for Lessee at or
for use on the Premises, which claims are or may be secured by any mechanic's or
materialmen's lien against the Premises or any interest therein.  Lessee shall
give Lessor not less than ten (10) days' notice prior to the commencement of any
work in, on or about the Premises, and Lessor shall have the right to post
notices of non-responsibility.  If Lessee shall contest the validity of any such
lien, claim or demand, then Lessee shall, at its sole expense defend and protect
itself, Lessor and the Premises against the same and shall pay and satisfy any
such adverse judgment that may be rendered thereon before the enforcement
thereof.  If Lessor shall require, Lessee shall furnish a surety bond in an
amount equal to one and one-half times the amount of such contested lien, claim
or demand, indemnifying Lessor against liability for the same. If Lessor elects
to participate in any such action, Lessee shall pay Lessor's attorneys' fees and
costs.

     7.4. Ownership; Removal; Surrender; and Restoration.

          (a) Ownership.  Subject to Lessor's right to require removal or elect
ownership as hereinafter provided, all Alterations and Utility Installations
made by Lessee shall be the property of Lessee, but considered a part of the
Premises.  Unless otherwise instructed per Paragraph 7.4(b) hereof, all Lessee
Owned Alterations and Utility Installations shall, at the expiration or
termination of this Lease, become the property of Lessor and be surrendered by
Lessee with the Premises.

          (b) Removal. By delivery to Lessee of written notice from Lessor not
later than ninety (90) days prior to the end of the term of this Lease, Lessor
may require that any or all Lessee Owned Alterations or Utility lnstallations
for which Lessee has not obtained Lessor's prior consent be removed by the
expiration or termination of this Lease.  Lessor may require the removal at any
time of all or any part of any Lessee Owned Alterations or Utility Installations
made without the required consent.  see addendum

          (c) Surrender/Restoration.  Lessee shall surrender the Premises by the
Expiration Date or any earlier termination date, with all of the improvements,
parts and surfaces thereof broom clean and free of debris, and in good operating
order, condition and state of repair, ordinary wear and tear excepted.
"Ordinary wear and tear" shall not include any damage or deterioration that
would have been prevented by good maintenance practice.  Lessee shall repair any
damage occasioned by the installation, maintenance or removal of Trade Fixtures,
furnishings, and equipment as well as the removal of any storage tank installed
by or for Lessee, and the removal, replacement, or remediation of any soil,
material or groundwater contaminated by Lessee. Trade Fixtures shall remain the
property of

                                      -12-
<PAGE>

Lessee and shall be removed by Lessee. The failure by Lessee to timely vacate
the Premises pursuant to this Paragraph 7.4(c) without the express written
consent of Lessor shall constitute a holdover under the provisions of Paragraph
26 below.

8.   Insurance; Indemnity.

     8.1. Payment For Insurance. Lessee shall pay for all insurance required
under Paragraph 8 except to the extent of the cost attributable to liability
insurance carried by Lessor under Paragraph 8.2(b) in excess of $2,000,000 per
occurrence.  Premiums for policy periods commencing prior to or extending beyond
the Lease term shall be prorated to correspond to the Lease term.  Payment shall
be made by Lessee to Lessor within ten (10) days following receipt of an
invoice.

     8.2. Liability Insurance.

          (a) Carried by Lessee. Lessee shall obtain and keep in force a
Commercial General Liability Policy of Insurance protecting Lessee and Lessor
against claims for bodily injury, personal injury and property damage based upon
or arising out of the ownership, use, occupancy or maintenance of the Premises
and all areas appurtenant thereto. Such insurance shall be on an occurrence
basis providing single limit coverage in an amount not less than $2,000,000 per
occurrence with an "Additional Insured-Managers or Lessors of Premises
Endorsement" and contain the "Amendment of the Pollution Exclusion Endorsement"
for damage caused by heat, smoke or fumes from a hostile fire. The Policy shall
not contain any intra-insured exclusions as between insured persons or
organizations. but shall include coverage for liability assumed under this Lease
as an "insured contract" for the performance of Lessee's indemnity obligations
under this Lease. The limits of said insurance shall not, however, limit the
liability of Lessee nor relieve Lessee of any obligation hereunder. All
insurance carried by Lessee shall be primary to and not contributory with any
similar insurance carried by Lessor, whose insurance shall be considered excess
insurance only.

          (b) Carried by Lessor. Lessor shall maintain liability insurance as
described in Paragraph 8.2(a), in addition to, and not in lieu of, the insurance
required to be maintained by Lessee. Lessee shall not be named as an additional
insured therein.

     8.3. Property Insurance - Building, Improvements and Rental Value.

          (a) Building and Improvements. The Insuring Party shall obtain and
keep in force a policy or policies in the name of Lessor, with loss payable to
Lessor and to any Lender insuring loss or damage to the Premises. The amount of

                                      -13-
<PAGE>

such insurance shall be equal to the full replacement cost of the Premises, as
the same shall exist from time to time, or the amount required by any Lenders,
but in no event more than the commercially reasonable and available insurable
value thereof. If Lessor is the Insuring Party, however, Lessee Owned
Alterations and Utility Installations, Trade Fixtures, and Lessee's personal
property shall be insured by Lessee under Paragraph 8.4 rather than by Lessor.
If the coverage is available and commercially appropriate, such policy or
policies shall insure against all risks of direct physical loss or damage
(except the perils of flood and/or earthquake unless required by a Lender),
including coverage for debris removal and the enforcement of any Applicable
Requirements requiring the upgrading, demolition, reconstruction or replacement
of any portion of the Premises as the result of a covered loss.  Said policy or
policies shall also contain an agreed valuation provision in lieu of any
coinsurance clause, waiver of subrogation, and inflation guard protection
causing an increase in the annual property insurance coverage amount by a factor
of not less than the adjusted U.S. Department of Labor Consumer Price Index for
All Urban Consumers for the city nearest to where the Premises are located.  If
such insurance coverage has a deductible clause, the deductible amount shall not
exceed $1,000 per occurrence, and Lessee shall be liable for such deductible
amount in the event of an Insured Loss.

          (b) Rental Value. The Insuring Party shall obtain and keep in force a
policy or policies in the name of Lessor with loss payable to Lessor and any
Lender, insuring the loss of the full Rent for one (1) year. Said insurance
shall provide that in the event the Lease is terminated by reason of an insured
loss, the period of indemnity for such coverage shall be extended beyond the
date of the completion of repairs or replacement of the Premises, to provide
for, one full year's loss of Rent from the date of any such loss. Said insurance
shall contain an agreed valuation provision in lieu of any coinsurance clause,
and the amount of coverage shall be adjusted annually to reflect the projected
Rent otherwise payable by Lessee, for the next twelve (12) month period. Lessee
shall be liable for any deductible amount in the event of such loss.

     8.4. Lessee's Property/Business Interruption Insurance.

          (a) Property Damage. Lessee shall obtain and maintain insurance
coverage on all of Lessee's personal property, Trade Fixtures, and Lessee Owned
Alterations and Utility Installations. Such insurance shall be full replacement
cost coverage with a deductible of not to exceed $1,000 per occurrence. The
proceeds from any such insurance shall be used by Lessee for the replacement of
personal property, Trade Fixtures and Lessee Owned Alterations and Utility
Installations.  Lessee shall provide Lessor with written evidence that such
insurance is in force.

                                      -14-
<PAGE>

          (b) Business Interruption. If reasonably available, and if Lessor
requests Lessee to do so in writing, Lessee shall obtain and maintain loss of
income and extra expense insurance in amounts as will reimburse Lessee for
direct or indirect loss of earnings attributable to all perils commonly insured
against by prudent lessees in the business of Lessee or attributable to
prevention of access to the Premises as a result of such perils.

          (c) No Representation of Adequate Coverage. Lessor makes no
representation that the limits or forms of coverage of insurance specified
herein are adequate to cover Lessee's property, business operations or
obligations under this Lease.

     8.5. Insurance Policies. Insurance required herein shall be by companies
duly licensed or admitted to transact business in the state where the Premises
are located, and maintaining during the policy term a "General Policyholders
Rating" of at least B+, V, as set forth in the most current issue of "Best's
Insurance Guide", or such other rating as may be required by a Lender. Lessee
shall not do or permit to be done anything which invalidates the required
insurance policies. Lessee shall, prior to the Start Date, deliver to Lessor
certified copies of policies of such insurance or certificates evidencing the
existence and amounts of the required insurance. No such policy shall be
cancelable or subject to modification except after thirty (30) days prior
written notice to Lessor. Lessee shall, at least thirty (30) days prior to the
expiration of such policies, furnish Lessor with evidence of renewals or
"insurance binders" evidencing renewal thereof, or Lessor may order such
insurance and charge the cost thereof to Lessee, which amount shall be payable
by Lessee to Lessor upon demand. Such policies shall be for a term of at least
one year, or the length of the remaining term of this Lease, whichever is less.
If either Party shall fail to procure and maintain the insurance required to be
carried by it, the other Party may, but shall not be required to, procure and
maintain the same.

     8.6. Waiver of Subrogation. Without affecting any other rights or remedies,
Lessee and Lessor each hereby release and relieve the other, and waive their
entire right to recover damages against the other, for loss of or damage to its
property arising out of or incident to the perils required to be insured against
herein. The effect of such releases and waivers is not limited by the amount of
insurance carried or required, or by any deductibles applicable hereto. The
Parties agree to have their respective property damage insurance carriers waive
any right to subrogation that such companies may have against Lessor or Lessee,
as the case may be.

     8.7. Indemnity. Except for Lessees sole negligence, Lessee shall indemnify,
protect, defend and hold harmless the Premises, Lessor and its agents, Lessors

                                      -15-
<PAGE>

master or ground lessor, partners and Lenders, from and against any and all
claims, loss of rents and/or damages, liens, judgments, penalties, attorneys'
and consultants' fees, expenses and/or liabilities arising out of, involving, or
in connection with, the use and/or occupancy of the Premises by Lessee. If any
action or proceeding is brought against Lessor by reason of any of the foregoing
matters, Lessee shall upon notice defend the same at Lessee's expense by counsel
reasonably satisfactory to Lessor and Lessor shall cooperate with Lessee in such
defense. Lessor need not have first paid any such claim in order to be defended
or indemnified.

     8.8. Exemption of Lessor from Liability.  Lessor shall not be liable for
injury or damage to the person or goods, wares, merchandise or other property of
Lessee, Lessee's employees, contractors, invitees, customers, or any other
person in or about the Premises, whether such damage or injury is caused by or
results from fire, steam, electricity, gas, water or rain, or from the breakage,
leakage, obstruction or other defects of pipes, fire sprinklers, wires,
appliances, plumbing, HVAC or lighting fixtures, or from any other cause,
Whether the said injury or damage results from conditions arising upon the
Premises or upon other portions of the Building of which the Premises are a
part, or from other sources or places. Lessor shall not be liable for any
damages arising from any act or neglect of any other tenant of Lessor.
Notwithstanding Lessor's negligence or breach of this Lease, Lessor shall under
no circumstances be liable for injury to Lessee's business or for any loss of
income or profit therefrom.

9.   Damage or Destruction.

     9.1. Definitions.

          (a) "Premises Partial Damage" shall mean damage or destruction to the
improvements on the Premises, other than Lessee Owned Alterations and Utility
Installations, which can reasonably be repaired in six (6) months or less from
the date of the damage or destruction.  Lessor shall notify Lessee in writing
within thirty (30) days from the date of the damage or destruction as to whether
or not damage is Partial or Total.

          (b) "Premises Total Destruction" shall mean damage or destruction to
the Premises, other than Lessee Owned Alterations and Utility Installations,
which cannot reasonably be repaired in six (6) months or less from the date of
the damage or destruction. Lessor shall notify Lessee in writing within thirty
(30) days from the date of the damage or destruction as to whether or not the
damage is Partial or Total.

                                      -16-
<PAGE>

          (c) "Insured Loss" shall mean damage or destruction to improvements on
the Premises, other than Lessee Owned Alterations and Utility Installations and
Trade Fixtures, which was caused by an event required to be covered by the
insurance described in Paragraph 8.3(a), irrespective of any deductible amounts
or coverage limits involved.

          (d) "Replacement Cost" shall mean the cost to repair or rebuild the
improvements owned by Lessor at the time of the occurrence to their condition
existing immediately prior thereto, including demolition, debris removal and
upgrading required by the operation of Applicable Requirements, and without
deduction for depreciation.

          (e) "Hazardous Substance Condition" shall mean the occurrence or
discovery of a condition involving the presence of, or a contamination by, a
Hazardous Substance as defined in Paragraph 6.2(a), in, on, or under the
Premises.

     9.2. Partial Damage - Insured Loss. If a Premises Partial Damage that is an
Insured Loss occurs, then Lessor shall, at Lessor's expense, repair such damage
(but not Lessee's Trade Fixtures or Lessee Owned Alterations and Utility
Installations) as soon as reasonably possible and this Lease shall continue in
full force and effect; provided, however, that Lessee shall, at Lessor's
election, make the repair of any damage or destruction the total cost to repair
of which is $10,000 or less, and, in such event, Lessor shall make any
applicable insurance proceeds available to Lessee on a reasonable basis for that
purpose. Notwithstanding the foregoing, if the required insurance was not in
force or the insurance proceeds are not sufficient to effect such repair, the
Insuring Party shall promptly contribute the shortage in proceeds (except as to
the deductible which is Lessee's responsibility) as and when required to
complete said repairs. In the event, however, such shortage was due to the fact
that, by reason of the unique nature of the improvements, full replacement cost
insurance coverage was not commercially reasonable and available, Lessor shall
have no obligation to pay for the shortage in insurance proceeds or to fully
restore the unique aspects of the Premises unless Lessee provides Lessor with
the funds to cover same, or adequate assurance thereof, within ten (10) days
following receipt of written notice of such shortage and request therefor.  If
Lessor receives said funds or adequate assurance thereof within said ten (10)
day period, the party responsible for making the repairs shall complete them as
soon as reasonably possible and this Lease shall remain in full force and
effect. If such funds or assurance are not received, Lessor may nevertheless
elect by written notice to Lessee within ten (10) days thereafter to: (i) make
such restoration and repair as is commercially reasonable with Lessor paying any
shortage in proceeds, in which case this Lease shall remain in full force and
effect, or have this Lease terminate thirty (30) days thereafter.

                                      -17-
<PAGE>

Lessee shall not be entitled to reimbursement of any funds contributed by Lessee
to repair any such damage or destruction. Premises Partial Damage due to flood
or earthquake shall be subject to Paragraph 9.3, notwithstanding that there may
be some insurance coverage, but the net proceeds of any such insurance shall be
made available for the repairs if made by either Party.

     9.3. Partial Damage - Uninsured Loss. If a Premises Partial Damage that is
not an Insured Loss occurs, unless caused by a negligent willful act of Lessee
(in which event Lessee shall make the repairs at Lessee's expense), Lessor may
either: (i) repair such damage as soon as reasonably possible at Lessor's
expense, in which event this Lease shall continue in full force and effect, or
(ii) terminate this Lease by giving written notice to Lessee within thirty (30)
days after receipt by Lessor of knowledge of the occurrence of such damage. Such
termination shall be effective sixty (60) days following the date of such
notice. In the event Lessor elects to terminate this Lease. Lessee shall have
the right within ten (10) days after receipt of the termination notice to give
written notice to Lessor of Lessee's commitment to pay for the repair of such
damage without reimbursement from Lessor. Lessee shall provide Lessor with said
funds or satisfactory assurance thereof within thirty (30) days after making
such commitment. In such event this Lease shall continue in full force and
effect, and Lessor shall proceed to make such repairs as, soon as reasonably
possible after the required funds are available. It Lessee does not make the
required commitment, this Lease shall terminate as of the date specified in the
termination notice.

     9.4. Total Destruction. Notwithstanding any other provision hereof, if a
Premises Total Destruction occurs, this Lease shall terminate sixty (60) days
following such Destruction.

     9.5. Damage Near End of Term. It at any time during the last six (6) months
of this Lease there is damage for which the cost to repair exceeds one (1)
month's Base Rent, whether or not an Insured Loss, Lessor may terminate this
Lease effective sixty (60) days following the date of occurrence of such damage
by giving a written termination notice to Lessee within thirty (30) days after
the date of occurrence of such damage. Notwithstanding the foregoing, if Lessee
at that time has an exercisable option to extend this Lease or to purchase the
Premises, then Lessee may preserve this Lease by, (a) exercising such option and
(b) providing Lessor with any shortage in insurance proceeds (or adequate
assurance thereof) needed to make the repairs on or before the earlier of (i)
the date which is ten days after Lessee's receipt of Lessor's written notice
purporting to terminate this Lease, or (ii) the day prior to the date upon which
such option expires. If Lessee duly exercises such option during such period and
provides Lessor with funds (or adequate assurance thereof) to cover any shortage
in insurance proceeds, Lessor shall, at Lessor's commercially reasonable
expense,

                                      -18-
<PAGE>

repair such damage as soon as reasonably possible and this Lease shall continue
in full force and effect. If Lessee fails to exercise such option and provide
such funds or assurance during such period, then this Lease shall terminate on
the date specified in the termination notice and Lessee's option shall be
extinguished.

     9.6. Abatement of Rent; Lessee's Remedies.

          (a)  Abatement. See addendum.

          (b)  Remedies. If Lessor shall be obligated to repair or restore the
Premises and does not commence, in a substantial and meaningful way, such repair
or restoration within ninety (90) days after such obligation shall accrue,
Lessee may, at any time prior to the commencement of such repair or restoration,
give written notice to Lessor and to any Lenders of which Lessee has actual
notice, of Lessee's election to terminate this Lease on a date not less than
sixty (60) days following the giving of such notice. If Lessee gives such notice
and such repair or restoration is not commenced within thirty (30) days
thereafter, this Lease shall terminate as of the date specified in said notice.
If the repair or restoration is commenced within said thirty (30) days, this
Lease shall continue in full force and effect. "Commence" shall mean either the
unconditional authorization of the preparation of the required plans, or the
beginning of the actual work on the Premises, whichever first occurs.

     9.7. Termination-Advance Payments. Upon termination of this Lease pursuant
to Paragraph 6.2(g) or Paragraph 9. an equitable adjustment shall be made
concerning advance Base Rent and any other advance payments made by Lessee to
Lessor. Lessor shall, in addition, return to Lessee so much of Lessee's Security
Deposit as has not been, or is not then required to be, used by Lessor.

     9.8. Waive Statutes. Lessor and Lessee agree that the terms of this Lease
shall govern the effect of any damage to or destruction of the Premises with
respect to the termination of this Lease and hereby waive the provisions of any
present or future statute to the extent inconsistent herewith.

10.  Real Property Taxes.

     10.1. Definition of "Real Property Taxes." As used herein, the term "Real
Property Taxes" shall include any form of assessment; real estate, general,
special, ordinary or extraordinary, or rental levy or tax (other than
inheritance, personal income or estate taxes); improvement bond; and/or license
fee imposed upon or levied against any legal or equitable interest of Lessor in
the Premises. Lessor's right to other income therefrom, and/or Lessor's business
of leasing, by-any authority having the direct or Indirect power to tax and
where the funds are

                                      -19-
<PAGE>

generated with reference to the Building address and where the proceeds so
generated are to be applied by the city, county or other local taxing authority
of a jurisdiction within which the Premises are located. The term "Real Property
Taxes" shall also include any tax, fee, levy, assessment or charge, or any
increase therein, imposed by reason of events occurring during the term of this
Lease, including but not limited to, a change in the ownership of the Premises.
see addendum

     10.2.

          (a) Payment of Taxes. Lessee shall pay the Real Property Taxes
applicable to the Premises during the term of this Lease.  Subject to Paragraph
10.2(b), all such payments shall be made at least ten (10) days prior to any
delinquency date. Lessee shall promptly furnish Lessor with satisfactory
evidence that such taxes have been paid.  If any such taxes shall cover any
period of time prior to or after the expiration or termination of this Lease,
Lessee's share of such taxes shall be prorated to cover only that portion of the
tax bill applicable to the period that this Lease is in effect, and Lessor shall
reimburse Lessee for any overpayment. If Lessee shall fail to pay any required
Real Property Taxes, Lessor shall have the right to pay the same, and Lessee
shall reimburse Lessor therefor upon demand.

          (b) Advance Payment. In the event Lessee incurs a late charge on any
Rent payment, Lessor may, at Lessors option, estimate the current Real Property
Taxes, and require that such taxes be paid in advance to Lessor by Lessee,
either: (i) in a lump sum amount equal to the installment due, at least twenty
(20) days prior to the applicable delinquency date, or (ii) monthly in advance
with the payment of the Base Rent. If Lessor elects to require payment monthly
in advance, the monthly payment shall be an amount equal to the amount of the
estimated installment of taxes divided by the number of months remaining before
the month in which said installment becomes delinquent. When the actual amount
of the applicable tax bill is known, the amount of such equal monthly advance
payments shall be adjusted as required to provide the funds needed to pay the
applicable taxes. If the amount collected by Lessor is insufficient to pay such
Real Property Taxes when due, Lessee shall pay Lessor, upon demand, such
additional sums as are necessary to pay such obligations. All moneys paid to
Lessor under this Paragraph may be intermingled with other moneys of Lessor and
shall not bear interest. In the event of a Breach by Lessee in the performance
of its obligations under this Lease, then any balance of funds paid to Lessor
under the provisions of this Paragraph may at the option of Lessor, be treated
as an additional Security Deposit.

                                      -20-
<PAGE>

     10.3. Joint Assessment. If the Premises are not separately assessed,
Lessee's liability shall be an equitable proportion of the Real Property Taxes
for all of the land and improvements included within the tax parcel assessed,
such proportion to be conclusively determined by Lessor from the respective
valuations assigned in the assessor's work sheets or such other information as
may be reasonably available.

     10.4. Personal Property Taxes. Lessee shall pay, prior to delinquency, all
taxes assessed against and levied upon Lessee Owned Alterations, Utility
Installations, Trade Fixtures, furnishings, equipment and all personal property
of Lessee. When possible, Lessee shall cause such property to be assessed and
billed separately from the real property of Lessor. If any of Lessee's said
personal property shall be assessed with Lessor's real property, Lessee shall
pay Lessor the taxes attributable to Lessee's property within ten (10) days
after receipt of a written statement.

11.  Utilities. Lessee shall pay for all water, gas, heat, light, power,
telephone, trash disposal and other utilities and services supplied to the
Premises, together with any taxes thereon. If any such services are not
separately metered to Lessee, Lessee shall pay a reasonable proportion, to be
determined by Lessor, of all charges jointly metered.

12.  Assignment and Subletting.

     12.1. Lessor's Consent Required.

           (a) Lessee shall not voluntarily or by operation of law assign,
transfer, mortgage or encumber (collectively, "assign or assignment") or sublet
all or any part of Lessee's interest in this Lease or in the Premises without
Lessor's prior written consent.

           (e) Lessee's remedy for any breach of Paragraph 12.1 by Lessor shall
be limited to compensatory damages and/or injunctive relief.  see addendum

     12.2. Terms and Conditions Applicable to Assignment and Subletting.

           (a) Regardless of Lessors consent, any assignment or subletting shall
not: (i) be effective without the express written assumption by such assignee or
sublessee of the obligations of Lessee under this Lease, (ii) release Lessee of
any obligations hereunder, or (iii) alter the primary liability of Lessee for
the payment of Rent or for the performance of any other obligations to be
performed by Lessee, unless (see Paragraph 57)

                                      -21-
<PAGE>

           (b) Lessor may accept Rent or performance of Lessee's obligations
from any person other than Lessee pending approval or disapproval of an
assignment. Neither a delay in the approval or disapproval of such assignment
nor the acceptance of Rent or performance shall constitute a waiver or estoppel
of Lessor's right to exercise its remedies for Lessees Default or Breach.

           (c) Lessor's consent to any assignment or subletting shall not
constitute a consent to any subsequent assignment or subletting.

           (d) In the event of any Default or Breach by Lessee, Lessor may
proceed directly against Lessee, any Guarantors or anyone else responsible for
the performance of Lessee's obligations under this Lease, including any assignee
or sublessee, without first exhausting Lessor's remedies against any other
person or entity responsible therefore to Lessor, or any security held by
Lessor.

           (e) Each request for consent to an assignment or subletting shall be
in writing, accompanied by information relevant to Lessor's determination as to
the financial and operational responsibility and appropriateness of the proposed
assignee or sublessee, including but not limited to the intended use and/or
required modification of the Premises, if any, together with a fee of $1,000 as
consideration for Lessor's considering and processing said request. Lessee
agrees to provide Lessor with such other or additional information and/or
documentation as may be reasonably requested.

           (f) Any assignee of, or sublessee under, this Lease shall, by reason
of accepting such assignment or entering in be deemed to have assumed and agreed
to conform and comply with each and every term, covenant, condition and
obligation herein to be observed or performed by Lessee during the term of said
assignment or sublease, other than such obligations as are contrary to or
inconsistent with provisions of an assignment or sublease to which Lessor has
specifically consented to in writing.  see addendum

     12.3. Additional Terms and Conditions Applicable to Subletting. The
following terms and conditions shall apply to any subletting by Lessee of all or
any part of the Premises and shall be deemed included in all subleases under
this Lease whether or not expressly incorporated therein:

           (a) Lessee hereby assigns and transfers to Lessor all of Lessee's
interest in all Rent payable on any sublease, and Lessor may collect such Rent
and apply same toward Lessee's obligations under this Lease; provided, however,
that until a Breach shall occur in the performance of Lessee's obligations,
Lessee may collect said Rent. Lessor shall not, by reason of the foregoing or
any assignment of such sublease, nor by reason of the collection of Rent, be
deemed liable to the

                                      -22-
<PAGE>

sublessee for any failure of Lessee to perform and comply with any of Lessee's
obligations to such sublessee. Lessee hereby irrevocably authorizes and directs
any such sublessee, upon receipt of a written notice from Lessor stating that a
Breach exists in the performance of Lessee's obligations under this Lease, to
pay to Lessor all Rent due and to become due under the sublease. Sublessee shall
rely upon any such notice from Lessor and shall pay all Rents to Lessor without
any obligation or right to inquire as to whether such Breach exists,
notwithstanding any claim from Lessee to the contrary.

           (b) In the event of a Breach by Lessee, Lessor may, at its option,
require sublessee to attorn to Lessor, in which event Lessor shall undertake the
obligations of the sublessor under such sublease from the time of the exercise
of said option to the expiration of such sublease; provided, however, Lessor
shall not be liable for any prepaid rents or security deposit paid by such
sublessee to such sublessor or for any prior Defaults or Breaches of such
sublessor.

           (c)  Any matter requiring the consent of the sublessor under a
sublease shall also require the consent of Lessor.

           (d) No sublessee shall further assign or sublet all or any part of
the Premises without Lessor's prior written consent.

           (e) Lessor shall deliver a copy of any notice of Default or Breach by
Lessee to the sublessee, who shall have the right to cure the Default of Lessee
within the grace period, if any, specified in such notice. The sublessee shall
have a right of reimbursement and offset from and against Lessee for any such
Defaults cured by the sublessee.  see addendum

13.  Default; Breach; Remedies.

     13.1. Default; Breach. A "Default" is defined as a failure by the Lessee to
comply with or perform any of the terms, covenants, conditions or rules under
this Lease. A "Breach" is defined as the occurrence of one or more of the
following Defaults, and the failure of Lessee to cure such Default within any
applicable grace period:

           (a) The abandonment of the Premises: or the vacating of the Premises
without providing a commercially reasonable level of security, or where the
coverage of the property insurance described in Paragraph 8.3 is jeopardized as
a result thereof, or without providing reasonable assurances to minimize
potential vandalism.

           (b) The failure of Lessee to make any payment of Rent or any other
monetary payment required to be made by Lessee hereunder, whether to Lessor or

                                      -23-
<PAGE>

to a third party, when due, to provide reasonable evidence of insurance or
surety bond, or to fulfill any obligation under this Lease which endangers or
threatens life or property where such failure continues for a period of three
(3) business days following written notice to Lessee.

          (c) The failure by Lessee to provide (i) reasonable written evidence
of compliance with Applicable Requirements, (ii) the service contracts, (iii)
the rescission of an unauthorized assignment or subletting, (iv) a Tenancy
Statement, (v) a requested subordination, (vi) evidence concerning any guaranty
and/or Guarantor, (vii) any document requested under Paragraph 42 (easements),
or (viii) any other documentation or information which Lessor may reasonably
require of Lessee under the terms of, this Lease, where any such failure
continues for a period of ten (10) days following written notice to Lessee.

          (d) A Default by Lessee as to the terms, covenants, conditions or
provisions of this Lease, or of the rules adopted under Paragraph 40 hereof,
other than those described in subparagraphs 13.1(a), (b) or (c), above, where
such Default continues for a period of thirty (30) days after written notice;
provided, however, that if the nature of Lessee's Default is such that more than
thirty (30) days are reasonably required for its cure, then it shall not be
deemed to be a Breach if Lessee commences such cure within said thirty (30) day
period and thereafter diligently prosecutes such cure to completion.

          (e) The occurrence of any of the following events: (i) the making of
any general arrangement or assignment for the benefit of creditors: (ii)
becoming a "debtor" as defined in 11 U.S.C. (S) 101 or any successor statute
thereto (unless, in the case of a petition filed against Lessee, the same is
dismissed within sixty (60) days); (iii) the appointment of a trustee or
receiver to take possession of substantially all of Lessee's assets located at
the Premises or of Lessee's interest in this Lease, where possession is not
restored to Lessee within thirty (30) days; or (iv) the attachment, execution or
other judicial seizure of substantially all of Lessee's assets located at the
Premises or of Lessee's interest in this Lease, where such seizure is not
discharged within thirty (30) days; provided, however, in the event that any
provision of this subparagraph (a) is contrary to any applicable law, such
provision shall be of no force or effect, and not affect the validity of the
remaining provisions.

          (f) The discovery that any financial statement of Lessee of any
Guarantor given to Lessor was materially false.

          (g) Upon a default by Lessee, if any of the following are in effect,
if the performance of Lessee's obligations under this Lease is guaranteed: (i)
the death of a Guarantor, (ii) the termination of a Guarantor's liability with
respect to

                                      -24-
<PAGE>

this Leesee other than in accordance with the terms of such guaranty, (iii) a
Guarantor's becoming insolvent or the subject of a bankruptcy filing, (iv) a
Guarantor's refusal to honor the guaranty, or (v) a Guarantor's breach of its
guaranty obligation on an anticipatory basis, and Lessee's failure, within sixty
(60) days following written notice of any such event, to provide written
alternative assurance or security, which, when coupled with the then existing
resources of Lessee, equals or exceeds the combined financial resources of
Lessee and the Guarantors that existed at the time of execution of this Lease.

     13.2. Remedies. If Lessee fails to perform any of its affirmative duties or
obligations, within ten (10) days after written notice (or in case of an
emergency, without notice), Lessor may, at its option, perform such duty or
obligation on Lessee's behalf, including but not limited to the obtaining of
reasonably required bonds, insurance policies, or governmental licenses, permits
or approvals. The costs and expenses of any such performance by Lessor shall be
due and payable by Lessee upon receipt of invoice therefor. If any check given
to Lessor by Lessee shall not be honored by the bank upon which it is drawn,
Lessor, at its option, may require all future payments to be made by Lessee to
be by cashier's check. In the event of a Breach, Lessor may, with or without
further notice or demand, and without limiting Lessor in the exercise of any
right or remedy which Lessor may have by reason of such Breach:

           (a) Terminate Lessee's right to possession of the Premises by any
lawful means, in which case this Lease shall terminate and Lessee shall
immediately surrender possession to Lessor. In such event Lessor shall be
entitled to recover from Lessee: (i) the unpaid Rent which had been earned at
the time of termination; (ii) the worth at the time of award of the amount by
which the unpaid rent which would have been earned after termination until the
time of award exceeds the amount of such rental loss that the Lessee proves
could have been reasonably avoided; (iii) the worth at the time of award of the
amount by which the unpaid rent for the balance of the term after the time of
award exceeds the amount of such rental loss that the Lessee proves could be
reasonably avoided; and (iv) any other amount necessary to compensate Lessor for
all the detriment proximately caused by the Lessee's failure to perform its
obligations under this Lease or which in the ordinary course of things would be
likely to result therefrom, including but not limited to the cost of recovering
possession of the Premises, expenses of reletting, including necessary
renovation and alteration of the Premises, reasonable attorneys' fees, and that
portion of any leasing commission paid by Lessor in connection with this Lease
applicable to the unexpired term of this Lease. The worth at the time of award
of the amount referred to in provision (iii) of the immediately preceding
sentence shall be computed by discounting such amount at the discount rate of
the Federal Reserve Bank of the District within which the

                                      -25-
<PAGE>

Premises are located at the time of award plus one percent (1%). Efforts by
Lessor to mitigate damages caused by Lessee's Breach of this Lease shall not
waive Lessor's right to recover damages under Paragraph 12. If termination of
this Lease is obtained through the provisional remedy of unlawful detainer,
Lessor shall have the right to recover in such proceeding any unpaid Rent and
damages as are recoverable therein, or Lessor may reserve the right to recover
all or any part thereof in a separate suit. If a notice and grace period
required under Paragraph 13.1 was not previously given, a notice to pay rent or
quit, or to perform or quit given to Lessee under the unlawful detainer statute
shall also constitute the notice required by Paragraph 13.1. In such case, the
applicable grace period required by Paragraph 13.1 and the unlawful detainer
statute shall run concurrently, and the failure of Lessee to cure the Default
within the greater of the two such grace periods shall constitute both an
unlawful detainer and a Breach of this Lease entitling Lessor to the remedies
provided for in this Lease and/or by said statute.

           (b) Continue the Lease and Lessee's right to possession and recover
the Rent as it becomes due, in which event Lessee may sublet or assign, subject
only to reasonable limitations. Acts of maintenance, efforts to relet, and/or
the appointment of a receiver to protect the Lessor's interests, shall not
constitute a termination of the Lessee's right to possession.

           (c) Pursue any other remedy now or hereafter available under the laws
or judicial decisions of the state wherein the Premises are located. The
expiration or termination of this Lease and/or the termination of Lessee's right
to possession shall not relieve Lessee from liability under any indemnity
provisions of this Lease as to matters occurring or accruing during the term
hereof or by reason of Lessee's occupancy of the Premises.

     13.3. Inducement Recapture. Any agreement for free or abated rent or other
charges, or for the giving or paying by Lessor to or for Lessee of any cash or
other bonus, inducement or consideration for Lessee's entering into this Lease,
all of which concessions are hereinafter referred to as "Inducement Provisions,"
shall be deemed conditioned upon Lessee's full and faithful performance of all
of the terms, covenants and conditions of this Lease. Upon Breach of this Lease
by Lessee, any such Inducement Provision shall automatically be deemed deleted
from this Lease and of no further force or effect, and any rent, other charge,
bonus, Inducement or consideration theretofore abated, given or paid by Lessor
under such an Inducement Provision shall be immediately due and payable by
Lessee to Lessor, notwithstanding any subsequent cure of said Breach by Lessee.
The acceptance by Lessor of rent or the cure of the Breach which initiated the
operation of this paragraph shall not be deemed a waiver by Lessor of the
provisions of this paragraph unless specifically so stated in writing by Lessor
at the time of such acceptance.

                                      -26-
<PAGE>

     13.4  Late Charges. Lessee hereby acknowledges that late payment by Lessee
of Rent will cause Lessor to incur costs not contemplated by this Lease, the
exact amount of which will be extremely difficult to ascertain. Such costs
include, but are not limited to, processing and accounting charges, and late
charges which may be imposed upon Lessor by any Lender. Accordingly, if any Rent
shall not be received by Lessor within five (5) days after such amount shall be
due, then without any requirement for notice to Lessee, Lessee shall pay to
Lessor a one-time late charge equal to six percent (6%) of each such overdue
amount. The parties hereby Agree that such late charge represents a fair and
reasonable estimate of the costs Lessor will incur by reason of such late
payment. Acceptance of such late charge by Lessor shall in no event constitute a
waiver of Lessee's Default or Breach with respect to such overdue amount, nor
prevent the exercise of any of the other rights and remedies granted hereunder.
In the event that a late charge is payable hereunder, whether or not collected,
for three (3) consecutive installments of Base Rent, then notwithstanding any
provision of this Lease, to the contrary, Base Rent shall, at Lessor's option,
become due and payable quarterly in advance.

     13.5  Interest. Any monetary payment due Lessor hereunder, other than late
charges, not received by Lessor within thirty (30) days following the date on
which it was due, shall bear interest from the thirty-first (31st) day after it
was due. The interest ("Interest") charged shall be equal to the prime rate
charged by the largest state chartered bank in the state in which the Premises
are located plus 4%, but shall not exceed the maximum rate allowed by law.
Interest is payable in addition to the potential late charge provided for in
Paragraph 13.4.

     13.6  Breach by Lessor.

          (a)  Notice of Breach. Lessor shall not be deemed in breach of this
Lease unless Lessor fails within a reasonable time to perform an obligation
required to be performed by Lessor. For purposes of this Paragraph, a reasonable
time shall in no event be less than thirty, (30) days after receipt by Lessor,
and any Lender whose name and address shall have been furnished Lessee in
writing for such purpose, of written notice specifying wherein such obligation
of Lessor has not been performed; provided, however, that if the nature of
Lessor's obligation is such that more than thirty (30) days are reasonably
required for its performance, then Lessor shall not be in breach if performance
is commenced within such thirty (30) day period and thereafter diligently
pursued to completion.

          (b)  Performance by Lessee on Behalf of Lessor. In the event that
neither Lessor nor Lender cures said breach within thirty (30) days after
receipt of said notice, or it having commenced said cure they do not diligently
pursue it to

                                      -27-
<PAGE>

completion, then Lessee may elect to cure said breach at Lessee's expense and
offset from Rent an amount equal to the greater of one month's Base Rent or the
Security Deposit, and to pay an excess of such expense under protest, reserving
Lessee's right to reimbursement from Lessor. Lessee shall document the cost of
said cure and supply said documentation to Lessor.

14.  Condemnation. If the Premises or any portion thereof are taken under the
power of eminent domain or sold under the threat of the exercise of said power
(collectively "Condemnation"), this Lease shall terminate as to the part taken
as of the date the condemning authority takes title or possession, whichever
first occurs, it more than ten percent (10%) of any building, or more than
twenty-five percent (25%) of the land area not occupied by any building, is
taken by Condemnation, Lessee may, at Lessee's option, to be exercised in
writing within ten (10) days after Lessor shall have given Lessee written notice
of such taking (or in the absence of such notice, within ten (10) days after the
condemning authority shall have taken possession) terminate this Lease as of the
date the condemning authority takes such possession. If Lessee does not
terminate this Lease in accordance with the foregoing, this Lease shall remain
in full force and effect as to the portion of the Premises remaining, except
that the Base Rent shall be reduced in proportion to the reduction in utility of
the Premises caused by such Condemnation. Condemnation awards and/or payments
shall be the property of Lessor, whether such award shall be made as
compensation for diminution in value of the household, the value of the part
taken, or for severance damages; provided, however, that Lessee shall be
entitled to any compensation for Lessor's relocation expenses, loss of business
goodwill and/or Trade Fixtures, without regard to whether or, not this Lease is
terminated pursuant to the provisions of this Paragraph. All Alterations and
Utility Installations made to the Premises by Lessee, for purposes of
Condemnation only, shall be considered the property of the Lessee and Lessee
shall be entitled to any and all compensation which is payable therefor. In the
event that this Lease is not terminated by reason of the Condemnation, Lessor
shall repair any damage to the Premises caused by such Condemnation.

15.  Brokers' Fee.

     15.1  Additional Commission. In addition to the payments owed pursuant to
Paragraph 1.10 above, and unless Lessor and the Brokers otherwise agree in
writing, Lessor agrees that: (a) if Lessee exercises any Option, (b) if Lessee
acquires any rights to the Premises or other premises owned try Lessor and
located within the same Project, if any, within which the Premises is located,
(c) if Lessee remains in possession of the Premises, with the consent of Lessor,
after the expiration of this Lease, or (d) if Base Rent is increased, whether by
agreement or operation of an escalation clause herein, then, Lessor shall pay
Brokers a fee in

                                      -28-
<PAGE>

 accordance with the schedule of said Brokers in effect at the time of the
execution of this Lease.

     15.2  Assumption of Obligations. Any buyer or transferee of Lessor's
interest in this Lease shall be deemed to have assumed Lessor's obligation
hereunder. Each Broker shall be a third party beneficiary of the provisions of
Paragraphs 1.10, 15, 22 and 31. If Lessor fails to pay to a Broker any amounts
due as and for commissions pertaining to this Lease when due, than such amounts
shall accrue Interest. In addition, if Lessor fails to pay any amounts to
Lessee's Broker when due, Lessee's Broker may send written notice to Lessor and
Lessee of such failure and if Lessor fails to pay such amounts within ten (10)
days after said-notice, Lessee shall pay said monies to its Broker and offset
such amounts against Rent.  In addition, Lessee's Broker shall be deemed to be a
third party beneficiary of any commission agreement entered into by and/or
between Lessor and Lessor's Broker.

     15.3  Representations and Indemnities of Broker Relationships. Lessee and
Lessor each represent and warrant to the other that it has had no dealings with
any person, firm, broker or finder (other than the Brokers, if any) in
connection with this Lease, and that no one other than said named Brokers is
entitled to any commission or finder's fee in connection herewith. Lessee and
Lessor do each hereby agree to indemnify, protect, defend and hold the other
harmless from and against liability for compensation or charges which may be
claimed by any such unnamed broker, finder or other similar party by reason of
any dealings or actions of the indemnifying Party, including any costs,
expenses, attorneys' fees reasonably incurred with respect thereto.

16.  Tenancy Statement/Estoppel Certificate.

     16.1  Each Party (as "Responding Party") shall within ten (10) days after
written notice from the other Party (the "Requesting Party") execute,
acknowledge and deliver to the Requesting Party an estoppel certificate in
writing, in form similar to the then most current "Tenancy Statement" form
published by the American Industrial Real Estate Association, plus such
additional information, confirmation and/or statements as may be reasonably
requested by the Requesting Party.

     16.2  If Lessor desires to finance, refinance, or sell the Premises, or any
part thereof, Lessee and all Guarantors shall deliver to any potential lender or
purchaser designated by Lessor such financial statements as may be reasonably
required by such lender or purchaser, including but not limited to Lessee's
financial statements for the past three (3) years. All such financial statements
shall be

                                      -29-
<PAGE>

received by Lessor and such lender or purchaser in confidence and shall be used
only for the purposes herein set forth.

17.  Definition of Lessor. The term "Lessor" as used herein shall mean the owner
or owners at the time in question of the fee title to the Premises, or, if this
is a sublease, of the Lessee's interest in the prior lease. In the event of a
transfer of Lessor's title or interest in the Premises or this Lease, Lessor
shall deliver to the transferee or assignee (in cash or by credit) any unused
Security Deposit held by Lessor. Except as provided in Paragraph 15, upon such
transfer or assignment and delivery of the Security Deposit, as aforesaid, the
prior Lessor shall be relieved of all liability with respect to the obligations
and/or covenants under this Lease thereafter to be performed by the Lessor.
Subject to the foregoing, the obligations and/or covenants in this Lease to be
performed by the Lessor shall be binding only upon the Lessor as hereinabove
defined. Notwithstanding the above, the original Lessor under this Lease, and
all subsequent holders of the Lessors interest in this Lease shall remain liable
and responsible with regard to the potential duties and liabilities of Lessor
pertaining to Hazardous Substances as outlined in Paragraph 6 above.

18.  Severability. The invalidity of any provision of this Lease, as determined
by a court of competent jurisdiction, shall in no way affect the validity of any
other provision hereof.

19.  Days. Unless otherwise specifically indicated to the contrary, the word
"days" as used in this Lease shall mean and refer to calendar days.

20.  Limitation on Liability. Except with respect to Lessor's fraud, gross
negligence or willful misconduct, the obligations of Lessor under this Lease
shall not constitute personal obligations of Lessor, the individual partners of
Lessor or its or their individual partners, directors, officers or shareholders,
and Lessee shall look to the Premises, and to no other assets of Lessor, for the
satisfaction of any liability of Lessor with respect to this Lease, and shall
not seek recourse against the individual partners of Lessor, or its or their
individual partners, directors, officers or shareholders, or any of their
personal assets for such satisfaction.

21.  Time of Essence. Time is of the essence with respect to the performance of
all obligations to be performed or observed by the Parties under this Lease.

22.  No Prior or Other Agreements; Broker Disclaimer. This Lease contains all
agreements between the Parties with respect to any mailer mentioned herein, and
no other prior or contemporaneous agreement or understanding shall be effective.
Lessor and Lessee each represents and warrants to the Brokers that it has made.
and is relying solely upon, its own investigation as to the nature, quality,
character

                                      -30-
<PAGE>

and financial responsibility of the other Party to this Lease and as to the
nature, quality and character of the Premises. Brokers have no responsibility
with respect thereto or with respect to any default or breach hereof by either
Party. The liability (including court costs and Attorneys' fees), of any Broker
with respect to negotiation, execution, delivery or performance by either Lessor
or Lessee under this Lease or any amendment or modification hereto shall be
limited to an amount up to the fee received by such Broker pursuant to this
Lease; provided, however, that the foregoing limitation on each Broker's
liability shall not be applicable to any gross negligence or willful misconduct
of such Broker.

23.  Notices.

     23.1  Notice Requirements. All notices required or permitted by this Lease
shall be in writing and may be delivered in person (by hand or by courier) or
may be sent by regular, certified or registered mail or U.S. Postal Service
Express Mail, with postage prepaid, or by facsimile transmission, and shall be
deemed sufficiently given if served in a manner specified in this Paragraph 23.
The addresses noted adjacent to a Party's signature on this Lease shall be that
Party's address for delivery or mailing of notices. Either Party may by written
notice to the other specify a different address for notice, except that upon
Lessee's taking possession of the Premises, the Premises shall constitute
Lessee's address for notice. A copy of all notices to Lessor shall be
concurrently transmitted to such party or parties at such addresses as Lessor
may from time to lime hereafter designate in writing.

     23.2  Date of Notice. Any notice sent by registered or certified mail,
return receipt requested, shall be deemed given on the date of delivery shown on
the receipt card, or if no delivery date is shown, the postmark thereon. If sent
by regular mail the notice shall be deemed given forty-eight (48) hours after
the same is addressed as required herein and mailed with postage prepaid.
Notices delivered by United States Express Mail or overnight courier that
guarantee next day delivery shall be deemed given twenty-four (24) hours after
delivery of the same to the Postal Service or courier. Notices transmitted by
facsimile transmission or similar means shall be deemed delivered upon telephone
confirmation of receipt, provided a copy is also delivered via delivery or mail.
If notice is received on a Saturday, Sunday or legal holiday, it shall be deemed
received on the next business day.

24.  Waivers. No waiver by Lessor of the Default or Breach of any term, covenant
or condition hereof by Lessee, shall be deemed a waiver of any other term,
covenant or condition hereof, or of any subsequent Default or Breach by Lessee
of the same or of any other term, covenant, or condition hereof. Lessor's
consent to, or approval of, any act shall not be deemed to tender unnecessary
the obtaining of

                                      -31-
<PAGE>

Lessor's consent to, or approval of, any subsequent or similar act by Lessee, or
be construed as the basis of an estoppel to enforce the provision or provisions
of this Lease requiring such consent. The acceptance of Rent by Lessor shall not
be a waiver of any Default or Breach by Lessee. Any payment by Lessee may be
accepted by Lessor on account of moneys or damages due Lessor, notwithstanding
any qualifying statements or conditions made by Lessee in connection therewith,
which such statements and/or condition shall be of no force or effect whatsoever
unless specifically agreed to in writing by Lessor at or before the time of
deposit of such payment.

25.  Recording. Either Lessor or Lessee shall, upon request of the other,
execute, acknowledge and deliver to the other a short form memorandum of this
Lease for recording purposes. The Party requesting remediation shall be
responsible for payment of any fees applicable thereto.

26.  No Right To Holdover. Lessee has no right to retain possession of the
Premises or any part thereof beyond the expiration or termination of this Lease.
In the event that Lessee holds over, then the Base Rent shall be increased to
one hundred twenty five percent (125%) of the Base Rent applicable during the
month immediately preceding the expiration or termination. Nothing contained
herein shall be construed as consent by Lessor to any holding over by Lessee.

27.  Cumulative Remedies. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other remedies at
law or in equity.

28.  Covenants and Conditions; Construction of Agreement.  All provisions of
this Lease to be observed or performed by Lessee are both covenants and
conditions. In construing this Lease, all headings and titles are for the
convenience of the parties only and shall not be considered a part of this
Lease. Whenever required by the context, the singular shall include the plural
and vice versa. This Lease shall not be construed as if prepared by one of the
parties, but rather according to its fair meaning as a whole, as if both parties
had prepared it.

29.  Binding Effect; Choice of Law. This Lease shall be binding upon the
parties, their personal representatives, successors and assigns and be governed
by the laws of the State in which the Premises are located. Any litigation
between the Parties hereto concerning this Lease shall be initiated in the
county in which the Premises are located.

30.  Subordination; Attornment; Non-Disturbance:

                                      -32-
<PAGE>

     30.1  Subordination. This Lease and any Option granted hereby shall be
subject and subordinate to any ground lease, mortgage, deed of trust, or other
hypothecation or security device (collectively, "Security Device"), now or
hereafter placed upon the Premises, to any and all advances made on the security
thereof, and to all renewals, modifications, and extensions thereof. Lessee
agrees that the holders of any such Security Devices shall have no liability or
obligation to perform any of the obligations of Lessor under this Lease. Any
Lender may elect to have this Lease and/or any Option granted hereby superior to
the lien of its Security Device by giving written notice thereof to Lessee, this
Lease and such Options shall be deemed prior to such Security Device,
notwithstanding the relative dates of the documentation or recordation thereof.

     30.2  Attornment. Subject to the non-disturbance provisions of
Paragraph 30.3, Lessee agrees to attorn to a Lender or any other party who
acquires ownership of the Premises by reason of a foreclosure of a Security
Device, and that in the event of such foreclosure, such new owner shall not: (i)
be liable for any act or omission of any prior lessor or with respect to events
occurring prior to acquisition of ownership; (ii) be subject to any offsets or
defenses which Lessee might have against any prior lessor, or (iii) be bound by
prepayment of more than one (1) month's rent.

     30.3  Non-Disturbance. With respect to Security Devices entered into by
Lessor after the execution of this Lease, Lessee's subordination of this Lease
shall be subject to receiving a commercially reasonable non-disturbance
agreement (a "Non-Disturbance Agreement") from the Lender which Non-Disturbance
Agreement provides that Lessee's possession of the Premises, and this Lease,
including any options to extend the term hereof, will not be disturbed so long
as Lessee is not in Breach hereof and attorns to the record owner of the
Premises. Further, within sixty (60) days after the execution of this Lease,
Lessor shall use its commercially reasonable efforts to obtain a Non-Disturbance
Agreement from the holder of any pre-existing Security Device which is secured
by the Premises. In the event that Lessor is unable to provide the Non-
Disturbance Agreement within said sixty (60) days, then Lessee may, at Lessee's
option, directly contact Lessor's lender and attempt to negotiate for the
execution and delivery of a Non-Disturbance Agreement.

     30.4  Self-Executing. The agreements contained in this Paragraph 30 shall
be effective without the execution of any further documents; provided, however,
that, upon written request from Lessor or a Lender in connection with a sale,
financing or refinancing of the Premises. Lessee and Lessor shall execute such
further writings as may be reasonably required to separately document any
subordination, attornment and/or Non-Disturbance Agreement provided for herein.

                                      -33-
<PAGE>

31.  Attorneys' Fees. It any Party or Broker brings an action or proceeding to
enforce the terms hereof or declare rights hereunder, the Prevailing Party (as
hereafter defined) in any such proceeding, action, or appeal thereon, shall be
entitled to reasonable attorneys' fees. Such fees may be awarded in the same
suit or recovered in a separate suit, whether or not such action or proceeding
is pursued to decision or judgment. The term, "Prevailing Party" shall include,
without limitation, a Party or Broker who substantially obtains or defeats the
relief sought, as the case may be, whether by compromise, settlement, judgment,
or the abandonment by the other Party or Broker of its claim or defense. The
attorneys' fees award shall not be computed in accordance with any court fee
schedule, but shall be such as to fully reimburse all attorneys' fees reasonably
incurred. In addition, Lessor shall be entitled to attorneys' fees, costs and
expenses incurred in the preparation and service of notices of Default and
consultations in connection therewith, whether or not a legal action is
subsequently commenced in connection with such Default or resulting Breach.

32.  Lessor's Access; Showing Premises; Repairs. Lessor and Lessor's agents
shall have the right to enter the Premises at any time, in the case of an
emergency, and otherwise at reasonable times for the purpose of showing the same
to prospective purchasers, lenders, or lessees, and making such alterations,
repairs, improvements or additions to the Premises as Lessor may deem necessary.
All such activities shall be without abatement of rent or liability to Lessee.
Lessor may at any time place on the Premises any ordinary "For Sale" signs and
Lessor may during the last six (6) months of the term hereof place on the
Premises any ordinary "For Lease" signs. Lessee may at any time place on or
about the Premises any ordinary "For Sublease" sign. see addendum

33.  Auctions. Lessee shall not conduct, nor permit to be conducted, any auction
upon the Premises without Lessor's prior written consent.  Lessor shall not be
obligated to exercise any standard of reasonableness in determining whether to
permit an auction.

34.  Signs. Except for ordinary "For Sublease" signs, Lessee shall not place any
sign upon the Premises without Lessor's prior written consent. All signs must
comply with all Applicable Requirements.

35.  Termination; Merger. Unless specifically stated otherwise in writing by
Lessor, the voluntary or other surrender of this Lease by Lessee, the mutual
termination or cancellation hereof, or a termination hereof by Lessor for Breach
by Lessee, shall automatically terminate any sublease or lesser estate in the
Premises; provided, however, that Lessor may elect to continue any one or all
existing subtenancies. Lessor's failure within ten (10) days following any such
event to elect to the

                                      -34-
<PAGE>

contrary by written notice to the holder of any such lesser interest, shall
constitute Lessor's election to have such event constitute the termination of
such interest.

36.  Consents. Except as otherwise provided herein, wherever in this Lease the
consent of a Party is required to an act by or for the other Party, such consent
shall not be unreasonably withhold or delayed. Lessor's actual reasonable costs
and expenses (including but not limited to architects', attorneys', engineers'
and other consultants' fees) incurred in the consideration of, or response to, a
request by Lessee for any Lessor consent, including but not limited to consents
to an assignment, a subletting or the presence or use of a Hazardous Substance,
shall be paid by Lessee upon receipt of an invoice and supporting documentation
therefor. Lessor's consent to any act, assignment or subletting shall not
constitute an acknowledgment that no Default or Breach by Lessee of this Lease
exists, nor shall such consent be deemed a waiver of any then existing Default
or Breach, except as may be otherwise specifically stated in writing by Lessor
at the time of such consent. The failure to specify herein any particular
condition to Lessor's consent shall not preclude the imposition by Lessor at the
time of consent of such further or other conditions as are then reasonable with
reference to the particular matter for which consent is being given. In the
event that either Party disagrees with any determination made by the other
hereunder and reasonably requests the reasons for such determination, the
determining party shall furnish its reasons in writing and in reasonable detail
within ten (10) business days following such request.

37.  Guarantor.

     37.1  Execution. The Guarantors, if any, shall each execute a guaranty in
the form most recently published by the American Industrial Real Estate
Association, and each such Guarantor shall have the same obligations as Lessee
under this Lease.

     37.2  Default. It shall constitute a Default of the Lessee it any Guarantor
fails or refuses, upon request to provide: (a) evidence of the execution of the
guaranty, including the authority of the party signing on Guarantees behalf to
obligate Guarantor, and in the case of a corporate Guarantor, a certified copy
of a resolution of its board of directors authorizing the making of such
guaranty, (b) current financial statements, (c) a Tenancy Statement, or (d)
written confirmation that the guaranty is still in effect.

38.  Quiet Possession. Subject to payment by Lessee of the Rent and performance
of all of the covenants, conditions and provisions on Lessee's part to be
observed and performed under this Lease, Lessee shall have quiet possession and
quiet enjoyment of the Premises during the term hereof.

                                      -35-
<PAGE>

39.  Options.

     39.1  Definition. "Option" shall mean: (a) the right to extend the term of
or renew this Lease or to extend or renew any lease that Lessor has on other
property of Lessor, (b) the right of first refusal or first offer to lease
either the Premises or other property of Lessor; (c) the right to purchase or
the right of first refusal to purchase the Premises or other property of Lessor.

     39.2  Options Personal To Original Lessee. Each Option granted to Lessee in
this Lease is personal to the original Lessee, and cannot be assigned or
exercised by anyone other than said original Lessee and only while the original
Lessee is in full possession of the Premises and, if requested by Lessor, with
Lessee certifying that Lessee has no intention of thereafter assigning or
subletting. see addendum

     39.3  Multiple Options. In the event that Lessee has any multiple Options
to extend or renew this Lease, a later Option cannot be exercised unless the
prior Options have been validly exercised.

     39.4  Effect of Default on Options.

           (a) Lessee shall have no right to exercise an Option; (i) during the
period commencing with the giving of any notice of Default and continuing until
said Default is cured, (ii) during the period of time any Rent is unpaid
(without regard to whether notice thereof is given Lessee), (iii) during the
time Lessee is in Breach of this Lease, or (iv) in the event that Lessee has
been given three (3) or more notices of Default, whether or not the Defaults are
cured, during the twelve (12) month period immediately preceding the exercise of
the Option.

           (b) The period of time within which an Option may be exercised shall
not be extended or enlarged by reason of Lessee's inability to exercise an
Option because of the provisions of Paragraph 39.4(a).

           (c) An Option shall terminate and be of no further force or effect,
notwithstanding Lessee's due and timely exercise of the Option, if, after such
exercise and prior to the commencement of the extended term, (i) Lessee fails to
pay Rent for a period of thirty (30) days after such Rent becomes due (without
any necessity of Lessor to give notice thereof), (ii) Lessor gives to Lessee
three (3) or more notices of separate Default during any twelve (12) month
period, whether or not the Defaults are cured, or (iii) if Lessee commits a
Breach of this Lease.

                                      -36-
<PAGE>

40.  Multiple Buildings. If the Premises are a part of a group of buildings
controlled by Lessor, Lessee agrees that it will observe reasonable rules and
regulations which Lessor may make from time to time for the management, safety,
and care of said properties, including the care and cleanliness of the grounds
and including the parking, loading and unloading of vehicles, and that Lessee
will pay its fair share of common expenses incurred in connection therewith.

41.  Security Measures. Lessee hereby acknowledges that the rental payable to
Lessor hereunder does not include the cost of guard service or other security
measures, and that Lessor shall have no obligation whatsoever to provide same.
Lessee assumes all responsibility for the protection of the Premises, Lessee,
its agents and invitees and their property from the acts of third parties.

42.  Reservations. Lessor reserves to itself the right, from time to time, to
grant, without the consent or joinder of Lessee, such easements, rights and
dedications that Lessor deems necessary, and to cause the recordation of parcel
maps and restrictions, so long as such easements, rights, dedications, maps and
restrictions do not unreasonably interfere with the use of the Premises by
Lessee. Lessee agrees to sign any documents reasonably requested by Lessor to
effectuate any such easement rights, dedication, map or restrictions.

43.  Performance Under Protest. If at any time a dispute shall arise as to any
amount or sum of money to be paid by one Party to the other under the provisions
hereof, the Party against whom the obligation to pay the money is asserted shall
have the right to make payment "under protest" and such payment shall not be
regarded as a voluntary payment and there shall survive the right on the part of
said Party to institute suit for recovery of such sum. If it shall be adjudged
that there was no legal obligation on the part of said Party to pay such sum or
any part thereof, said Party shall be entitled to recover such sum or so much
thereof as it was not legally required to pay.

44.  Authority. If either Party hereto is a corporation, trust, limited
liability company, partnership, or similar entity, each Individual executing
this Lease on behalf of such entity represents and warrants that he or she is
duly authorized to execute and deliver this Lease on its behalf. Each party
shall, within thirty (30) days after request, deliver to the other party
satisfactory evidence of such authority.

45.  Conflict. Any conflict between the printed provisions of this Lease and the
typewritten or handwritten provisions shall be controlled by the typewritten or
handwritten provisions.

                                      -37-
<PAGE>

46.  Offer. Preparation of this Lease by either Party or their agent and
submission of same to the other Party shall not be deemed an offer to lease to
the other Party. This Lease is not intended to be binding until executed and
delivered by all Parties hereto.

47.  Amendments. This Lease may be modified only in writing, signed by the
Parties in interest at the time of the modification.  As long as they do not
materially change Lessee's obligations hereunder, Lessee agrees to make such
reasonable non-monetary modifications to this Lease as may be reasonably
required by a Lender in connection with the obtaining of normal financing or
refinancing of the Premises.

48.  Multiple Parties. If more than one person or entity is named herein as
either Lessor or Lessee, such multiple Parties shall have joint and several
responsibility to comply with the terms of this Lease.

49.  Mediation and Arbitration of Disputes. An Addendum requiring the Mediation
and/or the Arbitration of all disputes between the Parties and/or Brokers
arising out of this Lease [_] is [X] is not attached to this Lease.

LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR
INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT AT THE
TIME THIS LEASE IS EXECUTED THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE
AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE
PREMISES.

ATTENTION: NO REPRESENTATION OR RECOMMENDATION IS MADE BY THE AMERICAN
INDUSTRIAL REAL ESTATE ASSOCIATION OR BY ANY BROKER AS TO THE LEGAL SUFFICIENCY,
LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS LEASE OR THE TRANSACTION TO WHICH IT
RELATES. THE PARTIES ARE URGED TO:

1.   SEEK ADVICE OF COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS LEASE.
2.   RETAIN APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION OF
     THE PREMISES. SAID INVESTIGATION SHOULD INCLUDE BUT NOT BE LIMITED TO: THE
     POSSIBLE PRESENCE OF HAZARDOUS SUBSTANCES, THE ZONING OF THE PREMISES, THE
     STRUCTURAL INTEGRITY, THE CONDITION OF THE ROOF AND OPERATING SYSTEMS, AND
     THE SUITABILITY OF THE PREMISES FOR LESSEE'S INTENDED USE.

                                      -38-
<PAGE>

WARNING: IF THE PREMISES IS LOCATED IN A STATE OTHER THAN CALIFORNIA, CERTAIN
PROVISIONS OF THE LEASE MAY NEED TO BE REVISED TO COMPLY WITH THE LAWS OF THE
STATE IN WHICH THE PREMISES IS LOCATED.

The parties hereto have executed this Lease at the place and on the dates
specified above their respective signatures.

                                      -39-
<PAGE>

Executed at: San Jose, California
             -----------------------
on:    9/23/97
     -------------------------------
By LESSOR:
____________________________________
____________________________________

By: /s/ Edwin A. Helwig
    --------------------------------
Name Printed: Edwin A. Helwig
              ----------------------
Title: _____________________________

By: /s/ [signature appears here]
    --------------------------------

Name Printed: Barbara G. Helwig
              ----------------------
Title: Barbara G. Helwig
       -----------------------------
Address: ___________________________
____________________________________

Telephone: (  ) ____________________
Facsimile: (  ) ____________________
Federal Id. No. ____________________

BROKER:
____________________________________
Executed at: _______________________
on: ________________________________

By:  _______________________________
Name Printed: ______________________
Title: _____________________________
Address: ___________________________
____________________________________
Telephone: (  ) ____________________
Facsimile: (  ) ____________________
Federal Id. No. ____________________

Executed at: _______________________
on: September 22, 1997
    --------------------------------
By LESSEE: The SMT Centre Inc., a
------------------------------------
California Corporation
------------------------------------

____________________________________

By: /s/ Gary Walker
    --------------------------------
Name Printed: Gary Walker
              ----------------------
Title: Vice President
       -----------------------------

By:  _______________________________
Name Printed: ______________________
Title: _____________________________
Address: ___________________________
____________________________________

Telephone: (  ) ____________________
Facsimile: (  ) ____________________
Federal Id. No. ____________________

BROKER:
____________________________________
Executed at: _______________________
on: ________________________________

By:  _______________________________
Name Printed: ______________________
Title: _____________________________
Address: ___________________________
____________________________________
Telephone: (  ) ____________________
Facsimile: (  ) ____________________
Federal Id. No. _____________________

NOTE: These forms are often modified to meet changing requirements of law and
industry needs. Always write or call to make sure you are utilizing the most
current form: AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION, 700 So. Flower
Street, Suite 600, Los Angeles, California 90017. (213) 687-8777.
Fax No. (213) 687-8616

                                      -40-
<PAGE>

                                   EXHIBIT A

                                 [FLOOR PLAN]
<PAGE>

                                LEASE ADDENDUM

       Addendum to the lease dated August 11, 1997, b and between Edwin A.
Helwig and Barbara A. Helwig (Lessor) and The SMT Centre, Inc., a California
corporation (Lessee), for those premises located at 2302 Trade Zone Boulevard,
San Jose, California.

Lessor and Lessee hereby amend the provisions of the lease as set out below.

1.5    Rent Schedule:

       Months                   Base Rent
       01-12                    $58,320.00/month
       13-24                    $61,560.00/month
       25-36                    $64,800.00/month
       37-48                    $68,040.00/month
       49-60                    $71,280.00/month

2.3(b) Notwithstanding the provisions of section 2.3(b) and 7.1(c), except as
       required under section 2.3(a) with regard to Capital Expenditures
       required as a result of th specific and unique use of the Premises by
       Lessee, Lessee shall have no obligation to make any contribution, of
       amortized payments or otherwise, for any Capital Expenditure for an
       upgrade of any structural component of the Premises (including without
       limitation any seismic upgrades to the Building).

6.2(a) Lessor hereby consents to the Tenant maintaining on the Premises those
       substances listed on exhibit C provided all such substances shall be
                            ---------
       maintained in compliance with Applicable Requirements.

6.2(b) If Lessor knows, or has reasonable cause to believe, that a Hazardous
       Substance has come to be located in, on, under or about the Premises,
       other than as previously disclosed to Lessee, lessor shall immediately
       give written notice of such fact to Lessee, and provide Lessee with a
       copy of any report, notice, claim or other documentation which it has
       concerning the presence of such Hazardous Substance.

6.2(c) for purposes of this section 6.2, Lessee shall have no responsibility or
       liability fr any `release' which consists of the continuation of the
       presence of a Hazardous Substance on the Premises, which originated prior
       to the Commencement Date.

6.2(f) With respect to any contamination for which Lessor is required to
       undertake investigations or remediation pursuant to this section, the
       Rent payable by Lessee for the period required for the investigation or
       remediation shall be abated in proportion to the degree to which Lessee's
       use of the Premises is impaired. If the impairment of Lessee's use cannot
       be eliminated within six (6) months or less from the date of discovery
       thereof,

                                      -2-
<PAGE>

       Lessor shall notify in writing within thirty (30) days from discovery
       thereof. Lessee may elect, by written notice delivered to Lessor within
       sixty (60) days from receipt of Lessor's notice that the impairment of
       use cannot be eliminated within said six (6) month period, to terminate
       this Lease.

6.3    If a request by the board of fire underwriters or Lessor's engineer
       relates to the condition of the Premises (as opposed to Lessee' specific
       and unique use) the Lessor shall pay the cost to comply with such
       requirements. If during the Lease term, Lessor receives a request from
       any insurance company or underwriter to perform tests on the Premises
       (including without limitation the fire protection system), Lessor will
       promptly inform Lessee of such request and if Lessee agrees to pay the
       cost of such test, Lessor promptly will perform the tests and provide the
       insurance company (or underwriter) of the results thereof.

7.1    Notwithstanding the foregoing, Lessee shall have no obligation to
       restore, replace or renew, or to contribute to the costs to restore,
       replace or renew, any structural portion of the Premises (including
       without limitation the foundation, structural floor slab, roof structure,
       weight bearing walls) and Lessee shall not be required to repaint the
       exterior of the Premises during the Original Term.

7.3(a) The parties acknowledge that the items described on Exhibit D are
                                                           ---------
       Lessee's Trade Fixtures.

7.4(b) As to any matter fr which Lessor's consent is required, at the time
       consent is given, Lessor shall indicate whether or not it shall require
       the Alterations or Utility Installations to be removed upon the
       expiration or termination of this Lease.

9.6(a) This section is revised to read as follows: In the event of a Hazardous
       Substance condition for which Lessee is not responsible under this Lease,
       or of Premises Partial Damage or of Premises Total Destruction, the Rent
       payable by Lessee for the period required for the repair, remediation or
       restoration of such damage shall be abated in proportion to the degree to
       which Lessee' use of the Premises is impaired. All other obligations of
       Lessee hereunder shall be performed by Lessee, and Lessor shall have no
       liability for any such damage, destruction, remediation, repair or
       restoration except as provided herein.

12.1   An Internal Change (as defined below) shall not be deemed an assignment
       or subletting requiring Lessor's consent. the term "Internal Change"
       shall mean any transfer by Lessee to (i) a subsidiary of Lessee, (ii) a
       parent of Lessee, (iii) an entity controlled by a subsidiary or parent of
       Lessee, (iv) any merger or any sale of a controlling interest in Lessee
       or (v) the private or public offering of stock in Lessee.

                                      -3-
<PAGE>

12.2   Notwithstanding the foregoing, Lessor will respond to any request for
       consent hereunder within ten (10) business days from receipt of the
       required information and the failure of Lessor to so respond shall be
       deemed consent to the requested act.

12.4   In the event of an assignment or subletting (other than an Internal
       Change, Lessor and lessee shall share in any Net Bonus Rent (as defined
       below) with one-half to belong to Lessor and one-half to belong to
       Lessee. "Net Bonus Rent" shall mean the Rent to be paid to Lessee by a
       subtenant or assignee for occupancy of the Premises less all sums that
       Lessee is required to pay to Lessor under this Lease. "Net Rent" shall
       mean those sums received from a subtenant or assignee after Lessee has
       recouped al its costs and expenses related to the assignment or
       subletting (including without limitation broker's commissions, attorneys'
       fees, any tenant improvement costs and any "incentives" that must be paid
       to induce the subtenant or assignee to occupy the Premises).

32     Except for emergencies, Lessor shall provide Lessee with prior notice of
       any entry by Lessor.

39.2   The foregoing notwithstanding, a successor as a result of an Internal
       Change may exercise any option or right granted to Lessee so long as such
       successor is in possession o the Premises.

The following new sections are hereby added to the Lease:

50.    Renewal at Fair Market Rent:

       a. Renewal Option: Lessee shall have the option (the "Renewal Option") to
          extend the initial term of this Lease for two (2) successive renewal
          terms of three (3) years (the "Renewal Term"). Provided that Lessee is
          not in default of this Lease beyond the expiration of any applicable
          grace or cure periods on the date of giving notice of exercise of the
          Renewal Option or on the first day of the extension term, Lessee may
          exercise the Renewal Option by giving Lessor written notice not more
          than two hundred ten (210) days, but at least 180 days, prior to, th
          date set forth above for the expiration of the initial term of this
          Lease, or first renewal term, if exercised (with time to be of the
          essence as to the timely exercise of such Renewal Option). If Lessee
          exercises the Renewal Option, then this Lease shall be extended for
          the three (3) years Renewal Term upon all of the terms, covenants, and
          conditions contained in this Lease, except that, during the Renewal
          Term, the fixed monthly rent shall be 100% of the monthly market
          rental value of the then applicable market rent for similar buildings
          with similar credit tenants guaranteed b similar guarantors and
          located n the same geographical area the "Market Value Rent") of the
          Premises on the date that Lessee exercises the Renewal Option (The
          "Exercise Date"), as determined below. Lessor shall have

                                      -4-
<PAGE>

          no obligation to complete any further tenant improvements during the
          ter of the Renewal Option.

b.   Market Value Rent:  If Lessee elects to extend the term of this Lease as
     provided above, the term "Market Value Rent" shall mean the annual Base
     Rent and annual increases that a willing Lessee would pay and a willing
     Lessor would accept to an arm's length lease of the Premises as of the
     Exercise Date.

c.   Rent Determination: The parties shall have thirty (30) days after Lessor
     receives the option notice in which to agree on the Market Value Rent
     during the extended term. Within the thirty (30) day period after Lessor
     receives the option notice, Lessor and Lessee shall meet and each shall
     simultaneously provide to the other its written opinion of the Market Value
     Rent for the Premises for the renewal term (the Lessor and Lessee
     Determination Notices, respectively).  If the parties agree on the Market
     Value Rent for the extended term during that period, they shall immediately
     execute an amendment to this Lease stating the Market Value Rent for the
     extended term.

     If the parties are unable to agree on the Market Value Rent for the
     extended term within that period, then within fifteen (15) days after the
     expiration of that period, each party, at its costs and by giving notice to
     the other party, shall appoint a real estate agent of broker
     "agent/broker") with at least five (5) years' full-time commercial real
     estate brokerage experience in the area in which the Premises are located,
     to determine and set the Market Value Rent fr the extended term.  f a party
     does not appoint a real estate agent/broker within fifteen (15) days after
     the other party has given notice of the name of its agent/broker, the
     single agent/broker appointed shall be the sole determiner of and shall set
     the Market Value Rent for the extended term.  If the two real estate
     agent/brokers are appointed by the parties as stated in this paragraph,
     they shall meet promptly and attempt to set the Market Value Rent for the
     extended term.  If they are unable to agree within thirty (30) days after
     the second real estate agent/broker has been appointed, they shall attempt
     to select a third real estate agent/broker meeting the qualifications
     stated in this paragraph, within fifteen (15) days after the last day the
     two agent/brokers are given to set the Market Value Rent.  If they are
     unable to agree on the third real estate agent/broker, either of the
     parties to this Lease, by giving fifteen (15) days' notice to the other
     party can apply to the then president of the San Jose Board of Realtors or
     to the presiding judge of the superior Court of Santa Clara County for the
     selection of a third real estate agent/broker who meets the qualifications
     stated in this paragraph.  Each of the parties shall bear one-half (1/2)
     of the cost of appointing the third real estate agent/broker and of paying
     the third agent/broker's fee.  The third agent/broker, however selected,
     shall be a person who has not previously acted in any capacity for either
     party.

     Within thirty (30) days after the selection of the third agent/broker, a
     majority of the agent/brokers shall set the Market Value Rent for the
     extended term.  If a majority of the agent/brokers are unable to set the
     Market Value Rent within the stipulated period of

                                      -5-
<PAGE>

     time, the three sums determined by the agent/brokers shall be added
     together and their total divided by three; the resulting quotient shall be
     the Market Value RENT for the Premises during the extended term. This
     process shall be binding on both Lessor and Lessee.

     (d)  Cancellation of Rent Determination:  In the event that the
     determination of the Market Value Rent set forth in the Lessor's and
     Lessee's Determination Notices shall differ by less than five percent (5%)
     per square foot per month for the Renewal Term, then the Market Value Rent
     shall not be determined by the real estate agent/brokers, but shall be sent
     by taking the average of the Lessor's and Lessee's Market Value Rent as set
     out in their respective Determination Notices. Only the determinations set
     forth in the Lessor's and Lessee's Determination Notices shall differ by
     more than five percent (5%) per square foot per month for the Renewal Term
     shall the actual determination of Market Value Rent be made by the above
     determination process.

     (e)  Late Determination.  If, for any reason, the Market Value RENT shall
     not have been determined prior to the Commencement Date of the Renewal
     Term, then, Lessee shall continue to pay the Base Monthly Rental in effect
     during the final year of the initial terms of the Lease.  Upon final
     determination of the Market Value Rent, an appropriate adjustment to the
     Base Rent shall be made reflecting such final determination, and Lessor or
     Lessee, as the case may be, shall promptly refund or pay to the other any
     overpayment or deficiency, as the case may be in the payment of the Market
     Value Rent from the date of commencement of the Renewal Term to the date of
     such final determination.

51.  Increases in Property Tax Due to a Sale to an Unrelated Third Party:

     If the real estate taxes on the Premises are increased during the first
     three years of the lease term as a result of a sale or exchange of the
     Premises, the parties have agreed to limit the increase in tax payments
     that Lessee will be obligated to pay during the first three years of the
     lease term.  In the event of such an increase, Lessee shall be required to
     pay, for any twelve month period that begins with an anniversary of the
     Commencement Date (a "Lease Year"), an increase in taxes up to (but not
     more than) an amount equal to ten percent (10%) of the total taxes that
     Lessee paid in Lease Year preceding the year of increase.  On the third
     anniversary of the Commencement Date, the limit on Lessee's obligation to
     pay taxes shall cease, and Lessee shall pay real estate taxes as required
     under lease section 10.  Notwithstanding the foregoing, however, in no case
     shall Lessee be required to pay, at any time during the lease term, any
     increase in real estate taxes caused by a "change in ownership" which is
     not a bona fide sale or exchange to a third party (including without
     limitation, for example, an internal reorganization of tenant, a transfer
     by tenant to related parties or an estate planning change of ownership
     (such as a transfer to a "family partnership"))

                                      -6-
<PAGE>

52.  Right of First Offer:

     a.  First Offer Right:  Lessee shall have the Right of First Offer for the
     sale of the Premises pursuant to the following terms of this right of First
     Offer.  This Right of First Offer shall apply to the initial (5) year term
     and the two (2) renewal term(s), if exercised.

     b.  Procedure for Offer:  Lessor agrees that during the initial five (5)
     year lease term and two (2) three (3) year option periods of this Lease,
     Lessor shall deliver written notice to Lessee prior to Lessor submitting to
     a third party a bond fide proposal or responding to a proposal to sell the
     Premises to such third party.  If Lessor sells the Premises to a third
     party after offering the Premises to lessee as required hereunder, Lessee's
     right of first offer shall thereupon terminate and be of no further force
     or effect.

     c.  Procedure for Acceptance:  Provided that the Lessee is not in default
     of this Lease beyond the expiration of any applicable grace or cure periods
     on the date of giving Notice of Right of First Offer, Lessee shall have the
     exclusive right and option to elect to negotiate with Lessor to purchase
     the Premises for a period of fifteen (15) days from Lessor's written
     notice.  During this period of time, Lessor will conduct any purchase
     discussions only with Lessee.  Lessor may negotiate with any other parties
     (whether or not an agreement is reached with Lessee) after this fifteen
     (15) days period has expired.

     d.  Suspension of Right of First Offer:  Lessee shall not have the right to
     exercise this Right of First Offer is Lessee is in default of this Lease
     beyond the expiration of any applicable grace or cure periods on the date
     of giving the First Offer Notice.

     e.  First Offer Right Personal to Lessee:  Lessee's Right of First Offer is
     personal to, and shall only be exercised by the originally named Lessee
     under this Lease (and may not be exercised by any assignee, sublessee or
     other transferee of Lessee's interest in this Lease or the Premises,), and
     shall only be available to Lessee while Lessee is in actual possession and
     physical occupancy of the entire Premises.  For purposes of this section, a
     successor under an Internal Change shall be deemed to be the Lessee
     hereunder.

     53. Intentionally deleted.

     54. Signage:  Lessor, without warranty of success, shall cooperate with
Lessee and the appropriate governmental agencies to acquire the monument and
building signage for Lessee.

     55. Condition of Premises/Roof Maintenance and Repair:   Prior to Lessee's
occupancy, the Premises' plumbing, electrical and mechanical systems will be in
good working order and condition.  Lessor shall repair or replace any defective
or malfunctioning component of the heating, ventilation, and air conditioning
system (HVAC), the plumbing system (including sprinkler system) or electrical
system (including lights) for which Lessor has received written notice from
Lessee describing the failure or malfunction within one hundred twenty (120)
days

                                      -7-
<PAGE>

of the Commencement Date. Prior to the Commencement Date, Lessor shall replace
the roof with a so-called twenty year roof of a type reasonably acceptable to
Lessee. Beginning on the first anniversary of the Commencement Date, with each
payment of Base Rent, Lessee shall pay, in addition, a monthly sum equal to the
amount necessary to fully amortize the cost of the roof plus interest at ten
percent per annum (10%) over one hundred twenty (12) such equal monthly
payments. Lessor shall provide, upon the request of Lessee, such evidence of
cost and is reasonably requested by Lessee.

LANDLORD:                               TENANT:

                                        The SMT Centre, Inc., a California
                                        corporation
/s/ Edwin A. Helwig
-----------------------                 By:  Gary Walker
                                             -----------------------------
Edwin A. Helwig                              Print Name

/s/ Barbara G. Helwig                        /s/ Gary Walker
-----------------------                      -----------------------------
Barbara G. Helwig                            Signature

                                             Vice President
                                             -----------------------------
9/23/97                                      Title of Signatory

                                      -8-
<PAGE>

                             WORK LETTER AGREEMENT
                             ---------------------

     This Work Letter Agreement ("Agreement") is made pursuant to and as part of
that certain lease agreement ("Lease") dated as of August 11, 1997 by and
between Edwin A. Helwig and Barbara G. Helwig (collectively, "Lessor") and The
SMT Centre, Inc., a California corporation ("Lessee") covering certain premises
("Premises") more particularly described in Section 1.2 of the Lease.  In
consideration of the mutual covenants contained below, Lessor and Lessee hereby
agree as follows:

     1.   Construction of Tenant Improvements.  Lessor agrees to construct
          -----------------------------------
certain improvements ("Tenant Improvements") within the Premises in conformance
with the Approved Plans described below, subject to all the terms and conditions
contained in this Agreement.

     2.   Improvement Allowance.
          ---------------------

          (a)  Amount.  Lessor shall provide an allowance for the building costs
               ------
incurred by Lessor in completing the Tenant Improvements ("Improvement
Allowance").  The allowance shall be used, but not limited to, the installation
and completion of the following improvements:

               (1) Remove all interior walls in the manufacturing area and
remove the existing office area.

               (2) Paint all the interior walls with a mutually acceptable
color.

               (3) Carpet in the office area with a mutually acceptable quality
and color.

               (4) Install adequate fluorescent lighting fixtures for Lessee's
assembly operation.

               (5) General cleanup outside the Premises, landscape and parking
areas.

               (6) Power wash and paint the exterior of the building in mutually
acceptable colors.

               (7) Distribute the existing power to accommodate Lessee's
assembly operation.

               (8) Construct a dock high truck well at the designated, existing
grade level roll-up door.

               (9) Install a new HVAC system(s) to service the entire premises.
<PAGE>

               (10) Install a tile floor covering (VCT) throughout the assembly
and storage areas.

               (11) Demolish concrete sloped slab (approximately 7,500 square
feet) and install a new slab.

     To the extent that the cost of the Tenant Improvement Work is in excess of
the Improvement Allowance, then Lessee shall pay to Lessor such excess amount on
a pro rata basis as a percentage of the completion of the Tenant Improvement
Work.

          (b)  Definition of Tenant Improvement Work.  The term "Tenant
               -------------------------------------
Improvement Work" shall mean all work required pursuant to the Approved Plans
(as defined below) to be done to complete the Tenant Improvements in the
Premises for occupancy by the Lessee.

          (c)  Definition of Improvement Costs.  As used in this Agreement, the
               -------------------------------
term "Improvement Costs" shall mean and include all hard and soft costs related
to the design and construction of the Tenant Improvements in accordance with the
Approved Plans and all approved Change Orders, including without limitation (i)
engineering and architectural fees; (ii) the costs of all required governmental
approvals and permits, (iii) all contractor supervision costs; (iv) the cost of
acquiring materials, supplies and equipment rental; (v) the contract price for
all construction work undertaken by general contractors and subcontractors,
including fees, general conditions and overhead of the contractors ("General
Contractor's Fees"), as applicable; (vi) the cost of all equipment and fixtures
provided for in the Approved Plans, including the cost of installation; (vii)
the cost of all testing expenses; (viii) the cost of premiums for surety bonds,
if any, including, but not limited to payment and performance bonds and
mechanics' lien bonds; (ix) the cost of utility connections, installation of
utility facilities and meters, and course of construction utility usage fees;
(x) the cost of removing rubbish and waste materials from the work site; and
(xi) the cost of premiums for insurance, if any, including contractor's
liability, course of construction and workers' compensation.

          (d)  Exclusions from Improvement Costs.  The Improvement Costs shall
               ---------------------------------
not include any costs incurred by Lessor in redoing the parking lot by removing
landscaping, repairing degraded areas of asphalt, reconfiguring the parking
layout, and slurry sealing and striping the parking lot.  This work all shall be
performed by Lessor and will result in a reconditioned parking lot with 175 or
more parking spaces.

     3.   Preparation of Preliminary and Final Plans.
          ------------------------------------------

          (a)  Preparation of Preliminary Plans.  On or before September 22,
               --------------------------------
1997 Lessee shall provide to Lessor sufficient information regarding Lessee's
requirements for the Tenant Improvements in order to enable Lessor to prepare
preliminary plans and specifications for the Tenant Improvements ("Preliminary
Plans").  Lessor shall cause its architect to promptly deliver to Lessee
Preliminary Plans.

                                      -2-
<PAGE>

          (b) Revision of Preliminary Plans.  Within three (3) business days
              -----------------------------
after the delivery of the Preliminary Plans to Lessee, Lessee shall approve the
Preliminary Plans or inform Lessor of Lessee's specific objections to such
Plans, which objections must be reasonable.  If Lessee disapproves the
Preliminary Plans, then the parties shall confer and negotiate in good faith to
reach agreement as to what revisions should be made.

          (c) Final Plans.  Once an agreement has been reached regarding
              -----------
revisions to the Preliminary Plans, Lessor shall prepare final plans and
specifications and working drawings ("Final Plans") for the Lessee Improvements.
Within three (3) business days after the delivery of the Final Plans to Lessee,
Lessee shall approve the Final Plans or inform Lessor of Tenant's specific
objections to such Final Plans, which objections must be reasonable.  Provided
that such Final Plans are logical evolutions of the Preliminary Plans and
incorporate the parties' agreement regarding revisions thereto, Lessee shall not
withhold its approval of the Final Plans.  The parties shall use their best
efforts to reach agreement regarding changes to the Final Plans as soon as it is
reasonably practicable.  In any event the parties shall agree on Final Plans on
or before October 6, 1997.

          (d) Lessee Right to Terminate.  Lessor's Architect and Lessee shall
              -------------------------
work diligently to obtain a preliminary cost estimate for the Improvement Costs.
The estimates shall be reduced to writing and initialed by Lessor and Lessee.
The preliminary estimates shall include (i) a preliminary estimate of the "hard
costs" for the Tenant Improvements, (ii) a preliminary estimate of the "soft
costs" for the Tenant Improvements and (iii) a preliminary estimate of all other
costs included in the definition of Improvement Costs for the Tenant
Improvements.  If the preliminary estimate exceeds nine hundred thousand dollars
($900,000), Lessee shall have the right to terminate this Lease by written
notice to Lessor within three business days after receipt of the preliminary
estimate.  If Lessee elects to terminate this Lease, Lessor promptly shall
return Lessee's Security Deposit and first month's rent.

          (e) Bidding/Cost Statement.  Once the parties have approved the Final
              ----------------------
Plans, Lessor shall be responsible for causing the Tenant Improvements to be
constructed by one (1) of the general contractors chosen by Lessor
("Contractors") to be selected by the bidding procedure described below in this
section ("Approved Contractor").  Prior to October 6, 1997, Lessor shall submit
to the contractors the Approved Plans and cause each contractor to submit to
Lessor fixed-price bids for such Tenant Improvements.  Such bids shall be quoted
as a total dollar amount.  Lessor shall instruct each Contractor to include in
its bid, to the extent practical, the identities of all subcontractors,
materialmen, laborers and suppliers (collectively "Subcontractors") from whom
such Contractors shall obtain competitive bids for the Tenant Improvements
(including any subcontractors required to be included in the bid package by
Lessor and Lessee, as described below), as well as an estimated construction
schedule for construction of the Tenant Improvement Work and a commitment to
achieve Lessor's and Lessee's goal to have the Tenant Improvements Substantially
Completed by December 15, 1997. Lessor shall cause each Contractor to include in
the bid package an appropriate adjustment, if

                                      -3-
<PAGE>

any, to such General Contractor's Fees, for overtime and other increased cost to
the extent required to meet such schedule. Lessor will cause the Contractors to
deliver to Lessor and Lessee sealed copies of their bids by October 17, 1997.
Lessor also shall deliver to Lessee final not-to-exceed "soft costs" on or
before October 17, 1997. On or before October 19, 1997, Lessor shall select one
of the Contractors described above to act as the general contractor for the
Tenant Improvements based on the lowest bid, as determined by Lessor after
Lessor has completed an "apples to apples" comparison of all the bids. Lessor
will supply this comparison to the Lessee by October 19, 1997. Lessee may
request a Contractor whose bid was higher by notifying Lessor in writing on or
before October 20, 1997.

Following the selection, the Approved Contractor shall submit a fixed-price
contract to the Lessor, which contract shall combine the selected
Subcontractor's bids with the General Contractors Fees.  Prior to Lessor's
execution of the fixed-price contract Lessor shall deliver to Lessee a statement
(the "Cost Statement") setting forth the projected delivery date and (i) the
contract price for the "hard" costs, and (ii) a statement of the design and
construction costs of the Tenant Improvements that are not included in the
General Contractor's contract, such as, but not limited to, (A) any permit fees
and (B) all other soft costs.

Notwithstanding the foregoing, if the Improvement Costs described in the Cost
Statement, are more than ten percent in excess of the Preliminary Improvement
Costs (exclusive of any increase in costs resulting from Lessee requested
changes or modifications), then Lessee shall have the right to terminate this
Lease by providing Lessor with written notice within two (2) business days from
receipt of the final Improvement Costs.  If Lessee does not so terminate this
Lease, then the Improvement Costs delivered to Lessee shall be binding and shall
not increase unless (i) Lessee agrees in writing to such an increase or (ii)
through Lessee approved Change Orders (as described below).  Lessor shall not
authorize any increase in Improvement Costs, once delivered to Lessee, without
Lessee's prior written consent.  If Lessee elects to terminate this Lease,
Lessor promptly shall return Lessee's Security Deposit and first month's rent.

          (f) Governmental Approvals.  Once the parties have agreed on any
              ----------------------
revisions to the Final Plans as described above, Lessor shall cause its
architect to obtain approval of the Approved Plans by all governmental agencies
having jurisdiction of the Premises.  If any changes are required by the
governmental authorities, Lessor and Lessee shall cooperate to incorporate such
changes.  The costs resulting from any such changes shall be included with
"Improvement Costs" as described above.  Immediately after all such governmental
approvals have been obtained, Lessor and Lessee shall initial and date four (4)
copies of such approved Final Plans ("Approved Plans"), which shall then become
a part of this Agreement as though fully set forth herein.

          (g) Failure to Deliver Objections.  Every approval or disapproval by
              -----------------------------
Lessee given to Lessor under this Agreement shall not be effective unless in
writing signed by Lessee. If Lessee fails to deliver any written objections to
the Preliminary Plans, Final Plans or Cost

                                      -4-
<PAGE>

Estimate within the respective time periods provided above, then Lessee shall be
deemed to have approved the same.

     4.   Change Orders.  No material changes, modifications or alternations in
          -------------
the Approved Plans or in the Tenant Improvement Work pursuant thereto shall be
made by either party without the prior written consent of the other, which
consent shall not be unreasonably withheld or delayed.  All requests for extra
work or change orders shall be made in writing, and shall specify the added or
reduced costs and time resulting therefrom.  Once approved in writing by both
parties, such change orders shall become a part of the Approved Plans, and any
additional or reduced costs relating thereto (including any similar services)
shall be added to or subtracted from Improvement Costs, as the case may be.

     5.   Completion and Rental Commencement Date.
          ---------------------------------------

          (a) Lessor's Obligations.  Upon obtaining all necessary governmental
              --------------------
approvals, Lessor shall commence construction of and diligently pursue the
completion of the Tenant Improvements substantially in compliance with the
Approved Plans and this Agreement, and in conformance with all conditions
applicable to the Tenant Improvements which are necessary for lawful occupancy
of the Premises.

          (b) Commencement Date; Substantial Completion.  Notwithstanding the
              -----------------------------------------
provisions of section 1.3 of the Lease to the contrary, the Commencement Date of
the Lease and Lessee's obligations for the payment of Rent under the Lease shall
commence on the date (the "Commencement Date") which shall be the later of:  (i)
Substantial Completion (as defined below) of the Tenant Improvement Work or (ii)
December 15, 1997.  As used in this Agreement, the term "Substantial Completion"
means the date on which all of the following have been completed:  (i)
Certification by Lessor's architect on the appropriate AIA form that the Tenant
Improvement Work has been completed in accordance with the Approved Plans,
subject to Punch-List items which will not materially interfere with Lessee's
use and occupancy of the Premises; and (ii) receipt of a temporary Certificate
of Occupancy, or other occupancy permit, entitling Lessee to legally occupy the
Premises.  Lessor shall use its commercially reasonable efforts to cause all
Punch-List items to be completed within thirty (30) days after Substantial
Completion.

In the event Substantial Completion occurs prior to December 15, 1997, then
Lessee, at Lessee's sole election, shall be permitted to (but shall not be
required to) occupy and do business from the Premises under all of the terms and
conditions of the Lease ("Early Occupancy").  In the event Early Occupancy
occurs, then Lessee shall be obligated to pay Base Rent, such Rent shall be
prorated on a per diem basis until December 15, 1997.  Lessor shall notify
Lessee at least two (2) weeks in advance of the anticipated Substantial
Completion date, subject to change depending on final inspections by City
inspectors.  Lessor shall deliver to Lessee a notice specifying the Commencement
Date and expiration date of the Term, which notice Lessee shall execute and
return to Lessor within ten (10) business days of receipt thereof.

                                      -5-
<PAGE>

          (c) Lessee Delay.  Notwithstanding the foregoing, if Lessor's
              ------------
completion of the Tenant Improvement Work is delayed as a result of any Lessee
Delay (defined below), then the Commencement Date as would otherwise have been
established pursuant to section (b) above shall be accelerated by the number of
days of such Lessee Delay.  For purposes of this Lease, "Lessee Delay" shall man
any delay or delays in Substantial Completion of the Tenant Improvement Work
resulting from (i) Lessee's failure to promptly furnish any information
necessary for Architect's completion of the Preliminary Plans or final
construction plans or to approve the Preliminary Plans or the final construction
plans by the date set forth, (ii) Lessee's failure to provide information to the
Architect in accordance with the provisions of this Work Letter Agreement, (iii)
Lessee's changes to the Approved Plans after Lessor's and Lessee's approval
thereof, (iv) Lessee's failure to otherwise perform any of its obligations
hereunder by the dates set forth and/or Lessee's failure to otherwise comply
with any provision of the Lease, (v) Lessee's request for materials, finishes or
installations that are long lead-time items, provided that Lessor shall notify
Lessee of such fact and give Lessee the opportunity of substitution within three
(3) business days after such notice, and any delay resulting from such
substitution shall be a Lessee Delay (provided it shall not be a Lessee Delay if
no substitution is available on a shorter lead-time), (vi) any delay of Lessee
in making payment of Lessee's share of the costs and expenses of the design and
construction of the Tenant Improvement Work, (vii) Lessee's interference with
Lessor or the General Contractor's construction of the Tenant Improvement Work,
(viii) any work performed by Lessee in the Premises which interferes with,
obstructs or delays Lessor in the construction of the Tenant Improvement Work
(provided the parties acknowledge that Lessee will be entering the Premises
prior to Substantial Completion to install equipment and other improvements in
accordance with section 7 below) and (ix) any other act or failure, after the
date Lessee executes this Work Letter Agreement, by Lessee, Lessee' s employees,
agents, consultants or any other persons performing or required to perform
services on behalf of Lessee.  Prior to claiming any Lessee Delay and as a
condition to such claim, Lessor must notify Lessee in writing within twenty four
hours of the occurrence of an event of Lessee Delay and of the number of days
that Lessor claims with regard to such Lessee Delay.  (In no event shall the
fact that Lessee's use of the Premises includes certain Hazardous Substances be
deemed in any manner a Lessee Delay.)

          (d) Assignment of Warranties.  Upon completion of the Tenant
              ------------------------
Improvements, Lessor shall assign to Lessee the warranties for any equipment or
portions of the Premises for which Lessee is assuming responsibility hereunder,
including without limitation the HVAC system.  If any such warranties are not
assignable, Lessor will cooperate with Lessee if Lessee determines that a claim
should be made under the warranty.

     6.   Punch List Procedure.  Within thirty (30) days after Lessor notifies
          --------------------
Lessee that the Tenant Improvements are substantially complete, Lessee shall
deliver to Lessor a statement describing all noticeable defects, errors and/or
omissions observed in the Tenant Improvements (the "Punch List").  Lessor,
Lessee, the Architect and Contractor shall perform an inspection of the Premises
and shall note any obvious defect or omissions within the Premises.

                                      -6-
<PAGE>

     7.   Fixturing Entry by Lessee.  Any time during thirty (30) days before
          -------------------------
the scheduled completion date for the Tenant Improvements, Lessee, at its
option, along with its contractors, subcontractors and agents, shall be
permitted to enter the Premises, with no obligation to pay Rent, for the
purposes of installing furniture, fixtures, and equipment provided that Lessee
has already complied with the insurance provisions of this Lease and provided
such access and installation work does not unreasonably interfere with,
obstruct, or delay Lessor's construction of the Tenant Improvement Work.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date above first written.

LANDLORD:                               TENANT:
                                        The SMT Centre, Inc., a
                                        California corporation

/s/ Edwin A. Helwig
--------------------------
Edwin A. Helwig                         By:   Gary Walker
                                              ------------------------
                                              Print Name

Date: September 23, 1997                      /s/ Gary Walker
                                              -----------------------
                                              Signature
/s/ Barbara G. Helwig
--------------------------
Barbara G. Helwig                             Vice President
                                              -----------------------
Date: September 23, 1997                      Title of Signatory

                                        By:   _______________________
                                              Print Name

                                              _______________________
                                              Signature

                                              _______________________
                                              Title of Signatory

                                        Date: September 22, 1997

                                      -7-
<PAGE>

                                   EXHIBIT B

                                 NONE-DELETED
<PAGE>

                                   EXHIBIT C

     LIST OF HAZARDOUS SUBSTANCES TO BE USED BY TENANT--LANDLORD APPROVES USE IN
ACCORDANCE WITH APPLICABLE LAWS BY EXECUTING LEASE

     DESCRIPTION              TYPE                ANNUAL QUANTITY

     SOLDER PASTE             ALPHA WS629         800 LBS

     FLUX                     ALPHA FLUX 856      1500 GALLONS

     FLUX THINNER             ALPHA 425           2500 GALLONS

     SOLDER                   ALPHA VACULOY       1200 LBS
<PAGE>

                                   EXHIBIT D

     LIST OF ITEMS TENANT INTENDS TO ATTACH TO PREMISES THAT WILL BE CONSIDERED
TRADE FIXTURES (OTHER TRADE FIXTURES MAY ALSO BE ATTACHED BY TENANT)

     TRADE FIXTURES TO BE ATTACHED TO THE BUILDING:

     1.  EQUIPMENT EXHAUST UNITS.<PAGE>

EXHIBIT 10.9

              THIS LEASE dated as of the 15th day of September, 1998

BETWEEN:

               WARDEN-McPHERSON DEVELOPMENTS LTD.
               ---------------------------------

               (hereinafter called "Landlord")

                                                              OF THE FIRST PART;

                                    - and -

               THE SURFACE MOUNT TECHNOLOGY CENTRE INC.
               ----------------------------------------

               (hereinafter called "Tenant")

                                                             OF THE SECOND PART;

                                   ARTICLE I
                                   ---------

1.00 - LEASE SUMMARY
       -------------

1.01   Lease Summary
       -------------

       The following is a summary of some of the basic terms of this Lease. For
       details of the terms referred to below, recourse should be had to the
       balance of this Lease. This Section 1.01 is for convenience and if a
       conflict occurs between the provisions of this Section 1.01 and any other
       provisions of this Lease, the other provisions of this Lease shall
       govern.

       (a)   Premises:        A free standing building and adjacent lands
             --------
                              described as the Lands and Building and
                              municipally known as 625-635 Hood Road, Markham,
                              Ontario.

       (b)   Term:            Five (5) Years and Five (5) Months
             ----

       (c)   Commencement:    The earlier of December 1st, 1998, or the date
             ------------
                              upon which the Tenant first uses that part of the
                              Premises, which are described as 625 Hood Road,
                              Markham, Ontario.

        (d)  Expiry Date:     April 30th, 2004
             -----------

        (e)  Basic Rent:      The Basic Rent payable for those premises known
             ----------
                              municipally as 635 Hood Road, Markham, shall be
                              the annual sum of THREE HUNDRED AND SIX
<PAGE>

                              THOUSAND SEVEN HUNDRED AND SIX DOLLARS AND TWENTY-
                              FIVE CENTS ($306,706.25) payable at the rate of
                              SIX DOLLARS AND TWENTY-FIVE CENTS ($6.25) per
                              square foot based upon the area of the Premises
                              being FORTY-NINE THOUSAND AND SEVENTY-THREE
                              (49,073) Square Feet, payable in equal monthly
                              installments of TWENTY-FIVE THOUSAND FIVE HUNDRED
                              AND FIFTY-EIGHT DOLLARS AND EIGHTY-FIVE CENTS
                              ($25,558.85).

                              The Basic Rent payable for those premises known
                              municipally as 625 Hood Road, Markham, shall be
                              the annual sum of ONE HUNDRED AND EIGHTY-THREE
                              THOUSAND TWO HUNDRED AND SIXTY-ONE DOLLARS
                              ($183,261.00) payable at the rate of SIX DOLLARS
                              AND FIFTY CENTS ($6.50) per square foot based upon
                              the area of the Premises being TWENTY-EIGHT
                              THOUSAND ONE HUNDRED AND NINETY-FOUR (28,194)
                              Square Feet, payable in equal monthly installments
                              of FIFTEEN THOUSAND TWO HUNDRED AND SEVENTY-ONE
                              DOLLARS AND SEVENTY-FIVE CENTS ($15,271.75).

     (f)  Option to Renew:    The Tenant shall have one (1) option to renew for
          ---------------
                              a further period of Five (5) Years for the entire
                              Premises at the rate of SIX DOLLARS AND FIFTY
                              CENTS ($6.50) per square foot.

     (g)  Use of Premises:    Light Electronic Manufacturing, Warehousing,
          ---------------
                              Offices, together with such other uses permitted
                              by the applicable building by-laws of the Town of
                              Markham and the Landlord, such permission of the
                              Landlord not to be unreasonably withheld.

     (h)  Prepaid Rent:       The Landlord acknowledges the receipt of the sum
          ------------
                              of THIRTY THOUSAND FIVE HUNDRED AND FORTY-THREE
                              DOLLARS AND FIFTY CENTS ($30,543.50) to be applied
                              on account of the Basic Rent due for the first Two
                              (2) months of the Term of the Lease following the
                              expiry of the One (1) Month rent-free period,
                              which relates to only that part of the Premises
                              known municipally as 625 Hood Road, Markham,
                              Ontario.
<PAGE>

                                   ARTICLE II
                                   ----------

2.00 - DEFINITIONS
       -----------

2.01   Definitions
       -----------

       Where used in this Lease, the following words or phrases shall have the
       meanings set forth in the balance of this Article.

2.02   "Actual Floor Area" shall mean the actual floor area of the Premises as
       same shall be determined by the Landlord's architect, engineer or
       surveyor as soon as the demising walls separating the Premises from other
       areas of the Building are completed.

2.03   "Additional Rent" shall have the meaning ascribed to it in Section 5.03.

2.04   "Building" means the building located on the Lands and forming part of
       the Premises.

2.05   "Building Operating Costs" means the costs referred to in Section 5.03.

2.06   "Commencement Date" shall have the meaning ascribed to it in Section
       1.01(c).

2.07   "Environmental Audit" shall have the meaning ascribed to it in Section
       19.06.

2.08   "Goods and Services Tax" means any and all goods and services taxes,
       sales taxes, value added taxes, business transfer taxes or any other
       taxes imposed on the Landlord with respect to:

       (a)  the Basic Rent payable by the Tenant to the Landlord; or

       (b)  Additional Rent payable by the Tenant to the Landlord or payable by
            the Tenant directly as set out in this Lease; or

       (c)  all other amounts which are payable by the Tenant as set out in this
            Lease; pursuant to the Excise Tax Act or any subsequent legislation,
                                   --------------
            whether characterized as a goods and services tax, sales tax, value
            added tax, business transfer tax or otherwise.

2.09   "Lands" means the lands more particularly described in Schedule "A"
       hereto.

2.10   "Laws" means all statutes, regulations, bylaws, orders, rules,
       requirements, directions of all federal, provincial, municipal and other
       governmental authority having jurisdiction.

2.11   "Lease" means this Lease including all of the schedules attached hereto.

                                      -3-
<PAGE>

2.12  "Offer to Lease" means that certain Offer to Lease with respect to
      Premises known municipally as 625 Hood Road, Markham, made between the
      Landlord and the Tenant and executed by the Parties on September 3rd,
      1998, which is attached hereto as Schedule "F".

2.13  "Option to Purchase" shall having the meaning ascribed to it in Schedule
      "D".

2.14  "Option to Renew" shall have the meaning ascribed to it in Schedule "C".

2.15  "Realty Taxes" means all taxes, rates, duties, levies, fees, charges,
      local improvement rates, imposed charges, levies and assessments whatever
      (including school taxes, water and sewer taxes, extraordinary and special
      assessments and all rates, charges, excise levies, whether or not of the
      foregoing nature), and whether municipal, provincial, federal or
      otherwise, which may be levied, confirmed, imposed, assessed, charged,
      rated against the Lands and Buildings or any part thereof, and any
      fixtures, equipment or improvements therein, or against Landlord in
      respect of any of the same or in respect of any rental or other
      compensation receivable by Landlord in respect of the same, including any
      commercial concentration levy or any tax or duty imposed upon Landlord
      which is measured by or based in whole or in part directly upon the
      _______ payable under this Lease whether existing at the date hereof or
      hereafter imposed by any governmental authority including, without
      limitation, value added tax, goods or services tax, business transfer tax,
      retail sales tax, federal sales tax, excise taxes or _______ or any tax
      similar to the foregoing, but not including taxes which are based on
      ______ Landlord's profits which are of the nature of a corporate or
      personal income tax liability imposed on the landlord.

2.16  "Rent" shall have the meaning ascribed to it in Section 5.01 hereof.

2.17  "Rental Year" means a period of twelve (12) consecutive calendar months.

2.18  "Term" shall have the meaning ascribed to it in Section 4.02.

                                  ARTICLE III
                                  -----------

3.00 - INTENT OF LEASE
       ---------------

3.01   Net Lease
       ---------

       Save and except where provided to the contrary in this Lease, this Lease
       shall be to the Landlord and the Landlord shall not be responsible for
       any expense __ obligations of any kind whatsoever other than those
       obligations and expenses which are the responsibility of the Landlord
       hereunder.

                                   ARTICLE IV
                                   ----------

                                      -4-
<PAGE>

4.00 - LEASE OF PREMISES
       -----------------

4.01   Premises
       --------

       Landlord hereby leases to Tenant and Tenant hereby leases from Landlord
       the Premises, subject to the provisions of this Lease Agreement and
       subject to the terms of the Offer to Lease. In the event that a conflict
       arises between the provisions of this Lease and the Offer to Lease, then
       the Offer to Lease shall govern.

4.02   Term
       ----

       The Term of the Lease shall be for the period described as the Term in
       Section 1.01(b) hereof, commencing on the Commencement Date and to be
       fully completed and ended on the date described as the Expiry Date in
       Section 1.01(d) hereof. Upon the commencement of the Term, the prior
       agreement entered into between the Landlord and Tenant with respect to
       that part of the Premises described as 635 Hood Road shall be deemed to
       be terminated and the within Agreement shall govern the relationship of
       the parties throughout the Term for the Premises; provided that the prior
       agreement will continue to apply to matters occurring in respect of 635
       Hood Road up to the commencement of the Term but not thereafter.

4.03   Quiet Enjoyment
       ---------------

       Subject to all of the terms of this Lease and subject to Tenant's paying
       all Rent and performing all material obligations whatsoever as and when
       the same are due to be paid and performed by Tenant, Tenant may peaceably
       possess and enjoy the Premises for the Term without interruption by
       Landlord or any person claiming by, from or under Landlord.

4.04   The Landlord shall pay all Realty Taxes and other costs and charges
       levied against the Premises and the Building in respect to which the
       Tenant has reimbursed the Landlord.

                                   ARTICLE V
                                   ---------

5.00 - RENT
       ----

5.01   Tenant to Pay
       -------------

       Tenant shall pay in lawful money of Canada at par at such address as
       shall be designated from time to time by Landlord, Basic Rent and
       Additional Rent (all of which are collectively herein sometimes referred
       to as "Rent") as herein provided without any deduction, set-off or
       abatement whatsoever, Tenant hereby agreeing to waive any rights it may
       have pursuant to the provisions of Section 35 of the Landlord and Tenant
       Act R.S.O.

                                      -5-
<PAGE>

       1980 or any other statutory provision to the same or similar effect and
       any other rights it may have at law to set-off.

5.02   Basic Rent
       ----------

       Commencing on the Commencement Date, Tenant shall pay to Landlord a fixed
       minimum annual rent ("Basic Rent") in the amount described as Basic Rent
       in Section 1.01(e) hereof, to be paid in equal monthly installments in
       advance on the first day of each month during the Term.

       In the event that the Actual Floor Area is different from the Floor Area
       set out in 1.01(a) and the Basic Rent is determined at a rate per square
       foot of Actual Floor Area, the Basic Rent shall be adjusted accordingly,
       based on the rental rate per square foot set out in 1.01(e).
<PAGE>

       If the first day upon which Rent is payable is other than the first day
       of a calendar month, the Tenant shall pay upon such date Rent from such
       date to the end of such month calculated at a daily rate of 1/365th of
       the annual Rent.

       The parties agree that with respect to the Premises known municipally as
       625 Hood Road, Markham, that there shall be no Basic Rent payable by the
       Tenant for the first Thirty (30) days of occupancy, and that Basic Rent
       for these Premises in the amount of FIFTEEN THOUSAND TWO HUNDRED AND
       SEVENTY-ONE DOLLARS AND SEVENTY-FIVE CENTS ($15,271.75) shall not be paid
       by the Tenant for the said Thirty (30) day period provided however that
       the Tenant shall be responsible for the payment of all Additional Rent
       from the Commencement Date forward.

5.03   Additional Rent.
       ---------------

       In addition to Basic Rent, Tenant shall pay to Landlord (i) all
       Additional Rent and other amounts as and when the same shall be due and
       payable pursuant to the provisions of this Lease all of which shall be
       deemed to accrue on a per diem basis; and (ii) all other amounts as and
       when the same shall be due and payable pursuant to any agreement related
       to the Premises, between Landlord and Tenant, all as such out in said
       separate agreement entered into between the Landlord and Tenant; all of
       such amounts whether originally payable pursuant to this Lease or
       otherwise, being herein sometimes referred to as "Additional Rent" and
       "Building Operating Costs".

5.04   Deemed Rent and Allocation
       --------------------------

       If Tenant defaults in payment of any Rent (whether to Landlord or
       otherwise) as and when the same is due and payable hereunder, Landlord
       shall have the same rights and remedies against Tenant (including rights
       of distress) upon such default as if such sum or sums were rent in
       arrears under this Lease. All Rent shall, as between the parties hereto,
       be deemed to be rent due on the date upon which such sum or sums were
       originally payable pursuant to this Lease and shall be paid in accordance
       with this Lease without any deduction, abatement or set-off whatsoever.

       No payment by Tenant or acceptance of payment by Landlord of any amount
       less than the full amount payable to Landlord, and no endorsement,
       direction or note on any cheque or other written instruction or statement
       respecting any payment by Tenant shall be deemed to constitute payment in
       full or an accord and satisfaction of any obligation of Tenant and
       Landlord may receive any such lesser amount and any such endorsement,
       direction, note, instruction or statement without prejudice to any of
       Landlord's other rights under this Lease or at law, whether or not
       Landlord notifies Tenant of any disagreement with or nonacceptance of any
       amount paid or any endorsement, direction, note, instruction or statement
       received.

                                      -7-
<PAGE>

5.05   Monthly Payments of Additional Rent
       -----------------------------------

       Landlord may from time to time estimate any amount(s) payable by Tenant
       pursuant to any provisions of this Lease for the then current or the next
       following Rental Year or, if applicable, any broken portion thereof and
       may notify Tenant in writing of the estimated amounts thus payable by
       Tenant. The amounts so estimated shall be payable by Tenant in advance in
       equal monthly installments over the Rental Year or broken portion
       thereof, such monthly installments being payable on the same day as the
       monthly payments of Basic Rent. Landlord may, from time to time,
       designate or alter the Rental year for which accounts shall be prepared
       covering the Building Operating Costs. Within Ninety (90) days following
       the expiration of each fiscal period, Landlord shall furnish to Tenant a
       statement of the actual expenses it has incurred which are the Tenant's
       responsibility for such Rental Year and shall make a final determination
       of the amounts payable by Tenant. If the amount determined to be payable
       by Tenant as aforesaid shall be greater or less than the payments on
       account thereof made by Tenant prior to the date of such determination,
       then the appropriate adjustments will be made and Tenant shall pay any
       deficiency to Landlord within thirty (30) days after delivery of such
       statement and final determination and if Tenant is not in default under
       the terms of the Lease, the amount of any overpayment shall be paid to or
       credited to the account of Tenant within thirty (30) days after the
       delivery of such statement.

       Landlord shall provide Tenant with copies of the invoices covering the
       expenses included in the statement of Building Operating Costs to be
       furnished annually to the Tenant.

                                   ARTICLE VI
                                   ----------

6.00 - REALTY TAXES
       ------------

6.01   Realty Tax Payable by Tenant
       ----------------------------

       Landlord shall have the right to require Tenant to pay all taxes and
       rates, municipal, parliamentary or otherwise, including electric and
       water rates for the normal supply of hot and cold water to the premises,
       assessed against the demised premises of the Landlord or Tenant on
       account thereof saving and excepting any business taxes and taxes upon
       personal property or income of the Tenant, license fees, or other taxes
       imposed upon the property, business or income of the Tenant. In the event
       that the Province of Ontario, Town or Markham, or any other relevant
       governmental authority abolishes or amends the business tax regime and
       adds the amount of business tax to the realty tax component of the
       Property of which the demised premises forms a part, then the Tenant
       shall pay the Landlord the increase in realty or other taxes which are
       the taxes which substitute for the Tenant's business taxes. To the extent
       of Realty Taxes received by Landlord from Tenant, Landlord shall pay same
       to the relevant taxing authority.

                                      -8-
<PAGE>

       Commencing on the Commencement Date and thereafter at all times
       throughout the Term, Tenant shall pay to Landlord in monthly installments
       based on Landlord's estimate of the Realty Taxes for the relevant Lease
       Year, or to the relevant taxing authority, if so requested by Landlord,
       not later than the time when they fall due the Realty Taxes, and other
       taxes, if any, levied, confirmed, imposed, assessed or charged (herein
       collectively or individually referred to as "charged") against or in
       respect of the Premises and all furnishings, fixtures, equipment,
       improvements and alterations in or forming part of the Premises.

6.02   Determination of Tenant's Realty Tax
       ------------------------------------

       Tenant's obligation to pay Realty Taxes and other taxes, if any, charged
       against the Premises shall be determined on the basis of separate tax
       bills or assessment notices respecting the Premises, where available. If
       the relevant taxing authority does not issue a separate tax bill
       respecting the Premises, then Tenant's obligation in respect of Realty
       Taxes shall be computed by applying the relevant tax rate to the
       applicable assessment of the Premises if the Premises have been
       separately assessed by the relevant assessing authority.

       Tenant shall also pay any increase in Realty Taxes assessed against the
       Building which may be levied as a result of any improvements made by
       Tenant to the Premises.

6.03   Tax Bills and Assessment Notices
       --------------------------------

       Tenant shall promptly delivery to Landlord forthwith upon Tenant's
       receiving the same:

       (a)  copies of all assessment notices, tax bills and any other documents
            received by Tenant related to Realty Taxes.

       (b)  receipts for payment of Realty Taxes and business taxes payable by
            Tenant pursuant hereto.

       On or before the expiry of each calendar year, in the event that the
       Landlord has requested that Tenant pay its share of Realty Taxes directly
       to the relevant taxing authority, Tenant shall provide to Landlord
       evidence satisfactory to Landlord that all Realty Taxes and business
       taxes payable by Tenant pursuant to the terms hereof up to the expiry of
       such calendar year, including all penalties and interest resulting from
       any delay in the payment of Realty Taxes and business taxes, have been
       duly paid.

6.04   Contest of Realty Taxes
       -----------------------

       Realty Taxes, or the assessments in respect of Realty Taxes which are the
       subject of any contest by Landlord or Tenant shall nonetheless be paid in
       accordance with the foregoing
<PAGE>

       provisions hereof, provided, however, that in the event Tenant shall have
       paid any amount in respect of Realty Taxes in excess of the amount
       ultimately found payable as a result of the disposition of any such
       contest, and Landlord receives a refund in respect of the Tenant's share
       thereof, if Tenant is not in default hereunder the appropriate amount of
       such refund shall be refunded to Tenant.

       Landlord may contest any Realty Taxes and appeal any assessments related
       thereto and may withdraw any such contest or appeal or may agree with the
       relevant authorities on any settlement, compromise or conclusion in
       respect thereof and Tenant consents to Landlord's so doing. Tenant shall
       co-operate with Landlord in respect of any such contest and appeal and
       shall make available to Landlord such information in respect thereof as
       Landlord requests. Tenant will execute forthwith on request all consents,
       authorizations or other documents as Landlord requests to give full
       effect to the foregoing.

       Tenant shall not contest any Realty Taxes or appeal any assessments
       related thereto without first notifying Landlord in writing.

6.05   Adjustments
       -----------

       Any amounts payable by Tenant on account of Realty Taxes shall be
       adjusted on a per diem basis in respect of any period not falling wholly
       within the Term, for which Realty Taxes are payable.

6.06   Goods and Services Taxes
       ------------------------

       The Tenant shall pay to the Landlord an amount equal to the Landlord's
       liability (pursuant to the applicable legislation) for any and all Goods
       and Services Taxes, levied, rated, charged or assessed in connection with
       this Lease, it being the intention of the parties that the Landlord shall
       be fully reimbursed by the Tenant with respect to the Tenant's liability
       for any and all Goods and Services Taxes payable by the Landlord. The
       amount of Goods and Services Taxes so payable by the Tenant shall be
       calculated by the landlord in accordance with the applicable legislation
       and shall be paid to the Landlord at the same time as the amounts, to
       which the Goods and Services Taxes or taxes apply, are payable to the
       Landlord under the terms of this Lease or upon demand at such other time
       or times as the Landlord from time to time determines. Despite any other
       paragraph or clause of this Lease, the amount payable by the Tenant under
       this paragraph shall be deemed to be a tax and not Rent but the Landlord
       shall have all of the same remedies for and rights of recovery of such
       amount as it has for recovery of Rent under this Lease and may require it
       to be paid in the same manner as Additional Rent for purposes of
       collection.

                                  ARTICLE VII
                                  -----------

7.00 - OPERATION OF PREMISES
       ---------------------

                                     -10-
<PAGE>

7.01   Operation of Premises by Tenant
       -------------------------------

       The Tenant at its own expense shall maintain, manage and operate the
       Premises in the same manner as a reasonable and prudent owner of same
       would do in a first class and reputable manner befitting the Premises and
       the age of the Building and in conformity with all Laws and present and
       future requirements of every governmental or other authority having
       jurisdiction and shall act diligently and use all proper and reasonable
       efforts consistent with good business practice.

7.02   Landlord May Perform or Pay
       ---------------------------

       In the event that Tenant fails to pay any cost or expense associated with
       or arising in connection with its use and operation, maintenance and
       repair of the Premises and including any and every obligation contained
       in this Lease or in the event Tenant fails to perform or fulfill any of
       its obligations hereunder, Landlord may pay or perform the same and shall
       be entitled to charge all of its costs and expenses together with an
       administrative charge of twenty (20%) percent in connection therewith to
       the Tenant as Additional Rent who shall pay them forthwith on demand.
       Landlord without prejudice and in addition to any other rights shall have
       the same remedies and may take the same steps for the recovery of all
       such sums as Landlord may take for the recovery of rent in arrears
       hereunder.

                                 ARTICLE VIII
                                 -------------

8.00 - USE OF PREMISES
       ---------------

8.01   Use of Premises
       ---------------

       Tenant covenants that it shall not use and shall not cause, suffer or
       permit the Premises to be used for any purpose other than as described as
       Use of Premises in Section 1.01(g) hereof without Landlord's prior
       written consent which may be withheld in Landlord's sole and absolute
       discretion.

8.02   Conduct of Business
       -------------------

       At all times throughout the Term, Tenant shall continuously, actively and
       diligently conduct its business in the whole of the Premises in an up-to-
       date first class and reputable manner.

8.03   Tenant's Fixtures
       -----------------

       Tenant shall install and maintain at all times during the Term in the
       Premises first-class trade fixtures including furnishings and equipment
       adequate and appropriate for the

                                     -11-
<PAGE>

       business to be conducted on the Premises and of no less a quality or
       quantity than whatever is usual for such type of business, all of which
       shall be kept in good order and condition.

       Tenant may not remove any trade fixtures or other contents of the
       Premises therefrom other than in the ordinary course of business except
       that, with the prior written consent of Landlord, Tenant may remove such
       trade fixtures provided that Tenant provides evidence satisfactory to
       Landlord that it is substituting therefor trade fixtures at least equal
       in value and function to those being removed.

8.04   Signs
       -----

       The Tenant shall have the right to erect signs on or about the Premises
       (except on or from the roof) advertising its business, provided that such
       signs are first approved in writing by the Landlord and such signs shall:

       (a)  comply with all applicable bylaws and regulations;

       (b)  be maintained in good repair by the Tenant and

       (c)  not be erected if to do the same would weaken or impair the
            structural strength of the Building;

       (d)  at Landlord's request be removed on termination of the Lease.

       The Tenant shall upon removal of such signs repair any damage caused by
       their installation or removal.

8.05   Waste Removal
       -------------

       Tenant shall not allow any refuse, garbage or any loose or objectionable
       material to accumulate in or about the Premises and will at all times
       keep the Premises in a clean and neat condition. Tenant shall comply with
       Landlord's regulations respecting the removal of waste and Tenant shall
       at its own expense removal all waste from the Premises. Until removed
       from the Premises, all waste from the Premises shall be kept in
       appropriate containers.

8.06   Pest Control
       ------------

       Tenant shall be responsible for pest extermination in respect of the
       Premises and shall engage, for such purpose, such contractors and at such
       intervals as Landlord shall require.

8.07   Waste and Nuisance
       ------------------

                                     -12-
<PAGE>

       (a)  Tenant shall not cause, suffer or permit any waste or damage to the
            Premises or leasehold improvements, fixtures or equipment therein
            nor permit any overloading of the floors thereof and shall not use
            or permit to be used any part of the Premises for any dangerous,
            noxious or offensive activity or goods and shall not do anything or
            permit anything to be done upon or about the Premises nor anything
            to be brought thereon which Landlord may reasonably deem to be
            hazardous or a nuisance or annoyance. Tenant shall take every
            reasonable precaution to protect the Premises from risk of damage by
            fire, water or the elements or any other cause.

       (b)  Tenant shall not use any advertising transmitting or other media or
            transmissions of any kind, or other devices in a manner which can be
            heard, seen, or received outside the Premises, or which would in any
            way interfere with any communications or other systems outside the
            Premises.

8.08   Compliance with Law
       -------------------

       (a)  Tenant shall be solely responsible for obtaining from all
            authorities having jurisdiction all necessary permits, licenses and
            approvals as may be necessary to permit Tenant to hold this Lease
            and to occupy the Premises and conduct its business thereon, as
            required by all applicable Laws, including, without limiting the
            generality of the foregoing, any necessary extra provincial license,
            any necessary license and any necessary approvals under the Foreign
            Investment Review Act (Canada).

            Tenant shall be responsible for and shall comply at its own expense
            with all applicable Laws respecting the use, condition and
            occupation of the Premises, and all leasehold improvements, trade
            fixtures, furniture, fixtures, equipment and contents thereof
            (collectively called "Contents") and Tenant shall promptly perform
            all necessary repairs, alterations, changes and improvements to the
            Premises and Tenant's business, use, or occupancy thereof and the
            Contents in order to comply with all of such Laws.

       (b)  Tenant shall provide Landlord on request with evidence satisfactory
            to Landlord acting responsibly that Tenant has obtained and is
            complying with the terms of all applicable Laws, licences, approvals
            and permits from time to time.

8.09   Prohibited Uses
       ---------------

       If, in the opinion of Landlord, Tenant is in breach of any of the
       provisions of this Article, Tenant shall immediately discontinue such
       breach upon Landlord's written request.

                                  ARTICLE IX
                                  -----------

                                     -13-
<PAGE>

9.00 - SERVICES AND UTILITIES
       ----------------------

9.01   Utilities
       ---------

       (a)  Tenant shall be solely responsible for supplying all utilities,
            heating and air-conditioning equipment in such manner as a
            reasonable, prudent owner of the Premises would do. Tenant shall
            promptly pay for, as and when they fall due, all costs of supplying
            hot and cold water, electricity, fuel, gas, steam, sewer charges and
            other utilities, forms of energy, or other services to or used in
            respect of the Premises and the Tenant's operation therein.

       (b)  If the heating and cooling equipment shall require maintenance,
            repair or replacement, Tenant shall promptly arrange for the
            necessary work to be done at its expenses by contractors approved by
            the Landlord, or Landlord may at its option, attend to the same at
            Tenant's expense with reasonable promptness having regard to the
            then existing climatic conditions but in any event Landlord, having
            so attended, shall not be liable for any losses or damages arising
            from the resulting lack of heating or cooling and, in any event,
            Landlord shall not be liable for any indirect or consequential
            losses or damages or any damages for personal discomfort arising
            from any lack of heating or cooling unless caused as a result of the
            negligence of the Landlord or those for whom it is in law
            responsible.

       (c)  Tenant shall promptly pay as and when the same shall be payable all
            costs for all fittings, machine apparatus, connections, including,
            but not limited to telephone installation, and meters and all work,
            services and rental charges, charged or performed in connection with
            any services or utilities provided to or in respect of the Premises
            including the costs of maintaining and repairing all such items.
            Tenant shall pay the total cost of and carry out any replacement of
            electric light bulbs, tubes, starters and ballasts in the Premises.

       (d)  Tenant's use of any such utilities shall not exceed the available
            capacity of the existing systems from time to time. If Tenant
            desires at any time to obtain any such utilities in excess of such
            available capacity, Tenant may supply and install at its expense any
            special wires, conducts or other equipment necessary to provide such
            additional capacity subject to the prior written consent of
            Landlord.

       (e)  Landlord shall not be responsible for the inadequacy of any heating
            or cooling of the Premises if (i) the use or occupancy of the
            Premises, or (ii) the electrical or other power consumed on the
            Premises, or (iii) the configuration of partitions or other items on
            the Premises, or (iv) the failure of Tenant to keep the equipment in
            good maintenance or repair or (v) the failure of Tenant to
            adequately shade exterior windows, interferes with or impairs the
            functioning of equipment for heating or cooling of the Premises.

                                     -14-
<PAGE>

9.02    Non-Liability of Landlord
        -------------------------

        Landlord shall not be liable for any damages, direct or indirect,
        resulting from or contributed to by any interruption or cessation of or
        failure in supply of any utilities, or any heating or air-conditioning
        equipment or any other systems or equipment on the Premises. Without
        limiting the generality of the foregoing, Landlord shall not be liable
        for and Tenant shall indemnify Landlord and save Landlord harmless from
        and against any and all indirect or consequential damages or damages for
        personal discomfort or illness of Tenant or any persons permitted by it
        to be on the Premises by reason of the suspension, non-operation, or
        failure for any period of time of any utilities, heating or air-
        conditioning equipment or any other systems or equipment on the
        Premises.

9.03    Landlord's Suspension of Utilities, etc.
        ----------------------------------------

        Should Landlord at any time wish to effect or make any inspection or any
        maintenance, repairs, replacements, alterations or improvements to any
        utilities, heating or air-conditioning equipment or systems
        (notwithstanding that Landlord has no obligation to do so), Landlord
        shall have the right, on at least 4 day's written notice to the Tenant,
        or with no prior notice in the event of an emergency, without any
        liability and without thereby constituting an interference with Tenant's
        rights under this Lease or a breach by Landlord of this Lease, and
        without thereby entitling Tenant to any rights in respect thereof, to
        discontinue, suspend or modify any utilities, heating, air-conditioning
        and other systems at such time or times and from time to time in order
        to allow the Landlord to do so, all with the consent of the Tenant,
        unless the Landlord is of the opinion, acting reasonably, that an
        emergency exists in which event the Landlord shall be permitted to
        perform such work without the consent of the Tenant. The costs incurred
        by the Landlord in connection with any of the above shall be payable by
        the Tenant forthwith on demand, and shall be recoverable by the Landlord
        as additional rent.

                                   ARTICLE X
                                   ---------

10.00 - MAINTENANCE, REPAIRS AND ALTERATIONS
        ------------------------------------

10.01   Maintenance and Repairs of Premises
        -----------------------------------

        (a)  At all times throughout the Term the Tenant at its sole expense
             shall perform or cause to be performed maintenance, decoration,
             repairs and replacements to keep the Premises and all the contents
             thereof and all services, equipment and systems located in or
             serving the Premises, at all times in first-class appearance and
             condition in accordance with the age of the Building, and in
             accordance with all Laws. Provided always that the Tenant's
             obligation to maintain and repair under this Lease Agreement shall
             be restricted to maintaining the Premises to a standard

                                     -15-
<PAGE>

          no higher than the Premises were in when the Tenant first occupied the
          Premises under this Lease, save and except for:

          (i)   reasonable wear and tear;

          (ii)  all repairs and replacements to the structural components of the
                Building and the Premises or those resulting from any inadequacy
                of design and construction of the Building all of which shall be
                the responsibility of the Landlord at its sole expense, as
                provided in Section 10.01(b); and

          (iii) damage by fire, including water and smoke damage and other
                casualties in respect of which the Landlord is required pursuant
                to the terms of this Lease to insure.

          Provided that the Tenant shall only be required to pay the amortized
          value (based upon their life expectancy) of the cost of those repairs
          and replacements which are its responsibility hereunder and which are
          properly characterized as "capital" in nature in accordance with
          generally accepted accounting principles.

     (b)  Subject to the provisions of paragraph 10.01(a), the Landlord
          covenants and agrees that it shall be responsible and that it shall at
          its expense keep in good and reasonable state of repair the structural
          elements of the Building and the Premises including all footings, the
          foundation, floor, load bearing walls, supporting columns and roof.
          The Landlord shall undertake any such repairs promptly upon receipt of
          notice from the Tenant in accordance with the provisions of this
          Lease. Provided however that the Tenant shall be responsible for any
          damage caused by it to the structural elements of the Building and the
          Premises subject to the Landlord's right to recover from any insurer
          of the Premises any sums due to it pursuant to any policies of
          indemnity.

10.02     Approval of Repairs and Alterations
          -----------------------------------

     (a)  Tenant shall not make any repairs, replacements, changes, additions,
          improvements or alterations (hereinafter in this Article X referred to
          as "Alterations") to the Premises without Landlord's prior written
          consent, which consent shall not be unreasonably withheld unless such
          proposed Alterations might (i) in any way affect the structure of the
          Premises, any demising walls or entrances, or the coverage of the
          Lands for zoning purposes; or (ii) in the opinion of Landlord,
          detrimentally affect the appearance or quality of the Premises, or
          impair the value or usefulness of the Premises, in either of which
          events such consent may be withheld in Landlord's sole discretion.

                                     -16-
<PAGE>

     (b)  With its request for Landlord's consent, Tenant shall submit to
          Landlord details of the proposed Alterations including plans and
          specifications in respect thereof prepared by qualified architects or
          engineers, and which Alterations shall be completed in accordance with
          the plans and specifications approved in writing by Landlord.

     (c)  Unless expressly authorized in writing by Landlord to the contrary,
          all Alterations which might cost in excess of Ten thousand
          ($10,000,000) dollars to complete or which might affect the structure
          of mechanical or electrical systems of the Premises, shall be
          conducted under the supervision of a qualified architect or engineer
          approved by Landlord, such approval not to be unreasonably withheld.

     (d)  All Alterations shall be planned and completed in compliance with all
          Laws and Tenant shall, prior to commencing any Alterations, obtain, at
          its expense, all necessary permits and licenses and provide evidence
          thereof satisfactory to Landlord.

     (e)  Tenant shall, prior to the commencement of any such Alterations
          furnish to Landlord at Tenant's expense such evidence as reasonably
          required by Landlord of the projected cost of Alterations together
          with such indemnification against costs, liens and damages as Landlord
          shall reasonably require including, if required by Landlord, a
          performance bond in such terms and issued by such company as shall be
          acceptable to Landlord in its sole discretion in an amount at least
          equal to the estimated cost of such Alterations, guaranteeing
          completion within a reasonable time of such Alterations free and clear
          of any liens or encumbrances.

     (f)  All Alterations shall be performed without any disruption to other
          tenants of the Building and promptly and in a good and workmanlike
          manner and in compliance with Landlord's rules and regulations by
          competent contractors or workmen who shall be designated or approved
          by Landlord.

     (g)  If Tenant performs any such Alterations without compliance with all of
          the foregoing provisions of this Article X, Landlord, without
          prejudice to and without limiting Landlord's other rights pursuant to
          this Lease and at law, shall have the right to require Tenant to cease
          and/or remove such Alterations forthwith.

10.03 Repair According to Landlord's Notice
      -------------------------------------

      Landlord or any persons designated by it shall have the right to enter the
      Premises at any time on notice to the Tenant to view the state of repair,
      condition and use thereof and Tenant shall promptly perform any
      maintenance, decoration, repairs, replacements or Alterations according to
      written notice from Landlord if same are the responsibility of the Tenant
      hereunder. In the event that the Tenant shall refuse or neglect to make
      forthwith

                                     -17-
<PAGE>

      the repairs referred to in any such notice, the Lessor may make the same
      and the costs thereof, together with reasonable compensation to the
      Landlord for administration and/or supervision of the work required, shall
      be paid forthwith by the Tenant as additional rent.

10.04 Notice by Tenant
      ----------------

      Tenant shall give immediate written notice to Landlord of any accident,
      defect, damage or deficiency in any part of the Premises, which comes to
      the attention of Tenant or any of its employees or contractors
      notwithstanding the fact that Landlord has no obligation in respect of the
      same. The provisions of this Section 10.04 shall not be interpreted so as
      to imply or impose any obligation whatsoever upon Landlord.

10.05 Ownership of Leasehold Improvements
      -----------------------------------

      All leasehold improvements installed in the Premises shall forthwith upon
      the installation thereof become the absolute property of Landlord without
      compensation therefor but without Landlord's having or thereby accepting
      any responsibility in respect of the maintenance, repair or replacement
      thereof, all of which shall be Tenant's responsibility. The expression
      "Leasehold Improvements" where used in this Lease includes, without
      limitation, all fixtures, improvements, installations, alterations and
      additions from time to time made, erected or installed in or about the
      Premises, and includes all the following, whether or not easily
      disconnected and moveable: doors partitions and hardware, mechanical,
      electrical and utility installations, carpeting, drapes, other floor and
      window coverings, and drapery hardware, and decorations of any kind,
      heating, ventilating, air conditioning and humidity control equipment,
      lighting fixtures, built-in furniture and furnishings, all counters in any
      way connected to the Premises or to any utility services located therein.

      The only exclusions from "Leasehold Improvements" are free-standing
      furniture, trade fixtures and equipment in the Premises or to any utility
      systems located therein, and all manufacturing and office equipment and
      all related piping, supports, wiring and the like that may be connected to
      the Premises.

10.06 Construction Liens
      ------------------

      Tenant shall make all payments and take all steps necessary to ensure that
      no lien or other charge is registered against the Lands or any portion
      thereof or against either Landlord's or Tenant's interest therein as a
      result of any work done or material supplied to Tenant or the Premises.
      Tenant shall cause any such registrations to be discharged or vacated
      immediately after notice from Landlord, or within thirty (30) days after
      registration, whichever is earlier.

                                     -18-
<PAGE>

        Tenant shall indemnify and save harmless Landlord from and against any
        Liabilities, claims, damages, costs or expenses, including legal
        expenses, arising in connection with any work done or materials supplied
        in respect of the Premises.

        If Tenant permits there to be registered or fails to cause any such
        registration to be discharged or vacated as aforesaid, then, in addition
        to any other rights of Landlord, Landlord may, but shall not be obliged
        to, discharge or vacate the same by paying the amount claimed to be due
        together with any other amounts into court or otherwise as Landlord
        determines, including legal fees and disbursements, in thus arranging
        for the discharging or vacating of any such liens or certificates of
        action and all amounts so paid by Landlord shall be paid by Tenant to
        Landlord forthwith upon demand together with reasonable compensation to
        landlord for administration in respect thereof.

                                  ARTICLE XI
                                  ----------

11.00 - END OF TERM
-------------------

11.01   Vacating of Possession
        ----------------------

        Forthwith upon the expiry or earlier termination of the Term, Tenant
        shall peaceably deliver to landlord vacant possession of the Premises in
        such condition in which Tenant is required to maintain and keep the
        Premises during the Term pursuant hereto and shall leave the Premises in
        a neat, clean and broom-swept condition and Tenant shall deliver all
        keys for the Premises and all keys or combinations to locks on doors,
        safes or vaults within the Premises.

11.02   Removal of Trade Fixtures
        -------------------------

        Provided that Tenant has paid all Rent to the date of expiry or earlier
        termination of the Term and any and all damages and other amounts
        payable by Tenant to Landlord for any reason whatever and provided
        Tenant is not otherwise in default hereunder, or if otherwise authorized
        or requested by the Landlord, Tenant shall at the expiry or earlier
        termination of the Term remove its trade fixtures and shall repair all
        damage or injury caused to the Premises resulting from the installation
        or removal of such trade fixtures. Other than as provided above, Tenant
        shall not remove trade fixtures from the Premises.

        If at the expiry or earlier termination of the Term, Tenant does not
        remove its trade fixtures or any of its other property on the Premises,
        Landlord shall have no obligation in respect of any such trade fixtures
        or property and may sell or destroy the same or have them removed or
        stored at the expense of Tenant or dispose of discretion; at the option
        of Landlord, such trade fixtures or property not removed at the expiry
        or earlier termination of the Term shall become the absolute property of
        Landlord without payment of any

                                     -19-
<PAGE>

        compensation therefor to Tenant and may be dealt with by Landlord in
        such manner as it determines.

11.03   Overholding by Tenant
        ---------------------

        If Tenant remains in possession of all or any part of the Premises after
        the expiry of the Term with the consent of Landlord and without any
        further written agreement, this Lease shall not be deemed thereby to
        have been renewed and Tenant shall be deemed conclusively to be
        occupying the Premises as a monthly tenant on the same terms as set
        forth in this Lease so far as they are applicable to a monthly tenancy
        except the monthly Rent shall be 200% of an amount determined by taking
        1/12 of the Rent payable for the period of the last twelve months of the
        Term.

                                  ARTICLE XII
                                  -----------

12.00 - DAMAGE AND DESTRUCTION
------------------------------

12.01   Termination of Lease
        --------------------

        If any part of the Premises is damaged or destroyed and either, -

        (a)  in the opinion of Landlord acting reasonably, the damage or
             destruction cannot be repaired or rebuilt within one hundred and
             eighty (180) days after the damage or destruction; or

        (b)  such damage or destruction is caused by an occurrence against which
             Landlord is not insured or required to insure or the cost of
             repairs of which would be in excess of the amount which Landlord is
             required to insure pursuant hereto or is otherwise insured; or

        (c)  such damage or destruction occurs within two (2) years prior to the
             expiry of the Term and either there are no remaining rights in
             Landlord or Tenant to extend or renew this Lease or Landlord or
             Tenant, having the right to renew or extend this Lease, fails to do
             so within fifteen (15) days after such occurrence:

        Landlord may, at its option to be exercised by written notice given to
        Tenant within Thirty (30) days after such occurrence, terminate this
        Lease whereupon Tenant will immediately surrender the Premises and all
        its interest therein to Landlord, and Basic Rent and all other payments
        for which Tenant is liable pursuant to this Lease shall be apportioned
        to the date of occurrence. Tenant will remain liable to Landlord for all
        sums accrued due under this Lease to the date of such occurrence, and
        Landlord may re-enter and repossess the Premises.

                                     -20-
<PAGE>

12.02 Repair and Re-Building
      ----------------------

      If this Lease is not terminated pursuant to this Article XII:

      (a) Landlord, to the extent of insurance proceeds which Landlord receives,
          and to the extent that any mortgagee entitle to be paid such insurance
          proceeds consents to the use of same for repair of such damage or
          destruction, shall diligently proceed to perform such repairs to the
          Premises to the extent of insurance proceeds being available. Within
          thirty (30) days after Landlord has completed its repairs, Tenant
          shall complete any necessary repairs to the Premises to render the
          Premises usable for Tenant's purposes and shall fully fixture, stock
          and staff the Premises and recommence the operation of Tenant's
          business.

      (b) Except to the extent of insurance proceeds received by the Landlord
          for the repair of the Premises, Tenant acknowledges that its
          obligations to repair the Premises after damage or destruction as
          aforesaid or otherwise shall be performed at Tenant's sole cost unless
          such damage or destruction was caused by Landlord's fault or
          negligence and whether or not Landlord had at any time made any
          contribution to the cost of supply, installation or construction of
          any Leasehold Improvements in the Premises.

      (c) Landlord, in performing its repairs to the Premises or the Common
          Facilities as required hereby shall not be obliged to repair or
          rebuild in accordance with plans or specifications for the Premises as
          they existed prior to such damage or destruction, but Landlord may
          repair or rebuild the same in accordance with any plans and
          specifications chosen by Landlord in its sole and absolute discretion
          provided that Tenant's use and occupancy of and access to the Premises
          and the general overall usability of the Premises are not materially
          detrimentally affected by any difference in plans, specifications, or
          form of the Premises or from such plans, specifications and form as
          the same existed immediately prior to the occurrence of such damage or
          destruction.

12.03 Abatement
      ---------

      (a) If the damage or destruction is such as to render the whole or any
          part of the Premises unusable for the purpose of Tenant's use as
          permitted hereby, then Basic Rent and Additional Rent shall abate from
          the date of the damage or destruction until the Premises are again
          usable by Tenant for the purpose intended. Basic Rent and Additional
          Rent shall abate to the extent that Tenant's use and occupancy of the
          Premises is in fact diminished, which determination shall be made by
          Landlord in its sole discretion acting reasonably. The abatement will
          diminish proportionately as repairs are made and more of the Premises
          is returned to a usable state.

                                     -21-
<PAGE>

        (b)  Notwithstanding any other provision of this Section 12.03 to the
             extent that any part of the Premises remains unusable because
             Tenant's repairs have not been completed, no abatement of Basic
             Rent will extend beyond the date by which, in the opinion of
             Landlord arrived at on a reasonable basis, Tenant's repairs would
             have been completed had Tenant exercised reasonable diligence.

12.04   Determination of Matters
        ------------------------

        For the purposes of this Article XII, all matters requiring
        determination such as, without limitation, the extent to which any
        area(s) of the Premises are damaged, or are not capable of being used,
        or the times within which repairs may be made, shall be determined by
        Landlord acting reasonably, such determination to be final and binding
        on the parties.

                                 ARTICLE XIII
                                 ------------

13.00 - INSURANCE AND INDEMNITY
-------------------------------

13.01   Landlord's Insurance
        --------------------

        Landlord shall obtain in full force and effect during the Term with
        respect to the Premises insurance against such occurrences and in such
        amounts and on such terms and conditions and with such deductible(s) as
        would be carried by a prudent owner of a comparable building in the
        Greater Toronto area. Unless and until otherwise determined by Landlord,
        such insurance shall include, without limitation:

        (a)  insurance on the Building and improvements and equipment contained
             therein owned or leased by Landlord or which Landlord desires to
             insure, for full replacement cost, against damage by fire,
             lightning, explosion, sprinkler leakage and other risks contained
             in fire insurance policies with endorsements generally known as
             extended coverage and riot vandalism and malicious acts,
             endorsements or, at Landlord's option, all risks and insurance;

        (b)  boiler and machinery insurance on such insurable objects as
             Landlord may elect to insure;

        (c)  rental income insurance covering such occurrences, in such form,
             and with such period of indemnity as Landlord may determine;

        (d)  public liability insurance; and

        (e)  such other insurance and insurance in such amounts and on such
             terms as Landlord, in its discretion, may determine.

                                     -22-
<PAGE>

        Notwithstanding that Tenant shall be contributing to or paying for
        Landlord's costs and premiums respecting such insurance pursuant to the
        terms of this Lease, Tenant shall not have any insurable or other
        interest in any of Landlord's insurance other than the rights, if any,
        expressly set forth in this Lease or in any policy of insurance obtained
        by Landlord, and, in any event, Tenant shall not have any interest in or
        any right to recover any proceeds under any of Landlord's insurance
        policies. All insurance policies required pursuant to this Lease shall
        provide for a waiver of subrogation in favor of the Landlord or the
        Tenant as the case may be. The Landlord hereby releases the Tenant from
        any liability for loss to the extent of all insurance proceeds paid
        under policies of insurance carried by the Landlord or which would have
        been paid if the Landlord had maintained the insurance it is required to
        maintain under this Lease. The Landlord shall furnish to the Tenant
        certified copies of all such policies, and shall provide written
        evidence of the continuation of such policies not less than Ten (10)
        days prior to their respective expiry dates.

13.02   Commencing on the Commencement Date and thereafter at all times
        throughout the term, Tenant shall pay to Landlord or as the Landlord may
        direct not later than the time when they shall fall due, all premiums
        and costs payable by the Landlord to obtain the above insurance.

13.03   Tenant's Effect on Other Insurance
        ----------------------------------

        (a)  Tenant shall not do and shall not cause, suffer or permit to be
             done or omitted to be done by any of its servants, agents,
             contractors, or persons for whom Tenant is in law responsible
             anywhere on the Premises or by any person in, on or about the
             Premises and shall not permit there to be on the Premises anything
             which might:

             (i)   result in any increase in the cost of any insurance policies
                   of Landlord;

             (ii)  result in an actual or threatened cancellation of or adverse
                   change in any policy of insurance of Landlord; or

             (iii) be prohibited by any policy or insurance of Landlord in force
                   from time to time in respect of the Premises or any part or
                   contents thereof.

        (b)  If the cost of any insurance policies of Landlord on or related to
             the Building, the Premises or any part or contents thereof shall be
             increased as a result of:

             (i)   the use or occupancy of the Premises by Tenant or any other
                   person on the Premises;

             (ii)  anything kept or permitted to be kept by Tenant or by any
                   person anywhere in the Premises; or

                                     -23-
<PAGE>

             (iii) any act or omission of Tenant or any person in the Premises.

             Tenant shall pay the full of such increase in cost to landlord
             forthwith upon demand.

             In determining Tenant's responsibility for any increased cost of
             insurance as aforesaid, a statement issued by the organization,
             company or insurer establishing the insurance premiums or rates for
             the relevant policy shall be conclusive evidence of the various
             components of such premiums or rates and the factors giving rise to
             any increase therein.

        (c)  In the event of an actual or threatened cancellation of or adverse
             change in any policy of insurance obtained by the Landlord, on or
             related to the Building or the Premises, or any part or contents
             thereof, by reason of:

             (i)  the use or occupancy of the Premises by Tenant or any other
                  person permitted by Tenant on the Premises; or

             (ii) anything placed on or permitted by Tenant or any person in the
                  Premises and if Tenant fails to remedy the situation,
                  condition, use, occupancy or other factor giving rise to such
                  actual or threatened cancellation or change within twenty-four
                  (24) hours after notice thereof by Landlord,

        Landlord may, at its option, either:

             (i)  terminate this Lease forthwith by written notice; or

             (ii) remedy the situation, condition, use, occupancy or other
                  factor giving rise to such actual or threatened cancellation
                  or change, all at the cost of Tenant to be paid to Landlord
                  forthwith upon demand; for any or all of such purposes as set
                  forth in this subsection (ii) Landlord shall have the right to
                  enter upon the Premises without further notice.

13.04   Tenant's Insurance
        ------------------

        The Tenant shall maintain during the Term (i) all risks insurance upon
        property owned by the Tenant or for which it is liable (including glass)
        and which is located on the Premises including, without limitation,
        furniture fittings, installations, alterations, additions, partitions
        and fixtures or anything in the nature of a leasehold improvement made
        or installed by or on behalf of the Tenant in an amount equal to the
        full replacement cost thereof; (ii) comprehensive general liability
        insurance against claims for death, personal injury and property damage
        in or about the Premises in amounts satisfactory from time to time to
        the Landlord acting reasonably but in any event in an amount not less
        than

                                     -24-
<PAGE>

        $5,000,000.00 per occurrence for personal injury and property damage;
        (iii) tenant's legal liability insurance for limits satisfactory from
        time to time to the Landlord acting reasonably; (iv) Business
        interruption insurance; and (v) such other insurance as Landlord may
        from time to time require. Each such policy shall be in form and with
        insurers acceptable to the Landlord. The insurance described in
        paragraphs (i) and (ii) above shall name the Landlord and anyone
        designated in writing by the Landlord as Mortgagee as additional
        insureds as their interests may appear. All property damage and public
        liability insurance shall contain a provision for cross-liability or
        severability of interest as between the Landlord and the Tenant. The
        Tenant hereby releases the Landlord from any liability for loss to the
        extent of all insurance proceeds under policies of insurance carried by
        the Tenant or which would have been paid if the Tenant had maintained
        the insurance it is required to maintain under this Lease. Such policies
        shall contain an endorsement requiring the insurers under such policies
        to notify the Landlord in writing at least thirty (30) days prior to any
        material change or cancellation thereof. The Tenant shall furnish to the
        Landlord certified copies of all such policies for its acceptance, as
        aforesaid, and shall provide written evidence of the continuation of
        such policies not less than ten days prior to their respective expiry
        dates. The cost or premium for each and every such policy shall be paid
        by the Tenant. If the Tenant fails to maintain such insurance, the
        Landlord shall have the right, but not the obligation or any liability
        to do so, to pay the cost or premium therefor, and in such event the
        Tenant shall repay to the Landlord, as Additional Rent, forthwith on
        demand the amount so paid.

13.05   Tenant agrees that Landlord shall not be liable or responsible for any
        injury or death to any person or for any loss or damage to any property
        at any time, in, on or about the Premises, unless any such death,
        injury, loss or damage is caused or attributed to the negligence of the
        Landlord, its servants, agents, employees, contractors or persons for
        whom Landlord is in law responsible in performing any of its obligations
        hereunder or unless such matter is covered by any policy of insurance
        required to be maintained by the Landlord. Without limiting the
        generality of the foregoing, Landlord shall not be liable or responsible
        for any injury, death, loss or damage to any persons or property caused
        or contributed to by any of the following: steam, water, rain, snow,
        electricity, gas or failing plaster; or by dampness or leaks from any
        pipes, appliances, plumbing works, roof, exterior walls or any other
        source whatsoever. All property kept or stored in or about the Premises
        shall be at the sole risk of the Tenant and the Tenant shall indemnify
        the Landlord and save it harmless in respect of the same. Without in any
        way limiting or affecting the generality or interpretation of the
        foregoing provisions of this Section 13.05, it is agreed that the
        Landlord shall in no event be liable for any indirect or consequential
        damages suffered by Tenant or any person arising therefrom except if
        arising from the Landlord's gross negligence. Similarly, the Tenant
        shall in no event be liable for any indirect or consequential damages
        suffered by the Landlord or any person arising therefrom except if
        arising from the Tenant's gross negligence in performing any of its
        obligations pursuant to this Lease.

                                     -25-
<PAGE>

13.06   Indemnity of Landlord
        ---------------------

        Tenant shall indemnify Landlord and all of its servants, agents,
        employees, contractors and persons for whom Landlord is in law
        responsible and shall hold them and each of them harmless from and
        against any and all liabilities, claims, damages, losses and expenses,
        including all legal fees and disbursements, due to, arising from or to
        the extent contributed to by the negligence of the Tenant or those for
        whom it is at law responsible:

        (a) any breach by Tenant of any of the provisions of this Lease;

        (b) any act or omission of any person on the Premises or any use of
            machinery, equipment or other articles in the Premises;

        (c) any act or omission of Tenant or any of its servants, agents,
            employees, invitees, licensees, sub-tenants, concessionaires,
            contractors or persons for whom Tenant is in law responsible on the
            Premises.

        (d) any injury, death or damage to persons or property of Tenant or its
            servants, agents, employees, customers, contractors or any other
            persons on or near the Premises by or with the invitation, license
            or consent of Tenant;

        (e) any damage, destruction or need of repair to any part of the
            Premises caused by any act or omission of Tenant or its servants,
            agents, employees, customers, contractors, or persons for whom
            Tenant is in law responsible, notwithstanding any other provisions
            of this Lease.

        Provided that the Tenant shall be released from any liabilities for loss
        to the extent of all insurance proceeds paid under policies of insurance
        carried by Landlord or which would have been paid if the Landlord had
        maintained the insurance that it is required to maintain under this
        Lease.

13.07   Landlord's Employees
        --------------------

        It is agreed that every indemnity, exclusion or release of liability and
        waiver of subrogation herein contained for the benefit of Landlord shall
        extend to and benefit all of Landlord's servants, agents, employees, and
        those for whom Landlord is in Law responsible (collectively referred to
        in this Section 13.07 as "Employees"); solely for such purpose, and to
        the extent that Landlord expressly chooses to enforce the benefits of
        the Section 13.07 for its Employees, it is agreed that Landlord is the
        agent or trustee for its Employees.

                                  ARTICLE XIV
                                  -----------

                                     -26-
<PAGE>

14.00 - ASSIGNMENT, SUBLETTING AND CHANGE OF CONTROL
----------------------------------------------------

14.01   Consent Required
        ----------------

        This lease is personal to Tenant only and therefore Tenant shall not
        assign this Lease in whole or in part and shall not sublet or part with
        or share possession of all or any part of the Premises, nor shall it
        grant any concessions, franchises, licences or other rights to others to
        use any portion of the Premises (all of the foregoing being hereinafter
        individually or collectively referred to as a "Transfer") without the
        written consent of the Landlord, which written consent is to be obtained
        in advance from the Landlord such consent not to be unreasonably
        withheld. If the Tenant has entered into a bona fide arm's length
        agreement to sell the business conducted at the Premises, Tenant may
        Transfer this Lease to the purchaser thereunder but only with the prior
        written consent of Landlord in each instance, which consent may not be
        unreasonably withheld.

        Notwithstanding and without in any way affecting or limiting the
        interpretation of the foregoing, it is agreed that it shall be
        reasonable for Landlord to withhold its consent to a Transfer unless it
        is shown to the Landlord's reasonable satisfaction that:

        (i)  the proposed Transferee has a good business and personal
             reputation;

        (ii) the proposed Transferee has not been bankrupt or the holder of
             twenty (20%) percent or more of the issued shares of any class of
             shares of a corporation or of an interest in a partnership, either
             of which has been bankrupt in the ten (10) years preceding the date
             of the proposed Transfer;

        No Transfer may be made other than pursuant to an agreement in writing
        of which a copy is given to Landlord together with the request for
        consent. The provisions of this Article XIV shall apply to any Transfer
        which might occur by inheritance or operation of law.

14.02   Obtaining Consent
        -----------------

        All request to Landlord for consent to any Transfer shall be made to
        Landlord in writing together with a copy of the agreement pursuant to
        which the proposed Transfer will be made and, where applicable, a copy
        of the agreement of purchase and sale in respect of the Tenant's
        business. All reasonable costs incurred by Landlord, in respect of any
        such request for consent, including legal costs and Landlord's
        administrative fee, shall be the responsibility of and shall be paid by
        Tenant forthwith upon demand, whether or not Landlord grants its consent
        to any proposed Transfer.

        All such requests to Landlord for consent to any Transfer shall also be
        accompanied by such information in writing as a landlord might
        reasonably require respecting a proposed Transferee and which might be
        required to provide Landlord with all the information

                                     -27-
<PAGE>

        necessary to determine whether the aforementioned factors are satisfied,
        and which information shall include, without limitation, the name,
        business and home addresses and telephone numbers, business experience,
        credit information and rating, financial position and banking and
        personal references of such proposed Transferee.

14.03   Terms of Consent
        ----------------

        If Landlord consents to a Transfer, or a consent to such Transfer is
        obtained by the order of a court of competent jurisdiction, or if a
        Transfer occurs as a result of operation of law not requiring Landlord's
        consent (notwithstanding the express agreement between the parties
        hereto that any Transfer by operation of law shall in any event be
        subject to the consent of Landlord and all of the other provisions as
        contained in this Article XIV), Landlord shall have the following
        rights, in default of any of which no such Transfer shall occur or be
        effective.

        (a) to collect a deposit or further deposit to be held as a security
            deposit for the prompt performance by the Transferee of all of the
            terms, covenants, conditions and provisions of this Lease such that
            a security deposit held by Landlord shall be equivalent to at least
            the last one (1) months' Rent payable in respect of the remaining
            terms for the Transferred Premises;

        (b) to require Tenant and the Transferee and any indemnifier in respect
            of Tenant's or Transferee's obligations hereunder to enter into an
            agreement in writing and under seal to implement any amendments to
            this Lease to give effect to Landlord's exercise of any of its
            rights hereunder;

        (c) to require the Transferee to enter into an agreement with Landlord
            in writing and under seal to be bound by all of Tenant's obligations
            accruing from the agreed date that the new Tenant is to take
            possession under this Lease amended as herein provided;

        (d) to require the Transferee to waive any rights pursuant to subsection
            39(2) of the Landlord and Tenant Act (Ontario) and any amendments
            thereto and any other statutory provisions of the same or similar
            effect, to pay any Rent less than the amount payable hereunder;

        (e) to require, if the Transfer is a sublease or other transaction not
            including an assignment, that all amounts payable by the Transferee
            to the Tenant be paid directly to Landlord who shall apply the same
            on account of Tenant's obligations under this Lease; and

        (f) to require, if the Transfer provides for a rental, a bonus, key
            money, a lump sum payment or other consideration incidental thereto
            which is in excess of the Rent or that portion of Rent attributable
            to the portion of the Premises transferred, then the

                                     -28-
<PAGE>

            excess shall be paid by Tenant to Landlord as Additional Rent, it
            being acknowledged by Tenant that it is not permitted to profit in
            any way from Transferring this Lease or parting with any portion of
            the Premises and that all additional payments in excess of the Rent
            and Additional Rent provided herein shall also be paid to Landlord
            as Additional Rent.

14.04   Effect of Transfer
        ------------------

        (a) No consent of Landlord to a Transfer shall be effective unless given
            in writing and executed by Landlord under seal and no such consent
            shall be deemed or presumed by any act or omission of Landlord or by
            Landlord's failure to respond to any request for consent or by
            Landlord's accepting any payment of any amount payable hereunder
            from any party other than Tenant. Without limiting the generality of
            the foregoing, Landlord may collect rent and any other amounts from
            any Transferee and apply the net amount collected to any Rent and
            the collection or acceptance of any Rent shall not be deemed to be a
            waiver of Landlord's rights under this section nor an acceptance of
            or consent to any such Transfer or a release of any of Tenant's
            obligations under this Lease. No Transfer and no consent by Landlord
            to any Transfer shall constitute a waiver of the necessity to obtain
            Landlord's consent to any subsequent or other Transfer.

        (b) In the event of any Transfer or any consent by Landlord to any
            Transfer, Tenant shall not thereby be released from any of its
            obligations hereunder but shall remain bound by all such obligations
            pursuant to this Lease for the balance of the initial Term. Tenant
            hereby consents to any amendments of this Lease which may be made
            between the Transferee and Landlord without the further consent or
            agreement of Tenant ("Amendments") and Tenant also consents to all
            Alterations as referred to in Section 10.02 above) after any such
            Transfer. Tenant shall continue to be bound by all of its
            obligations pursuant hereto notwithstanding any such Amendments or
            Alterations, to the extent of what would have been Tenant's
            obligations pursuant hereto had such Amendments or Alterations not
            been made.

        (c) Every Transferee shall be obliged to comply with all of the
            obligations of Tenant under this Lease. Tenant shall enforce all of
            such obligations against each Transferee. Any default of any
            Transferee shall also constitute a default of Tenant hereunder.

        (d) Tenant agrees that if this Lease is ever disclaimed or terminated by
            a trustee in bankruptcy of a Transferee or, if Landlord terminates
            this Lease as a result of the bankruptcy, insolvency or any act or
            default of any Transferee, Tenant shall, upon Landlord's request,
            enter into a new lease of the Premises on the identical terms hereof
            subject to such amendments hereto which had been agreed upon prior
            to such disclaimer or termination, with the exception that the
            length of the term of such new lease shall commence on the date upon
            which Landlord exercises its right to require

                                     -29-
<PAGE>

            Tenant to enter into such new lease and shall expire on the date
            upon which the initial Term would have expired but for such
            disclaimer or termination by such trustee in bankruptcy or such
            termination by Landlord, and with the exception that Tenant will
            accept the Premises on an "as is" condition, as of such date upon
            which Landlord exercises its right to require Tenant to enter into
            such new lease.

14.05   No Advertising of Premises
        --------------------------

        Tenant shall not advertise this Lease or all or any part of the Premises
        or the business or fixtures or contents therein for sale without
        Landlord's prior written consent, which consent Landlord shall not
        unreasonably withhold subject to the other provisions hereof.

14.06   Mortgage of Lease
        -----------------

        The restrictions on Transfer as aforesaid shall apply, mutatis mutandis,
        to any assigning, subletting, mortgaging, charging or otherwise
        transferring of the Premises or this Lease for the purpose of securing
        any loan or the repayment thereof by Tenant.

14.07   Corporate Tenant
        ----------------

       If Tenant or any occupant of the Premises at any time is a corporation,
       it is acknowledged and agreed that the transfer of the majority of the
       issued shares in the capital stock or any transfer, issuance or division
       of any shares of the corporation or of any affiliated corporation of the
       corporation sufficient to transfer control to others than the then
       present shareholders of the corporation shall be deemed for all purposes
       of this Article XIV to be a Transfer and, accordingly, shall be subject
       to the requirements of this Article XIV, and it is agreed that the
       parties hereto shall have all of the same rights and obligations in
       respect thereof as are applicable to a Transfer.

       This Section 14.07 shall not apply to Tenant if and as long as Tenant is
       in occupancy of the Premises and is a corporation or whose ultimate
       parent is a corporation whose shares are listed and traded on any
       recognized public stock exchange in Canada or the United States.

14.08  Assignment by Landlord
       ----------------------

       Landlord shall have the right to sell, lease, convey or otherwise dispose
       of the Lands or any portion thereof, and to assign this Lease and any
       interest of Landlord pursuant to this Lease without restriction. If
       Landlord shall sell, lease, convey or otherwise dispose of the Lands or
       any portion thereof, or shall assign this Lease or any interest of
       Landlord pursuant to this Lease, then, to the extent that the purchaser
       or assignee agrees with Landlord to assume the covenants and obligations
       of Landlord hereunder, Landlord shall thereupon and without further
       agreement be released of all liability subsequently occurring under this
       Lease.

                                     -30-
<PAGE>

                                  ARTICLE XV
                                  ----------

15.00 - STATUS AND SUBORDINATION OF LEASE
-----------------------------------------

15.01   Status Statement
        ----------------

        Tenant shall, within ten (10) days' after written request from Landlord,
        execute and deliver to Landlord, or to any actual or proposed lender,
        purchaser or assignee of Landlord, a statement or certificate in such
        form as requested by Landlord stating with reasonable particularity (if
        such is the case or stating with reasonable particularity the manner in
        which such may not be the case):

        (a) that this Lease is unmodified and in full force and effect, or
            particulars of any such modifications or stating that this Lease is
            not in full force and effect if such is the case;

        (b) the date of commencement and expiry of the Term and the dates to
            which Basic Rent and any other Rent, including any prepaid rent have
            been paid;

        (c) whether or not there is any existing default by either party under
            this Lease and, if so, specifying such default;

        (d) that there is no reason why the obligations of Tenant under this
            Lease may not be fully enforced in accordance with their terms and
            that there are no defences, counter-claims or rights of set-off in
            respect of any of the same; and

        (e) a copy of the Tenant's most recent financial statement, which the
            Landlord agrees to treat as confidential, save and except that it
            shall be permitted to disclose the financial statement to its
            lenders, bankers and professional advisors.

15.02   Subordination
        -------------

        This Lease and the rights of Tenant hereunder are and shall be subject
        and subordinate to any and all mortgages, trust deeds, and charges (any
        of which are herein called "Mortgage" or "Mortgages") now or which in
        the future may be registered against the Lands or any portion thereof,
        and including all renewals, extensions, modifications and replacements
        of any Mortgages from time to time. Tenant shall at any time on notice
        from Landlord or a holder of any Mortgage attorn to and become a tenant
        of the holder of any of such Mortgages upon the same terms and
        conditions as set forth herein and shall execute promptly on request by
        Landlord any certificates, agreements, instruments of postponement or
        attornment or other such instruments or agreements as requested from
        time to time to postpone or subordinate this Lease and all of Tenant's
        rights hereunder to any of such Mortgages or to otherwise give full
        effect to any of the provisions of this Article XV.

                                     -31-
<PAGE>

        Tenant agrees to attorn to and become the tenant of any party whose
        title to the Premises is superior to that of Landlord or to any assignee
        from Landlord of Landlord's interest under this Lease upon the same
        terms and conditions as are set forth in this Lease and shall execute
        promptly on request any agreements or instruments of attornment to give
        effect to such attornment as shall be requested by Landlord at any time
        and from time to time.

        Provided however that in the event that the Tenant is required to effect
        the postponement of its rights and privileges hereunder to any Mortgagee
        pursuant to this paragraph 15.02, the Landlord shall concurrently obtain
        from any such Mortgagee, on the Mortgagee's standard form, a covenant in
        writing acknowledging the tenancy herein and agreeing that so long as
        the Tenant duly performs the terms, covenants, conditions and agreements
        herein contained, the Tenant shall be entitled to peaceful possession of
        the Premises pursuant to the terms of the Lease, notwithstanding the
        exercise of any or all rights of such Mortgagee.

15.03   Tenant's Failure to Comply
        --------------------------

        If Tenant fails to execute any certificate, agreement, instrument, or
        other document as required by the foregoing provisions of this Article
        XV within ten (10) days after request by Landlord, then Landlord shall
        have the right to:

        (a) execute any such certificate, agreement, instrument or document for
            and on behalf of Tenant and in Tenant's name, Tenant hereby agreeing
            to be bound by the same, and for such purpose Tenant hereby
            irrevocably appoints Landlord as Tenant's attorney for and on behalf
            of Tenant pursuant to the Powers of Attorney Act (Ontario) and which
            appointment shall survive the death or incapacity of Tenant;

        (b) in any event, and without being affected by either of the foregoing
            rights, to exercise all rights against Tenant in respect of Tenant's
            default as aforesaid as Landlord might otherwise have pursuant to
            this Lease or at law.

15.04   Registration
        ------------

        The Landlord agrees to consent to the Tenant registering in the Land
        Registry Office at Newmarket, notice of this Lease.

                                  ARTICLE XVI
                                  -----------

16.00 - DEFAULT AND REMEDIES
----------------------------

16.01   Default and Remedies
        --------------------

        If any of the following shall occur:

                                     -32-
<PAGE>

     (a)  Tenant shall fail, for any reason, to make any payment of Rent as and
          when the same is due to be paid hereunder and such default shall
          continue for five (5) days after such payment was due, and for a
          further three (3) business days following the notice of such default.

     (b)  Tenant shall fail, for any reason, to perform any other material
          covenant, condition, agreement or other obligation on the part of
          Tenant to be observed or performed pursuant to this Lease (other than
          the payment of any Rent) and such default shall continue for fifteen
          (15) days after written notice thereof (unless such performance will,
          due to the nature of the obligation, require a period of time in
          excess of Thirty (30) days, then after such period of time, as is
          reasonably necessary).

     (c)  any of the policies of Landlord's insurance on the Premises or any
          part or contents thereof shall be actually or threatened to be
          cancelled or adversely changed as a result of any use or occupancy of
          or contents in the Premises;

     (d)  Tenant shall purport to make a Transfer affecting the Premises, or the
          Premises shall be used by any person or for any purpose, other than in
          compliance with and as expressly authorized by this Lease;

     (e)  Tenant or any other person occupying any portion of the Premises shall
          make an assignment for the benefit of creditors or become bankrupt or
          insolvent or take the benefit of any statute for bankrupt or insolvent
          debtors or make any proposal, assignment, arrangement or compromise
          with its creditors or, if any steps are taken or action or proceedings
          commenced by any person for the dissolution, winding-up or other
          termination of Tenant's existence or liquidation of its assets;

     (f)  a trustee, receiver, receiver-manager, agent or other like person
          shall be appointed in respect of the assets or business of Tenant or
          any other occupant of the Premises;

     (g)  Tenant attempts to or does abandon the Premises or remove or dispose
          of any goods and chattels from the Premises so that there would not,
          in the event of such removal or disposition, be sufficient goods of
          Tenant on the Premises subject to distress to satisfy all arrears of
          Rent payable under this Lease and all Rent payable hereunder for a
          further period of at least twelve (12) months, or if the Premises
          shall be vacant or unoccupied for a period of five (5) consecutive
          days or more without the prior written consent of Landlord;

     (h)  Tenant makes any sale in bulk affecting any property on the Premises
          (other than in conjunction with a Transfer approved in writing by
          Landlord and made pursuant to all applicable legislation);

                                     -33-
<PAGE>

     (i)  this Lease or any goods or other property of Tenant shall at any time
          be seized or taken in execution or attachment which remains
          unsatisfied for a period of five (5) days or more; and

     (j)  termination or re-entry by Landlord is permitted under any provision
          of this Lease or at law;

then, without prejudice to and in addition to any other rights and remedies to
which Landlord is entitled pursuant hereto or at law, the then current and the
next three (3) months' Rent shall be forthwith due and payable and Landlord
shall have the following rights and remedies, all of which are cumulative and
not alternative, to:

     (a)  terminate this Lease in respect of the whole or any part of the
          Premises by written notice to Tenant; if this Lease is terminated in
          respect of part of the Premises, this Lease shall be deemed to be
          amended by the appropriate amendments, and proportionate adjustments
          in respect of Rent and any other appropriate adjustments shall be made
          in such manner as shall be determined by Landlord;

     (b)  enter the Premises as agent of Tenant and as such agent to relet them
          for whatever term (which may be for a term extending beyond the Term)
          and on whatever terms and conditions as Landlord in its sole
          discretion may determine and to receive the rent therefor and, as the
          agent of Tenant, to take possession of any furniture, fixtures,
          equipment, stock or other property thereon and, upon giving written
          notice to Tenant, to store the same at the expense and risk of Tenant
          or to sell or otherwise dispose of the same at public or private sale
          without further notice, and to make such alterations to the Premises
          in order to facilitate their reletting as Landlord shall determine,
          and to apply the net proceeds of the sale of any furniture, fixtures,
          equipment, stock or other property or from the reletting of the
          Premises, less all expenses incurred by Landlord in making the
          Premises ready for reletting and in reletting the Premises, on account
          of the Rent due and to become due under this Lease and Tenant shall be
          liable to Landlord for any deficiency and for all such expenses
          incurred by Landlord as aforesaid; no such entry or taking possession
          of or performing alterations to or reletting of the Premises by
          Landlord shall be construed as an election on Landlord's part to
          terminate this Lease unless a written notice of such intention or
          termination is given by Landlord to Tenant;

     (c)  remedy or attempt to remedy any default of Tenant in performing any
          repairs, work or other covenants of Tenant hereunder and, in so doing,
          to make any payments due or claimed to be due by Tenant to third
          parties and to enter upon the Premises, without any liability to
          Tenant therefor or for any damages resulting thereby, and without
          constituting a re-entry of the Premises or termination of this Lease,
          and without being in breach of any of Landlord's covenants hereunder
          and without thereby being deemed to infringe upon any of Tenant's
          rights pursuant hereto, and, in such

                                     -34-
<PAGE>

            case, Tenant shall pay to Landlord forthwith upon demand all amounts
            paid by Landlord to third parties in respect of such default and all
            reasonable costs of Landlord in remedying or attempting to remedy
            any such default plus ten (10%) percent of the amount of such costs
            for Landlord's inspection and supervision, plus a further ten (10%)
            percent for Landlord's overhead and profit;

       (d)  obtain damages from Tenant including, without limitation, if this
            Lease is terminated by Landlord, all deficiencies between all
            amounts which would have been payable by Tenant for what would have
            been the balance of the Term, but for such termination, and all net
            amounts actually received by Landlord for such period of time.

16.02  Interest
       --------

       All amounts of Rent shall bear interest from their respective due dates
       until the actual dates of payment at a rate which shall be the greater of
       (i) six (6%) per cent per annum in excess of the prime commercial rate of
       interest charged by Landlord's bank in Ontario for loans to its most
       favoured commercial customers from time to time; and (ii) the rate
       expressly agreed by Tenant in writing to be paid in respect of any
       amount(s) from time to time.

16.03  Costs
       -----

       Tenant shall be responsible for and pay to Landlord forthwith upon demand
       all reasonable costs incurred by Landlord, including, without limitation,
       reasonable compensation for all time expended by Landlord's own
       personnel, legal costs on a solicitor and his own client basis, and all
       other costs of any kind whatsoever, arising from or incurred as a result
       of any default of Tenant or any enforcement by Landlord of any of
       Tenant's obligations under this Lease.

16.04  Allocation of Payments
       ----------------------

          INTENTIONALLY DELETED

16.05  Remedies to Subsist
       -------------------

       (a)  No waiver of any of Tenant's obligations under this Lease and no
            waiver of any of Landlord's rights hereunder in respect of any
            default by Tenant hereunder shall be deemed to have occurred or be
            given as a result of any condoning, excusing, overlooking or delay
            in acting upon by Landlord in respect of any default by Tenant or by
            any other act or omission of Landlord including, without limitation,
            the acceptance of any Rent less than the full amount thereof, the
            acceptance of any Rent after the occurrence of any default by
            Tenant, or any verbal or written statements or agreements made by
            any employee of Landlord other than an agreement in writing duly
            executed on behalf of Landlord by one of its personnel with
            ostensible authority to do so. No waiver of any of Tenant's
            obligations or any of Landlord's rights

                                     -35-
<PAGE>

            hereunder shall be effective except and only to the extent of any
            express waiver in writing duly executed on behalf of Landlord by one
            of its personnel with ostensible authority to do so. The waiver by
            Landlord of any default of Tenant or of any rights of Landlord shall
            not be deemed to be a waiver of any term, covenant or condition in
            respect of which such default or right has been waived and shall not
            be deemed to be a waiver of any subsequent default of Tenant or
            right of Landlord. Similarly, the provisions of this paragraph shall
            apply, mutatis mutlandis to the obligations of the Landlord and the
                   ------- ---------
            rights of the Tenant arising under this Lease.

       (b)  All rights and remedies of Landlord under this Lease and at law,
            shall be cumulative and not alternative, and the exercise by
            Landlord of any of its rights pursuant to this Lease or at law shall
            at all times be without prejudice to any other rights of Landlord,
            whether or not they are expressly reserved.

       (c)  If Landlord assigns this Lease to a mortgagee or holder of other
            security on the Premises or any part thereof or to any other person
            whatsoever, Landlord shall nonetheless be entitled to exercise all
            rights and remedies available to it pursuant to this Lease and at
            law without providing evidence of the approval or consent of such
            mortgagee, holder of other security or other person whatsoever.

       (d)  All Rent shall be paid by Tenant to Landlord without deduction,
            abatement or set-off whatsoever, except as and to the extent
            expressly permitted pursuant to the terms of this Lease, and Tenant
            hereby waives any rights of deduction, abatement or set-off
            available to it now or at any time in the future, including any
            right to deduction, abatement or set-off contained in any statute.

16.06  Impossibility of Performance
       ----------------------------

       If and to the extent that either Landlord or Tenant shall be unable to
       fulfil or shall be delayed or restricted in the fulfilment of any
       obligation under this Lease, other than the payment by Tenant of any
       Rent, by reason of unavailability of material, equipment, utilities,
       services or labour required to enable it to fulfil such obligation or by
       reason of any laws, or by reason of its not being able to obtain any
       permission or authority required pursuant to any applicable laws or by
       reason of any other such cause beyond its control and not the fault of
       the party being delayed and not avoidable by the exercise of reasonable
       foresight (excluding the inability to pay for the performance of such
       obligation), then the party being delayed shall be entitled to extend the
       time for fulfilment of such obligation by a time equal to the duration of
       such delay or restriction, and the other party shall not be entitled to
       any compensation for any loss, inconvenience, nuisance or discomfort
       occasioned thereby. The party delayed will, however, use its best efforts
       to fulfil the obligation in question as soon as is reasonably practicable
       by arranging an alternate method of providing the work, services or
       materials being delayed subject, in the case of performance by Tenant, to
       the approval of Landlord in

                                     -36-
<PAGE>

        its sole and absolute discretion. In any event, the provisions of this
        Section 16.06 shall not apply to permit any delay in any payment by
        Tenant of any Rent.

                                 ARTICLE XVII
                                 ------------

17.00 - CONTROL OF PREMISES
        -------------------

17.01 Rules and Regulations
      ---------------------

        Landlord may, from time to time, make and amend such rules and
        regulations for the management and operation of the Lands, Building and
        Premises as Landlord shall determine and Tenant and all persons under
        its control shall be bound by and shall comply with all of such rules
        and regulations of which notice is given to Tenant from time to time and
        all of such rules and regulations shall be deemed to be incorporated
        into and form a part of this Lease. Without limiting the generality of
        the foregoing, Tenant shall comply with all rules and regulations made
        by Landlord respecting security and respecting shipping, receiving,
        loading and unloading of merchandise, supplies, materials, garbage and
        all other things whatsoever, all of which shall be made only at such
        times and from, over or by means of such access routes, driveways,
        doors, loading areas, stairs and other areas or passages whatsoever as
        Landlord shall determine in writing from time to time. Landlord shall
        not make any rules or regulations which conflict with any express
        provision of this Lease unless and only to the extent required by any
        applicable laws or unless Tenant consents thereto. Landlord shall act
        reasonably in enforcing such rules and regulations but the imposition of
        any rules and regulations shall not create or imply any obligation of
        Landlord to enforce them or create any liability of Landlord for their
        non-enforcement or otherwise.

17.02  Access to Premises
       ------------------

        (a)  Landlord (including its agents, employees, contractors or
             representatives), without limiting any other rights Landlord may
             have pursuant hereto or at law, shall have the right, but not the
             obligation, to enter the Premises on notice to the Tenant, and in
             the presence of a designated Tenant employee (unless a bone fide
             emergency exists) at any time and for any of the following
             purposes:

             (i)  to examine the Premises and to perform any maintenance,
                  repairs and alterations to the same or any part thereof as may
                  be required or permitted by this Lease and to perform any
                  maintenance, repairs and alterations to any mechanical,
                  electrical, heating, ventilating, airconditioning and humidity
                  control equipment and services located therein serving the
                  Premises or any part thereof, and for all of such purposes,
                  Landlord may take such material and equipment into the
                  Premises as Landlord may require;

                                     -37-
<PAGE>

             (ii)  to protect the Premises in respect of any construction or
                   other work being performed in premises adjoining or in the
                   vicinity of the Premises;

             (iii) for any purposes as determined by Landlord in cases of
                   emergency;

             (iv)  to read any utility or other similar meters located in the
                   Premises;

             (v)   during the last twelve (12) months of the Term to show the
                   Premises to prospective tenants, and to permit prospective
                   tenants to make inspections, measurements, and plans;

             (vi)  at any time during the Term, to show the Premises to
                   prospective purchasers, mortgagees or lenders; and

             (vii) to exercise any of the rights available to Landlord pursuant
                   to this Lease.

(b)  Landlord shall have the right to run through the Premises conduits, wires,
     pipes, ducts and other elements of any systems for utilities, heating,
     ventilating, air-conditioning and humidity control, telephone and other
     communications systems and any other such systems to serve the Premises or
     any parts thereof and Landlord shall have access for itself and those
     designated by it to the Premises for the purpose of inspecting,
     maintaining, repairing, replacing, and altering any services in respect of
     any of the same.  Notwithstanding the foregoing, the Rent shall not be
     reduced or otherwise affected as a result of any of such systems being
     located on or running through the Premises.

(c)  In the event that the Tenant does not provide Seven (7) days' a week,
     Twenty-Four (24) Hours a day, on site security, Landlord shall exercise its
     rights pursuant to this Section 17.02 in such manner and at such times as
     Landlord, acting reasonably but in its sole discretion, shall determine; at
     any time that entry by Landlord is desired in case of emergency, and if no
     personnel of Tenant are known by Landlord to be present on the Premises or
     if such personnel fail for any reason to provide Landlord immediate access
     at the time such entry is desired, Landlord may forcibly enter the Premises
     without liability for damage caused thereby.

                                 ARTICLE XVIII
                                 -------------

18.00 - EXPROPRIATION
---------------------

18.01 Expropriation
      -------------

     If the whole or any part of the Premises shall be expropriated (which term
     shall for the purposes of this Article XVII include expropriation,
     condemnation or sale by Landlord to an authority with the power to
     expropriate, condemn or take) by any competent authority then:

                                     -38-
<PAGE>

        (a)  In the event of any such expropriation, both the Landlord and
             Tenant shall be free to separately pursue their claims for
             compensation for the loss of their respective interests in the
             Premises and shall be entitled to receive and retain such
             compensation as may be awarded them or paid to them respectively
             and agree to co-operate with each other in pursuing their
             respective claims. If an award of compensation made to the Landlord
             specifically includes an award for the Tenant, the Landlord will
             remit to the Tenant the portion awarded for it.

       (b)   Landlord shall have the option, to be exercised by written notice
             to Tenant, to terminate this Lease, such termination to be
             effective on the date the expropriating authority takes possession
             of the whole or any portion of the Premises; and

       (c)   this Lease shall continue in full force and effect in accordance
             with its terms until the date on which this Lease is terminated in
             accordance with the provisions of this Article XVIII, if terminated
             in accordance with the express provisions hereof and, if
             terminated, Rent and all other obligations under this Lease shall
             be accrued to and be adjusted as of the date of such termination.

                                  ARTICLE XIX
                                  -----------

19.00 - MISCELLANEOUS
---------------------

19.01 Notices

       All notices, demands, requests or other instruments ("Notices") which may
       be or are required to be given under this Lease shall be in writing and
       shall be effectively given if (i) delivered personally; (ii) sent by
       prepaid courier services; or (iii) sent prepaid by telecopier or other
       similar means of electronic communication (confirmed on the same or the
       following day by prepaid mail) addressed, in the case of the Tenant as
       follows:

       The Surface Mount Technology Centres Inc.

       635 Hood Road,
       Markham, Ontario, L3R 4N6

       Attention: Paul Walker

       Facsimile: 905-479-1877

       and in the case of notice to the Landlord:

       Warden McPherson Developments Ltd.,
       c/o Z & N Construction Management Limited,

                                     -39-
<PAGE>

       25 Valleywood Drive, Unit 8,
       Markham, Ontario, L3R 5L9

       Attention: Sal Nasello

       Facsimile: 905-470-0598

       Any notice so given shall be deemed conclusively to have been given and
       received when so personally delivered or sent by telecopy or other
       electronic communication, or on the second day following the sending
       thereof by private courier. Any party hereto may change any particulars
       of its address for notice by notice to the others in the manner
       aforesaid.

19.02  Planning Act
       ------------

       This Lease is entered into subject to the provisions of and compliance
       with the provisions of all applicable legislation dealing with planning
       restrictions including the Planning Act S.O. 1983 and amendments.

19.03  Complete Agreement
       ------------------

       It is understood and agreed that other than and to the extent that any
       other written agreement between Landlord and Tenant respecting the
       Premises remains in force, this Lease constitutes the complete agreement
       between the parties and that there are no covenants, representations,
       agreements, warranties or conditions in any way relating to the subject
       matter of this Lease or the tenancy created hereby, expressed or implied,
       collateral or otherwise, except as expressly set forth herein. Tenant
       acknowledges that no representatives of Landlord are authorized to make
       on Landlord's behalf any covenants, representations, agreements,
       warranties or conditions of any kind or in any manner whatsoever other
       than as expressly set forth in writing in this Lease in the form in which
       it is executed by Landlord under seal.

       No amendment to this Lease shall be binding upon the parties unless the
       same is in writing and executed by the parties under seal.

19.04  Use Prior to Commencement Date
       ------------------------------

       If Tenant uses or occupies the whole or any part of the Premises in any
       way prior to the Commencement Date without entering into a lease with
       Landlord in respect of such use or occupancy, then during the period of
       such use or occupancy, Tenant shall be a tenant of Landlord subject to
       all the terms and conditions as contained in this Lease which shall apply
       to such tenancy mutatis mutandis; the inclusion of this paragraph shall
       not be deemed to authorize or permit Tenant to use or occupy the whole or
       any portion of the Premises in any way prior to the Commencement Date.

                                     -40-
<PAGE>

19.05  Acceptance of Premises
       ----------------------

       The Landlord agrees to complete the work as set out in Schedule "D", and
       provided that all such work is completed in a good and workmanlike
       manner, subject to any items of outstanding work set out in a deficiency
       list which may be delivered by Tenant to the Landlord within 30 days of
       taking possession, the Tenant's entering into possession of the Premises
       shall be conclusive evidence of the acceptance by Tenant of the condition
       of the Premises.

19.06  Environmental Clause
       --------------------

In this Lease:

       (a) "Environmental Audit" shall mean a complete review of the Premises
           and the environmental practices of the Tenant thereon by the
           Landlord, its employees or agents and shall include such visual
           inspections, interviews with the Tenant, its employees, servants, or
           agents, and such soil, air, or other tests as the Landlord shall in
           its sole discretion deem to be necessary.

       (b) "Hazardous Substance" means any contaminant, pollutant or hazardous
           substance that is likely to cause immediately or at some future time,
           harm or degradation to the environment or risk to human health or
           safety, and without restricting the generality of the foregoing,
           includes without limitation any pollutant, contaminant, waste,
           hazardous waste, toxic substance or dangerous good which is defined
           or identified in any municipal, provincial or federal environmental
           legislation.

       The Tenant shall at all times use the Premises so as to comply with all
       municipal, provincial and federal environmental legislation in keeping
       with first class environmental protection practices and so as not to
       allow Hazardous Substance to be on the Premises, in contravention of this
       paragraph 19.06.

       The Landlord shall have the right at its expense to conduct an
       Environmental Audit of the Premises at any time and -from time to time
       throughout the term and any renewal thereof.

       In the event that the Environmental Audit reveals that the Tenant is
       storing, handling, transporting, manufacturing, processing or otherwise
       dealing with any Hazardous Substances in the Premises or Building, the
       Landlord shall give the Tenant ninety (90) days within which to amend its
       manner of storing, handling, transporting, manufacturing, processing or
       otherwise dealing with such Hazardous Substances to comply with first
       class environmental protection practices and the manner in which the
       Landlord indicates such Hazardous Substances must be stored, handled,
       transported, manufactured, processed or otherwise dealt with. The Tenant
       shall further forthwith carry out such procedures as are, in the opinion
       of the Landlord, necessary to correct any damage which may have been done
       to the Premises or Building and to forestall any damage to the Premises
       or Building which in the opinion of

                                     -41-
<PAGE>

       the Landlord may be created by the unsatisfactory storing, handling,
       transporting, manufacturing, processing or otherwise dealing with any
       Hazardous Substances.

       In the event that the Tenant shall be in default of the material
       provisions hereof and shall fail to amend its practices or take such
       corrective measures as are required pursuant to subparagraph (d) hereof
       within the aforesaid ninety (90) day period the Landlord shall have the
       right to enter upon the Premises and carry out such procedures as are, in
       the opinion of the Landlord, necessary to correct any damage which may
       have been done to the Premises or Building, or to forestall any damage to
       the Premises or Building which in the opinion of the Landlord based upon
       the Environmental Audit may be created by the unsatisfactory storing,
       handling, transporting, manufacturing, processing or otherwise dealing
       with such Hazardous Substances and the Tenant shall pay to the Landlord
       on demand, as Additional Rent, all costs and expenses of carrying out
       such procedures. Further, and in addition, to any other remedies
       available to the Landlord, the Landlord may, on Ninety (90) days' notice,
       terminate the Lease.

       The Landlord warrants and represents that as at the Commencement Date,
       the Premises and the lands upon which the building is situate:

       (i)   were free of environmental contamination of any kind;

       (ii)  complied with all applicable environmental laws, rules, policies
             and guidelines;

       The Landlord shall indemnify and hold harmless the Tenant from all costs,
       claims, demands, suits, actions and damages (including loss of profit)
       and expenses to which the Tenant may be put or may suffer arising
       directly or indirectly incurred from (a) any misrepresentation by or on
       the part of the Landlord; (b) any warranty or representation on the part
       of the Landlord being untrue; (c) any failure by the Landlord to perform
       any of its covenants relating to environmental matters.

       These environmental warranties, representations, covenants and indemnity
       are intended to remain in full force and effect and shall not merge in
       any subsequent document nor cease to have effect in the event of the sale
       of the building.

       The Landlord also agrees to supply the Tenant with a Phase II
       Environmental Report within two (2) weeks of its acceptance of this
       Lease. The provision of such report shall not effect the above recited
       environmental warranties and representations and Landlord's indemnity. In
       the event that the Landlord does not so provide the Phase II
       Environmental Report then it is agreed and understood that in the event
       an environmental problem develops or becomes known in the future in
       respect of which there is an issue as to whether or not it originates as
       a result of activities occurring prior to SMTC occupancy, then the burden
       of proof shall be on the Landlord to prove the environmental problem
       originated from SMTC's activities.

                                     -42-
<PAGE>

19.07  Option to Renew
       ---------------

        The Tenant shall have one option to renew the Lease in accordance with
        the provisions of Schedule "C" hereto.

19.08  Option to Purchase
       ------------------

        The Tenant shall have the Option to Purchase the Premises in accordance
        with the provisions of Schedule "D".

19.09  Time of the Essence
       -------------------

        Time is of the essence of this Lease and all parts hereof.

19.10  Applicable Law
       --------------

        This Lease shall be governed by and interpreted in accordance with the
        laws of the Province of Ontario. The parties agree that the Courts of
        Ontario shall have (unreadable text from bottom of page on MASTER)
        expressly provided to the contrary herein, and the parties hereby attorn
        to the jurisdiction of the Courts of Ontario.

19.11  Severability
       ------------

        If any provision of this Lease or any portion thereof or the application
        of any of the same is illegal, unenforceable or invalid, it shall be
        considered separate and severable from this Lease and all of the
        remaining provisions hereof shall remain in full force and effect as
        though any such provision of this Lease or any portion thereof had not
        been included in this Lease but such provision of this Lease or portion
        hereof shall nonetheless continue to be enforceable to the full extent
        permitted by law.

        Neither party is obliged to enforce this Lease to the extent that by so
        doing they would be contravening any applicable laws.

19.12  Section Numbers and Headings
       ----------------------------

        The table of contents of this Lease and all section numbers and all
        headings are inserted as a matter of convenience only and shall in no
        way limit or affect the interpretation of this Lease.

19.13  Interpretation
       --------------

        Whenever a word importing singular or plural is used in this Lease such
        word shall include the plural and singular respectively. Where any party
        is comprised of more than one entity, the obligations of each of such
        entities shall be joint and several. Words importing either

                                     -43-
<PAGE>

        gender or firms or corporations shall include persons of the other
        gender and firms or corporations as applicable. Subject to the express
        provisions contained in this Lease, words such as "hereof", "herein",
        "hereby", "hereinafter", and "hereunder" and all similar words or
        expressions shall refer to this Lease as a whole and not to any
        particular section, or portion thereof being less than the whole, unless
        the context otherwise requires.

19.14  Successors
       ----------

        This Lease and all portions hereof shall enure to the benefit of and be
        binding upon the parties hereto and their respective heirs, executors,
        administrators, successors, assigns and other legal representatives
        excepting only that this Lease shall not enure to the benefit of any of
        such parties unless and only to the extent expressly permitted pursuant
        to the provisions of this Lease.

        IN WITNESS WHEREOF this Lease has been executed by the parties hereto
under their respective corporate seals and under the hands of their duly
authorized officers in that behalf, as of the day and year first written above.

SIGNED, SEALED AND DELIVERED          WARDEN McPHERSON DEVELOPMENTS LTD.
in the presence of

                                      Per: /s/ Robert Green
                                           -------------------------------

                                           /s/ Oscar Zvretsky
                                           -------------------------------

                                      THE SURFACE MOUNT TECHNOLOGY CENTRE
                                          INC.

                                      Per: /s/ Paul Walker
                                           -------------------------------

                                     -44-
<PAGE>

                                 SCHEDULE "A"

     Legal Description of Premises:

          Parcel 17-1, Section M-1807,

          Lot 17, Plan M-1807,

          Town of Markham, Regional Municipality of York,

          Land Titles Division of York Region (No. 65)

                                     -45-
<PAGE>

                                 SCHEDULE "B"
                                 ------------

SKETCH OF OFFICE AND WAREHOUSE LAYOUT FOR THE PREMISES

                                     -46-
<PAGE>

                                 SCHEDULE "C"
                                 ------------

                                OPTION TO RENEW
                                ---------------

     The Tenant, if not then in default under this Lease either in payment of
     rent or observance of the material covenants, shall have the right to renew
     this Lease from its Expiry Date for a further term of FIVE (5) years
     provided that Tenant has notified Landlord in writing of its intention to
     exercise its option to renew not less than NINE (9) months prior to the
     expiration of the Term.  In the event of failure to give written notice
     within the time or in the manner prescribed, this option shall be null and
     void.  In the event that the exercise of this option shall be duly and
     properly completed by Tenant, then all of the terms of this Lease shall
     apply during the renewal term except:

          (a)  there shall be no further right of renewal unless agreed upon in
               writing at the time of renewal, if any, of this Lease; and

          (b)  Basic Rent shall be at the rate of SIX DOLLARS AND FIFTY CENTS
               ($6.50) per Square Foot for the entire Building and Premises.

                                     -47-
<PAGE>

                                 SCHEDULE "D"
                                 ------------

                              OPTION TO PURCHASE
                              ------------------

Provided the Tenant is not in default under the Lease, either in the payment of
Rent or the observance of material covenants contained in the Lease, then the
Tenant shall have the option to purchase the land and building known municipally
as 625-635 Hood Road, Markham, Ontario, (being Lots 17 and 18, Plan M-1807, Town
of Markham) and all improvements thereon, at any time during the Term, by
delivering to the Landlord written notice of the exercise of such right.  The
Purchase Price for the lands and premises herein pursuant to this Option
Agreement, shall be equivalent to the estimated market value for similar
buildings in the area as of the date of that notice of exercise of the option is
given as agreed upon between the Landlord and the Tenant.  In the event that the
Option to Purchase is exercised, the Tenant shall agree to accept any existing
tenancies in the Premises or any part thereof.

Provided that if the Landlord and the Tenant fail to agree upon the market value
of the lands and premises within Two (2) months of the Tenant's exercise of the
option to purchase, then same shall be established as set out below.

     Either the Landlord or the Tenant (the "Requesting party") shall be
     entitled to notify the other party hereto (the "Receiving Party") of the
     name of an expert for the purpose of determining the market value.  Within
     Fifteen (15) days after such notice from the Requesting Party, the
     Receiving Party shall notify the Requesting Party either approving the
     expert proposed by the Requesting Party or naming another expert for the
     purposes of determining the market value.  Should the Receiving Party fail
     to give notice to the Requesting Party within the said Fifteen (15) day
     period, the expert named in the notice given by the Requesting Party shall
     perform the expert's functions hereinafter set forth.  If the Landlord and
     Tenant are unable to agree upon the selection of the expert within Fifteen
     (15) days after such notice from the Receiving Party to the Requesting
     Party, then either party shall be entitled to apply to a court to appoint
     an expert in the same manner as an arbitrator may be appointed by a court
     under the Arbitrations Act of Ontario.

     The expert appointed by either the Landlord and/or the Tenant or by a
     Court, shall be qualified by education, experience and training to value
     commercial real estate for rental and sale purposes in the Province of
     Ontario and shall have been ordinarily engaged in the valuation of real
     property in the Town of Markham and Greater Toronto area for at least the
     immediately preceding ten years.  Within Sixty (60) days after being
     appointed the expert shall make a determination of the market value based
     upon the considerations set out above. The cost of such determination shall
     be shared equally by the parties.  The determination of the expert of
     market value shall be conclusive and binding upon the Landlord and Tenant
     and not subject to appeal.

                                     -48-
<PAGE>

                                 SCHEDULE "E"
                                 ------------

                                LANDLORD'S WORK
                                ---------------

1) Landlord's Work - 635 Hood Road

The Landlord shall renovate the Premises, at its expense and in a good and
workmanlike manner (and to a standard of that of the Tenant's existing premises
at 635 Hood Road) to provide for the following:

Office Area

(a) install wall-to-wall carpeting in the Tenant's choice of colours from the
Landlord's samples (including baseboard, carpet);

(b) relocation/removal/addition of walls in a layout to be agreed upon between
the Landlord and the Tenant within five (5) business days;

(c) perform modification/relocation/addition of electrical outlets, as requested
by Tenant;

(d) repair and replace ceiling tiles and/or components of the T-bar mounting;
including T-bar ceilings, 2'x4' fluorescent light fixtures;

(e) paint all walls in two coats of paint in the Tenant's choice of colours from
the landlord's samples.

(f) side lights in all private office as those at 635 Hood Road (4' x 6');

(g) washrooms to be cleaned, painted and renovated to the washroom standards at
635 Hood Road;

(h) construct a new lunchroom approximately 20' x 30' (exact size to be
determined by Tenant and Landlord) including HVAC, dropped T-bar ceiling, 2' x
4' fluorescent light fixtures and vinyl tile flooring.

double stainless steel sink, upper and lower cupboards (8' x 10'), duplex
outlets for fridge and microwaves.

(i) install new warehouse male and female washrooms, including sinks, vanity,
mirrors, paper towel dispensers - urinals, toilets, stalls and proper exhaust
system.  All hardware to be similar or equal to 635 Hood Road.

75-100 employees:   70% female \ 30% male

Warehouse Area

                                     -49-
<PAGE>

(j) all floors and walls to be professionally cleaned to ensure removal of all
chemical and oil residues.

2) Landlord's Work - 625 - 635 Hood Road

Roof

The Landlord shall at its expense strip and replace the complete roofing
structure at 625 - 635 Hood Road other than that area of the roof consisting of
approximately 9,500 square feet which has already been replaced.  This work
shall be completed by October 15, 1998 or such other date as agreed upon by the
Landlord and the Tenant.

Parking Lot

The Landlord shall at its expense resurface (asphalt), repair and reline the
entire parking area by October 15, 1998 or such other date as agreed upon by the
Landlord and the Tenant.

3) Warranty

The Landlord warrants and represents that all existing electrical, lighting,
mechanical, plumbing, heating and air conditioning systems\the sprinkler system,
and all other fixtures will be in good working order as at the Commencement date
and agrees to take any remedial action required to ensure the accuracy of such
warranties and representations. The Landlord to provide the Tenant with
confirming inspection reports.

                                     -50-
<PAGE>

                                 SCHEDULE "F"
                                 ------------

                                OFFER TO LEASE
                                --------------

To:   Warden - McPherson Developments Ltd. (the " Landlord ")

From: The Surface Mount Technology Centre Inc. (the "Tenant ")

Re:   Offer to Lease of that part of the Building\Lands known municipally as 625
      Hood Road, Town of Markham

The Surface Mount Technology Centre Inc., as Tenant hereby offers to lease
through Royal LePage Commercial Inc., Broker, the above space on the following
terms and conditions:

Premises

The leased premises consist of that portion of the building known municipally as
625 Hood Road, Markham, Ontario containing approximately 28,194 square feet of
gross rentable area shown on the plan attached hereto as schedule "l" ( the"
Premises").  The exact measurement and boundaries of the Premises shall be
governed by BOMA standards. All Rent dependent upon the gross rentable area of
the Premises may be retroactively adjusted upon measurement of the Premises.

Term

The term of the Lease (the "Term") shall be for a period of five years and six
months commencing, subject to the provisions of this Offer to Lease, on November
1, 1998 and expiring on April 30, 2004.

Basic Rent

The annual basic rent during the Term of the lease shall be the sum of
$183,261.00 plus G.S.T. based on an annual rate of $6.50 per square foot of
gross rentable area of the Premises.

The annual basic Rent shall be payable in equal monthly installments in advance
on the first day of the Term and thereafter on the first day of each month in
the Term.

Additional Rent

The Tenant agrees to pay to the Landlord each year as additional rent in monthly
installments in advance on the first day of each month consisting of the
Tenant's proportionate share of :

                                     -51-
<PAGE>

          (a) operating costs, including but not limited to heat, hydro,
          maintenance\repairs, insurance and an annual management fee of $5,000;

          (b) realty taxes;

The Landlord's 1998 estimate for operating costs and realty taxes is $2.10 per
square foot of gross rentable area.

Free Rent Fixturing Period

The Tenant shall not be required to pay any basic or additional rent during the
first month of the Term.

Conditions

This Offer to Lease shall be conditional upon the satisfaction of the following
conditions within a period of five (5) business days from the date of
acceptance:

(a) approval of this Offer to Lease by the Tenant's board of directors;

(b) the Tenant and the existing tenant of the Premises, Safety-Kleen Canada Inc.
executing a "moving compensation package";

(c) the Tenant and the Landlord agreeing:

          (i) to the amendment of the existing offer to lease for that portion
          of the building known municipally as 635 Hood Road, Markham which is
          presently being leased by the Tenant from the Landlord to, inter alia,
          extend the term of the existing offer to lease to April 30, 2004.
          [such amendment to be null and void in the event the conditions herein
          are not satisfied);

          (ii) in writing to an acceptable office, plant and warehouse layout
          and finishings for the Premises.

Tenant's Work

The Tenant will be permitted at its expense to :

    (i)   cut into the floors of the Premises to provide for drainage for its
          equipment
    (ii)  cut into the ceiling\roof of the Premises for venting purposes
    (iii) remove the existing wall between the Premises and 625 Hood Road and/or
          create an opening to allow free and clear access between both units.
          Relocation/ removal/addition of walls in a layout shall be agreed upon
          between the Landlord and

                                     -52-
<PAGE>

           the Tenant within five (5) business days of the date of acceptance of
           this offer to lease.
     (iv)  install HVAC, lighting and vinyl floor tiling in the warehouse area
           of the Premises.

Provided that such work shall not be commenced prior to the issuance by the
Landlord of its written approval of all plans therefor, which approval shall not
be unreasonably withheld.

All work shall be completed by the Tenant in a good and workmanlike manner and
in accordance with all municipal legislation and regulations imposed by all
authorities having jurisdiction.  The Landlord shall have the right to approve
the Tenant's contractors.  Such approval shall not be unreasonably withheld and
the decision in connection therewith shall be made promptly.

Landlord's Work

The Landlord shall complete, at its expense, the work described in schedule "A"
hereto.

Delay By Landlord

In the event the Landlord's Work is not completed by the later of November 1,
1998 or thirty days following the vacating of the Premises by the existing
tenant, Safety - Kleen Canada Inc., through no fault of the Tenant, then the
commencement date of the lease term shall be extended to the date that the
Landlord's Work is in fact completed (the "Commencement Date") and all dates
contained herein including the one month rent free period shall be adjusted
accordingly.

Signage

The Tenant shall be permitted to erect, at its own expense, in accordance with
all municipal legislation and regulations imposed by all authorities having
jurisdiction, and subject to the Landlord's prior written approval, such signs
as are required to properly identify the building and to direct visitors,
employees and shipping/receiving activities.

Options To Renew \ Purchase

The Tenant if not then in default under the lease, either in payment of rent or
observance of the material covenants :

          (1) shall have the option to extend the Term of the lease for a
further term of five (5) years upon giving the Landlord at least nine (9)
months' written notice of the exercise of such right. The extension term shall
be for a period of five (5) years under the same terms and conditions as are set
out herein and in the lease (including the basic rent rate of $6.50 per square
foot) except for (i) any further right of extension (ii) the area of the
Premises shall include the existing space in the building [ known municipally as
635 Hood Road ] presently being leased by the Tenant from the Landlord .

                                     -53-
<PAGE>

          (2) shall have the option to purchase the land and building known
municipally as 625 and 635 Hood Road [being Lots 17 and 18, plan M 1807],
Markham and all improvements thereon at any time during the Term by delivering
to the Landlord written notice of the exercise of such right. The purchase price
shall be equivalent to the estimated market value for similar buildings in the
area as at the date that notice of exercise of the option is given as agreed
upon between the Landlord and Tenant.  In the event that the option to purchase
is exercised, the Tenant shall accept any then existing tenancies in the
Premises or part thereof.

Provided that if the Landlord and Tenant fail to agree upon the market value
within two months of the Tenant's exercise of the option to purchase then same
shall be established as set out below.

     Either the Landlord or the Tenant  (the "Requesting Party") shall be
     entitled to notify the other party hereto (the "Receiving Party") of the
     name of an expert for the purposed of determining the market value.  Within
     fifteen (15) days after such notice from the Requesting Party, the
     Receiving Party shall notify the Requesting party either approving the
     expert proposed by the Requesting Party or naming another expert for the
     purposes of determining the market value.  Should the Receiving Party fail
     to give notice to the Requesting Party within the said fifteen (15) day
     period, the expert named in the notice given by the Requesting Party shall
     perform the expert's functions hereinafter set forth. If the Landlord and
     Tenant are unable to agree upon the selection of the expert within fifteen
     (15) days after such notice from the Receiving Party to the Requesting
     Party, then either party shall be entitled to apply to a court to appoint
     an expert in the same manner as an arbitrator may be appointed by a court
     under the Arbitrations Act of Ontario.

     The expert appointed by either the Landlord and /or the Tenant or by a
     court, shall be qualified by education, experience and training to value
     commercial real estate for rental and sale purposes in the Province of
     Ontario and shall have been ordinarily engaged in the valuation of real
     property in the Town of Markham and Greater Toronto area for at least the
     immediately preceding ten years.  Within sixty (60) days after being
     appointed the expert shall make a determination of the market value based
     upon the considerations set out above. The cost of such determination shall
     be shared equally by the parties.  The determination of the expert of
     market value shall be conclusive and binding upon the Landlord and Tenant
     and not subject to appeal.

Parking

The Tenant shall have full and exclusive use of the building's parking lot.

Deposit

A deposit of $30,543.50 shall be submitted to the Landlord's agent upon the
satisfaction of the conditions described above and applied on account of the
basic rent for the first two months following expiry of the one month rent free
period.

                                     -54-
<PAGE>

Assignment

The Tenant shall have the right to assign or sublet the whole or any part of the
Premises subject to the approval of the Landlord which approval shall not be
unreasonably withheld.  In the event that the Tenant assigns all of its interest
in the Premises then it shall remain liable to the Landlord for the observance
and performance of all covenants herein including the covenant to pay rent
during the initial Term but not thereafter.

Lease

The Lease shall be prepared by the Landlord in accordance with the terms and
conditions of this Offer to Lease and shall contain such other terms and
conditions as are agreed upon by the Landlord and the Tenant.  A copy of this
Offer to Lease shall be annexed as a schedule to the Lease.

Use

The Tenant may use the Premises for light electronic manufacturing, warehousing,
offices together with such other uses as are permitted by the applicable
building bylaws of the Town of Markham and the Landlord, such permission not to
be unreasonably withheld.

Insurance

The Tenant shall provide the Landlord with certificates of insurance evidencing
that the Tenant has taken out in the names of the Tenant, the Landlord and any
Mortgagee, insurance covering the Premises and their contents and leasehold
improvements, comprehensive general liability insurance and any other form of
insurance as more fully set out in the Lease all in accordance with and as
required under the Lease.  Each party, save and except as provided herein, shall
be responsible for injury or loss directly attributable to its own negligence or
those for whom it is at law responsible and all insurance policies required
pursuant hereto shall provide for a waiver of subrogation in favour of the
Landlord or the Tenant as the case may be.

Brokerage Commission \ Agency Disclosure

The Tenant represents and warrants to the Landlord that no broker, agent or
other intermediary other than Royal LePage Commercial Inc. has negotiated or has
been instrumental in the negotiating and \ or consummating of this Offer to
Lease.

The Landlord and Tenant acknowledge and agree that Royal LePage Commercial Inc.
is acting on behalf of the Landlord and is to be compensated solely by the
Landlord upon successful completion of this transaction.

Repair By Landlord

                                     -55-
<PAGE>

The Landlord shall be responsible at its expense:

          (i) to keep in a good and reasonable state of repair the structural
          elements of the Building and the Premises including all footings, the
          foundation, floor, load-bearing walls, supporting columns, and roof.

The Landlord shall undertake any such repairs promptly upon receipt of notice
from the Tenant in accordance with the provisions of the Lease to be entered
into for the Premises.  Provided that the Tenant shall be responsible for any
damage caused by it to the structural elements of the Building and the Premises
unless such damage is covered by insurance that the Landlord is required by the
Lease to provide.

Repair By Tenant

The Tenant shall be responsible to maintain the Premises in the same condition
as at the commencement of the lease Term save and except for:

          (i) reasonable wear and tear

          (ii) all repairs and replacements to the structural components of the
          building and the Premises or those resulting from any inadequacy of
          design and construction of the building all of which shall be the
          responsibility of the Landlord at its sole expense as above provided;
          and
          (iii) damage by fire, including water and smoke damage and other
          casualties in respect of which the Landlord is required by the Lease
          to insure.

Provided that the Tenant shall only be required to pay the amortized value [
based upon their expected life expectancy ] of the cost of those repairs and
replacements which are its responsibility hereunder and which are properly
characterized as " capital" in nature in accordance with generally accepted
accounting principles .

Provided however that subject to subparagraph (i) above, the Tenant shall
restore to preoccupancy condition at the termination of the Term:

          (i) any computer room environment or built-in vault
          (ii) any holes in the ceilings, roof or floors created by the Tenant.

The Tenant shall not be required at the termination of the Term to replace
previously existing walls or make good any openings made in existing walls as
part of the Tenant's work described above.

The Tenant shall have the right to make alterations and installations, from time
to time during the Term or any renewal thereof, provided it has the prior
written consent of the Landlord, which shall not to be unreasonably withheld.

                                     -56-
<PAGE>

The Tenant may remove its equipment and fixtures at the termination of the Lease
provided any damage caused by such removal shall be repaired by the Tenant.  The
Tenant shall leave the Premises in vacant, broom-swept condition at the
conclusion of the Term.

Environmental

The Landlord warrants and represents that as at the Commencement Date, the
Premises and the lands upon which the building is situate:

          (i) shall be free of environmental contamination of any kind

          (ii) shall comply with all applicable environmental laws, rules,
          policies and guidelines

The Landlord shall indemnify and hold harmless the Tenant from all costs,
claims, demands, suits, actions and damages (including loss of profit) and
expenses to which the Tenant may be put or may suffer arising directly or
indirectly incurred from (a) any misrepresentation by or on the part of the
Landlord (b) any warranty or representation on the part of the Landlord being
untrue (c) any failure by the Landlord to perform any of its covenants relating
to environmental matters.

These environmental warranties, representations, covenants and indemnity are
intended to remain in full force and effect and shall not merge in any
subsequent document nor cease to have effect in the event of the sale of the
building.

The Landlord also agrees to supply the Tenant with a Phase II environmental
report within two weeks of its acceptance of this Offer to Lease.  The provision
of such report shall not effect the above recited environmental warranties and
representations and landlord's indemnity.  In the event that the Landlord does
not so provide the Phase 11 environmental report then it is agreed and
understood that in the event an environmental problem develops or becomes known
in the future in respect of which there is an issue as to whether or not it
originates as a result of activities occurring prior to SMTC occupancy, then the
burden of proof shall be on the Landlord to prove the environmental problem
originated from SMTC's activities.

Notices

Any notice required or permitted to be given hereunder shall be in writing and
shall be effectively given if:

          (i) delivered personally,
          (ii) sent by prepaid courier services or
          (iii) sent prepaid by telecopier, or other similar means of electronic
          communication (confirmed on the same or the following day by prepaid
          mail) addressed, in the case of the Tenant as follows:

                                     -57-
<PAGE>

          The Surface Mount Technology Centre Inc.
          635 Hood Road
          Markham, ON
          L3R 4N6

          Attention: Paul Walker

          Facsimile 905 479 1877

          and in the case of notice to the Landlord as follows:

          Warden McPherson Developments Ltd.
          c\ o Z & N Construction Management Limited
          8 - 25 Valleywood Drive
          Markham, ON

          L3R 5L9

          Attention: Sal Nasello

          Facsimile 905 470 0598

Any notice so given shall be deemed conclusively to have been given and received
when so personally delivered or sent by telecopy or other electronic
communication or on the second day following the sending thereof by private
courier.  Any party hereto may change any particulars of its address for notice
by notice to the others in the manner aforesaid.

No Representation

There are no covenants, representations, agreements, warranties or conditions
relating to the Premises whether express or implied, collateral or otherwise,
except those as set forth herein.

Time of the Essence \ Act Reasonably \ Registration of Notice

Time is of the essence of this offer to lease and the Lease.

The Landlord and the Tenant agree to act in a commercially reasonable manner in
their dealings with each other.

The Landlord agrees to consent to the Tenant registering in the Land Registry
Office at Newmarket notice of this offer to lease or executed lease agreement.

Acceptance Period

                                     -58-
<PAGE>

This Offer to Lease is open for the Landlord's acceptance until 5:00 pm
September 3, 1998, after which time, if not accepted, this Offer shall be null
and void and of no further force of effect.

The foregoing agreement is hereby agreed to by the Tenant.

Dated at the Town of Markham this 2nd day of September , 1998.

                              Tenant:

                              THE SURFACE MOUNT TECHNOLOGY
                              CENTRE INC.

                              By: /s/ Paul Walker
                                 ________________________________
                              Name: Paul Walker
                              Title: President

The Landlord hereby accepts the offer to lease.

Dated at the Town of Markham this 3 day of September , 1998.

                              Landlord

                              WARDEN-McPHERSON DEVELOPMENTS LTD.

                              By: /s/ Oscar Zvretsky
                                 _________________________________
                              Name:  Oscar Zvretsky
                              Title: President

                              By: /s/ Robert Green
                                 _________________________________
                              Name:  Robert Green
                              Title:  Treasurer

                                     -59-
<PAGE>

               SCHEDULE, A TO LEASE OFFER DATED SEPTEMBER 2,1998

1) Landlord's Work - 625 Hood Road

The Landlord shall renovate the Premises, at its expense and in a good and
workmanlike manner (and to a standard of that of the Tenant's existing premises
at 635 Hood Road) to provide for the following:

Office Area

(a) install wall-to-wall carpeting in the Tenant's choice of colours from the
Landlord's samples (including baseboard, carpet);

(b) relocation/removal/addition of walls in a layout to be agreed upon between
the Landlord and the Tenant within five (5) business days;

(c) perform modification/relocation/addition of electrical outlets, as requested
by Tenant;

(d) repair and replace ceiling tiles and/or components of the T-bar mounting;
including T-bar ceilings, 2'x4' fluorescent light fixtures;

(e) paint all walls in two coats of paint in the Tenant's choice of colours from
the landlord's samples.

(f) side lights in all private office as those at 635 Hood Road (4'x 6');

(g) washrooms to be cleaned, painted and renovated to the washroom standards at
635 Hood Road;

(h) construct a new lunchroom approximately 20'x 30' (exact size to be
determined by Tenant and Landlord) including HVAC, dropped T-bar ceiling, 2'x 4'
fluorescent light fixtures and vinyl tile flooring, double stainless steel sink,
upper and lower cupboards (8'x 10'), duplex outlets for fridge and microwaves.

(i) install new warehouse male and female washrooms, including sinks, vanity,
mirrors, paper towel dispensers - urinals, toilets, stalls and proper exhaust
system.  All hardware to be similar or equal to 635 Hood Road.

75-100 employees:   70% female \ 30% male

Warehouse Area

(j) all floors and walls to be professionally cleaned to ensure removal of all
chemical and oil residues.

2) Landlord's Work - 625 - 635 Hood Road

                                     -60-
<PAGE>

Roof

The Landlord shall at its expense strip and replace the complete roofing
structure at 625 - 635 Hood Road other than that area of the roof consisting of
approximately 9,500 square feet which has already been replaced.  This work
shall be completed by October 15, 1998 or such other date as agreed upon by the
Landlord and the Tenant.

Parking Lot

The Landlord shall at its expense resurface (asphalt), repair and reline the
entire parking area by October 15, 1998 or such other date as agreed upon by the
Landlord and the Tenant.

3) Warranty

The Landlord warrants and represents that all existing electrical, lighting,
mechanical, plumbing, heating and air conditioning systems\the sprinkler system
and all other fixtures will be in good working order as at the Commencement date
and agrees to take any remedial action required to ensure the accuracy of such
warranties and representations.  The Landlord to provide the Tenant with
confirming inspection reports.

Provided that both the Landlord and the Tenant agree to use their best efforts
to make all necessary selections and give all necessary approvals so as to not
delay each others' work as described in this Schedule "A" .  In the event the
Landlord completes its work prior to November 1, 1998, then the Commencement
Date may be accelerated if the Tenant agrees.

                                     -61-
<PAGE>

                      FOR USE IN THE PROVINCE OF ONTARIO
                            AMENDMENT TO AGREEMENT
<TABLE>

<S>                  <C>                               <C>
TYPE OF AGREEMENT    Offer to Lease                    DATED April 20, 1992
                  -----------------------------------
SUBJECT PROPERTY  635 Hood Road, Markham, Ontario
                 -----------------------------------
BETWEEN PURCHASER(S)/LESSEE(S)  The Surface Mount Technology Centre, Inc.
                              -------------------------------------------------
 VENDORS/LESSOR(S) Warden McPherson Developments, Ltd.
                  ------------------------------------------

It is hereby understood and agreed between the undersigned parties hereto that
the following changes shall be made to the above mentioned Agreement, and except
for such changes noted below all other terms and conditions in the Agreement
shall remain in full force and effect:

DELETE:

     TERM
     ----
     The Lease Term shall be for a period of ten (10) years and six (6) months
     commencing November 1, 1992 (Commencement Date) and terminating April 30,
     2003 (Expiry Date)

     RENTAL RATE
     -----------
     Throughout the Term of the Lease, the net annual rental amount (Basic Rent)
     shall be calculated on the basis of:

     Years 1-5:     Five Dollars ($5.00) per square foot of Gross Rentable Area
                    per annum, from November 1, 1992 to October 31, 1997;

     Years 6 -10.5: Six Dollars and Twenty-Five Cents ($6.25) per square foot of
                    Gross Rentable Area per annum, from November 1, 1997 to
                    April 30, 2003.

The foregoing Basic Rent shall be payable in equal monthly instalments, in
advance, on the first day of each and every month of the Lease Term.

INSERT:
     TERM
     ----
     The Lease Term shall be for a period of eleven (11) years and six (6)
     months commencing November 1, 1992 (Commencement Date) and terminating
     April 30, 2004 (Expiry Date)

     RENTAL RATE
     -----------

     Throughout the Term of the Lease, the net annual rental amount (Basic Rent)
     shall be calculated on the basis of:

     Years 1-5:     Five Dollars ($5.00) per square foot of Gross Rentable Area
                    per annum, from November 1, 1992 to October 31, 1997;

     Years 6 - 11:  Six Dollars and Twenty-Five Cents ($6.25) per square foot of
                    Gross Rentable Area per annum, from November 1, 1997 to
                    April 30, 2004.

     The foregoing Basic Rent shall be payable in equal monthly instalments, in
     advance, on the first day of each and every month of the Lease Term.

DATED at  Markham               this 2nd day of September 1998
          -------                    ---        --------- ----
SIGNED, SEALED AND DELIVERED    IN WITNESS whereof I have hereunto set my hand and seal:
</TABLE>

                                     -62-
<PAGE>

<TABLE>
<S>                                     <C>
in the presence of                        THE SURFACE MOUNT TECHNOLOGY CENTRE INC.

_______________________                 ____________________________(Affix Seal)   _______________  ______
(Witness)                               (Purchaser/Lessee)                         (Date)

/s/ [signature appears here]            per: /s/ Paul Walker             (Affix Seal)  9/2/98
____________________________                _____________________________            _______________

_____(Witness)                          (Purchaser/Lessee)                         (Date)

DATED at  Markham                       ______this_______  day of September_____ 19   98
        __________
in the presence of               IN WITNESS whereof I have hereunto set my hand and seal
                                    WARDEN McPHERSON DEVELOPMENTS LTD

__________________________              ____________________________________  (Affix Seal)________________
(Witness)                               (Vendor/Lessor)                                       (Date)

                                       per:   /s/ Robert Green               (Affix Seal)
__________________________                   _______________________________              ________________
(Witness)                                     (Vendor/Lessor)                                 (Date)
</TABLE>

                                ACKNOWLEDGMENT

<TABLE>
<S>                                                    <C>
I/WE acknowledge receipt of a signed copy of this      I/WE acknowledge receipt of a signed copy of this
accepted Amendment to Agreement and authorize          accepted Amendment to Agreement and authorize
a copy to be forwarded to my/our solicitor.            a copy to be forwarded to my/our solicitor.
</TABLE>

_____________________________________    _______________________________________
(Vendor/Lessor)     (Date)                (Purchaser/Lessee)      Date

_____________________________________    _______________________________________
(Vendor/Lessor)     (Date)                (Purchaser/Lessee)      Date

_____________________________________    _______________________________________
(Vendor/Lessor's Address)                 (Purchaser's/Lessee's Address)

_____________________________________    _______________________________________
                    (Phone #)                               (Phone #)

_____________________________________    _______________________________________
(Vendor/Lessor's Solicitor)               (Purchaser's/Lessee's Solicitor)

                                     -63-

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