Document:

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                                                                    EXHIBIT 10.9

        THIS LEASE made as of the 1st day of February, 1997.

BETWEEN:

        SUN LIFE ASSURANCE COMPANY OF CANADA, a body corporate incorporated
under the laws of Canada

(hereinafter called the "Landlord")

                                                              OF THE FIRST PART.

                                     - and -

                       NOVATEL WIRELESS TECHNOLOGIES LTD.

        (hereinafter called the "Tenant")

                                                             OF THE SECOND PART.

             WHEREAS the Landlord is registered as owner, subject to such
encumbrances, liens and interests as are notified by memorandum underwritten (or
endorsed hereon) of that certain parcel of land municipally described as 6715
8th St. N.E. and situated in the City of Calgary in the Province of Alberta and
more particularly described in Schedule "A" attached hereto (hereinafter called
the "Land") upon which Land is situated an office building and related
improvements (the said office building and all other fixed improvements now or
hereafter on the Land being hereinafter referred to as the "Building"); and

             WHEREAS the Tenant has agreed to lease space in the Building which
will comprise the area more particularly hereinafter set forth for the term and
at the rental and subject to the terms, covenants, conditions and agreements
hereinafter contained; and

             WHEREAS in this Lease certain expressions have the defined meanings
set out in Article 16 hereof;

             WITNESSETH THAT

                                    ARTICLE 1
                                    PREMISES

Premises                 1.01 In consideration of the rents, covenants,
                         agreements and conditions hereinafter reserved and
                         contained on the part of the Tenant to be respectively
                         paid, kept, observed and performed, the Landlord hereby
                         demises and leases unto the Tenant those certain
                         premises situate on the 2nd floor of the Building
                         containing a Rentable Area of 11,494 square feet as
                         shown outlined in red on the floor plan hereto annexed
                         as Schedule "B" (hereinafter referred to as the "Leased
                         Premises") which Leased Premises shall have for
                         purposes hereinafter set out a Gross Area of 12,644
                         square feet and the Rentable Area and Gross Area of the
                         Leased Premises shall be measured as provided in
                         Sub-sections 16.01 (g), (h), and (j) hereof.

                                    ARTICLE 2
                                      TERM

Term                     2.01 TO HAVE AND TO HOLD the Leased Premises for a term
                         of FIVE (5) YEARS commencing on the 1ST DAY of
                         FEBRUARY, 1997 (hereinafter referred to as the
                         "commencement date") and to be fully completed and
                         ended on the 31ST DAY OF JANUARY, 2002.

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Possession               2.02 It is expressly understood and agreed between the
                         Landlord and the Tenant that, should all of the Leased
                         Premises not be ready for occupancy by the Tenant on
                         the commencement date, the Term of this lease shall
                         nonetheless commence on the commencement date and this
                         Lease shall remain in full force and effect and subject
                         as hereinafter provided the Tenant shall take
                         possession of the Leased Premises when all of the said
                         Leased Premises are ready for occupancy (or in the
                         opinion of the Landlord's Architect would have been
                         ready for occupancy except for the fault of the
                         Tenant). The Tenant shall be obligated to pay rent for
                         the Leased Premises as and from the date that all of
                         the Leased Premises are ready for occupancy. If such
                         date shall occur on a day other than the first day of a
                         month, the basic rent and electrical charges for such
                         month shall be payable only for the proportionate part
                         (being the balance of the month commencing on the date
                         the Leased Premises are ready for occupancy) and the
                         full monthly installments payable under the within
                         Lease shall commence and be payable as of and from the
                         first day of the month next following the date when the
                         Leased Premises are ready for occupancy.

Ready for Occupancy      2.03 For the purposes of this Article, the date on
                         which the Leased Premises are "ready for occupancy"
                         shall be the commencement date.

Inability to Deliver     2.04 The Landlord shall not be liable Possession for
                         loss, injury, damage or inconvenience which the Tenant
                         may sustain by reason of the inability of the Landlord
                         to deliver the Leased Premises ready for occupancy on
                         the commencement date.

Relocation of Leased     2.05 The Tenant agrees that notwithstanding of Leased
Premises                 anything herein contained, the Landlord shall have a
                         ONE TIME RIGHT, to change the location of the Leased
                         Premises as set forth in Article I hereof and Schedule
                         "B" attached hereto to comparable premises in the
                         Building on or above the 2nd floor provided such
                         premises are acceptable to the Tenant, acting
                         reasonably. If the Landlord exercises its right to
                         relocate the Tenant hereunder after the date upon which
                         the Landlord gives notice to the Tenant that the Leased
                         Premises are ready for installation of the Tenant's
                         improvements, THE LANDLORD SHALL PAY THE COSTS OF THE
                         TENANT IN RELOCATING IN THE AMOUNT OF $250,000.00. THE
                         LANDLORD SHALL PROVIDE THE TENANT WITH FOUR MONTHS
                         ADVANCE NOTICE OF THE RELOCATION AND THE TENANT SHALL
                         HAVE ACCESS TO THE NEW LOCATION IN ORDER TO PERFORM
                         IMPROVEMENTS AND ALTERATIONS OF THE NEW LOCATION. SUCH
                         ACCESS TO BE PROVIDED AT LEAST THREE MONTHS PRIOR TO
                         THE DATE OF THE RELOCATION.

                                    ARTICLE 3
                                      RENT

Rent                     3.01 YIELDING AND PAYING THEREFOR unto the Landlord, at
                         the Landlord's office in the City of Toronto, Ontario
                         (or to such other persons at such other places as the
                         Landlord may from time to time in writing designate),
                         subject to adjustment as hereinafter provided, in
                         lawful money of Canada, the annual basic rent of ONE
                         HUNDRED TEN THOUSAND TWO DOLLARS EIGHTY CENTS
                         ($110,002.80) payable without deduction by equal
                         consecutive monthly installments of NINE THOUSAND ONE
                         HUNDRED SIXTY SIX DOLLARS NINETY CENTS ($9,166.90) in
                         advance on the first day of each and every month during
                         the Term.

Basis of determining     3.02 The aforesaid annual basic rent is calculated on
Rent                     the basis of the Gross Area of the Leased Premises
                         being 12,644 SQUARE FEET leased at a rate of $8.70 for
                         each square foot of Gross Area for the Term.

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Apportionment            3.03 Annual basic rent and Common Costs Escalation are
of Annual Basic Rent     considered to accrue from day to day, and where it
and Common Costs         becomes necessary to calculate annual basic rent or
Escalation               Common Costs Escalation for an irregular period of less
                         than twelve calendar months, or an installment of
                         annual basic rent or Common Costs Escalation for a
                         period of less than one calendar month, an appropriate
                         apportionment and adjustment will be made on a per diem
                         basis.

                                    ARTICLE 4
                               TENANT' S COVENANTS

                         The Tenant covenants with the Landlord as follows:

Occupancy                4.01 To occupy the Leased Premises on the date the
                         Leased Premises are ready for occupancy subject to the
                         terms hereof.

Rent                     4.02 To pay the rent hereby reserved promptly on the
                         days and at the times and in the manner herein
                         mentioned, without demand or deduction.

Permitted Use            4.03 To use the Leased Premises only for general office
                         purposes and ELECTRICAL ENGINEERING LABORATORY, and
                         such normal and lawful business, duties and functions
                         of a general business office and ELECTRONIC ENGINEERING
                         LABORATORY, that will not unreasonably interfere with
                         normal use of a first-class office building OF A NATURE
                         AND TYPE SIMILAR TO THE WITHIN BUILDING; and not to use
                         or permit to be used the Leased Premises or any part
                         thereof for any business which is that of a bank,
                         treasury branch, credit union, trust or acceptance or
                         loan company or any other organization engaged in the
                         business of accepting, money on deposit, or any similar
                         banking business (excluding insurance, stock brokers or
                         investment dealers), nor use nor permit the use of any
                         part of the Leased Premises for the purpose of
                         installation or operation of any electronic or
                         mechanical equipment, or machines by which any banking
                         transaction, operation or function may be available to
                         the public, nor use or permit the use of any part of
                         the Leased Premises for or as a restaurant, cafeteria,
                         lunch counter, food dispensary, snack bar or other food
                         services operation, OTHER THAN FOR STAFF PURPOSES.

Waste and Nuisance       4.04 Not to commit or permit any waste or injury to the
                         Leased Premises including the Leasehold improvements
                         and trade fixtures therein, any overloading of the
                         floors thereof, any nuisance therein or any use or
                         manner of use causing annoyance to other tenants and
                         occupants of the Building and not to use or permit to
                         be used any part of the Leased Premises for any
                         dangerous, noxious or offensive trade or business; and
                         not to place any objects on or otherwise howsoever
                         obstruct the heating or air conditioning vents within
                         the Leased Premises. The Landlord acknowledges that the
                         Tenant's existing use mentioned in Section 4.03 of the
                         Lease does not constitute a nuisance.

Floor Loads              4.05 That the Tenant shall not place a load upon any
                         portion of any floor of the Leased Premises which
                         exceeds the floor load which the area of such floor
                         being loaded was designed to carry having regard to the
                         loading of adjacent areas and that which is allowed by
                         law. The Landlord reserves the right to prescribe the
                         weight and position of all safes and heavy
                         installations which the Tenant wishes to place in the
                         Leased Premises, so as to distribute properly the
                         weight thereof and the Tenant shall pay for all costs
                         incurred by the Landlord and the Landlord's Architect
                         in making such assessment.

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Insurance Risk           4.06 EXCEPT FOR THE PERMITTED USES DESCRIBED IN
                         PARAGRAPH 4.03, not to do, omit to do or permit to be
                         done or omitted to be done upon the Leased Premises
                         anything which would cause the Landlord's cost of
                         insurance (whether fire or liability) to be increased
                         (and, without waiving the foregoing prohibition the
                         Landlord may demand, and the Tenant shall pay to the
                         Landlord upon demand, the amount of any such increase
                         of cost caused by anything so done or omitted or
                         permitted to be done or omitted) or which would cause
                         any policy of insurance to be subject to cancellation
                         or refusal of placement or renewal.

Noxious Fumes Vapours    4.07 The Tenant shall so use the Leased Premises that
and Odours               noxious or objectionable fumes, vapours and odours will
                         not occur beyond the extent to which they are
                         discharged or eliminated by means of the flues and
                         other devices provided in the Building by the Landlord
                         and shall prevent any such noxious or objectionable
                         fumes, vapours and odours from entering into the air
                         conditioning or being discharged into other vents or
                         flues of the Building or annoying any of the tenants in
                         the Building. Any discharge of fumes, vapours and
                         odours shall be permitted only during such period or
                         periods, to such extent, in such conditions and in such
                         manner as is directed by the Landlord from time to
                         time. THE LANDLORD SHALL BE RESPONSIBLE TO MAINTAIN
                         REASONABLE VENTILATION AND FLUES COMMONLY FOUND IN A
                         BUILDING OF THE NATURE AND TYPE OF THE WITHIN BUILDING.

Condition                4.08 Not to permit the Leased Premises to become
                         untidy, unsightly, offensive or hazardous or permit
                         unreasonable quantities of waste or refuse to
                         accumulate therein, and at the end of each business day
                         to leave the Leased Premises in a condition such as
                         reasonably to facilitate the performance of the
                         Landlord's janitor and cleaning services referred to in
                         Section 5.06.

By-laws                  4.09 To comply at its own expense with all municipal,
                         federal, provincial, sanitary, fire, building and
                         safety statutes, laws, by-laws, and safety statutes,
                         laws, by-laws, regulations, ordinances, orders and
                         requirements pertaining to the operation and use of the
                         Leased Premises, the condition of the Leasehold
                         Improvements, trade fixtures, furniture and equipment
                         installed by the Tenant therein and the making by the
                         Tenant of any repairs, changes or improvements therein
                         or any other matter pertaining to the Leased Premises
                         or the Tenant as well as all rules and regulations of
                         the Canadian Board of Fire Underwriters, or any
                         successor body and with the requirements of all
                         insurance companies having policies of any kind
                         whatsoever in effect covering the Building which are
                         communicated to the Tenant.

Rules and Regulations    4.10 To observe, and to cause its employees, invitees
                         and all others over whom the Tenant can reasonably be
                         expected to exercise control to observe the Rules and
                         Regulations attached as Schedule "C" hereto, and such
                         further and other reasonable Rules and Regulations and
                         amendments and changes therein as may hereafter be made
                         by the Landlord of which notice in writing shall be
                         given to the Tenant and all such Rules and Regulations
                         shall be deemed to be incorporated into and form part
                         of this Lease. For the enforcement of such Rules and
                         Regulations, the Landlord shall have available to it
                         all remedies in this Lease provided for a breach
                         thereof and all legal remedies whether or not provided
                         for in this Lease, both at law and in equity. The
                         Landlord shall not be responsible or liable to the
                         Tenant for the non-observance or violation by any other
                         tenant of any such Rules and Regulations or the
                         non-enforcement as against other tenants of such Rules
                         and Regulations or any loss or damage arising out of
                         the same.

Surrender, Overholding   4.11 That upon the expiration or other termination of
                         the Term of this Lease, the Tenant shall quit and
                         surrender the Leased Premises in vacant and clean
                         possession and in good order, repair, decoration, and
                         condition (subject to the provisions of Sub-section
                         6.02 (a) hereof) and shall remove all its property
                         therefrom, except as otherwise provided in this Lease.
                         The Tenant's obligation to observe or perform this
                         covenant shall survive the expiration or other
                         termination of the Term of this Lease. If the Tenant
                         shall continue to occupy the Leased Premises after the
                         expiration of this Lease without further written

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                         agreement and without objection by the Landlord, the
                         Tenant shall be a month-to-month tenant at double the
                         annual basic rent and (except as to length of tenancy)
                         on and subject to the provisions and conditions herein
                         set out including the payment of electrical charges and
                         Common Costs Escalation.

Signs and Directory      4.12 Not to paint, display, inscribe, place or affix
                         any sign, notice or lettering of any kind anywhere
                         outside the Leased Premises (whether on the outside or
                         inside of the Building) or within the Leased Premises
SEE                      so as to be visible from the outside of the Leased
SECTION 17.06            Premise with the exception only of any identification
                         sign at or near the entrance of the Leased Premises and
                         a directory listing in the main lobby of the Building,
                         in each case containing only the name of the Tenant and
                         such other names as the Landlord may permit, and to be
                         subject to the approval of the Landlord as to design,
                         size, location and content. Such identification sign
                         and directory listing shall be installed at the expense
                         of the Tenant, and the Landlord reserves the right to
                         install them as an Additional Service.

Inspection Access        4.13 Other than regularly scheduled access as agreed to
                         by the Tenant and Landlord, during Normal Business
                         Hours and on at least one hours notice to the Tenant,
                         the Landlord shall be permitted, as reasonably
                         required, any time and from time to time to enter and
                         to have its authorized agents, employees and
                         contractors enter the Leased Premises for the purpose
                         of inspection, window cleaning, maintenance, providing
                         janitor services, making repairs, alterations or
                         improvements to the Leased Premises, adjoining premises
                         or the Building, or to have access to or make changes
                         in utilities and services (including underfloor and
                         overhead ducts, air conditioning, heating, plumbing,
                         electrical and telephone facilities and access panels,
                         all of which the Tenant agrees not to obstruct) or to
                         determine the electric light and power consumption by
                         the Tenant in the Leased Premises and the Tenant shall
                         provide free and unhampered access for such purposes,
                         and shall not be entitled to compensation for any
                         inconvenience, nuisance and discomfort or loss caused
                         thereby, but the Landlord in exercising its rights
                         hereunder shall proceed to the extent reasonably
                         possible so as to minimize interference with the
                         Tenant's use and enjoyment of the Leased Premises.

Exhibiting Premises      4.14 That the Landlord or its agents may, ON 24 HOURS
                         NOTICE TO THE TENANT enter and exhibit the Leased
                         Premises during Normal Business Hours during the Term
                         hereof, and place upon the Leased Premises a notice, of
                         reasonable dimensions and reasonably placed, stating
                         that said Land or the Leased Premises are for sale or
                         to let which notice the Tenant shall not remove or
                         obscure or permit to be removed or obscured, but the
                         Landlord in exercising its rights hereunder shall
                         proceed to the extent reasonably possible so as to
                         minimize interference with the Tenant's use and
                         enjoyment of the Leased Premises. THE TENANT SHALL BE
                         PERMITTED TO BE PRESENT AT THE TIME OF ANY SUCH
                         ENTERING AND EXHIBITING.

Name of Building         4.15 Not to refer to the Building by any name other
                         than that designated from time to time by the Landlord,
                         nor to use such name for any purpose other than that of
                         the business address of the Tenant.

Acceptance Leased        4.16 That the Tenant shall be deemed to have examined
                         the Leased Premises Premises before taking possession
                         and the taking of possession shall be conclusive
                         evidence as against the Tenant that at the time thereof
                         the Leased Premises were in good order and satisfactory
                         condition and that all alterations, remodelling,
                         decorating and installation of equipment and fixtures
                         required to be done by the Landlord have been
                         satisfactorily completed save only for such
                         deficiencies of which notice shall have been given to
                         the Landlord within fifteen (15) days after the taking
                         of possession. Any dispute as to any aspects of the
                         Landlord's work or completion or adequacy of the
                         Building, the Leased Premises or any part thereof shall
                         be determined by the Landlord's Architect.

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                                    ARTICLE 5
                              LANDLORD'S COVENANTS

        The Landlord covenants with the Tenant as follows:

Quiet Enjoyment          5.01 That the Tenant paying the rent hereby reserved at
                         the times mentioned and in the manner aforesaid and
                         observing and performing each and every of the
                         covenants, conditions, restrictions and stipulations by
                         the Tenant to be observed or performed shall and may
                         peaceably and quietly possess and enjoy the Leased
                         Premises for the Term hereby granted without any
                         interruption from the Landlord or any other person
                         lawfully claiming by, through, or under it.

Interior Climate         5.02 To maintain in the Leased Premises during Normal
Control                  Business Hours, and to the extent permitted by law by
                         means of a heating and cooling system, conditions of
                         reasonable temperature and comfort in accordance with
                         good standards of interior climate control generally
                         pertaining at the date of this Lease applicable to
                         normal occupancy of the said premises, but the Landlord
                         shall have no responsibility for any inadequacy of
                         performance of the said system if the Leased Premises
                         depart from the design criteria for such system as
                         determined by the Landlord's Architect. If the use of
                         the Leased Premises does not accord with the said
                         design criteria and changes in the system are feasible
                         and desirable to accommodate such use, the Landlord may
                         make such changes and the entire expense of such
                         changes will be paid by the Tenant.

Elevators                5.03 Subject to the supervision of the Landlord and
                         except when repairs are being made thereto, to furnish
                         for use by the tenant and its employees and invitees in
                         common with other persons entitled thereto passenger
                         elevator service (operatorless automatic elevator
                         service, if used, shall be deemed "elevator service"
                         within the meaning of this Section) to the floor on
                         which the Leased Premises or portions thereof are
                         located, and to furnish for the use of the Tenant in
                         common with others entitled thereto at reasonable
                         intervals and at such hours as the Landlord may
                         REASONABLY select, elevator service for the carriage of
                         furniture, equipment, deliveries and supplies, provided
                         however, that if the elevators shall become inoperative
                         or shall be damaged or destroyed the Landlord shall
                         have reasonable time within which to repair such damage
                         or replace such elevator and the Landlord shall repair
                         or replace the same as soon as reasonably possible, but
                         shall in no event be liable for indirect or
                         consequential damages or other damages for personal
                         discomfort or illness during such period of repair or
                         replacement. THE ELEVATORS WILL BE AVAILABLE TO THE
                         TENANT 24 HOURS A DAY.

Entrances, Lobbies,      5.04 To permit the Tenant and its employees and
etc.                     Lobbies, etc. invitees to have the use during Normal
                         Business Hours in common with others entitled thereto
                         of the common entrances, lobbies, stairways and
                         corridors of the Building giving access to the Leased
                         Premises, THE TENANT SHALL BE PERMITTED ACCESS TO SUCH
                         AREAS AT SUCH OTHER TIMES OF ITS OPERATIONS ON SUCH
                         TERMS AS MAY BE REASONABLE IN ALL OF THE CIRCUMSTANCES,
                         (subject to the Rules and Regulations referred to in
                         Section 4.10 and such other reasonable limitations as
                         the Landlord may from time to time impose) provided
                         that notwithstanding the foregoing the Landlord
                         reserves the right to restrict for security purposes
                         the method of access on Saturdays even during Normal
                         Business Hours; and to permit access to the Leased
                         Premises outside of Normal Business Hours by the Tenant
                         and its authorized employees subject to such reasonable
                         restrictions for security purposes as the Landlord may
                         impose.

Washrooms                5.05 To permit the Tenant and its employees and
                         invitees in common with others, entitled thereto to use
                         the washrooms in the Building on the floor or floors on
                         which the Leased Premises are situate and to provide in
                         such washrooms washroom supplies to a standard
                         consistent with normal standards.

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Janitor Services         5.06 To provide cleaning and janitorial services,
                         including window cleaning, to a standard and with
                         services consistent with normal standards from time to
                         time for similar buildings in similar locations in the
                         city in which the Building is situate, provided that
                         the Tenant shall at the end of each business day leave
                         the Leased Premises in a reasonably tidy condition.
                         With the exception of the obligation to cause such work
                         to be done, the Landlord shall not be responsible for
                         any act of omission on the part of the person or
                         persons, firm or corporation employed to perform such
                         work, and such work shall be done at the Landlord's
                         direction, without interference by the Tenant, its
                         servants, agents or employees.

                                    ARTICLE 6
                        REPAIR AND DAMAGE AND DESTRUCTION

        The Landlord and Tenant further covenant and agree as follows:

Landlord's Repairs       6.01 The Landlord covenants with the Tenant, subject to
                         Sub-section 6.03 (b) and Section 11.02 hereof and
                         except for reasonable wear and tear, to keep in good
                         and substantial state of repair the exterior walls,
                         roof, foundations, and bearing structure of the
                         Building and the pipes, heating and air conditioning,
                         plumbing and electrical wires installed by the
                         Landlord.

Tenant's Repairs         6.02 The Tenant covenants with the Landlord:

                              (a)     subject to Sub-section 6.03 (b) and except
                                      for reasonable wear and tear and Insured
                                      Damage, except where the latter is caused
                                      by the Tenant, its agents, employees,
                                      invitees or licensees, to keep in good and
                                      substantial state of repair and
                                      decoration, including repainting and
                                      cleaning of drapes and carpets at
                                      reasonable intervals as needed, the Leased
                                      Premises including all Leasehold
                                      Improvements and all trade fixtures
                                      therein and all glass therein other than
                                      (subject to Sub-section 6.02 (d) hereof)
                                      perimeter windows on floors above the
                                      Ground Floor of the Building;

                              (b)     that the Landlord may, ON AT LEAST ONE
                                      HOURS NOTICE TO THE TENANT, from time to
                                      time enter and view the state of repair,
                                      and that the Tenant will repair according
                                      to notice in writing;

                              (c)     that if any part of the Building including
                                      without limitation, the structure or the
                                      structural elements of the Building, or
                                      the systems for interior climate control
                                      or for the provisions of utilities or
                                      services get out of repair, or become
                                      damaged or destroyed through the
                                      negligence or misuse of the Tenant or of
                                      its employees, invitees or others over
                                      whom the Tenant can reasonably be expected
                                      to exercise control, the expense of
                                      repairs or replacements thereto
                                      necessitated thereby shall be paid by the
                                      Tenant;

                              (d)     that the Tenant shall during the
                                      continuance of this lease at its expense
                                      repair and replace with as good quality
                                      and size any glass broken on the Leased
                                      Premises, and such obligation shall
                                      include outside windows and doors on the
                                      perimeter of the Leased Premises whenever
                                      such glass shall be broken by the Tenant,
                                      its servants, employees, agents or
                                      invitees; and

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                              (e)     that the Tenant will notify the Landlord
                                      immediately upon the Tenant becoming aware
                                      of any defect in the Leased Premises or of
                                      any other condition which may cause damage
                                      to the Leased Premises or the Building.

Abatement and            6.03 It is agreed between the Landlord and the Tenant
Termination              that:

                              (a)     (i)     in the event of partial
                                              destruction (as hereinafter
                                              defined) of the Leased Premises by
                                              fire, the elements or other cause
                                              or casualty, then in such event,
                                              if the destruction is such that,
                                              in the REASONABLE opinion of the
                                              Landlord's Architect, the Leased
                                              Premises may be partially used for
                                              the Tenant's business while the
                                              repairs are being made, then the
                                              rent shall abate in the proportion
                                              that the part of the Leased
                                              Premises rendered unusable bears
                                              to the whole of the Leased
                                              Premises, PROVIDED ALWAYS that if
                                              the part rendered unusable exceeds
                                              one-half (1/2) of the area of the
                                              Leased Premises there shall be a
                                              total abatement of rent until the
                                              repairs have been made unless the
                                              Tenant, with the permission of the
                                              Landlord, in fact, uses the
                                              undamaged part, in which case the
                                              Tenant shall pay proportionate
                                              rent for the part so used (being
                                              annual basic rent, electrical
                                              charges and Common Costs
                                              Escalation bearing the same
                                              proportion to the annual basic
                                              rent, electrical charges and
                                              Common Costs Escalation for the
                                              whole of the Leased Premises as
                                              the area in square feet of the
                                              part of the Leased Premises being
                                              used bears to the Rentable Area of
                                              the Leased Premises). "Partial
                                              destruction" shall mean any damage
                                              to the Leased Premises less than
                                              total destruction, but which
                                              renders all or any part of the
                                              Leased Premises temporarily unfit
                                              for use by the Tenant for the
                                              Tenant's business. A certificate
                                              of the Landlord's Architect as to
                                              whether the whole or a part of the
                                              Leased Premises is rendered
                                              unusable, and certifying the
                                              extent of the part rendered
                                              unusable, shall be binding and
                                              conclusive upon both Landlord and
                                              Tenant for the purposes hereof.
                                              Provided that if the partial
                                              destruction is repaired within
                                              fifteen (15) days after the date
                                              of destruction, there shall be no
                                              abatement of rent.

                                              (ii) Notwithstanding the foregoing
                                              provisions concerning total or
                                              partial destruction of the Leased
                                              Premises, in the event of total or
                                              partial destruction of the
                                              Building of which the Leased
                                              Premises form a part (and whether
                                              or not the Leased Premises are
                                              destroyed) to such a material
                                              extent or of such a nature that in
                                              the opinion of the Landlord the
                                              Building must be or should be
                                              totally or partially demolished,
                                              whether to be re-constructed in
                                              whole or in part or not, then the
                                              Landlord may, at its option (to be
                                              exercised within sixty (60) days
                                              from the date of destruction) give
                                              notice to the Tenant that this
                                              Lease is terminated with effect
                                              from the date stated in the
                                              notice. If the Tenant is able
                                              effectively to use the Leased
                                              Premises after the destruction,
                                              such date shall be not less than
                                              thirty (30) days from the date of
                                              the notice. If the Tenant is
                                              unable effectively to use the
                                              Leased Premises after the
                                              destruction, the date given in the
                                              notice shall be the date of
                                              destruction. Upon such
                                              termination, the Tenant shall
                                              immediately surrender the Leased
                                              Premises and all its interest
                                              therein to the Landlord and the
                                              rent shall abate and be
                                              apportioned to the date of

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                                      -9-

                                              termination and the Tenant shall
                                              remain liable to the landlord for
                                              all sums accrued due pursuant to
                                              the terms hereof to the date of
                                              termination. The Landlord's
                                              Architect shall determine whether
                                              the Leased Premises can or cannot
                                              be effectively used by the Tenant
                                              and his certificate thereon shall
                                              be binding and conclusive upon
                                              both Landlord and Tenant for the
                                              purposes hereof.

                                      (iii)   In none of the cases aforesaid
                                              shall the Tenant have any claim
                                              upon the Landlord for any damages
                                              sustained by it nor shall the
                                              Landlord be obligated to rebuild
                                              the Building or any part thereof
                                              in accordance with the original
                                              plans and specifications therefor.
                                              No damages, compensation or claim
                                              whatsoever shall be payable by the
                                              Landlord for inconvenience, loss
                                              of business or annoyance or other
                                              loss or damage whatsoever arising
                                              from the occurrence of any such
                                              damage or destruction of the
                                              Leased Premises or of the building
                                              and/or the repair or restoration
                                              thereof.

                                    ARTICLE 7
                            TAXES AND OPERATING COSTS

        The Landlord and Tenant further covenant and agree:

Landlord's Obligations   7.01 The Landlord covenants with the Tenant subject to
                         the Tax provisions of Sections 7.02 and 7.03 to pay
                         promptly when due to the taxing authority or
                         authorities having jurisdiction, all Taxes (as defined
                         in section 16.01 hereof).

Business Taxes           7.02 The Tenant covenants with the Landlord:
and Common Costs
Escalation                    (a)     to pay when due all business taxes,
                                      business licence fees, and other taxes,
                                      rates, duties or charges levied or
                                      assessed by lawful authority in respect of
                                      the use or occupancy of the Leased
                                      Premises by the Tenant, the business or
                                      businesses carried on therein, or the
                                      equipment, machinery or fixtures brought
                                      therein by or belonging to the Tenant, or
                                      anyone occupying the Leased Premises with
                                      the Tenant's consent, and to pay to the
                                      Landlord upon demand the portion of any
                                      tax, rate, duty or charge levied or
                                      assessed upon the land and Building that
                                      is attributable to any equipment,
                                      machinery or fixtures on the Leased
                                      Premises which are not the property of the
                                      Landlord.

                              (b)     to pay to the Landlord in the manner
                                      specified in Section 7.03 as additional
                                      rent any Common Costs Escalation.

                              (c)     to reimburse the Landlord throughout the
                                      Term and at the times and in the manner
                                      specified by the Landlord from time to
                                      time, the full amount of any tax, sales
                                      tax, goods and services tax, value added
                                      tax, multi-stage sales tax, business
                                      transfer tax or any other similar tax
                                      levied, rated, charged, imposed or
                                      assessed in respect of the rent,
                                      additional rent or any other amounts
                                      payable pursuant to this Lease or in
                                      respect of the space demised under this
                                      Lease.

Payment of Common        7.03 (a)     After the commencement of the Term of this
Costs Escalation                      Lease and prior to the commencement of
                                      each calendar year thereafter which
                                      commences during the Term the Landlord
                                      shall estimate the Common Costs Escalation
                                      for the ensuing calendar year or (if
                                      applicable) broken

<PAGE>   10

                                      -10-

                                      portion thereof, as the case may be, to
                                      become payable under Section 7.02, and
                                      notify the Tenant in writing of such
                                      estimate. The amount so estimated (which
                                      amount may be re-estimated from time to
                                      time during the calendar year) shall be
                                      payable in equal monthly installments in
                                      advance over the calendar year in
                                      question, each such installment being
                                      payable on each monthly rental payment
                                      date proved in Article 3 hereof.

See Section 17.08             (b)     When the Common Costs for the calendar
                                      year or broken portion of the calendar
                                      year in question become finally determined
                                      the Landlord shall recalculate the Common
                                      Costs Escalation. If the Tenant has
                                      overpaid such Common Costs Escalation, the
                                      Landlord shall refund any excess paid, but
                                      if any balance remains unpaid the Tenant
                                      shall pay such remaining balance within
                                      thirty (30) days of demand by the
                                      Landlord. If for any reason the Common
                                      Costs Escalation is not finally determined
                                      within such calendar year or broken
                                      portion thereof, the parties shall make
                                      the appropriate re-adjustment when such
                                      Common Costs Escalation becomes finally
                                      determined. The obligation of the parties
                                      to observe or perform this covenant shall
                                      survive the expiration or other
                                      termination of the Term of this Lease.
                                      Within 120 days after the end of each
                                      calendar year, the Landlord shall furnish
                                      to the Tenant a statement in writing
                                      certified by the Landlord's external
                                      auditors of the amount of Common Costs for
                                      such calendar year showing in reasonable
                                      detail the main classification of items
                                      included in Common Costs. If the amount
                                      payable by the Tenant as shown on such
                                      statement is greater or less than the
                                      portion paid by the Tenant to the landlord
                                      pursuant to Article 7.03 (a) or (b) , the
                                      proper adjustments shall be paid by the
                                      party liable for such amount within ten
                                      (10) days after delivery of the statement.

                              (c)     Neither party may claim a re-adjustment in
                                      respect of the Common Costs Escalation
                                      based upon any error of estimation,
                                      determination or calculation thereof
                                      unless claimed in writing prior to the
                                      expiration of one (1) year after the end
                                      of the calendar year to which the Common
                                      Costs Escalation relates. Any report of
                                      the Landlord's accountant (who may be the
                                      Landlord's internal auditor or accountant)
                                      as to the Common Costs Escalation shall be
                                      conclusive as to the amount thereof for
                                      any period to which such report relates.
                                      THE TENANT SHALL BE ENTITLED TO REASONABLY
                                      REQUEST THE DOCUMENTATION BASED UPON WHICH
                                      THE LANDLORD HAS DETERMINED THE COMMON
                                      COSTS ESCALATION. THE COMMON COSTS ARE
                                      ESTIMATED TO BE $6.65 PER SQUARE FOOT
                                      INCLUDING ELECTRICITY FOR THE FISCAL YEAR
                                      1996. FURTHER THE LANDLORD AGREES TO LIMIT
                                      ANNUAL INCREASES IN ADDITIONAL RENT,
                                      EXCLUDING PROPERTY TAX AND UTILITIES AND
                                      ANY OTHER LEGISLATED COSTS NOT UNDER THE
                                      LANDLORD'S CONTROL, TO ACTUAL INCREASES OF
                                      5%, WHICHEVER IS LESS.

Postponement, etc.,      7.04 The Landlord may postpone payment of any Taxes
of Taxes                 payable by it pursuant to Section 7.01 and the Tenant
                         may postpone payment of any taxes, rates, duties,
                         levies and assessments payable by it under Sub-section
                         7.02 (a), in each case to the extent permitted by law
                         and if prosecuting in good faith any appeal against the
                         imposition thereof, and provided in the case of a
                         postponement by the Tenant that if the Building or any
                         part thereof or the Landlord shall become liable to
                         assessment, prosecution, fine or other liability the
                         Tenant shall have given security in a form and of an
                         amount satisfactory to the landlord in respect of such
                         liability and such undertakings as the Landlord may
                         reasonably require to ensure payment thereof.

<PAGE>   11

                                      -11-

Receipts, etc.           7.05 Whenever requested by the Landlord the Tenant will
                         deliver to it receipts for payment of all taxes, rates,
                         duties, levies and assessments payable by the Tenant
                         pursuant to Sub-section 7.02 (a) hereof and furnish
                         such other information in connection therewith as the
                         Landlord may reasonably require.

                                    ARTICLE 8
                        UTILITIES AND ADDITIONAL SERVICES

        The Landlord and Tenant further covenant and agree as follows:

Water, Telephone and     8.01 The Landlord shall furnish appropriate conduits
Electricity              for bringing building standard electrical and telephone
                         services to the Leased Premises and shall provide hot
                         and cold or tempered water to the building standard
                         washrooms on each floor on which the Leased Premises
                         are situate. (SEE SECTION 16.01(o).

Utilities                8.02 The Tenant shall pay for the cost of all utilities
                         provided for its exclusive use in the Leased Premises,
                         including without restricting the generality of the
                         foregoing or of Section 8.03, gas, water, electricity,
                         telephone and communication service charges and rates
                         incurred by the Tenant and any other charges and/or
                         rates relating to services and/or utilities provided
                         for the exclusive use of the Tenant in respect of the
                         Tenant's occupation of the Leased Premises and
                         operation of its business carried on therein or
                         therefrom, including laboratory work and any special
                         systems servicing its own computers, or any other
                         machinery.

Electricity              8.03 The Landlord may from time to time determine the
                         Tenant' s electrical consumption in the Leased Premises
                         upon whatever reasonable basis may be selected by it,
                         including without limitation, the metering of
                         electricity either to the Leased Premises or to special
                         equipment therein or by estimating the consumption of
                         the Leased Premises or any special equipment therein
                         having regard to electrical capacity and hours of use.
                         If the Landlord determines that the Tenant' s
                         electrical consumption is disproportionate to the
                         electrical consumption of other tenants in the
                         Building, the Landlord may require the Tenant to
                         install at the Tenant's expense a domestic meter for
                         measurement or checking of the Tenant's electrical
                         consumption or any part of such consumption or use; and
                         in that event the Tenant shall pay directly to the
                         supplier of the electricity as and when due from time
                         to time any and all electrical charges for such
                         electrical consumption which is disproportionate as
                         aforesaid and which the Landlord has required to be
                         metered. The Landlord's determination shall be verified
                         by an engineer selected by the Landlord (who may be an
                         employee of the Landlord) and being so verified shall
                         be binding on the parties hereto. THE TENANT SHALL,
                         WHEN REASONABLY REQUESTED BE PERMITTED TO REVIEW THE
                         RECORDS AND RECEIVE AN ACCOUNTING FROM THE LANDLORD IN
                         REGARD TO THE DETERMINATION OF THE ELECTRICAL
                         CONSUMPTION IN THE BUILDING.

Excess Use               8.04 The Tenant's use of electric power in the Leased
                         Premises shall not be for the operation of other than
                         normal office electrical fixtures, lights, lamps,
                         typewriters, photocopiers, bookkeeping machines,
                         telexes, adding machines and similar small office
                         machines for the Tenant's own use solely (the Landlord
                         to determine what equipment is characterizable as
                         "small office machines" and "normal office" equipment),
                         AND SUCH OTHER ITEMS AND EQUIPMENT REASONABLY NECESSARY
                         FOR THE PERMITTED USE AS DESCRIBED IN PARAGRAPH 4.03
                         HEREOF, without the prior written consent of the
                         Landlord and shall not at any time exceed the capacity
                         of any of the electrical conductors and equipment in or
                         otherwise serving the Leased Premises.

<PAGE>   12

                                      -12-

                         As a condition of granting such consent, the Landlord
                         may require the Tenant to pay as additional rent the
                         cost of all additional risers and other equipment
                         required therefor as well as the increased cost to the
                         Landlord of the electric power and the Additional
                         Services to be furnished by the Landlord in connection
                         therewith.

Lamps                    8.05 The Tenant shall pay throughout the Term promptly
                         to the Landlord when demanded the cost of maintaining
                         and servicing in all respects all electric lighting
                         fixtures in the Leased Premises including the
                         REASONABLE cost of replacement on a group basis or
                         otherwise of electric light bulbs, fluorescent tubes,
                         starters and ballasts installed on commencement of the
                         said Term. Such maintaining, servicing and replacing
                         shall be within the exclusive right of the Landlord
                         and shall be carried out at reasonably competitive
                         rates.

Additional Services      8.06 The Landlord, if it shall from time to time so
                         elect, shall have the exclusive right, by way of
                         Additional Services, to provide or have its designated
                         agents or contractors provide any janitor or cleaning
                         services to the Leased Premises required by the Tenant
                         which are additional to those required to be provided
                         by the Landlord under Section 5.06, and to supervise
                         the moving of furniture or equipment of the Tenant and
                         the making of repairs or alterations conducted within
                         the Leased Premises, and to supervise or make
                         deliveries to the Leased Premises. The cost of
                         Additional Services provided to the Tenant shall be
                         REASONABLY COMPETITIVE IN RELATION TO SUCH SERVICES IN
                         THE MARKET PLACE AND SHALL BE paid to the Landlord by
                         the Tenant from time to time promptly upon receipt of
                         invoices therefor from the Landlord. The Landlord may
                         include as part of its costs of rendering such
                         Additional Services the Landlord's then current
                         administration fee. Costs of Additional Services
                         recovered directly from the Tenant and other tenants
                         shall not be included in computing Operating Costs.

                         8.07 NOTWITHSTANDING PARAGRAPH 8.06, IF THE ADDITIONAL
                         COSTS ARISING FROM OR OUT OF PARAGRAPH 8.06 EXCEED
                         $500.00, THE TENANT, IN ITS SOLE DISCRETION, MAY SEEK
                         OTHER ARRANGEMENTS FOR THE PROVISION OF THE ADDITIONAL
                         SERVICES DESCRIBED IN PARAGRAPH 8.06 AND SHALL ADVISE
                         THE LANDLORD OF THE ALTERNATIVE ARRANGEMENTS MADE AND
                         WHICH ALTERNATIVE ARRANGEMENTS SHALL IN ALL OF THE
                         CIRCUMSTANCES, BE REASONABLE.

                         8.08 NOTWITHSTANDING THE FOREGOING PROVISIONS CONTAINED
                         IN THIS ARTICLE 8, THE TENANT SHALL NOT BE CHARGED NOR
                         OBLIGATED TO PAY FOR ANY UTILITIES AND/OR ADDITIONAL
                         SERVICES REFERRED TO IN THIS ARTICLE 8, WHICH HAVE BEEN
                         INCLUDED IN THE DETERMINATION OF THE COMMON COSTS
                         AND/OR OPERATING COSTS AS DEFINED IN THE WITHIN LEASE.

                                    ARTICLE 9
                      LICENSES, ASSIGNMENTS AND SUBLETTINGS

Assignments and/or       9.01 (a)     The Tenant shall not assign, mortgage or
Sublettings                           charge this Lease or sublet or part with
                                      possession of the whole or any part of the
                                      Leased Premises nor shall it permit any
                                      subtenant to assign, mortgage or charge
                                      its sublease or sublet or part with
                                      possession of the whole or any part of the
                                      Leased Premises (each of the foregoing
                                      transactions being sometimes referred to
                                      herein as a "Transfer") unless it shall
                                      have first requested and obtained the
                                      consent in writing of the Landlord
                                      thereto, which consent shall not be
                                      unreasonably withheld. Any request for
                                      such consent shall be in writing and shall
                                      be accompanied by a true copy of any
                                      agreements relating to the Transfer which
                                      the Tenant may have originated or
                                      received, and the Tenant shall furnish to
                                      the Landlord all information reasonably
                                      requested by the Landlord available to the
                                      Tenant as to the business and financial
                                      responsibility and standing of the
                                      proposed assignee, subtenant, mortgagee or
                                      chargee

<PAGE>   13

                                      -13-

                                      or occupant (herein referred to as the
                                      "Transferee").

                              (b)     The Landlord's consent to the Tenant's
                                      request for consent to a Transfer shall
                                      not unreasonably be withheld, provided
                                      nevertheless that the Landlord shall be
                                      entitled to withhold consent unreasonably
                                      if the Landlord exercises the right
                                      hereinafter set out in subsection 9.01(c).
                                      Provided further that the landlord's
                                      consent to any Transfer shall be
                                      conditional upon the Transferee entering
                                      into an agreement in form and content
                                      stipulated by the Landlord to perform,
                                      observe and keep each and every covenant,
                                      proviso, condition and agreement in this
                                      Lease on the part of the Tenant to be
                                      performed, observed and kept, including
                                      (except in the case of a subtenancy
                                      payment of rent and all other sums and
                                      payments agreed to be paid or payable
                                      under this Lease-on the days and at the
                                      times and in the manner herein specified.
                                      In the case of a subtenancy, the agreement
                                      shall contain an assignment to the
                                      Landlord of the rents and other amounts
                                      payable under the sublease involved and a
                                      provision whereby the subtenant agrees to
                                      pay to the landlord, unless the latter
                                      otherwise directs, all such rents and
                                      other amounts payable under the sublease.
                                      The assignment shall be given as security
                                      for payment of the rents and other amounts
                                      payable under this Lease. Without limiting
                                      the grounds for withholding consent to a
                                      Transfer, the Landlord's refusal to
                                      consent will not be considered
                                      unreasonable if a reason for withholding
                                      the consent is (i) that the Landlord has
                                      concerns, on reasonable grounds, about the
                                      business, financial background, business
                                      history or creditworthiness of the
                                      proposed Transferee or about the use to
                                      which the Leased Premises may be put or
                                      (ii) the Transferee's refusal to execute
                                      an agreement of the type referred to
                                      above.

                              (c)     Upon the receipt from the Tenant of such
                                      request and such required information, the
                                      Landlord shall have the right, exercisable
                                      in writing within fourteen (14) days after
                                      such receipt, to cancel and terminate this
                                      Lease if the request relates to all the
                                      Leased Premises or to cancel this Lease
                                      only with respect to the applicable part
                                      of the Leased Premises if the request
                                      relates only to a part of the Leased
                                      Premises. In a case where the Tenant's
                                      request for consent to a Transfer relates
                                      only to a part of the Leased Premises, the
                                      phrase "cancellation of this Lease" means
                                      cancellation of this Lease only with
                                      respect to the applicable part of the
                                      Premises, and similar expressions have
                                      similar meanings. Such cancellation shall
                                      be effective as of the date set forth in
                                      the Landlord's notice of exercise of such
                                      right, which shall be neither less than
                                      sixty (60) nor more than one hundred and
                                      twenty (120) days following the service of
                                      such notice. If the lease is cancelled
                                      only with respect to a part of the Leased
                                      Premises, basic rent will abate in the
                                      proportion that the Rentable Area of the
                                      part of the Leased Premises for which this
                                      lease is cancelled bears to the Rentable
                                      Area of the Leased Premises, and this
                                      lease will be amended accordingly.

                              (d)     If the landlord shall exercise such right
                                      the Tenant shall surrender possession of
                                      the Leased Premises or the cancelled
                                      portion thereof on the date set forth in
                                      such notice in accordance with the
                                      provisions of this Lease relating to
                                      surrender of the Leased Premises at the
                                      expiration of the Term.

                              (e)     If the Landlord shall not exercise the
                                      right to cancel this Lease or a proportion
                                      thereof, as above provided after the
                                      receipt of the Tenant's written request,
                                      then the Landlord's consent to such
                                      request shall not be

<PAGE>   14

                                      -14-

                                      unreasonably withheld. In no event shall
                                      any Transfer to which the Landlord may
                                      have consented release or relieve the
                                      Tenant from its obligations fully to
                                      perform all the terms, covenants and
                                      conditions of this Lease on its part to be
                                      performed. No consent by the Landlord to
                                      any Transfer shall be construed to mean
                                      that the Landlord has consented or will
                                      consent to any further Transfer.

                              (f)     Documents evidencing the Landlord's
                                      consent to a Transfer, if permitted or
                                      consented to by the Landlord, will be
                                      prepared by the Landlord or its solicitors
                                      and all related legal costs will be paid
                                      by the Tenant to the Landlord or its
                                      solicitors, as Additional Rent, within
                                      fifteen (15) days after receipt of an
                                      invoice from the Landlord setting out
                                      reasonable particulars of the charges.

                              (g)     If after the date of execution of this
                                      Lease shares not listed for sale on a
                                      recognized stock exchange in Canada or the
                                      United States in the capital of either the
                                      Tenant or a corporation that controls the
                                      Tenant are transferred by sale,
                                      assignment, bequest, inheritance,
                                      operation of law or other disposition, or
                                      are issued by subscription or allotment,
                                      or are cancelled or redeemed, so as to
                                      result in a change in the effective voting
                                      or other control of the Tenant, or of a
                                      corporation that controls the Tenant, by
                                      the person or persons holding control on
                                      the date of execution of this Lease, or if
                                      other steps are taken to accomplish a
                                      change of control, the Tenant promptly
                                      will notify the Landlord in writing of the
                                      change of control, which will be
                                      considered to be an assignment of this
                                      Lease to which the provision of this
                                      Article shall apply. Whether or not the
                                      Tenant notifies the Landlord, unless the
                                      Landlord previously had consented to the
                                      change of control, the landlord may,
                                      within sixty (60) days after it learns of
                                      the change in control, notify the Tenant
                                      that it elects to terminate this Lease.
                                      The Tenant will make available to the
                                      landlord or its lawful representative all
                                      PERTINENT corporate books and records of
                                      the Tenant and of any corporation that
                                      controls the Tenant for inspection at all
                                      reasonable times, to ascertain to the
                                      extent possible whether there has been a
                                      change of control. For the purposes of
                                      this section, control means the direct or
                                      indirect beneficial ownership of more than
                                      fifty percent (50%) of the voting shares
                                      in the capital of a corporation.

                              (h)     If an approved Transferee has sublet or
                                      taken an assignment of all or part of the
                                      leased Premises from the Tenant and has
                                      agreed to pay the Tenant a rent or other
                                      amount in respect of the Leased Premises
                                      or any part of the Leased Premises that
                                      exceeds the rent payable by the Tenant to
                                      the Landlord (or a pro-rated portion of
                                      such rent in the case of a sublease or
                                      assignment of less than the entire Leased
                                      Premises), the Tenant will pay to the
                                      Landlord monthly, as additional rent,
                                      together with basic rent, an amount equal
                                      to the excess rent or other amount
                                      received or receivable by the Tenant from
                                      the Transferee.

                              (i)     If the Landlord sells or otherwise
                                      disposes of the Building or an interest in
                                      the Building or in this Lease to the
                                      extent that the purchaser or assignee
                                      assumes responsibility for compliance with
                                      the covenants and obligations of the
                                      Landlord under this Lease, the Landlord
                                      without further written agreement will be
                                      relieved of liability under the covenants
                                      and obligations.

                              (j)     The Tenant covenants and agrees that it
                                      shall not grant to any lender or other
                                      creditor an assignment, mortgage or charge
                                      of its interest in any

<PAGE>   15

                                      -15-

                                      sublease of all or any part of the Leased
                                      Premises or of its interest in any of the
                                      rents payable under any such sublease. The
                                      Tenant hereby agrees that upon the request
                                      of the Landlord from time to time, it
                                      shall assign unto the Landlord, as
                                      security for the payment of the rent under
                                      this Lease, all of its right, title and
                                      interest in the rents payable under any
                                      and all such sublease. Such assignment
                                      shall be acceptable to the Landlord as to
                                      form and content and it is agreed that the
                                      Landlord may withhold its consent to a
                                      proposed sublease if the Tenant fails to
                                      execute the assignment.

                                   ARTICLE 10
                            FIXTURES AND IMPROVEMENTS

        The Landlord and Tenant further covenant and agree as follows:

Installation Fixtures    10.01(a)     AFTER FEBRUARY 1, 1997 the Tenant will not
and Improvements                      make, erect, install or alter any of
                                      Improvements or trade fixtures in the
                                      Leased Premises without having requested
                                      and obtained the Landlord's prior written
                                      approval, which the Landlord shall not
                                      unreasonably withhold.

                              (b)     AFTER FEBRUARY 1, 1997 in making,
                                      erecting, installing or altering any
                                      Leasehold Improvements or trade fixtures
                                      the Tenant will not alter or interfere
                                      with any installations which have been
                                      made by the Landlord without the prior
                                      written approval of the Landlord, and in
                                      no event shall alter or interfere with or
                                      affect the structural elements or the
                                      strength or outside appearance of the
                                      Building, or the mechanical, electrical,
                                      plumbing and climate control systems
                                      thereof or the window coverings installed
                                      by the Landlord on exterior windows.

                              (c)     The Tenant's request for any approval
                                      hereunder shall be in writing and
                                      accompanied by an adequate description of
                                      the contemplated work and where
                                      appropriate, working drawings and
                                      specifications therefor. Any out-of-pocket
                                      expenses incurred by the Landlord in
                                      connection with any such request for
                                      approval shall be deemed incurred by way
                                      of an Additional Service. All work to be
                                      performed by competent contractors and
                                      subcontractors of whom the Landlord shall
                                      have approved (such approval not to be
                                      unreasonably withheld, but provided that
                                      the Landlord may require that the
                                      Landlord's contractors and subcontractors
                                      be engaged for any mechanical or
                                      electrical work) and by workmen whose
                                      labour affiliations are compatible with
                                      those of workmen employed by the Landlord
                                      and its contractors and subcontractors. At
                                      the option of the Landlord, all such work
                                      shall be subject to inspection by and the
                                      reasonable supervision of the Landlord, as
                                      an Additional Service, and shall be
                                      performed in accordance with any
                                      reasonable conditions or regulations
                                      imposed by the Landlord (including without
                                      limitation the examination by the
                                      Landlord's Architect or other experts of
                                      the detailed drawings and specifications
                                      as an Additional Service and contractor's
                                      liability insurance in reasonable amounts)
                                      and completed in a good and workmanlike
                                      manner in accordance with the description
                                      of the work approved by the Landlord.

Liens and                10.02 In connection with the making, erection,
Encumbrances on          installation or alteration of Leasehold Improvements
Fixtures and             and on trade fixtures and all other work or
Improvements             installations made by or for the Tenant in the Leased
                         Premises the Tenant shall comply with all the
                         provisions of the applicable provincial legislation in
                         respect of mechanics' (builders') liens and workmen's
                         (workers') compensation and other statutes from time to
                         time applicable thereto

<PAGE>   16

                                      -16-

                         (including any provision requiring or enabling the
                         retention of portions of any sums payable by way of
                         holdbacks) and except as to any such holdback shall
                         promptly pay all accounts relating thereto. The Tenant
                         will not create or cause to be created any mortgage,
                         conditional sale agreement or other encumbrance in
                         respect of the Leasehold Improvements or permit any
                         such mortgage, conditional sale agreement or other
                         encumbrance to attach to the Leased Premises or the
                         Building or any part thereof. If and whenever any
                         mechanics' (builders') or other lien for work, labour,
                         services or materials supplied to or for the Tenant or
                         for the cost of which the Tenant may be in any way
                         liable or claims therefor shall arise or be filed or
                         any such mortgage, conditional sale agreement or other
                         encumbrance shall attach, the Tenant shall within
                         twenty (20) days after receipt of notice thereof
                         procure the discharge thereof, including any
                         certificate of action registered in respect of any
                         lien, by payment or giving security or in such other
                         manner as may be required or permitted by law, and
                         failing which the Landlord may in addition to all other
                         remedies hereunder avail itself of its remedy under
                         Section 13.01 and may make any payments required to
                         procure the discharge of any such liens or
                         encumbrances, shall be reimbursed by the Tenant as
                         provided in Section 13.01, and its right to
                         reimbursement shall not be affected or impaired if the
                         Tenant shall then or subsequently establish or claim
                         that any lien or encumbrance so discharged was without
                         merit or excessive or subject to any abatement, set-off
                         or defence.

Tenant's Goods           10.03 The Tenant covenants that it will not sell,
                         dispose of or remove any of the trade fixtures, goods
                         or chattels of the Tenant from or out of the Leased
                         Premises, during the Term without the consent of the
                         Landlord, unless the Tenant is substituting new trade
                         fixtures, goods or chattels of equal value or is bona
                         fide disposing of individual items in the normal course
                         of its business. The Tenant further covenants that
                         OTHER THAN GOODS AND CHATTELS WHICH ARE LEASED BY THE
                         TENANT it will at all times have and retain full legal
                         and beneficial ownership of its trade fixtures, goods
                         and chattels and will not permit them to be or become
                         subject to any lien, mortgage, charge, encumbrance or
                         title retention agreement except such as are bona fide
                         incurred for the purpose of financing the purchase of
                         such trade fixtures, good or chattels.

Removal of Fixtures      10.04 All Leasehold Improvements in or upon the Leased
and Improvements         Premises installed by the Tenant shall immediately upon
                         termination of this Lease be and become the Landlord's
                         property without compensation therefor to the Tenant.
                         Except to the extent herein or otherwise expressly
                         agreed by the Landlord in writing, no Leasehold
                         Improvements, trade fixtures, furniture or equipment
                         shall be removed by the Tenant from the Leased Premises
                         either during or at the expiration or sooner
                         termination of the Term, except that (1) the Tenant, if
                         not in default hereunder, may at the end of the Term
                         remove its trade fixtures; (2) the Tenant, if not in
                         default hereunder, may remove its furniture and
                         equipment at the end of the Term; and (3) the Tenant
                         shall at the end of the Term remove such of the
                         Leasehold Improvements installed by it, and such of its
                         trade fixtures, furniture and equipment as the Landlord
                         shall require to be removed. The Tenant shall, in the
                         case of every removal either during or at the end of
                         the Term, make good any damage caused to the Leased
                         Premises and/or the Building by the installation and
                         removal.
                                   ARTICLE 11
                             INSURANCE AND LIABILITY

        The Landlord and Tenant further covenant and agree as follows:

Tenant's Insurance       11.01 The Tenant shall take out and keep in force
                         during the Term:

                              (a)     comprehensive general public liability
                                      insurance (covering bodily injury, death
                                      and property damage) on an occurrence
                                      basis with respect to all construction,
                                      installation and alteration done in the
                                      Leased

<PAGE>   17
                                     - 17 -

                                      Premises by the Tenant, the business
                                      carried on, in or from the Leased Premises
                                      and the Tenant's use and occupancy
                                      thereof, of not less than $1,000,000.00;

                              (b)     insurance in such amounts as may be
                                      reasonably required by the Landlord in
                                      respect of fire and such other perils as
                                      are from time to time defined in the usual
                                      extended coverage endorsement covering the
                                      Tenant's trade fixtures and the furniture
                                      and equipment of the Tenant and all
                                      Leasehold Improvements of the Tenant, and
                                      which insurance shall include the Landlord
                                      as a named insured as the Landlord's
                                      interest may appear with respect to
                                      insured Leasehold Improvements and provide
                                      that any proceeds recoverable in the event
                                      of loss to Leasehold Improvements shall be
                                      payable to the Landlord but the Landlord
                                      agrees to make available such proceeds
                                      toward the repair or replacement of the
                                      insured property if this Lease is not
                                      terminated pursuant to any provision
                                      hereof, and if this Lease is terminated
                                      for reasons other than the default of the
                                      Tenant hereunder, the Landlord and Tenant
                                      agree that the proceeds shall be divided
                                      between the Landlord and the Tenant as
                                      their respective interest in the Leasehold
                                      Improvements may appear, (as determined by
                                      agreement or failing agreement by
                                      arbitration pursuant to Section 15.10
                                      hereof); and

                              (c)     plate glass insurance (if there shall be
                                      plate glass in the Lease Premises) in
                                      amount and on terms satisfactory to the
                                      Landlord.

                         All insurance required to be maintained by the Tenant
                         hereunder shall be in amounts and on terms REASONABLY
                         satisfactory to the Landlord. Such insurance shall be
                         by policies in form satisfactory from time to time to
                         the Landlord and with insurers acceptable to the
                         Landlord, ACTING REASONABLY, and shall provide that
                         such insurers shall provide to the Landlord thirty (30)
                         days prior written notice of cancellation or material
                         alteration of such policies. Each policy shall name the
                         Landlord as an additional insured except for coverage
                         for the Tenant's trade fixtures and furnishings and
                         equipment but including coverage for Leasehold
                         Improvements in respect contain a waiver of cross-claim
                         and subrogation against the Landlord and shall protect
                         and indemnify both the Landlord and the Tenant. The
                         Tenant shall furnish to the Landlord certificates, or,
                         if required by the Landlord, certified copies of the
                         policies (signed by the insurers) of the insurance from
                         time to time required to be effected by the Tenant and
                         evidence acceptable to the Landlord of their
                         continuation in force. If the Tenant shall fail to take
                         out, renew and keep in force such insurance the
                         Landlord may do so as the agent of the Tenant and the
                         Tenant shall repay to the Landlord any amounts paid by
                         the Landlord as premiums forthwith upon demand.

                         11.02 The Tenant covenants and agrees that:

                              (a)     the Landlord shall not be liable for any
                                      bodily injury to or the death of, or loss
                                      or damage to any property belonging to,
                                      the Tenant or its employees, invitees, or
                                      licensees or any other person (on Land for
                                      the purpose of attending at the Leased
                                      Premises), on or about the Land, unless
                                      resulting from the actual fault or
                                      negligence of the Landlord. Provided that,
                                      THE LANDLORD IS NOT DEEMED RESPONSIBLE, in
                                      no event shall the Landlord be liable for
                                      any consequential injury, loss or damage,
                                      or:

                                      (i)     for any injury or damage of any
                                              nature whatsoever to any persons
                                              or property caused by the failure
                                              by reason of a breakdown or other
                                              cause, to supply adequate
                                              drainage, snow or ice removal, or
                                              by reason of the interruption of
                                              any public

<PAGE>   18
                                     - 18 -

                                              utility or other service, or in
                                              the event of gas, steam, water,
                                              rain, snow, ice, or other
                                              substances leaking, issuing or
                                              flowing from the water, steam,
                                              sprinkler or drainage pipes or
                                              plumbing of the Building or from
                                              any other place or quarter, into
                                              any part of the Leased Premises or
                                              for any loss or damage caused by
                                              or attributable to the condition
                                              or arrangement of any electric or
                                              other wiring or for any damage
                                              caused by anything done or omitted
                                              to be done by any other tenant of
                                              the Building;

                                      (ii)    for any act or omission (including
                                              theft, malfeasance or negligence)
                                              on the part of any agent,
                                              contractor or person from time to
                                              time employed by it to perform
                                              janitor services, security
                                              services, maintenance, supervision
                                              or Additional Services or any
                                              other work in or about the Leased
                                              Premises or the Building. THE
                                              LANDLORD, ACTING REASONABLY, SHALL
                                              ENSURE THAT SUCH SERVICES SHALL
                                              CARRY SUFFICIENT AND APPROPRIATE
                                              INSURANCE AND/OR ARE BONDED;

                                      (iii)   for loss or damage, however
                                              caused, to money, securities,
                                              negotiable instruments, papers or
                                              other valuables of the Tenant,
                                              including any consequential loss
                                              or damage resulting therefrom; or

                                      (iv)    for loss or damage to any
                                              automobiles or their contents for
                                              the unauthorized use by other
                                              tenants or strangers of parking
                                              space allotted to the Tenant, but
                                              the covenants to indemnify the
                                              Landlord against and from all
                                              loss, costs, claims and demands in
                                              respect of any such injury or loss
                                              to it or its employees, invitees
                                              or licensees or any other person
                                              on the Land for the purpose of
                                              attending at the Leased Premises
                                              or in respect of any such damage
                                              to property belonging to or
                                              entrusted to the care of any of
                                              the aforementioned;

                              (b)     the Landlord shall have no responsibility
                                      or liability for the failure to supply
                                      interior climate control or elevator
                                      service when prevented from doing so by
                                      strikes, the necessity of repairs, any
                                      order or regulation of any body having
                                      jurisdiction, the failure of the supply of
                                      any utility required for the operation
                                      thereof or any other cause beyond the
                                      Landlord's reasonable control, and shall
                                      not be held responsible for indirect or
                                      consequential damages or other damages for
                                      personal discomfort or illness or injury
                                      resulting therefrom or for any bodily
                                      injury, death or damage to property
                                      arising from the use of, or any happening
                                      in or about, any elevator;

                              (c)     the Landlord may require one (1) year
                                      after the Tenant has fully occupied the
                                      Leased Premises in order to adjust and
                                      balance the climate control system and the
                                      Landlord shall not be responsible for any
                                      inconvenience, discomfort, damages, loss
                                      or claims whatsoever arising out of the
                                      process of such adjustment or balancing;

                              (d)     the Landlord shall be under no obligation
                                      to repair or maintain or insure the
                                      Tenant' s Leasehold Improvements,
                                      furniture, equipment or other property;

                              (e)     the Landlord shall be under no obligation
                                      to remedy any default of the Tenant, and
                                      shall not incur any liability to the
                                      Tenant for any act or
<PAGE>   19
                                     - 19 -

                                      omission in the course of its curing or
                                      attempting to cure any such default or in
                                      the event of its entering upon the Leased
                                      Premises to undertake any examination
                                      thereof or any work therein or in the case
                                      of any emergency.

                         11.03 The Tenant agrees to defend, indemnify and save
                         harmless the Landlord in respect of all claims for
                         bodily injury or death, property damage or other loss
                         or damage arising howsoever out of the use or
                         occupation of the Leased Premises or from the conduct
                         of any work by or any act or omission of the Tenant or
                         any assignee, subtenant, agent, employee, contractor,
                         invitee or licensee of the Tenant, and in respect of
                         all costs, expenses and liabilities incurred by the
                         Landlord in connection with or arising out of all such
                         claims, including the expenses of any action or
                         proceeding pertaining thereto, and in respect of any
                         loss, cost, expense or damage suffered or incurred by
                         the Landlord arising from any breach or non-performance
                         by the Tenant of any of its covenants or obligations
                         under this Lease. The Tenant's obligation to observe or
                         perform this covenant shall survive the expiration or
                         other termination of the Term of this Lease.

                                   ARTICLE 12
                     SUBORDINATION, ATTORNMENT, REGISTRATION
                                AND CERTIFICATES

        The Tenant agrees with the Landlord that:

Subordinations and       12.01 This Lease and all rights of the Tenant are
Attornment               subject and subordinate to all mortgages, trust deeds
                         or trust indentures (and all instruments supplemental
                         thereto) or other forms of loan security now or
                         hereafter existing which may now or hereafter affect
                         the Land or Building and to all renewals,
                         modifications, consolidations, replacements and
                         extensions thereof; provided that the Tenant whenever
                         requested by any mortgagee (including any trustee under
                         a trust deed or trust indenture) shall attorn to such
                         mortgagee as the tenant upon all terms of this Lease.
                         The Tenant agrees to execute promptly whenever
                         requested by the Landlord or by such mortgagee an
                         instrument or subordination and/or attornment, as may
                         be required of it.

Registration             12.02 The Tenant will not register this Lease in this
                         form in the Registry Office or the Land Titles Office
                         and will not request or apply for issue for a leasehold
                         title for this Lease. If the Tenant desires to make a
                         registration in respect of this Lease, the Tenant shall
                         effect registration by caveat or by a short form of
                         lease, provided that such caveat or short form of lease
                         shall not disclose the rental rate or rates payable
                         under this Lease.

Certificates             12.03 The Tenant shall promptly whenever requested by
                         the Landlord from time to time execute and deliver to
                         the Landlord (and if required by the Landlord, to any
                         mortgagee (including any trustee under a trust deed or
                         trust indenture) designated by the Landlord a
                         certificate in writing as to the status of this Lease,
                         including as to whether it is in full force and effect,
                         is modified or unmodified, confirming the rental
                         payable hereunder and the state of the accounts between
                         the Landlord and Tenant, the existence or non-existence
                         of defaults, and any other matter pertaining to this
                         Lease as to which the Landlord shall request a
                         certificate.

                                   ARTICLE 13
                   REMEDIES OF LANDLORD AND TENANT'S DEFAULT

        The Landlord and Tenant further covenant and agree as follows:

<PAGE>   20
                                     - 20 -

Remedying by Landlord    13.01 In addition to all rights and remedies of the
Non-Payment and          Landlord available to it in the event of any default
Interest                 hereunder by the Tenant either by any other provisions
                         of this Lease or by statute or the general law, the
                         Landlord:

                              (a)     shall have the right (but shall not be
                                      obligated to) at all times to remedy or
                                      attempt to remedy any default of the
                                      Tenant, and in so doing may make any
                                      payments due or alleged to be due by the
                                      Tenant to third parties and may enter upon
                                      the Leased Premises to do any work or
                                      other things therein, and in such event
                                      all expenses of the Landlord in remedying
                                      or attempting to remedy such default shall
                                      be payable by the Tenant to the Landlord
                                      forthwith upon demand, together with a fee
                                      for supervision for carrying out the
                                      Tenant's obligations in an amount equal to
                                      the product of the Prime Rate plus two
                                      percent (2%) multiplied by the cost of
                                      repairs or other work carried out by or
                                      under the supervision of the Landlord
                                      which amount shall be in addition to the
                                      incurred costs of such work;

                              (b)     may recover as additional rent all sums
                                      paid or expenses incurred hereunder by the
                                      Landlord, which ought to have been paid or
                                      incurred by the Tenant, or for which the
                                      Landlord hereunder is entitled to
                                      reimbursement from the Tenant, and any
                                      interest owing to the Landlord hereunder,
                                      by any and all remedies available to it
                                      for the recovery of rent in arrears;

                              (c)     if the Tenant shall fail to pay any rent
                                      or other amount from time to time, payable
                                      by it to the Landlord hereunder promptly
                                      when due, shall be entitled to interest
                                      thereon at the Prime Rate plus two percent
                                      (2%) per annum from the date upon which
                                      the same was due until actual payment
                                      thereof.

Remedies Cumulative      13.02 The Landlord may from time to time resort to any
                         or all of the rights and remedies available to it in
                         the event of any default hereunder by the Tenant,
                         either by any provision of this Lease or by statute or
                         the general law, all of which rights and remedies are
                         intended to be cumulative and not alternative, and the
                         express provision hereunder as to certain rights and
                         remedies are not to be interpreted as excluding any
                         other or additional rights and remedies available to
                         the Landlord by statute or the general law.

Right of Re-entry on     13.03 If this Lease shall have become terminated
Termination              pursuant to any provision hereof, or if the Landlord
                         shall have become entitled to terminate this Lease and
                         shall have given notice terminating it pursuant to any
                         provisions hereof, then and in every such case it shall
                         be lawful for the Landlord thereafter to enter into and
                         upon the Leased Premises or any part thereof in the
                         name of the whole and the same to have again, repossess
                         and enjoy as of its former estate.

Re-entry and             13.04 If and whenever the Landlord becomes entitled to
Termination              or does re-enter the Leased Premises under any
                         provision of this Lease, the Landlord, in addition to
                         all other rights and remedies, shall have the right to
                         terminate this Lease forthwith by leaving upon the
                         Leased Premises notice in writing of such termination,
                         and in such event the Tenant shall forthwith vacate and
                         surrender the Leased Premises.

Rights on Re-entry       13.05 Whenever the Landlord becomes entitled to
                         re-enter upon the Leased Premises under any provision
                         of this Lease, the Landlord in addition to all other
                         rights it may have shall have the right to enter the
                         Leased Premises as agent of the Tenant, either by force
                         or otherwise without being liable for any loss or
                         damage occasioned thereby and to re-let them and to
                         receive the rent therefor and as the agent of the
                         Tenant to take possession of any furniture or other
                         property thereon and to sell the same at public or
                         private sale without notice and to apply the proceeds
                         thereof and any rent derived from re-letting the

<PAGE>   21
                                     - 21 -

                         Leased Premises, after deducting its costs of
                         conducting such sale and its costs of re-letting, upon
                         account of the rent due and to become due under this
                         Lease and the Tenant shall be liable to the Landlord
                         for the deficiency, if any.

Payment of Rent, etc.    13.06 If the Landlord shall re-enter and this Lease
on Termination           shall be terminated as provided for herein, then the
                         Tenant shall pay to the Landlord on demand:

                              (a)     rent up to the time of re-entry or
                                      termination whichever shall be the later
                                      plus accelerated rent as herein provided;

                              (b)     all other amounts payable hereunder until
                                      such time;

                              (c)     such expenses as the Landlord may incur or
                                      have incurred in connection with
                                      re-entering or terminating and re-letting,
                                      or collecting sums due or payable by the
                                      Tenant or realizing upon assets seized
                                      including brokerage, legal fees and
                                      disbursements, (on a solicitor-client
                                      basis) and the expenses of keeping the
                                      Leased Premises in good order, repairing
                                      the same and preparing them for re-letting
                                      them; and

                              (d)     as liquidated damages for the loss of rent
                                      and other income of the Landlord expected
                                      to be derived from the Lease during the
                                      period which would have constituted the
                                      unexpired portion of the Term had it not
                                      been terminated, the amount, if any, by
                                      which the rental value of the Leased
                                      Premises for such period established by
                                      reference to the terms and provisions of
                                      this Lease exceeds the rental value of the
                                      Leased Premises for such period
                                      established by reference to the terms, and
                                      provisions upon which the Landlord re-lets
                                      them, if such re-letting is accomplished
                                      within a reasonable time after termination
                                      of this Lease, and otherwise with
                                      reference to all market and other relevant
                                      circumstances. Rental value is to be
                                      computed in each case by reducing to
                                      present worth at an interest rate equal to
                                      the then current Prime Rate all rent and
                                      other amounts to become payable for such
                                      period and where the ascertainment of
                                      amounts to become payable requires it, the
                                      Landlord may make estimates and
                                      assumptions of fact which shall govern
                                      unless shown to be unreasonable or
                                      erroneous.

                                   ARTICLE 14
                            EVENTS TERMINATING LEASE

        The Landlord and Tenant further covenant and agree as follows:

Cancellation of          14.01 If any policy of insurance upon the Building from
Insurance                time to time effected by the Landlord shall be
                         cancelled or be about to be cancelled by the insurer or
                         an insurer shall refuse or decline to place or renew
                         insurance EACH AS A reason of the use or occupation of
                         the Leased Premises by the Tenant, OTHER THAN A USE OR
                         OCCUPATION PERMITTED PURSUANT TO PARAGRAPH 4.03 HEREOF,
                         or any assignee, subtenant or licensee of the Tenant or
                         anyone permitted by the Tenant to be upon the Leased
                         Premises and the Tenant after receipt of notice in
                         writing from the Landlord shall have failed to take
                         such immediate steps in respect of such use or
                         occupation as shall enable the Landlord to reinstate,
                         renew, replace or avoid cancellation of (as the case
                         may be), such policy or insurance,, the Landlord may at
                         its option, at anytime and without notice:

<PAGE>   22
                                     - 22 -

                              (a)     enter upon the Leased Premises and remove
                                      said use or condition, or

                              (b)     re-enter upon and take possession of the
                                      Leased Premises and/or terminate this
                                      Lease by leaving upon the Leased Premises
                                      notice in writing of such termination.

Default                  14.02 If and whenever:

                              (a)     the rent, additional rent, or other moneys
                                      payable by the Tenant or any part thereof
                                      shall not be paid on the day appointed for
                                      payment thereof, whether lawfully demanded
                                      or not, and the Tenant shall have failed
                                      to pay such rent or other moneys within
                                      five (5) BUSINESS days after the Landlord
                                      shall have given to the Tenant notice of
                                      default in such payment;

                              (b)     The Tenant shall breach or fail to observe
                                      or perform any of the covenants,
                                      agreements, provisos, conditions, Rules
                                      and Regulations or other obligations on
                                      the part of the Tenant to be kept,
                                      observed, or performed hereunder and shall
                                      persist in such failure after fifteen (15)
                                      days notice by the Landlord requiring that
                                      the Tenant remedy, correct, desist or
                                      comply (or in the case of any such breach
                                      which reasonably would require more than
                                      fifteen (15) days to rectify unless the
                                      Tenant shall commence rectifications
                                      within the fifteen ( 15 ) day period and
                                      thereafter promptly and diligently and
                                      continuously proceed with the
                                      rectification of the breach);

                              (c)     without the written consent of the
                                      Landlord, the Leased Premises shall be
                                      used by any persons other than the Tenant
                                      or its permitted assigns or subtenants or
                                      for any purpose other than that for which
                                      they were leased, or occupied by any
                                      persons whose occupancy is prohibited by
                                      this Lease;

                              (d)     the Leased Premises shall be vacated or
                                      abandoned, or remain unoccupied for
                                      fifteen (15) BUSINESS days or more while
                                      capable of being occupied;

                              (e)     the Term or any of the goods and chattels
                                      of the Tenant shall at any time be taken
                                      or be exigible in execution or in
                                      attachment or if a writ of execution shall
                                      BE ENFORCED, the Tenant shall attempt or
                                      threaten to move its goods, chattels or
                                      equipment out of the Leased Premises
                                      (other than in the ordinary course of its
                                      business or as permitted hereunder) or
                                      shall cease to conduct business from the
                                      Leased Premises;

                              (f)     the Tenant shall make a general assignment
                                      for the benefit of creditors or a bulk
                                      sale of its goods or if a receiver shall
                                      be appointed for the business, property,
                                      affairs or revenues of the Tenant; or

                              (g)     the Tenant shall become insolvent or
                                      commit an act of bankruptcy or become
                                      bankrupt or take the benefit of any
                                      statute now or hereafter in force for
                                      bankrupt or insolvent debtors or ( if a
                                      corporation) shall take any steps or
                                      suffer any order to be made for its
                                      winding-up or other termination of its
                                      corporate existence;

                         then and in any of such cases, at the option of the
                         Landlord, the full amount of the current month's and
                         the next three (3) months' monthly rent shall
                         immediately become due and payable and the Landlord may
                         immediately distrain for the same, together with any

<PAGE>   23
                                     - 23 -

                         arrears then unpaid; and the Landlord may without
                         notice or any form of legal process forthwith re-enter
                         and take possession of the Leased Premises or any part
                         thereof in the name of the whole and remove and sell
                         the Tenant's goods, chattels and equipment therefrom,
                         any rule of law or equity to the contrary
                         notwithstanding; and the Landlord may seize and sell
                         such goods, chattels and equipment of the Tenant as are
                         in the Leased Premises or at any place to which the
                         Tenant or any other person may have removed them in the
                         same manner as if they had remained and been distrained
                         upon the Leased Premises; and such sale may be effected
                         in the discretion of the Landlord either by public
                         auction or by private treaty; and either in bulk or by
                         individual item, or partly by one means and partly by
                         another, all as the Landlord in its entire discretion
                         may decide.

                                   ARTICLE 15
                                  MISCELLANEOUS

        The Landlord and Tenant further covenant and agree as follows:

Notices                  15.01 All notices, demands, requests, consents,
                         approvals and other instruments required or permitted
                         to be given pursuant to the terms of this Lease shall
                         be given in writing and shall be deemed to have been
                         properly given if personally served, sent by registered
                         mail or certified mail (postage prepaid with return
                         receipt requested) or sent by telegram or by confirmed
                         receipt of facsimile with report of delivery to:

                         The Landlord at: Sun Life Assurance Company of Canada
                                          #210, 140 - 4 Avenue S.W.
                                          Calgary, Alberta
                                          T2P 3N3

                        The Tenant at:    200, 6715 8th St. N.E.
                                          Calgary, AB
                                          T2E 7H7

                         Provided, however, that such addresses may be changed
                         upon five (5) business days written notice or confirmed
                         receipt of facsimile thereof, similarly given to the
                         other party.

                         The date of receipt of any such notice, demand,
                         request, consent, approval or other instrument shall be
                         deemed to be as follows:

                              (a)     in the case of personal service, the date
                                      of service;

                              (b)     in the case of registered mail or
                                      certified mail, the fifth (5th) business
                                      day following the date of delivery to the
                                      Post Office, provided, however, that in
                                      the event of an interruption of normal
                                      mail service, service shall be effected by
                                      personal delivery;

                              (c)     in the case of telegram, the business day
                                      next following the day of sending.

Entire Agreement         15.02 The Parties acknowledge that there are no
                         covenants, representations, warranties, agreements or
                         conditions expressed or implied relating to this Lease
                         or the Leased Premises save as expressly set out in
                         this Lease. This Lease may not be modified except by an
                         agreement in writing executed by the Landlord and the
                         Parties.

<PAGE>   24
                                     - 24 -

Area Determination       15.03 In the event that any calculation or
                         determination by the Landlord of the Rentable Area or
                         Gross Area of any premises (including the Leased
                         Premises) of the Building is disputed or called into
                         question, it shall be calculated or determined by the
                         Landlord's Architect, USING BOMA STANDARDS, whose
                         certification shall be conclusive.

Successors and Assigns,  15.04 This Lease and everything herein contained shall
Interpretation           enure to the benefit of and be binding upon the
                         successors and assigns of the Landlord and theirs,
                         executors, administrators, successors and permitted
                         assigns of the Tenant. References to the Tenant shall
                         be read with such changes in gender as may be
                         appropriate, depending on whether the Tenant is a male
                         or female person or a firm or corporation, and if the
                         Tenant is more than one person or entity, the covenants
                         of the Tenant shall be deemed joint and several.

Force Majeure            15.05 Save and except for the obligations of the Tenant
                         as set forth in this Lease to pay rent, additional
                         rent, increased rent and other moneys to the Landlord,
                         if either party shall fail to meet its obligations
                         hereunder within the time prescribed, and such failure
                         shall be caused or materially contributed to by force
                         majeure (and for the purpose of this Lease, force
                         majeure shall mean any acts of God, strikes, lockouts,
                         or other industrial disturbance, acts of the Queen's
                         enemies, sabotage, war, blockades, insurrections,
                         riots, epidemics, lightning, earthquakes, storms,
                         fires, washouts, nuclear and radiation activity or
                         fallout, arrests, and restraints of rulers and people,
                         civil disturbances, explosions, breakage of or accident
                         to machinery, inability to obtain materials or
                         equipment, any legislative, administrative or judicial
                         action which has been resisted in good faith by all
                         reasonable legal means, any act, omission or event
                         whether of the kind enumerated or otherwise not within
                         the control of such part, and which by the exercise of
                         due diligence such party could not have prevented (but
                         lack of funds on the part of such party shall be deemed
                         not to be a force majeure), such failure shall be
                         deemed not to be a breach of the obligations of such
                         party hereunder but such party shall use reasonable
                         diligence to put itself in a position to carry out its
                         obligations hereunder.

Waiver                   15.06 Failure of the Landlord to insist upon strict
                         performance of any of the covenants or conditions of
                         this Lease or to exercise any right or option herein
                         contained shall not be construed as a waiver or
                         relinquishment of any such covenant, condition, right
                         or option, but the same shall remain in full force and
                         effect. The Tenant undertakes and agrees, for itself
                         and for any person claiming to be a subtenant or
                         assignee, that the acceptance by the Landlord of any
                         rent from any person other than the Tenant shall not be
                         construed as a recognition of any rights not herein
                         expressly granted, or as a waiver of any of the
                         Landlord's rights, or as an admission that such person
                         is, or as a consent that such person shall be deemed to
                         be, a subtenant or assignee of this Lease, irrespective
                         of whether the Landlord or said person claims that such
                         person is a subtenant or assignee of this Lease. The
                         Landlord may accept rent from any person occupying the
                         Leased Premises at any time without in any way waiving
                         any right under this Lease.

Governing Law,           15.07 This Lease shall be governed by and construed in
Covenants, Severability  accordance with the laws of the province in which the
                         Building is situate. The Landlord and the Tenant agree
                         that all of the provisions of this Lease are to be
                         construed as covenants and agreements as though the
                         words importing such covenants and agreements were used
                         in each separate section hereof. Should any provision
                         or provisions of this Lease be illegal or not
                         enforceable, it or they shall be considered separate
                         and severable from the Lease and its remaining
                         provisions shall remain in force and be binding upon
                         the parties hereto as though the said provision or
                         provisions had never been included.

Headings, Captions       15.08 The heading and captions appearing in this Lease
                         have been inserted for convenience of reference only
                         and in no way define, limit or enlarge the scope or
                         meaning of this Lease or of any provision hereof.

Expropriation            15.09 If at any time during the Term of this Lease
                         title is taken by the right or exercise of condemnation
                         or expropriation to the whole or a portion of the
                         Building (whether or

<PAGE>   25
                                     - 25 -

                         not including the Leased Premises) the Landlord may, at
                         its option, give notice to the Tenant terminating this
                         Lease on the date stated in the said notice. Upon such
                         termination, the Tenant shall immediately surrender the
                         Leased Premises and all its interest therein to the
                         Landlord, and the rent shall abate and be apportioned
                         to the date of termination and the Tenant shall
                         forthwith pay to the Landlord the apportioned rent and
                         all other amounts which may be due to the Landlord up
                         to the date of termination. The Tenant shall have no
                         claim upon the Landlord for the value of the unexpired
                         Term of this Lease, but the parties shall each be
                         entitled to separately advance their claims for
                         compensation for the loss of their respective interests
                         in the Leased Premises and the parties shall be
                         entitled to receive and retain such compensation as may
                         be awarded to each respectively.

Arbitration              15.10 That in the case of any dispute between the
                         Landlord and the Tenant during the Term hereof as to
                         any matter which by the provisions hereof is required
                         to be determined by arbitration in accordance with the
                         provisions of this Section, the matter in dispute shall
                         be referred to a single arbitrator appointed by the
                         parties for determination. If the parties cannot agree
                         on a single arbitrator, then upon the application of
                         either party a Justice of the Superior Court of the
                         province in which the Building is situate shall appoint
                         an arbitrator whose sole determination shall be final.
                         The arbitrator shall be a disinterested party of
                         recognized competence in the real estate business in
                         the city in which the Building is situate. The expense
                         of such arbitration shall be conducted in accordance
                         with the provisions of the Arbitration Act of the
                         province in which the Building is situate and any
                         amendments thereto or successors to such statute which
                         provisions shall apply mutatis mutandis.

                                   ARTICLE 16
                                   DEFINITIONS

Definitions              The Landlord and Tenant further covenant and agree as
                         follows:

                              (a)     "Landlord's Architect" means the
                                      independent architect, or engineer or
                                      quantity surveyor selected by the Landlord
                                      from time to time for the purpose of
                                      making determinations hereunder.

                              (b)     The terms "Land" and "building" have the
                                      meanings set out on page one hereof.

                              (c)     "Leased Premises" means that portion of
                                      the Building shown outlined in red on the
                                      Plan attached as Schedule "B" hereto and
                                      described on page 1 hereof. The exterior
                                      face of the Building and any space in the
                                      Leased Premises used for stairways or
                                      passageways to other premises, stacks,
                                      shafts, pipes, conduits, ducts or other
                                      building facilities, the heating,
                                      electrical, plumbing, air conditioning and
                                      other systems in the Building and the use
                                      thereof, as well as access thereto through
                                      the Leased Premises for the purpose of
                                      use, operation, maintenance, replacement
                                      and repair, are expressly excluded from
                                      the Leased Premises and reserved to the
                                      Landlord.

                              (d)     "Leasehold Improvements" means all
                                      fixtures, improvements, installations,
                                      alterations and additions from time to
                                      time made, erected or installed by or on
                                      behalf of the Tenant with the exception of
                                      trade fixtures and furniture and equipment
                                      not of the nature of fixtures, and
                                      includes all wall-to-wall carpeting
                                      (whether or not supplied by the Landlord),
                                      and drapes supplied by the Landlord.

<PAGE>   26
                                     - 26 -

                              (e)     "Term" means the term of this Lease set
                                      forth in Section 2.01 and any extension
                                      thereof and any period of permitted
                                      overholding.

                              (f)     "Normal Business Hours" means the hours
                                      from 7:30 a.m. to 6:00 p.m., Monday to
                                      Friday, inclusive, of each week, and the
                                      hours from 7:30 a.m. to 1:00 p.m.,
                                      Saturdays, statutory holidays excepted.

                              (g)     "Rentable Area" in the case of a whole
                                      floor shall mean the area within the
                                      outside walls and shall be computed by
                                      measuring to the glass line (that is, the
                                      inside surface of the windows) on the
                                      outer Building walls without deduction for
                                      columns and projections necessary to the
                                      Building, but shall not include stairs and
                                      elevator shafts (supplied by the Landlord
                                      for use in common with other tenants),
                                      flues, stacks, pipes, shafts or vertical
                                      ducts with their enclosing walls.

                              (h)     "Rentable Area" in the case of part of a
                                      floor shall mean all the area occupied and
                                      shall be computed by measuring from the
                                      glass line (that is, the inside surface of
                                      the windows) on the outer Building walls
                                      to the office side of corridors or other
                                      permanent partitions which separate the
                                      area occupied from adjoining Rentable
                                      Areas without deduction for columns and
                                      projections necessary to the Building but
                                      shall not include stairs and elevator
                                      shafts (supplied by the Landlord for use
                                      in common With other tenants) flues,
                                      stacks, pipe shafts or vertical ducts with
                                      their enclosing walls within the area
                                      occupied or janitorial or electrical or
                                      telephone closets not for the exclusive
                                      use of the Tenant.

                              (i)     "Service Areas" shall mean the area of
                                      corridors, fire protection cross-over
                                      corridors, elevator lobbies, washrooms,
                                      air-conditioning rooms, fan rooms,
                                      janitor's closets, telephone and
                                      electrical closets and other closets
                                      serving the Lease Premises in common with
                                      other premises.

                              (j)     "Gross Area" of any Leased Premises means:

                                      (i)     in the case of Leased Premises
                                              consisting of a whole floor or
                                              whole floors the Rentable Area
                                              thereof; and

                                      (ii)    in the case of Leased Premises
                                              consisting of or including only
                                              part of a floor of the Building,
                                              the Rentable Area thereof plus an
                                              amount equal to the product of (a)
                                              the fraction having as its
                                              numerator the Rentable Area
                                              contained in the Leased Premises
                                              on such floor and as its
                                              denominator the sum of the
                                              Rentable Areas of such floor,
                                              multiplied by (b) the total area
                                              in square feet of Service Areas,
                                              if any, on such floor.

                              (k)     "Total Rentable Area" shall mean the total
                                      Rentable Area of the Building whether
                                      rented or not, calculated as if the
                                      Building were entirely occupied by tenants
                                      renting whole floors. The lobby and
                                      entrances on the ground floor and
                                      subsurface floors used in common by
                                      tenants, mechanical equipment areas and
                                      areas rented or to be rented for
                                      automobile parking or for storage, shall
                                      be excluded from the foregoing
                                      calculations. The calculation of the Total
                                      Rentable Area, whether rented or not,
                                      shall be determined by the Landlord's
                                      Architect upon completion of the Building
                                      and shall be adjusted from time to time to
                                      give effect to any structural or
                                      fractional change affecting the same.

<PAGE>   27
                                     - 27 -

                              (l)     "Additional Services" means the services
                                      and supervision supplied by the Landlord
                                      and referenced in Section 8.06 or in any
                                      other provision hereof as Additional
                                      Services, and any other services which
                                      from time to time the Landlord supplies to
                                      the Tenant and which are additional to the
                                      janitor and cleaning and other services
                                      which the Landlord has agreed to supply
                                      pursuant to the provisions of this Lease
                                      and to like provisions of other leases of
                                      the Building or may elect to supply to be
                                      included within the standard level of
                                      services available to tenants generally
                                      and includes janitor and cleaning
                                      services, in addition to those normally
                                      supplied, the provision of labour and
                                      supervision in connection with deliveries,
                                      supervision in connection with the moving
                                      of any furniture or equipment of any
                                      tenant and the making of any repairs or
                                      alterations by the tenant and maintenance
                                      or other services not normally furnished
                                      to tenants generally.

                              (m)     "Cost of Additional Services" shall mean
                                      in the case of Additional Services
                                      provided by the Landlord a reasonable
                                      charge made therefor by the Landlord which
                                      shall not exceed the cost of obtaining
                                      such services from independent contractors
                                      and in the case of Additional Services
                                      provided by independent labour (including
                                      salaries, wages and fringe benefits) and
                                      materials and other direct expenses
                                      incurred, the cost of supervision and
                                      other indirect expenses capable of being
                                      allocated thereto (such allocation to be
                                      made upon a reasonable basis) and all
                                      other out-of-pocket expenses made in
                                      connection therewith including amounts
                                      paid to independent contractors, plus the
                                      Landlord's then current administration
                                      fee. A report of the Landlord's accountant
                                      (who may be the Landlord's internal
                                      auditor or accountant) as to the amount of
                                      any Cost of Additional Services shall be
                                      conclusive.

                              (n)     "Taxes" means all taxes, rates, duties,
                                      levies and assessments whatsoever, whether
                                      municipal, provincial, federal or
                                      otherwise, levied, imposed or assessed
                                      against the Building, the Land and any
                                      Leasehold Improvements or any of them or
                                      upon the Landlord in respect thereof or
                                      from time to time levied, imposed or
                                      assessed in lieu thereof, including those
                                      levied, imposed or assessed for education,
                                      schools and local improvements, and
                                      including all costs and expenses
                                      (including legal and other professional
                                      fees and interest and penalties on
                                      deferred payments) incurred by the
                                      Landlord in good faith in contesting,
                                      resisting or appealing any taxes, rates,
                                      duties, levies or assessments but
                                      excluding taxes and license fees in
                                      respect of any business carried on by
                                      tenants and occupants of the Building
                                      (including the Landlord) and income or
                                      profits taxes upon the income of the
                                      Landlord to the extent such taxes are not
                                      levied in lieu of taxes, rates, duties,
                                      levies and assessments against the
                                      Building, the Land or Leasehold
                                      Improvements or upon the Landlord in
                                      respect thereof and shall also include any
                                      and all taxes which may in the future by
                                      levied in lieu of Taxes as hereinbefore
                                      defined.

                              (o)     "Operating Costs" means the total of all
                                      expenses, costs and outlays of every
                                      nature incurred in the complete
                                      maintenance, repair, operation and
                                      management of the Building and the Land
                                      and a reasonable proportion as determined
                                      by the Landlord from time to time of all
                                      expenses incurred by or on behalf of
                                      tenants in the Building with whom the
                                      Landlord may from time to time have
                                      agreements whereby in respect of their
                                      premises such tenants perform any
                                      cleaning, maintenance or other work or
                                      services usually performed by the
                                      Landlord, and which expenses if directly
                                      incurred by the Landlord

<PAGE>   28
                                     - 28 -

                                      would have been included in Operating
                                      Costs. Without limiting the generality of
                                      the foregoing, Operating Costs shall
                                      include (but subject to certain deductions
                                      as hereinafter provided):

                                      (i)     the cost of providing complete
                                              cleaning, janitor, supervisory and
                                              maintenance services;

                                      (ii)    the cost of operating elevators;

                                      (iii)   the cost of heating, cooling and
                                              ventilating all space including
                                              both rentable and non-rentable
                                              areas;

                                      (iv)    the cost of providing hot and cold
                                              water, electric light and power,
                                              telephone, sewer, gas and other
                                              utilities and services to both
                                              rentable and non-rentable areas;

                                      (v)     the cost of all repairs including
                                              repairs to the Building,
                                              equipment, or services (including
                                              elevators);

                                      (vi)    the cost of window cleaning;

                                      (vii)   the cost of providing security and
                                              supervision;

                                      (viii)  the costs of all insurance for or
                                              against liability, fire, extended
                                              perils, loss of rental, elevator
                                              liability, plate glass, boiler,
                                              sprinkler leakage and all such
                                              other casualties and losses as the
                                              Landlord may elect to insure
                                              against; and if the Landlord shall
                                              elect in whole or in part to
                                              self-insure, the amount of
                                              reasonable contingency reserves
                                              not exceeding the amount of
                                              premiums which would otherwise
                                              have been incurred in respect of
                                              the risks undertaken;

                                      (ix)    accounting costs incurred in
                                              connection with the maintenance,
                                              repair, operation or management
                                              including computations required
                                              for the imposition of charges to
                                              tenants and audit charges required
                                              to be incurred for the
                                              determination of any costs
                                              hereunder;

                                      (x)     the reasonable rental value
                                              (having regard to the rentals
                                              prevailing from time to time for
                                              similar space) of space utilized
                                              by the Landlord in connection with
                                              the maintenance, repair, operation
                                              or management of the Building and
                                              the Land; (xi) the amount of all
                                              salaries, wages and fringe
                                              benefits paid to employees engaged
                                              in the maintenance, repair,
                                              operation or management of the
                                              Building and the Land;

                                      (xii)   amounts paid to independent
                                              contractors for any services in
                                              connection with such maintenance,
                                              repair, operation or management;

                                      (xiii)  the cost of direct supervision and
                                              of management and all other
                                              indirect expenses to the extent
                                              allocable to the maintenance,
                                              repair or operation of the
                                              Building and the Land;

                                      (xiv)   the cost of any management fees or
                                              management agent fees (if

<PAGE>   29
                                     - 29 -

                                              any for the Building), (or of the
                                              Landlord if it elects to manage
                                              the Building itself), in an amount
                                              not exceeding four percent (4%) of
                                              the gross rentals received or
                                              receivable from the Building;

                                      (xv)    depreciation of the cots of
                                              machinery, equipment, facilities,
                                              systems, and property
                                              (individually and collectively in
                                              this clause called "machinery")
                                              installed in or used in connection
                                              with the Building (except to the
                                              extent that the costs are charged
                                              fully to income account in the
                                              Landlord's tax year in which they
                                              are incurred) if a principal
                                              purpose or intention of such
                                              installation or use is to conserve
                                              energy or to reduce the cost of
                                              other items included in Operating
                                              Costs and interest on the
                                              undepreciated portion of the
                                              original cost of such machinery,
                                              payable monthly, from the date on
                                              which the relevant cost was
                                              incurred, at an annual rate of
                                              interest that is two percentage
                                              points above the Prime Rate in
                                              effect on the date on which the
                                              relevant cost was incurred, (the
                                              rate of interest to be applied to
                                              the undepreciated portion of the
                                              original cost, in each case, to be
                                              adjusted, as long as a rate is
                                              required, every five years, on the
                                              anniversary date of the
                                              acquisition of the relevant
                                              machinery, to the annual rate of
                                              interest that is two percentage
                                              points above the Prime Rate then
                                              in effect); the depreciation costs
                                              and interest charged under this
                                              clause in respect of machinery
                                              installed or used to conserve
                                              energy or reduce the cost of other
                                              items included in Operating Costs
                                              may be equal to, but in no event
                                              shall exceed in any year the
                                              savings resulting from such
                                              installation or use, estimated by
                                              the Landlord, acting reasonably;

                                      (xvi)   cost of services by and salaries
                                              for elevator operators, porters,
                                              sidewalk shovellers, window
                                              cleaners, janitors, cleaners,
                                              dusters, handymen, watchmen,
                                              commissionaires, caretakers,
                                              security personnel, carpenters,
                                              engineers,firemen, mechanics,
                                              electricians, plumbers, and other
                                              persons or firms engaged in the
                                              operating, maintenance and repair
                                              of the Building, or the heating,
                                              air conditioning, ventilating,
                                              plumbing, electrical and elevator
                                              systems in the Building and
                                              superintendents, and accounting
                                              and clerical staff attached to the
                                              Building superintendent's or
                                              manager's office;

                                      (xvii)  uniforms of employees and agents;

                                      (xviii) supplies and equipment used in
                                              connection with the repair,
                                              maintenance, management,
                                              caretaking and operating of the
                                              Building (including without
                                              limitation straight-line
                                              amortization based on
                                              tax-deductible depreciation
                                              allowance of capitalized cleaning
                                              equipment used in the Building);

                                      (xix)   supplies and materials for
                                              washrooms, and other common
                                              facilities;

                                      (xx)    workers' compensation costs,
                                              unemployment insurance premiums,
                                              pension plan contributions,
                                              health, accident and group life
                                              insurance for employees, managers,
                                              and superintendents employed by
                                              the Landlord in connection with
                                              the Building;

<PAGE>   30
                                     - 30 -

                                      (xxi)   servicing and inspection costs for
                                              elevators, electrical distribution
                                              systems and mechanical, heating,
                                              ventilating and air conditioning
                                              systems;

                                      (xxii)  parking area staff and maintenance
                                              costs;

                                      (xxiii) snow and ice removal and related
                                              costs;

                                      (xxiv)  sales and excise taxes on goods
                                              and services provided by the
                                              Landlord in the management,
                                              operating, maintenance and repair
                                              of the Building;

                                      (xxv)   REASONABLE costs of stationery
                                              supplies and other materials
                                              required for the normal operation
                                              of the superintendent's or
                                              manager's office; and

                                      (xxvi)  all other direct and indirect
                                              REASONABLE costs and expenses
                                              whatsoever to the extent allocable
                                              to the operating, maintaining,
                                              managing or repairing of the said
                                              Land, the Building or any
                                              appurtenances thereto.

                                      Notwithstanding any of the foregoing, it
                                      is understood and agreed that Operating
                                      Costs for any period are to be calculated
                                      as if the Building were fully occupied
                                      during such period. Therefore, in addition
                                      to expenses, costs and outlays actually
                                      incurred in the maintenance, repair,
                                      operation and management of the Building,
                                      the Landlord may include in the
                                      calculation and estimation of operating
                                      costs, such additional amounts that in the
                                      Landlord's estimation would have been
                                      incurred had all rentable areas in the
                                      Building been fully occupied during the
                                      period in question. However, in no event
                                      shall the Tenant be required to pay more
                                      on account of its proportionate share of
                                      Operating Costs that it would be if the
                                      Building were fully occupied.

                                      It is understood and agreed that the
                                      Building is one of two office buildings
                                      contained in the development. In this
                                      connection, the Tenant acknowledges that
                                      certain materials and services which
                                      relate in part to the Building will be
                                      incurred in connection with the provision
                                      of materials and services for all of the
                                      Development. The Tenant therefore agrees
                                      that in computing Operating Costs, the
                                      Landlord shall be entitled to allocate to
                                      the Building a reasonable portion of such
                                      Operating Costs that are incurred in
                                      respect of the Development generally.

                                      Operating Costs shall exclude (except as
                                      herein otherwise provided) Taxes, debt
                                      service, depreciation, expenses properly
                                      chargeable to capital account, costs
                                      determined by the Landlord from time to
                                      time to be fairly allocable to the
                                      correction of construction faults or
                                      initial maladjustments in operating
                                      equipment, all management cost not
                                      allocable to the actual maintenance,
                                      repair or operation of the Building (such
                                      as in connection with leasing and rental
                                      advertising), work performed in connection
                                      with the initial construction of the
                                      Building and the Leased Premises, changes
                                      for tenants, capital cost of addition,
                                      improvements and modernizations to the
                                      Building subsequent to date of original
                                      construction, advertising and promotion
                                      expenses, and expenses of redecorating and
                                      renovating space for new tenants.

<PAGE>   31
                                     - 31 -

                                      In computing Operating Costs there shall
                                      be credited as a deduction the amounts of
                                      proceeds of insurance relating to Insured
                                      Damage and other damage actually recovered
                                      by the Landlord (or if the Landlord has
                                      self-insured, a corresponding application
                                      of reserves) applicable to damage, and
                                      also electricity and light bulbs, tube and
                                      ballast replacement costs and insurance
                                      premiums that are directly payable by any
                                      tenants, in each case to the extent that
                                      the cost thereof was included therein. Any
                                      expenses not directly incurred by the
                                      landlord but which are included in
                                      Operating Costs may be estimated by the
                                      Landlord on whatever reasonable basis the
                                      Landlord may select if and to the extent
                                      that the Landlord cannot ascertain the
                                      actual amount of such expenses from the
                                      tenants who incurred them. Any report of
                                      the Landlord' s accountant (who may be the
                                      Landlord's internal auditor or accountant)
                                      for such purpose shall be conclusive as to
                                      the amount of Operating costs for any
                                      period to which such report relates.

                              (p)     "Common Costs" means the aggregate of the
                                      Taxes plus the Operating Costs for or
                                      incurred in a twelve (12) month period.

                              (q)     "Base Common Costs" means $nil per square
                                      foot of the Total Rentable Area;

                              (r)     "Current Common Costs" in respect of any
                                      twelve (12) month period means an amount
                                      equal to the total Common Costs for such
                                      twelve (12) month period divided by the
                                      Total Rentable Area;

                              (s)     "Common Costs Escalation" in any twelve
                                      (12) month period means an amount equal
                                      to:

                                      (i)     the amount by which the Current
                                              Common Costs for such period
                                              exceed the Base Common Costs
                                              multiplied by

                                      (ii)    the Gross Area of the Leased
                                              Premises.

                              (t)     "Insured Damage" means that part of any
                                      damage occurring to the Leased Premises to
                                      the extent to which the cost of repair is
                                      actually recoverable by the Landlord under
                                      a policy of insurance in respect of fire
                                      or other perils from time to time effected
                                      by the Landlord;

                              (u)     "Prime Rate" means that rate of interest
                                      charged and published from time to time by
                                      the main branch in the city in which the
                                      Building is situate, of the Landlord's
                                      bank, as its most favourable rate of
                                      interest to its most credit-worthy
                                      commercial customers and commonly known as
                                      its Prime Rate.

                                   ARTICLE 17
                               SPECIAL PROVISIONS

Required Conditions      17.01 The Tenant acknowledges that certain provisions
                         contained herein are personal to the Tenant and will be
                         available to the Tenant only in the event that certain
                         conditions (the "Required Conditions") have been
                         satisfied. The Required Conditions are as follows:

                              (a)     the Tenant is NOVATEL WIRELESS
                                      TECHNOLOGIES LTD.;

<PAGE>   32
                                     - 32 -

                              (b)     the Tenant is in occupation of the
                                      Premises; and

                              (c)     the Tenant has not been and is not in
                                      default of any of the terms and conditions
                                      contained in the Lease including, without
                                      limitation, the payment of any rent.

Parking                  17.02 The Landlord shall permit for the use of the
                         Tenant during the Term of the Lease, THIRTY FIVE (35)
                         random surface stalls at no cost to the Tenant.

Right to Renew           17.03 This clause is specific and personal solely to
                         the Tenant and, provided that:

                              a)      and subject to the rights of existing
                                      tenants on these premises as and when it
                                      becomes available for renewal; and

                              b)      the Tenant has duly and regularly paid all
                                      of the annual basic rent and additional
                                      rent and other sums to be paid pursuant to
                                      this Lease and within the times and in the
                                      manner set out in this Lease; and

                              c)      the Tenant has duly and regularly observed
                                      and performed each and every one of the
                                      terms, covenants and conditions contained
                                      in this Lease on its part to be observed
                                      and performed and within the times and in
                                      the manner set out in this Lease; and

                              d)      the Tenant has given notice to the
                                      Landlord at least SIX (6) months (but not
                                      sooner than TWELVE (12) months) prior to
                                      the expiration of the Term of its
                                      intention to renew the Lease,

                         then the Landlord will grant to the Tenant the right to
                         renew this Lease for the Leased Premises on an "as-is"
                         basis, for a further period of THREE (3) years (the
                         "Renewal Term") commencing on the expiration of the
                         Term and such Renewal Term shall be upon the same terms
                         and conditions as are contained during the Term, save
                         and except Leasehold Improvement Allowance, and that
                         there shall be no further right to renew the term and
                         that the annual basic rent during the Renewal Term
                         shall be such amount as may be agreed upon between the
                         parties on or before the commencement of the Renewal
                         Term, based upon the then current market basic rent
                         being charged, without deduction, for similarly
                         improved space in comparable office buildings in the
                         City of Calgary, in any event not less than the last
                         annual basic rent paid during the original Lease Term.
                         If the parties are unable to agree upon the annual
                         basic rent to be charged during the Renewal Term on or
                         before the commencement of the Renewal Term then the
                         annual basic rent shall be determined by arbitration in
                         accordance with the Arbitration Act of Alberta. If the
                         annual basic rent for the Renewal Term is to be
                         determined by arbitration and a final decision under
                         the arbitration is not reached before the commencement
                         of the Renewal Term, the Tenant will pay on account in
                         equal monthly installments, annual basic rent at the
                         rate charged during the Term. After a decision is
                         reached under the arbitration, the Tenant will pay to
                         the Landlord the balance, if any, of annual basic rent
                         then due together with interest on the balance at an
                         annual rate equal to one percentage point above the
                         Prime Rate.

<PAGE>   33
                                     - 33 -

Leasehold Improvement    17.04 The Landlord shall contribute toward the cost of
Allowance                the Leasehold Improvements installed by the Tenant
                         which by the terms of this Lease shall be the property
                         of the Landlord immediately upon such installation to a
                         maximum of FOURTEEN DOLLARS AND SEVENTY-FIVE CENTS
                         ($14.75) (the Tenant Improvement Allowance) multiplied
                         by the number of square feet comprising the Gross Area
                         of the Leased Premises for which the Tenant pays rent.
                         The Tenant shall be responsible for any costs which
                         exceed the Landlord's maximum contribution. If the
                         Landlord's maximum contribution is not required to
                         complete the Leasehold Improvements, any savings shall
                         be applied towards the Basic Rent as it comes due.

                         The Landlord will carry out the Improvements in
                         accordance with the design prepared by R S & A Interior
                         Design and dated the 24th day of October, 1996 or as
                         otherwise mutually agreed by the Landlord and Tenant
                         and in accordance with the lawful requirements of all
                         Government bodies having jurisdiction.

                         The Landlord will not be obliged to commence the
                         Improvements except for any preliminary layout design
                         which the Landlord has authorized in writing, until the
                         Lease has been fully and unconditionally executed in a
                         form acceptable to the Landlord.

                         The construction drawings and specifications shall be
                         mutually approved by Landlord and Tenant prior to
                         arranging for construction bids.

                         The Tenant shall retain the right to review, accept or
                         alter the Landlord's selected construction bid for the
                         purpose of deleting any such items deemed necessary to
                         maintain the cost of construction below the maximum
                         allowance provided by the Landlord, provided such
                         deletions in no way make the Improvements below
                         building standards and provided all Improvements
                         continue to meet the requirements of all Government
                         Bodies having jurisdiction.

Lease Termination        17.05 Notwithstanding anything else contained in this
                         Lease, Provided the Tenant's Required Conditions are
                         satisfied, the Tenant with SIX (6) months prior written
                         notice may terminate the Lease on the Anniversary Date
                         of the term at the end of the second year and each year
                         thereafter with a one time payment accompanying the
                         notice as follows:

<TABLE>
<CAPTION>
                         END OF YEAR   PAYMENTS $S/SQ. FT.   ESTIMATED TOTAL*
                         -----------   -------------------   ---------------
<S>                                    <C>                   <C>
                              2              $10.72           $135,500.00
                              3              $ 7.20           $ 91,000.00
                              4              $ 3.44           $ 43,500.00
</TABLE>

                         * Plus GST as applicable

Signage                  17.06 The Landlord will permit the Tenant to install
                         signage on the pylon by The Deerfoot Atrium Building at
                         the Tenant's expense in accordance to the Building
                         specifications and design to be approved by the
                         Landlord. Tenant will be required to sign a licence
                         agreement for the sign, at no charge.

Early Occupancy          17.07 If the Landlord completes improvements prior to
                         the Commencement Date, the Landlord will permit the
                         Tenant to take occupancy of the premises, and the net
                         basic rent and proportionate share of taxes and
                         operating costs will be abetted until the Commencement
                         Date. The Landlord will do everything reasonably
                         possible to ensure that the premises are ready for
                         occupancy on December 1, 1996.

<PAGE>   34
                                     - 34 -

Right of Examination     17.08 The Tenant and its duly authorized
                         representatives, shall be permitted, from time to time,
                         during the Landlord's normal business hours, to examine
                         and make copies, at its entire expense at the main
                         offices of the Landlord, all books, ledgers and records
                         of the Landlord required to substantiate the Tenant's
                         Proportionate Share of Additional Rentals, save that
                         such right of examination shall cease NINE (9) months
                         following the date of each annual certification of the
                         amounts payable by the auditors of the Landlord.
                         Payment by the Tenant of the Tenant's Proportionate
                         Share shall not preclude the Tenant from thereafter
                         contesting such amounts. Should the Tenant and its
                         auditors and/or consultants determine there is a bona
                         fide discrepancy of more than three percent (3%)
                         between the Landlord's stated costs and the actual
                         audited costs, then the Landlord shall pay the
                         difference to the Tenant forthwith and be responsible
                         for the cost of the Tenant's audit.

<PAGE>   35
                                     - 35 -

                                   ARTICLE 18
                                   ACCEPTANCE

Acceptance               18.01 The Tenant hereby accepts this Lease of the
                         within described lands and premises to be held by it as
                         Tenant and subject to the conditions, restrictions and
                         covenants above set forth.

                                   SCHEDULES:

                         "A" - Legal Description of Land

                         "B" - Plan of Leased Premises

                         "C" - Rules and Regulations

             IN WITNESS WHEREOF the Landlord and Tenant have executed this Lease
as of the day and year first above written.

                                       SUN LIFE ASSURANCE COMPANY
                                       OF CANADA

                                       Per: /s/
                                           ------------------------------------
                                           Landlord

                                           ------------------------------------
                                           Name (Please Print)

                                           ------------------------------------
                                           Title

                                                                             c/s

                                       Per: /s/
                                           ------------------------------------
                                           Landlord

                                           ------------------------------------
                                           Name (Please Print)

                                           ------------------------------------
                                           Title

                                       NOVATEL WIRELESS TECHNOLOGIES, LTD.

                                       Per: /s/
                                           ------------------------------------
                                           Landlord

                                           ------------------------------------
                                           Name (Please Print)

                                           ------------------------------------
                                           Title

                                                                             c/s

                                       Per: /s/
                                           ------------------------------------
                                           Landlord

                                           ------------------------------------
                                           Name (Please Print)

                                           ------------------------------------
                                           Title

<PAGE>   36

                                  SCHEDULE "A"

                            LEGAL DESCRIPTION OF LAND
                                6715 8TH ST. N.E.
                                   CALGARY, AB
                                     T2E 7H7

        The northwesterly 110 feet in perpendicular width throughout Lot Nine
        (9), all of Lots Ten (10) to Fourteen (14) and the southerly 26.50 feet
        in perpendicular width throughout Lot Fifteen (15) inclusive, Block Two
        (2), Calgary Deerfoot Business Centre, plan 7911331. Reserving unto her
        Majesty all Mines and Minerals.

<PAGE>   37

                                  SCHEDULE "B"

                    [DEERFOOT BUSINESS CENTRE MAP GOES HERE]

<PAGE>   38

                                  SCHEDULE "C"

                              RULES AND REGULATIONS

             1. The landlord shall have the right to control and operate the
             public portions of the Building and the public facilities, as well
             as facilities furnished for the common use of the tenants, in such
             manner as it deems best for the benefit of the tenants generally.
             No tenant shall invite to the Lease Premises, or permit the visit
             of, persons in such numbers or under such conditions as to
             interfere with the use and enjoyment of the entrances, corridors,
             elevators and facilities of the Building by other tenants.

             2. The sidewalks, driveways, entrances, vestibules, passages,
             corridors, halls, elevators and stairways shall not be encumbered
             or obstructed by tenants or tenants' agents, servants, employees,
             licensees or invitees, or be used by them for any purpose other
             than for ingress to and egress from the Leased Premises. Landlord
             reserves the right to restrict and regulate the use of
             aforementioned public areas of the Building by tenants and tenants'
             agents, employees, servants, licensees and invitees and by persons
             making deliveries to tenants (including, but not limited to, the
             right to allocate certain elevator or elevators, if any, and the
             reasonable hours of use thereof for delivery service), and the
             right to designate which Building entrance or entrances shall be
             used by persons making deliveries in the Building.

             3. No awnings or other projections shall be attached to the outside
             walls of the Building. No curtains, blinds, shades or screens other
             than those furnished by Landlord shall be attached to, or hung, or
             used in connection with, any window or door of the Leased Premises,
             without the prior written consent of Landlord. Such curtains,
             blinds, shades, screens or other fixtures must be of a quality,
             type, design and colour, and attached in the manner approved by
             Landlord.

             4. No sign, advertisement, notice or other lettering shall be
             exhibited, inscribed, painted or affixed by any tenant on any
             window or part of the outside or inside of the Leased Premises or
             the Building without the prior written consent of Landlord. In the
             event of the violation of the foregoing by any tenant, Landlord may
             remove same without any liability, and may charge the expense
             incurred by such removal to such tenant. Interior signs on doors
             shall be inscribed, painted, or affixed for tenants by Landlord or
             by sign painters, first approved by the Landlord, at the expense of
             tenants and shall be of a size, colour, and style acceptable to
             Landlord.

             5. The windows and doors, and, if any, the sashes, sash doors, and
             skylights, that reflect or admit light and air into the halls,
             passageways, or other public places in the Building shall not be
             covered or obstructed by tenants, nor shall any bottles, parcels,
             files, papers or other articles be placed on the windowsills.

             6. No showcases or other articles shall be put in front of or
             affixed to any part of the exterior of the Building, nor placed in
             the halls, corridors, or vestibules without the prior written
             consent of Landlord.

             7. The toilet, urinals, sinks and other water apparatus shall not
             be used for any purposes other than those for which they were
             constructed, and no sweepings, rubbish, rags, ashes or other
             substances shall be thrown therein. Any damage resulting by misuse
             shall be borne by the tenants by whom or by whose agents, servants,
             employees, customers or invitees the same was caused. Tenants shall
             not let the water run unless it is in actual use, and shall not
             deface or damage any part of the Building, nor drive nails, spikes,
             hooks, or screws into the walls or woodwork of the Building.

<PAGE>   39
                                     - 2 -

             8. Tenants shall not mark, paint, drill into, or in any way deface
             any part of the Leased Premises or the Building. No boring, cutting
             or stringing of wires shall be permitted except with the prior
             written consent of Landlord and as Landlord may direct. Only
             contractors approved in writing by Landlord may be employed by
             tenants for making repairs, changes or any improvements to the
             Leased Premises. Tenants shall not (without Landlord's prior
             consent) lay floor coverings other than unaffixed rugs, so that the
             same shall come in direct contact with the floor of the Leased
             Premises, and, if wall to wall carpeting, linoleum or other similar
             floor coverings other than the Building Standard carpet are desired
             to be used and such use is approved by the Landlord, and if such
             floor coverings are placed or to be placed over tile flooring then
             an interlining of builder's deadening felt shall be first affixed
             to the floor, by a paste or other material soluble in water, the
             use of cement or similar adhesive materials being expressly
             prohibited. Metal cabinets shall be set on a non-corrosive pad
             wherever the floors are tile. In those portions of the Leased
             Premises where the Landlord has provided carpeting, whether
             directly or indirectly, the Tenant shall install at its own expense
             protective padding under all furniture not equipped with carpet
             casters.

             9. No bicycles, vehicles or animals or birds of any kind shall be
             brought into or kept in or about the Building or the Leased
             Premises excepting that those vehicles so authorized by the
             Landlord may enter and be kept in the Buildings' parking facilities
             (if any).

             10. No space in the Building shall be used for lodging, sleeping,
             or any immoral or illegal purposes. No space shall be used for the
             storage of merchandise or for the sale of merchandise, goods, or
             property, and no auction sales shall be made, by tenants without
             prior written consent of Landlord.

             11. Tenants shall not make, or permit to be made, any unseemly or
             disturbing noises or disturb or interfere with occupants of this or
             neighbouring buildings or premises or those having business with
             them whether by the use of any musical instrument, radio,
             television, talking machine, unmusical noise, whistling, singing or
             in any other way. Tenants shall not throw anything out of the
             doors, windows, or skylights, of any, or down the passageways,
             stairs or elevator shafts nor sweep anything into the corridors,
             hallways or stairs of the Building.

             12. No additional locks or bolts of any kind shall be placed upon
             any of the doors or windows by tenants, nor shall any changes
             whatsoever be made to existing locks or the mechanics thereof
             except by the Landlord, at its option. Tenants shall not permit any
             duplicate keys to be made, but additional keys as reasonably
             required shall be supplied by the Landlord when requested by the
             tenant in writing and such keys shall be paid for by the tenant,
             and upon termination of tenant's Lease, the tenant shall surrender
             to the Landlord all keys of the Leased Premises and other part or
             parts of the Building.

             13. The tenants and their agents, servants, contractors, invitees
             or employees, shall not bring in or take out, position, construct,
             install or move any safe, business machine or other heavy office
             equipment without first obtaining the consent in writing of the
             Landlord. In giving such consent, the Landlord shall have the right
             in its sole discretion, to prescribe the weight permitted and the
             position thereof, and the use and design of planks, skids or
             platforms to distribute the weight thereof. All damage done to the
             Building by moving or using any such heavy equipment or other
             office equipment or furniture shall be repaired at the expense of
             the tenant. The moving of all heavy equipment or other office
             equipment or furniture shall occur only outside of Normal Business
             Hours or at any other time consented to by the Landlord and the
             persons employed to move the same in and out of the Building and
             must be acceptable to the Landlord. Safes and other heavy office
             equipment will be moved through the halls and corridors only upon
             steel bearing plates. No freight or bulky matter of any description
             will be received into the Building or carried in the elevators,
             except during hours approved by the Landlord.

<PAGE>   40
                                     - 3 -

             14. Tenants shall not occupy or permit any portion of the Leased
             Premises to be occupied as an office for a public stenographer or
             typist, or, for the possession, storage, manufacture, or sale of
             narcotics or drugs, or, except as incidental to tenant's main
             business, as an employment bureau.

             15. Tenants shall not use the name of the Building or the owner in
             any advertising without the express consent in writing of the
             Landlord. Landlord shall have the right to prohibit any advertising
             by any tenant which, in any way, tends to impair the reputation of
             the Building or its desirability as a building for offices, and
             upon written notice from Landlord, tenants shall refrain from or
             discontinue such advertising.

             16. All entrance doors in the demised premises shall be left locked
             and all windows shall be left closed by tenants when the Leased
             Premises are not in use.

             17. Except for the negligence of the Landlord or persons for whom
             in law it is responsible, Landlord shall be in no way responsible
             to any tenant for loss of property from the Leased Premises,
             however occurring, or for damage done to the furniture or other
             effects of any tenant by Landlord's agents, janitors, cleaners,
             employees, or contractors doing work in the Leased Premises. The
             tenants shall permit window cleaners to clean the windows of the
             Leased Premises during Normal Business Hours.

             18. The requirements of tenants will be attended to only upon
             application to the Building manager or such other authorized
             representative as the Landlord may designate in writing. Landlord's
             employees shall not perform any work or do anything outside of
             their regular duties, unless under specific instructions from the
             office of the Landlord, from the Building manager or other
             representative as aforesaid.

             19. Canvassing, soliciting, and peddling in the Building are
             prohibited, and tenants shall cooperate to prevent the same.

             20. Any hand trucks, carryalls, or similar appliances used in the
             Building shall be equipped with rubber tires, side guards and such
             other safeguards as Landlord shall require.

             21. Without first obtaining Landlord's written permission, tenants
             shall not install, attach, or bring into the Leased Premises any
             equipment (other than normal office equipment such as electric
             typewriters, computers, printers, calculators, and the like) or any
             instrument, duct, refrigerator, air conditioner, water cooler, or
             any other appliance requiring the use of gas, electric current or
             water. Any breach of this rule will entitle the Landlord at the
             tenant's expense to enter the Leased Premises and remove whatever
             the tenant may have so installed, attached, or brought in.

             22. Landlord reserves the right to exclude from the Building
             outside of Normal Business Hours and during all hours on Saturdays
             all persons not authorized by a tenant in writing, by pass, or
             otherwise, to have access to the Building and the Leased Premises.
             Each tenant shall be responsible for all persons authorized to have
             access to the Building and shall be liable to Landlord for all of
             their acts while in the Building. When security service is in
             effect, entrance to the Building, deliveries, and exits shall be
             made via designated entrances and the Landlord may require all
             persons to sign a register on entering and leaving the Building

<PAGE>   41
                                     - 4 -

             23. Tenant shall at all times keep all drapes, blinds or curtains
             adjusted to block the direct rays of the sun in order to avoid
             overloading the air conditioning systems.

             24. Neither tenants nor their servants, employees, agents,
             visitors, or licensees shall at any time bring or keep upon the
             Leased Premises any inflammable, combustible or explosive fluid,
             chemical or substance, nor do nor permit to be done anything in
             conflict with any insurance policy which may or might be in force
             upon the Building or any part thereof or with the laws relating to
             fires, or with the regulations of the Fire Department or the Health
             Department, or with any of the rules, regulations or ordinances of
             the City in which the Leased Premises are located, or of any other
             duly constituted authority.

             25. Subject to section 4.3 hereof, Tenants shall not, without first
             obtaining Landlord's prior written approval, do any cooking,
             conduct any restaurant, luncheonette, or cafeteria for the sale or
             service of food or beverages to its employees or to others, or
             cause or permit any odours of cooking or other processes or any
             unusual or objectionable odours to emanate from the Leased
             Premises. Tenants shall not, without first obtaining Landlord's
             written approval, install or permit the installation or use of any
             food, beverage, cigarette, cigar, or stamp dispensing machine; or
             permit the delivery of any food or beverage to the Leased Premises,
             except by such persons delivering the same as shall be approved by
             the Landlord. No food or beverage shall be carried in the public
             halls or elevators except in closed containers.

             26. Lists of automobile license numbers of people working in the
             Building and the names of people who normally work off-hours may be
             required by the Landlord, who may also require tenants' employees
             to display a card or sticker as a prerequisite to admission to the
             parking facility (if any).

             27. The Landlord reserves the right to promulgate, rescind, alter
             or waive any rules or regulations at any time prescribed for the
             Building when it is necessary, desirable or proper for its best
             interest and in the opinion of the Landlord, for the best interests
             of the tenants.

             28. The Landlord may publish from time to time emergency fire
             regulations and evacuation procedures in consultation with the
             applicable municipal authorities. Each tenant will appoint a
             premises warden (wardens for multi-floor users) who will be
             responsible for liaison with building management in all emergency
             matters and who will be responsible for instructing employees of
             the tenant in emergency matters.

             29. The tenants shall promptly notify the Landlord of all requests
             by any taxing authority for information relating to the Leased
             Premises (including fixtures, improvements, or machinery and
             equipment therein) or the tenant's occupation or use thereof and
             any such information to be given by the tenant to such taxing
             authority shall be forwarded by the tenant to the Landlord for
             delivery of such taxing authority.

             30. If any apparatus used or installed by a tenant requires a
             permit as a condition for its installation, the tenant must file a
             copy of such permit with the Landlord.

             31. Tenants shall be responsible for the cleaning of any drapes
             and/or curtains that may be installed in their Leased Premises,
             including those installed by the Landlord.

<PAGE>   42

--------------------------------------------------------------------------------

                                      LEASE

                                     BETWEEN

                      SUN LIFE ASSURANCE COMPANY OF CANADA

                                    LANDLORD

                                       AND

                       NOVATEL WIRELESS TECHNOLOGIES, LTD.

                                     TENANT

Lease #387170
--------------------------------------------------------------------------------

<PAGE>   43
                                      LEASE
                      SUN LIFE ASSURANCE COMPANY OF CANADA

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                         PAGE
                                                                                         ----
<S>                              <C>                                                     <C>
               ARTICLE I         PREMISES
                                    1.01    PREMISES                                        1
               ARTICLE II        TERM
                                    2.01    TERM                                            1
                                    2.02    POSSESSION                                      1
                                    2.03    READY FOR OCCUPANCY                             2
                                    2.04    INABILITY TO DELIVER POSSESSION                 2
                                    2.05    RELOCATION OF LEASED PREMISES                   2
               ARTICLE III       RENT
                                    3.01    RENT                                            2
                                    3.02    BASIS OF DETERMINING RENT                       3
                                    3.03    APPORTIONMENT OF ANNUAL BASIC RENT
                                            AND COMMON COSTS ESCALATION                     3
               ARTICLE IV        TENANT'S COVENANTS
                                    4.01    OCCUPANCY                                       3
                                    4.02    RENT                                            3
                                    4.03    PERMITTED USE                                   3
                                    4.04    WASTE AND NUISANCE                              3
                                    4.05    FLOOR LOADS                                     4
                                    4.06    INSURANCE RISK                                  4
                                    4.07    NOXIOUS FUMES VAPOURS AND
                                            ODOURS                                          4
                                    4.08    CONDITION                                       4
                                    4.09    BY-LAWS                                         4
                                    4.10    RULES AND REGULATIONS                           5
                                    4.11    SURRENDER, OVERHOLDING                          5
                                    4.12    SIGNS AND DIRECTORY                             5
                                    4.13    INSPECTION ACCESS                               6
                                    4.14    EXHIBITING PREMISES                             6
                                    4.15    NAME OF BUILDING                                6
                                    4.16    ACCEPTANCE LEASED PREMISES                      6
               ARTICLE V         LANDLORD'S COVENANTS
                                    5.01    QUIET ENJOYMENT                                 7
                                    5.02    INTERIOR CLIMATE CONTROL                        7
                                    5.03    ELEVATORS                                       7
                                    5.04    ENTRANCES, LOBBIES, ETC.                        7
                                    5.05    WASHROOMS                                       8
                                    5.06    JANITOR SERVICES                                8
               ARTICLE VI        REPAIR AND DAMAGE AND DESTRUCTION
                                    6.01    LANDLORD'S REPAIRS                              8
                                    6.02    TENANT'S REPAIRS                                8
                                    6.03    ABATEMENT AND TERMINATION                       9
               ARTICLE VII       TAXES AND OPERATING COSTS
                                    7.01    LANDLORD'S OBLIGATIONS                         12
                                    7.02    BUSINESS TAXES AND COMMON COSTS ESCALATION     12
                                    7.03    PAYMENT OF COMMON COSTS ESCALATION             13
                                    7.04    POSTPONEMENT, ETC., OF TAXES                   14
                                    7.05    RECEIPTS, ETC                                  14
               ARTICLE VIII      UTILITIES AND ADDITIONAL SERVICES
                                    8.01    WATER, TELEPHONE AND ELECTRICITY               14
</TABLE>

<PAGE>   44

<TABLE>
<S>                              <C>                                                      <C>
                                    8.02    UTILITIES                                      14
                                    8.03    ELECTRICITY                                    15
                                    8.04    EXCESS USE                                     15
                                    8.05    LAMPS                                          15
                                    8.06    ADDITIONAL SERVICES                            16
               ARTICLE IX        LICENSES, ASSIGNMENTS AND SUBLETTINGS
                                    9.01    ASSIGNMENTS AND/OR SUBLETTINGS                 16
               ARTICLE X         FIXTURES AND IMPROVEMENTS
                                    10.01   INSTALLATION FIXTURES AND IMPROVEMENTS         20
                                    10.02   LIENS AND ENCUMBRANCES ON FIXTURES AND
                                            IMPROVEMENTS                                   21
                                    10.03   TENANT'S GOODS                                 21
                                    10.04   REMOVAL OF FIXTURES AND IMPROVEMENTS           22
               ARTICLE XI        INSURANCE AND LIABILITY
                                    11.01   TENANT'S INSURANCE                             22
                                    11.02   LIMITATION ON LANDLORD'S LIABILITY             23
                                    11.03   INDEMNITY OF LANDLORD                          25
               ARTICLE XII       SUBORDINATION, ATTORNMENT, REGISTRATION AND
                                 CERTIFICATES
                                    12.01   SUBORDINATIONS AND ATTORNMENT                  26
                                    12.02   REGISTRATION                                   26
                                    12.03   CERTIFICATES                                   26
               ARTICLE XIII      REMEDIES OF LANDLORD AND TENANT'S DEFAULT
                                    13.01   REMEDYING BY LANDLORD NON-PAYMENT AND
                                            INTEREST                                       27
                                    13.02   REMEDIES CUMULATIVE                            27
                                    13.03   RIGHT OF RE-ENTRY ON TERMINATION               28
                                    13.04   RE-ENTRY AND TERMINATION                       28
                                    13.05   RIGHTS ON RE-ENTRY                             28
                                    13.06   PAYMENT OF RENT, ETC. ON TERMINATION           28
               ARTICLE XIV       EVENTS TERMINATING LEASE
                                    14.01   CANCELLATION OF INSURANCE                      29
                                    14.02   DEFAULT                                        29
               ARTICLE XV        MISCELLANEOUS
                                    15.01   NOTICES                                        31
                                    15.02   ENTIRE AGREEMENT                               32
                                    15.03   AREA DETERMINATION                             32
                                    15.04   SUCCESSORS AND ASSIGNS, INTERPRETATION         32
                                    15.05   FORCE MAJEURE                                  32
                                    15.06   WAIVER                                         33
                                    15.07   GOVERNING LAW, COVENANTS, SEVERABILITY         33
                                    15.08   HEADINGS, CAPTIONS                             33
                                    15.09   EXPROPRIATION                                  33
                                    15.10   ARBITRATION                                    34
               ARTICLE XVI       DEFINITIONS
                                    16.01   DEFINITIONS                                    34
               ARTICLE XVII      SPECIAL PROVISIONS                                        43
               ARTICLE XVIII     ACCEPTANCE
                                    ACCEPTANCE                                             42
               SCHEDULE "A"         -  LEGAL DESCRIPTION OF LAND
               SCHEDULE "B"         -  PLAN OF LEASED PREMISES
               SCHEDULE "C"         -  RULES AND REGULATIONS
</TABLE><PAGE>   1

                                                                   EXHIBIT 10.10

                                SUPPLY AGREEMENT

        This Supply Agreement ("Agreement") is being entered into and is
effective as of March 31, 2000 (the "Effective Date"), by and between NOVATEL
WIRELESS, INC., a Delaware corporation ("Novatel Wireless" or "Seller"), having
its principal place of business at 9360 Towne Centre Drive, San Diego,
California 92121 and Hewlett-Packard Company, a Delaware corporation
("Hewlett-Packard" or "Buyer"), having its principal place of business at 3000
Hanover Street, Palo Alto, California 94304.

        WHEREAS, Seller is engaged in, among other things, the development and
manufacture of wireless modem cradles ("Modems");

        WHEREAS, Buyer desires to purchase certain quantities of Modems from
Seller, and Seller is willing to supply such quantities of Modems to Buyer,
subject to the terms and conditions of this Agreement;

        NOW, THEREFORE, in consideration of the premises and the mutual promises
and covenants set forth below, the parties agree as follows:

1.      SALE AND PURCHASE OF PRODUCTS.

        1.1 Sale and Purchase. Buyer shall purchase from Seller, and Seller
shall supply to Buyer *** Modems in accord with the specifications set forth in
Annex B (the "Product Specifications").

        1.2 Price and Payments.

            1.2.1 Buyer shall make payments due to Seller for Modems either
directly to Seller or to such bank as Seller may designate in writing. Order
payment terms are Net 30 Days.

            1.2.2 Buyer shall pay in accordance with the terms set forth in
Annex D ("Purchase Price and Volume Commitments") per unit for each Modem.

        1.3 Modems. The price per unit as set forth above includes the finished
product modem, installation and configuration software on CD ROM, AC adapter,
display packaging and user documentation.

        1.4 Shipment and Forecast. Buyer shall order and Seller shall deliver to
Buyer the Modems set forth in Section 1.1 in accord with the delivery schedule
attached set forth in Annex C ("Forecast and Delivery Schedules").

        1.5 Delivery. Seller shall deliver the Modems sold to Buyer in accord
with the delivery schedule set forth in Annex C. The Modems shall be shipped
f.o.b. shipping point from the Seller's manufacturing site.

        1.6 Warranties. Acceptance of a Modem shall not relieve Seller from its
obligations thereunder with respect to warranties under Section 6 below.

* Certain information on this page has been omitted and filed separately with
  the Commission. Confidential treatment has been requested with respect to the
  omitted portions.

<PAGE>   2

        1.7 Title; Risk of Loss. Title to and risk of loss in Modems covered by
this Agreement shall pass to Buyer at such time Seller ships the Modems.

        1.8 Taxes. The prices of all Modems hereunder include all taxes, duties
and excise which are directly imposed on the Modems. Notwithstanding the
foregoing, Buyer shall bear the responsibility for any taxes or duties imposed
on Modems in any other country or state of destination, including without
limitation, taxes imposed on the sale by Buyer of a product that includes Seller
products.

        1.9 Preferred Supplier Status. For the term of this Agreement, Seller
shall have the right of first refusal as a supplier with respect to any wireless
data modem project initiated by the Hewlett-Packard Wireless and Internet
Services Division.

2.      TRADEMARKS.

        2.1 Seller's Trademarks.

            2.1.1 Buyer shall not use the trademark "Novatel" or "Novatel
Wireless" or any other trademark owned by Seller or any mark confusingly similar
thereto without the prior written consent of Seller in each instance.
Notwithstanding the foregoing, Buyer shall be entitled to use the trademark
"Novatel" or "Novatel Wireless" or any other trademark owned by Seller in
association with the Modems, but such use shall be in strict accord with the
latest (most recent) version of Seller's Trademark Style Guide as provided by
Seller to Buyer.

            2.1.2 Buyer shall not use the Seller's trademark or any other
trademark owned by Seller or any mark confusingly similar thereto without the
prior written consent of Seller in each instance.

            2.1.3 Buyer acknowledges Seller's sole ownership and exclusive
right, title and interest in and to the use of each of its trademarks, and that
any use of any of the trademarks of Seller will inure solely to the benefit of
Seller. Buyer shall not acquire any right to or under any of Seller's
trademarks. Nothing contained herein shall in any way limit Seller's rights
under its patents or licensing agreements or grant Buyer any rights under such
patents or licensing agreements.

            2.1.4 License to the Documentation. Solely for purposes as required
in accordance with this Agreement, Seller hereby grants to Buyer, under Seller"s
intellectual property rights, a non-exclusive, worldwide license to use,
reproduce and display the appropriate Documentation for the Modems.

        2.2 Buyer's Trademarks.

            2.2.1 Trademarks. Neither party is granted any ownership in or
            license to the trademarks, marks or trade names (collectively,
            "Marks") of the other party. Seller's use of Buyer's Marks shall be
            in accordance with the latest (most recent) Buyer's Trademark
            guidelines as provided by Buyer to Seller.

                                       2
<PAGE>   3

            2.2.2 Seller shall not use the Buyer's trademark or any other
            trademark owned by Buyer or any mark confusingly similar thereto
            without the prior written consent of Buyer in each instance.

            2.2.3 Seller acknowledges Buyer's sole ownership and exclusive
            right, title and interest in and to the use of each of its
            trademarks, and that any use of any of the trademarks of Buyer will
            inure solely to the benefit of Buyer. Seller shall not acquire any
            right to or under any of Buyer's trademarks. Nothing contained
            herein shall in any way limit Buyer's rights under its patents or
            licensing agreements or grant Seller any rights under such patents
            or licensing agreements.

        2.3 Co-Branding. Buyer and Seller agree that the Modems manufactured and
sold under this Agreement shall be co-branded with the trademarks of both Buyer
and Seller. Buyer and Seller agree to reasonably cooperate with one another in
developing an appropriate co-branding strategy.

3.      KNOW-HOW AND SUPPORT.

        Seller shall provide Level II and Level III Technical Support (as set
forth in Annex A ("Technical Support")), and training to Buyer's designated
service technicians to enable Buyer to provide Level I Support and engineering
support at Buyer's facilities to enable Buyer to support the Modems, including
the details of modem functionality and design required for detection and
correction of bugs or failures. The parties hereto acknowledge and agree that
Seller shall not provide direct end-user support to any end-user on its own
behalf or on behalf of Buyer (Level I Technical Support). Seller will provide
technical support during the term of this Agreement in accordance with the terms
of this Agreement, except that Seller shall not be obligated to provide support
for any change in Seller's specifications of the Modems as set forth in Annex B
(the "Product Specifications") requested by the Buyer to the extent that this
change proposed by Buyer is not incorporated into the standard Modems sold by
Seller.

4.      REPRESENTATION, WARRANTY and indemnification.

        4.1 Seller represents and warrants that no additional Federal Trade
Commission certification or CDPD carrier certification or other governmental
certification is required for the Modems. If either certification becomes
necessary for the sale of the Modems, Seller shall immediately stop delivery of
the Modems. Seller shall make the necessary changes to certify the Modems and
all previously delivered Modems shall be retrofitted to meet the certified
configuration.

        4.2 Seller also represents and warrants that it is entitled to enter
into this Supply Agreement and that Seller's performance according to the terms
of this Supply Agreement shall not violate any other agreement to which Seller
is a party. Seller shall, at its sole cost and expense, indemnify, defend and
hold Buyer harmless from and against any claims, demands, liability or suit,
including costs and expenses, for or by reason of any actual or alleged breach
of this warranty in this Section 4.2.

                                       3
<PAGE>   4

        4.3 General Indemnity. Seller agrees to indemnify and hold Buyer
harmless of and from any and all loss, cost, claim, liability, suit, judgment or
expense, including reasonable attorneys' fees, arising out of any breach of the
above described warranties.

        4.4 No Infringement. Seller warrants that the computer software provided
by Seller with the Modems to Buyer (the "Program"), and accompanying
Documentation, referred to in this Agreement do not violate or infringe any
patent, copyright, trademark, trade secret or other proprietary right of any
third party and that Seller is not aware of any facts upon which such a claim
for infringement could be based.

        4.5 Infringement Indemnity.

            (a) Seller will defend any claim, suit, or proceeding brought
against Buyer or its customers insofar as it is based on a claim that the
Program or Documentation, or any part thereof, furnished by Seller under this
Agreement constitutes an infringement of any third party's patent, copyright,
trademark, trade name, other proprietary right, or unauthorized trade secret
use; provided that Seller is notified promptly in writing of such claim, and
given authority, information and assistance (at Seller's expense) to handle the
claim or the defense of any suit or proceeding. Seller agrees to pay damages and
costs awarded therein against Buyer and its customers but only to the extent
such damages and costs are directly attributable to infringement caused by the
Program or Documentation which is provided by Buyer to Seller. Notwithstanding
the foregoing, Seller's total liability under this Section shall not exceed the
total amounts actually paid by Buyer to Seller under this Supply Agreement.

            (b) In case any Program or Documentation or any part thereof in such
suit is held to constitute an infringement and its use is enjoined, Seller
shall, at its own expense and at its option (i) procure for Buyer and its
customers the right to continue use, or (ii) if applicable, replace the same
with a noninfringing program and documentation of substantially equivalent
function and performance, or (iii) modify them so they become noninfringing
without detracting substantially from function or performance.

            (c) Notwithstanding the foregoing, Seller shall have no
responsibility for claims arising from (i) unauthorized modifications of the
Program made by Buyer or its customers if such claim would not have arisen but
for such modifications, or (ii) unauthorized combination or use of the Program
with products not contemplated herein if such claim would not have arisen but
for such combination or use.

5.      TERM; TERMINATION; RIGHTS AND OBLIGATIONS UPON TERMINATION.

        5.1 Except as otherwise provided for herein, the term of this Agreement
shall be for the period set forth on Annex D, unless terminated earlier by
either party pursuant to the provisions of this Section 5 or extended by mutual
written agreement of the parties.

        5.2 Notwithstanding the foregoing, the following provisions shall
continue in effect after termination of this Agreement in accordance with their
terms:

                                       4
<PAGE>   5

            (a) All payment provisions to the extent unpaid at the time of
termination shall be paid in accordance with the terms of this Agreement.

            (b) All warranties specified in the Agreement.

            (c) Sections 2.1 and 2.2 (Trademarks).

            (d) Section 5.6 (Commitment Termination Event).

            (e) Sections 9.1 and 9.2 (Confidentiality and Advertising).

            (f) Section 9.3 (Confidential Information).

            (g) Section 9.8 (Applicable Law).

        5.3 Buyer's Right to Terminate. Buyer shall have the right, by providing
Seller with thirty (30) days' prior written notice, to terminate this Agreement
upon the occurrence of any of the following events, any one of which shall be
considered a "Seller Default":

            (a) Seller discontinues the Modems;

            (b) Seller is adjudged bankrupt;

            (c) Seller files a voluntary petition in bankruptcy or liquidation
or for the appointment of a receiver;

            (d) Filing of an involuntary petition to have Seller declared
bankrupt, or subject to receivership, provided that such petition is not vacated
or set aside within ninety (90) days from the date of filing;

            (e) The execution by Seller of any assignment for the benefit of
creditors; or

            (f) Seller breaches any material provision of this Agreement and
fails to cure such material breach within thirty (30) days from receipt of
written notice describing the breach.

            (g) Seller, after receiving written notice from Buyer, fails to make
product deliveries as provided in this Agreement, unless such failure is cured
within thirty (30) days of Seller receiving such written notice from Buyer.

        5.4 Seller's Right to Terminate. Seller shall have the right, by
providing Buyer with thirty (30) days' prior written notice, to terminate this
Agreement upon the occurrence of any of the following events, any one of which
shall be considered a "Buyer Default":

            (a) Buyer fails to make payments as provided in this Agreement,
unless such failure is cured within thirty (30) days from receipt of written
demand for such payment. Any late payments shall bear interest at the annual
rate of ***;

            (b) Buyer is adjudged bankrupt;

* Certain information on this page has been omitted and filed separately with
  the Commission. Confidential treatment has been requested with respect to the
  omitted portions.

                                       5
<PAGE>   6

            (c) Buyer files a voluntary petition in bankruptcy or liquidation or
for the appointment of a receiver;

            (d) Filing of an involuntary petition to have Buyer declared
bankrupt, or subject to receivership, provided that such petition is not vacated
or set aside within ninety (90) days from the date of filing;

            (e) The execution by Buyer of any assignment for the benefit of
creditors; or

            (f) Buyer breaches any material provision of this Agreement and
fails to cure such material breach within thirty (30) days from receipt of
written notice describing the breach.

        5.5 Remedy Upon Default. In the event that this Agreement is terminated
pursuant to Section 5.3 or 5.4 above, both parties shall have the right to
exercise any and all rights surviving such termination pursuant to Section 5.2.

        5.6 Commitment Termination Event. In the event of a Commitment
Termination Event, Buyer shall, as soon as practicable and in no event later
than five (5) days after the occurrence of such Commitment Termination Event,
pay Seller, ***. Seller agrees to use commercially reasonable efforts to dispose
of or otherwise use excess finished product in an effort to reduce any residual
amount owed to Seller. "Commitment Termination Event" means (i) the failure by
Buyer to purchase Modems in the amounts set forth in Section 1.1 ("Sale and
Purchase") hereof pursuant to the schedule of payment and delivery set forth in
the Delivery Schedule (Annex C); (ii) termination of this Agreement by Buyer for
any reason whatsoever other than pursuant to an uncured material breach by
Seller; (iii) any uncured material breach by Buyer of any representation,
covenant or agreement on the part of Buyer set forth in this Agreement, and
subsequent termination of this Agreement by Seller for such breach. ***

6.      PRODUCT WARRANTY.

        6.1 Product Warranty. The following Sections 6.l through 6.6 refer only
to Product Warranty.

            (a) Seller warrants that all Modems, including components thereof,
to be delivered hereunder, will conform substantially to the Product
Specifications and be free from defects in material and workmanship. The
foregoing warranty is given provided Buyer gives written notice of any defect,
deficiency or non-conformance of any Modem, or parts thereof, within: (i) ***
from the purchase date by the end-user/consumer (the "Warranty Period"). Seller
shall, at no cost to Buyer, and within the "Turn-Around Time" as defined in
Section 6.2(a) below, repair or furnish replacements for all such defective,
deficient or non-conforming items or parts thereof; provided, however, the
Modems have been maintained in accordance with Seller's specifications and have
not been modified by any party other than Seller except as expressly permitted
by Seller in writing.

            (b) The foregoing warranties do not extend to:

                (i) defects, errors or nonconformities in a Modem due to
accident, abuse, misuse or negligent use of such Modem or use in other than a
normal and customary

* Certain information on this page has been omitted and filed separately with
  the Commission. Confidential treatment has been requested with respect to the
  omitted portions.

                                       6
<PAGE>   7

manner, environmental conditions not conforming to Seller's specifications, or
failure to follow prescribed operating maintenance procedures;

                (ii) defects, errors or nonconformities in the Modem due to
modifications, alterations, additions or changes in the Modem not made or
authorized to be made by Seller in writing;

                (iii) normal wear and tear; or

                (iv) damage caused by force of nature or act of any third party.

        6.2 Turn-Around Time.

            (a) "Turn-Around Time" for the purposes of this Section 6 means ***
from the date on which such defective item, or defective or non-conforming part
thereof, is furnished to Seller, for repair or replacement until the date on
which such replaced or repaired item is returned to Buyer.

            (b) Seller shall bear air shipment costs of the deficient, repaired
or replaced item as well as the risk or loss or damage to the item or its
replacement throughout the period between the shipment of the defective item and
the receipt of the repaired or replaced item. Repaired or replaced items shall
be subject to the warranty provided on the original finished product only (the
time during which Seller repairs or replaces the item shall not be considered as
part of the Warranty Period), in accordance with this Section 6. Notwithstanding
the foregoing, Buyer shall bear all expenses if no fault on the part of Seller
was found in the items returned for repair or replacement.

        6.3 Inspection; Acceptance. This warranty shall survive inspection,
acceptance or payments by Buyer and is provided for the sole and exclusive
benefit of Buyer and shall not extend to any third party, including without
limitation, any reseller or end-user.

        6.4 Exclusive Remedy. The warranty granted in this Section 6 sets forth
Buyer's sole and exclusive remedy and Seller's sole and exclusive liability for
any claim of warranty for any product delivered by Seller.

        6.5 No Authority. Buyer acknowledges that it is not authorized to make
any warranty or representation on behalf of Seller or its suppliers regarding
the Modems, whether express or implied, other than the warranty terms set forth
in this Section 6.

        6.6 Year 2000 Compliance. Novatel Wireless hereby warrants that the
Software included as part of the overall product is Year 2000 Compliant; "Year
2000 Compliant" shall be defined as having the capability to (i) correctly
process date field dependent logic to accurately process and utilize any date
prior to and any date after December 31, 1999; and (ii) store and represent
dates in a manner which enables the user to easily identify or use the century
portion of any date fields without any special processing.

* Certain information on this page has been omitted and filed separately with
  the Commission. Confidential treatment has been requested with respect to the
  omitted portions.

                                       7
<PAGE>   8

        6.7 No Other Warranty. THE WARRANTY MADE UNDER THIS SECTION 6 IS
EXPRESSLY IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING,
WITHOUT LIMITATION, ALL IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE.

7.      LIMITATION OF LIABILITY.

        SELLER SHALL NOT BE LIABLE FOR ANY SPECIAL, INCIDENTAL, CONSEQUENTIAL,
INDIRECT OR PUNITIVE DAMAGES (INCLUDING LOST REVENUES OR PROFITS) OF ANY KIND
DUE TO ANY CAUSE, REGARDLESS OF WHETHER SELLER HAS BEEN ADVISED OR IS AWARE OF
THE POSSIBILITY OF SUCH DAMAGES.

8.      FORCE MAJEURE.

        8.1 Events of Force Majeure. Neither party shall be liable for a default
or delay in the performance under this Agreement if and to the extent such
default or delay is caused, directly or indirectly, by (i) fire, flood, natural
disturbances or other acts of God; (ii) any outbreak or escalation of
hostilities, war, civil commotion, riot or insurrection; (iii) any act or
omission of the other party or any governmental authority or (iv) any other
similar causes beyond the control of such party that arise without the fault or
negligence of such party. Any delay resulting from such events shall be referred
to herein as a "Force Majeure," shall not constitute a default by such party
under this Agreement and shall entitle the delayed party to a corresponding
extension of its delayed obligation. The party whose performance will be delayed
by such events will use its best efforts to notify the other party within three
(3) days after delayed party becomes aware of such event, as well as the
cessation thereof.

        8.2 Subcontractor's Default. Any delays in performance by Seller's
subcontractors or suppliers shall be deemed excusable delays with respect to
Seller only if (i) such subcontractor's non-performance is caused by Force
Majeure and (ii) Seller could not have obtained the supplies or services of such
subcontractor from other sources in sufficient time and on customary terms to
prevent interruption of Seller's performance of this Agreement.

        8.3 Termination.

            (a) If Force Majeure results in a delay to make any scheduled
delivery under this Agreement by more than sixty (60) days, Buyer may terminate
this Agreement in whole or in part and such termination shall not be deemed a
breach of this Agreement.

            (b) If Buyer does not terminate within such sixty (60) day period,
and the Force Majeure prevails for further forty-five (45) days, Buyer may
terminate this Agreement, but it shall have no right to claim damages from
Seller for breach of the Agreement. The foregoing expresses Buyer's sole remedy
and Seller's sole liability for such termination resulting from Force Majeure.

                                       8
<PAGE>   9

9.      MISCELLANEOUS.

        9.1 Confidentiality of Agreement; Permitted Disclosures. Throughout the
term of this Agreement, each party agrees that the terms of this Agreement shall
be kept confidential. No disclosure of the identity of Buyer's customers or
end-users or other information concerning this Agreement shall be released by
Seller without the prior written consent of Buyer except in Seller's or Buyer's
communication with its respective shareholders, investors or potential
investors.

        9.2 Required Disclosures; Advertising. Notwithstanding Section 9.1
above:

            (a) Each party may divulge information hereunder as is reasonably
required for the performance of the Agreement or as is required by law; and

            (b) Each party shall have the right to list the other party as a
customer or supplier (as the case may be) in its advertising material.

        9.3 Confidential Information.

            (a) In performance of this Agreement, it may be necessary or
desirable for either party to disclose to the other certain business and/or
technical information which the disclosing party regards as proprietary and
confidential (the "Confidential Information"). Any Confidential Information
disclosed shall be reduced to writing and provided to the other party within
twenty (20) days after it was first disclosed. The disclosing party shall make
commercially reasonable efforts to mark all tangible embodiments of Confidential
Information with an appropriate confidentiality legend. Each of the parties
hereto agree that it shall (i) not make use of or disclose the Confidential
Information for any purpose whatsoever at any time, other than for the purposes
of this Agreement and (ii) limit access to the Confidential Information of the
other party to its employees and contractors who shall be advised of and agree
to be subject to the terms of this Section 9.3.

            (b) Nothing herein shall be construed as granting to either party,
by implication, estoppel or otherwise, any right, title or interest in, or any
license under, any patent or Confidential Information.

            (c) Items shall not be considered Confidential Information if such
information was (i) available to the public other than by a breach of an
agreement with the disclosing party; (ii) rightfully received from a third party
not in breach of any obligation of confidentiality; (iii) independently
developed by one party without access to the Confidential Information of the
other; (iv) known to the recipient at the time of disclosure; or (v) produced in
compliance with applicable law or a court order, provided that other party is
given reasonable notice of such law or order and an opportunity to attempt to
preclude or limit such production.

        9.4 Severability. If any provision of this Agreement shall be held
illegal or unenforceable, that provision shall be limited or eliminated to the
minimum extent necessary so that this Agreement shall otherwise remain in full
force and effect and enforceable.

                                       9
<PAGE>   10

        9.5 Assignment. Neither Seller nor Buyer may assign this Agreement in
whole or in part, or any rights hereunder without the prior written consent of
the other, except to (i) a wholly-owned subsidiary of such party, (ii) a
successor in interest of all or substantially all of such party's assets or
business or (iii) a bank trust company or other financial institution for money
due or to become due under this Agreement. In the event of any assignment, the
assigning party shall promptly supply the other party with two (2) copies of
such assignment and, in the instance of an assignment pursuant to this Section
9.5, shall indicate on each invoice to whom payment is to be made. In the event
of any assignment pursuant to this Section 9.5, the assigning party also shall
provide a written guarantee by such party of the obligations assigned to such
party's subsidiary.

        9.6 Relations of the Parties. Nothing in this Agreement shall be
construed as creating relationship of principal and agent or of employer and
employee between the parties. Furthermore, nothing in this Agreement is intended
to constitute, create, give effect to or otherwise contemplate a joint venture,
partnership or formal business entity of any kind. The rights and obligations of
the parties with respect to this Agreement shall not be construed as providing
for sharing of profits or losses arising out of the effort of either of the
parties. The parties shall not incur any liability on behalf of the other.

        9.7 Waiver. No waiver by either Seller or Buyer of any breach of this
Agreement shall be held to be a waiver of any other subsequent breach. No waiver
or time extension given by either Seller or Buyer shall have effect unless made
expressly and in writing.

        9.8 Applicable Law. This Agreement and all matters regarding the
interpretation and/or enforcement hereof shall be governed exclusively by the
law of the State of California without reference to its choice of law rules.

        9.9 Entire Agreement. This Agreement constitutes the entire agreement
between the parties, supersedes and cancels any previous understandings or
agreements between all the parties relating to the provisions hereof, and
expresses the complete and final understanding of the parties in respect
thereto. This Agreement may not be changed, modified, amended or supplemented
except by a written instrument signed by the parties.

        9.10 Notices. Any notice contemplated by or made pursuant to this
Agreement shall be in writing and shall be deemed delivered on the date of
delivery if delivered personally or by commercial overnight courier with
tracking capabilities or by fax, or five (5) days after mailing if placed in the
mail, postage prepaid, registered or certified mail, return receipt requested,
addressed to Buyer or Seller (as the case may be) as follows:

                    Seller:     Novatel Wireless, Inc.
                                9360 Towne Centre Drive
                                Suite 110
                                San Diego, CA  92121
                                Attn:  Bruce Gray, Vice President of Sales
                                and Marketing

                                       10
<PAGE>   11

                     Buyer:      Hewlett-Packard Company
                                 3000 Hanover Street
                                 Palo Alto, CA 94304
                                 Attn:  General Counsel

or such other address as each party may designate for itself by notice given in
accordance with this Section 9.10.

        9.11 Headings. The headings in this Agreement are for convenience only
and shall not be regarded in the interpretation hereof.

        IN WITNESS WHEREOF, the parties hereto have executed this Agreement to
be effective as of the Effective Date written above.

                           SELLER: NOVATEL WIRELESS, INC.

                           By: _______________________________________________
                               Name: Bruce Gray
                               Title: Vice President of Sales and Marketing

                           BUYER:  HEWLETT-PACKARD COMPANY

                           By: _______________________________________________
                               Name:
                               Title:

                                       11
<PAGE>   12

ANNEX A; TECHNICAL SUPPORT

Technical Support for the H.P. Jornada 540 series modem cradle Product delivered
to Hewlett Packard customers will be managed via a three-tier Technical Support
infrastructure and process as follows:

LEVEL ONE TECHNICAL SUPPORT

        Level one Technical Support will be provided by Hewlett Packard to their
        direct and indirect customers. Level one support is defined as calls*
        originating from Hewlett Packard customers, resellers or distributors
        regarding H.P. Jornada 540 series modem cradle products including but
        not limited to pre and post sale inquiries concerning the basic
        operation of the hardware and software, functionality, interoperability
        and capabilities of those products and services.

        For calls regarding the H.P. Jornada 540 series modem cradle products,
        Hewlett Packard will make every attempt to answer customer questions and
        resolve issues using available tools, documentation, test equipment and
        other materials used to support the H.P. Jornada 540 series modem cradle
        products (see training section below). If the customer question/issue
        regarding the H.P. Jornada 540 series modem cradle product cannot be
        resolved by Hewlett Packard support personnel to the customers'
        satisfaction, the issue will be forwarded to Seller level two Technical
        Support for further investigation and resolution.

        *Calls include phone calls, e-mail, web-based inquiries, faxes and
        letters.

LEVEL TWO TECHNICAL SUPPORT

    Level two Technical Support will be provided by Seller support staff
    directly to Hewlett Packard level one support personnel to assist in the
    resolution of open customer issues that have not been resolved to Hewlett
    Packard customers satisfaction during a level one support call. Hewlett
    Packard will have direct access to designated support staff within the
    Seller support organization for this purpose. A direct line of communication
    between the two organizations will be established and Seller support
    technicians will be available during normal Hewlett Packard Technical
    Support operation hours to assist in resolution of customer problems. Seller
    support engineering will work directly with Hewlett Packard support staff to
    resolve issues and answer questions, this may require Hewlett Packard
    support staff to gather additional information and provide system
    information or test results back to Seller

<PAGE>   13

    support staff to aid in the definition and resolution of the problem It will
    be Hewlett Packard support staff's responsibility to communicate directly
    with the end-user customer. Problems that are not resolved WITHIN 72 HOURS
    or problems that are flagged as sensitive/mission critical will be escalated
    to level three Technical Support for final resolution.

LEVEL THREE TECHNICAL SUPPORT (ESCALATION)

    Level three Technical Support will be provided by Seller support and system
    engineering staff to resolve issues that cannot be satisfactorily resolved
    by level one and level two support personnel. Level three support will
    handle all Hewlett Packard product escalations issues including unresolved
    support calls and will work directly with Seller engineering staff to
    resolve those issues.

TECHNICAL SUPPORT TRAINING

    Technical Support training and documentation for the H.P. Jornada 540 series
    modem cradle will be provided to Hewlett Packard level one support staff by
    Seller. Hewlett Packard support staff will receive training on the general
    use, functionality, operation and compatibility of the Seller H.P. Jornada
    540 series modem cradle products. In addition all support related
    documentation, training materials, notes, FAQ's, and web based support
    materials will be made available to Hewlett Packard for their use in
    supporting these products.

<PAGE>   14

ANNEX B; PRODUCT SPECIFICATIONS

HARDWARE AND SOFTWARE DESCRIPTIONS

TOPCAT POCKET PC MODEM CRADLE PRODUCT DESCRIPTION

This product is a "cradle" or "sled" module that will fit the form factor of the
TopCat Pocket PC providing wireless connectivity. The modem will connect via a
serial port interface and will have a form factor that fits a small area on the
back of the Pocket PC device. A rechargeable Lithium Ion battery will power the
modem and provide battery life of between 6 - 8 hours of average use. This
battery will be charged with an external AC adapter.

PRODUCT FEATURES DESCRIPTION

-       GSM/GPRS version: Dual band (900/1800Mhz)GSM data transmission at
        9600bps (optional 900/1900Mhz available)

-       GSM/GPRS version: GPRS support with high speed data transmission

-       CDPD version: Compliant with the CDPD Part 409 specifications.

-       GSM/GPRS versions: Short messaging (SMS) send and receive

-       GSM/GPRS versions: Automatic message polling

-       GSM/GPRS versions: Buzzer and/or vibrating alarm functionality

-       Stand-alone charging mechanism for Cradle

-       LED Status indication

-       Minimal battery requirement: 90h stand-by time or 1.5 hours online time.

-       GSM/GPRS versions: PIN Protection

-       Power switched by the Pocket PC

-       Software Tools

-       Pre-packaged Applications for Email and Web-browsing

-       Desktop/Laptop synchronization software

FEATURE SET DETAILS

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HARDWARE SPECIFICATIONS

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HARDWARE SPECIFICATION DETAILS

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3.  INDUSTRIAL DESIGN

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Overview:

        This is a Type II PC Card based on GSM GPRS specifications and designed
        to work with a Windows laptop or handheld PC. It is wireless modem based
        on digital packet technology and allows high-speed data communication on
        a world recognized wireless standard.

Features:

        -  900/1900 operation in a North American GSM environment, 900/1800
           operation in European and Asian GSM environments.

        -  has support for circuit switched operation to allow coverage in areas
           where advanced features of GPRS have not yet been rolled out

        -  capable of power output at 1 watt.

        -  size is compatible with Type II PC Card (PCMCIA)

        -  GPRS technology allows for over the air download of data at 56Kbps
           nominally in MS10 mode of operation and upload at 28Kbps

        -  SIM card features and proven security are the same as for standard
           GSM products with the SIM card itself being supplied by the carrier
           as a separate item

        -  Over the Air programming is available for user feature implementation

        -  This assumes downloading to the laptop or handheld PC from the web
           site and then downloading to the PC Card.

        -  Application Software available for setup, configuration, operation
           and status monitoring of the PC Card

        -  Designed for Windows 95/98/NT/CE and 2000 computers equipped with a
           Type II PC Card (PCMCIA) slot

*Certain information on this page has been omitted and filed separately with the
Commission. Confidential treatment has been requested with respect to the
omitted portions.
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Specifications:

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CDPD PC CARD
Product Description

Overview:
        This is a Type II PC Card based on the CDPD specifications and designed
        to work with a Windows laptop or handheld PC. It is wireless modem based
        on digital packet technology and allows high-speed data communication on
        a world recognized wireless standard.

Features:

        -  Operation in all CDPD environments.

        -  capable of power output at .6 watts

        -  size is compatible with Type II PC Card (PCMCIA)

        -  CDPD technology allows for over the air download of data at 19.2Kbps
           nominally

        -  Over the Air programming is available for user feature implementation

        -  Application Software available for setup, configuration, operation
           and status monitoring of the PC Card

*Certain information on this page has been omitted and filed separately with the
Commission. Confidential treatment has been requested with respect to the
omitted portions.

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Specifications:

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*Certain information on this page has been omitted and filed separately with the
Commission. Confidential treatment has been requested with respect to the
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ANNEX C; FORECAST AND DELIVERY SCHEDULES

PRODUCT MANUFACTURING AND FORECASTING: Hewlett Packard will need to submit a ***
forecast to Novatel Wireless. The forecast for the *** of shipments shall be
given *** days in advance of the scheduled production date and will be
considered fixed. After the forecast for first *** of shipments is submitted to
Novatel Wireless, forecast changes may be made as follows for the remaining
months:

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NOTE: Hewlett Packard can reserve the right to provide forecasting for the
consumption of the entire volume commitment (product mix and quantity) by
providing a minimum of *** advance notice.

DEVELOPMENT AND DELIVERY SCHEDULE: The schedule below indicates the total
development time (time-to-market) for all versions of the cradle starting from
the date the agreement is signed to the date when volume quantities are shipped
to Hewlett Packard's designated point of distribution. Development of all
devices will begin once an agreement between the two parties is signed.

The schedule is detailed as follows (Time listed in months ARO):

                                            CDPD                 GSM/GPRS

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FORECAST BEGINNING WITH FIRST MONTH'S AVAILABILITY:

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  omitted portions.

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               ***

Novatel Wireless, during the term of this Agreement, for all H.P. Jornada series
540 modem cradles that are shipped through Novatel Wireless channels, will
bundle collateral marketing and advertising materials and any other related
collaterals, electronic or otherwise which are supplied by Hewlett-Packard or
Hewlett-Packard partners.

For each H.P. Jornada series 540 modem cradle shipped by Novatel Wireless to
Hewlett-Packard pursuant to this Agreement, Novatel Wireless will provide
Hewlett-Packard on a monthly basis with all EID Numbers for such modem cradles.

*Certain information on this page has been omitted and filed separately with the
Commission. Confidential treatment has been requested with respect to the
omitted portions.
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ANNEX D; PRODUCT PRICING AND VOLUME COMMITMENTS

VOLUME COMMITMENT: *** units between H.P. Jornada 540 series modem cradle and PC
Card form factors using either CDPD or GSM/GPRS technologies.

TERM: *** beginning from the first revenue GSM/GPRS H.P. Jornada 540 series
modem cradle Cradle modem shipment to Hewlett Packard from Novatel Wireless.

DISTRIBUTION: During the term of this Agreement, Novatel Wireless agrees not to
sell H.P. Jornada 540 series modem cradles to wireless network providers and
aggregators of wireless service. During the term of this Agreement, all carrier
service bundles offered for the H.P. Jornada 540 series modem cradles by Novatel
Wireless shall be provided by Hewlett-Packard or one of its assigned agents.
Hewlett-Packard agrees, during the term of this Agreement, to make the H.P.
Jornada 540 series modem cradles available to all wireless carriers on a
non-discriminatory basis, pursuant to comparable business terms and pricing.

UNIT PRICING: Unit pricing for the H.P. Jornada 540 series modem cradle cradle
is as follows:

Quantity:             ***

GSM/GPRS              ***

CDPD                  ***

Unit Pricing for the Type II PCMCIA cards is as follows:

GSM/GPRS              ***

CDPD                  ***

DEVELOPMENT FEE:

Hewlett-Packard agrees to provide a product development fee of *** to Novatel
Wireless. One payment of *** shall be made by Hewlett-Packard to Novatel
Wireless upon execution of this Agreement and a second payment of *** shall be
made one week prior to the first manufacturing run for the products.

* Certain information on this page has been omitted and filed separately with
  the Commission. Confidential treatment has been requested with respect to the
  omitted portions.

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