Document:

Exhibit 4.1

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                                 LEASE AGREEMENT

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         DATE:                      MARCH 27, 2001

         LANDLORD:                  MITEL RESEARCH PARK CORPORATION

         TENANT:                    MITEL CORPORATION

         PREMISES:                  Phase 1, Block C
                                    Phase 3, Ground, Mezzanine and Second Floor

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                                        1

                                      INDEX

<TABLE>
<S>       <C>                                                                                                    <C>
Article 1 DEFINITIONS.............................................................................................1
   1.1.     In this Lease,........................................................................................1
Article 2 DEMISE, DELIVERY AND SURRENDER..........................................................................6
   2.1.     Demise and Leased Premises............................................................................6
   2.2.     Shared Areas and Facilities...........................................................................7
   2.3.     Examination of Leased Premises........................................................................7
   2.4.     Separation of Leased Premises, Condition and Relocation...............................................7
   2.5.     Installation and Removal of Trade Fixtures............................................................8
   2.6.     Overholding by Tenant.................................................................................9
Article 3 RENTAL..................................................................................................9
   3.1.     Basic Rent............................................................................................9
   3.2.     Payment of Additional Rent for Complex Operating Costs................................................9
   3.3.     Annual Estimation of the Complex Operating Costs......................................................9
   3.4.     Annual Adjustment of Basic Rent Based Upon the Actual Complex Operating Costs.........................9
   3.5.     Rent Covenant........................................................................................10
   3.6.     Waiver of Set-Off....................................................................................10
   3.7.     Interest on Overdue Rent.............................................................................10
   3.8.     Net Lease............................................................................................10
Article 4 OTHER AMOUNTS TO BE PAID BY TENANT.....................................................................11
   4.1.     Business Taxes, GST and Other Taxes..................................................................11
   4.2.     Third Party Services.................................................................................11
   4.3.     Additional Services of the Landlord..................................................................11
   4.4.     Upgrading Building Systems...........................................................................11
   4.5.     Leased Premises Heating, Ventilating and Air Conditioning Systems....................................11
Article 5 OPERATION OF COMPLEX...................................................................................12
   5.1.     Utility Services.....................................................................................12
   5.2.     Taxes................................................................................................12
   5.3.     Building and Pedestal Signage........................................................................12
Article 6 INSURANCE AND INDEMNITY................................................................................13
   6.1.     Landlord's Insurance.................................................................................13
   6.2.     Tenant's Insurance...................................................................................14
   6.3.     Premium Increases and Cancellation...................................................................15
   6.4.     Compliance with Landlord's Insurance Requirements....................................................15
   6.5.     Limitation of Landlord's Liability...................................................................16
   6.6.     Indemnity by Tenant..................................................................................16
   6.7.     Limitation of Tenant's Liability.....................................................................17
Article 7 REPAIRS AND ALTERATIONS................................................................................17
   7.1.     Tenant's Repairs.....................................................................................17
   7.2.     Tenant to Notify of Defects..........................................................................17
   7.3.     Tenant Work..........................................................................................17
   7.4.     Construction or Mechanic's Lien......................................................................19
   7.5.     No Interference with Tenant's Operations.............................................................19
   7.6.     Installation of Meters...............................................................................20
   7.7.     Repair Where Tenant at Fault.........................................................................20
   7.8.     Repairs by Landlord..................................................................................20
   7.9.     Door Locks...........................................................................................20

</TABLE>

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                                        2

<TABLE>
<S>       <C>                                                                                                    <C>
Article 8 DAMAGE OR DESTRUCTION..................................................................................21
   8.1.     Right to Terminate...................................................................................21
   8.2.     Repair and Rebuilding................................................................................21
   8.3.     Abatement of Rent....................................................................................21
   8.4.     Certificate of Architect Binding.....................................................................22
Article 9 LANDLORD'S COVENANTS...................................................................................22
   9.1.     Landlord's Covenant for Quiet Enjoyment..............................................................22
Article 10 TITLE OF COMPLEX......................................................................................22
   10.1.       Subordination.....................................................................................22
   10.2.       Attornment........................................................................................22
   10.3.       Status of Lease Statement.........................................................................23
   10.4.       Registration of Lease Prohibited..................................................................23
Article 11 USE OF LEASED PREMISES................................................................................23
   11.1.       Type of Business Permitted........................................................................23
   11.2.       Compliance With Applicable Laws and Government Requirements.......................................23
   11.3.       Waste/Nuisance....................................................................................23
   11.4.       Rules and Regulations.............................................................................24
   11.5.       Environment.......................................................................................24
Article 12 ASSIGNMENT AND SUB-LETTING............................................................................25
   12.1.       Assignment by Landlord............................................................................25
   12.2.       Assignment and Subletting by Tenant...............................................................25
   12.3.       Request to Assign or Sublet.......................................................................26
   12.4.       Assignment or Sublet Agreement....................................................................26
   12.5.       Changes in Corporate Control......................................................................26
Article 13 DEFAULT OF TENANT.....................................................................................27
   13.1.       Landlord's Right of Re-Entry......................................................................27
   13.2.       Bankruptcy of Tenant and Other Events of Default..................................................27
   13.3.       Excuse of Performance.............................................................................28
   13.4.       Cross - Default...................................................................................28
Article 14 LANDLORD'S RIGHT OF ACCESS............................................................................28
   14.1.       Right of Access and Method of Re-Entry............................................................28
   14.2.       Building Systems..................................................................................29
   14.3.       Obligations of Tenant and Landlord................................................................29
Article 15 SHARED AREAS AND FACILITIES...........................................................................29
   15.1.       Non-Exclusive Right to Use Shared Areas and Facilities............................................29
   15.2.       Alterations to Shared Areas and Facilities........................................................29
Article 16 INTERPRETATION AND MISCELLANEOUS......................................................................30
   16.1.       No Partnership....................................................................................30
   16.2.       Agency............................................................................................30
   16.3.       Lease is Entire Agreement.........................................................................30
   16.4.       Joint and Several Liability.......................................................................30
   16.5.       Governing Law.....................................................................................30
   16.6.       Interpretation....................................................................................31
   16.7.       Successors and Assigns............................................................................31
   16.8.       Reasonableness....................................................................................31
   16.9.       Counterparts and Facsimile........................................................................31
Article 17 SPECIAL PROVISIONS....................................................................................32
   17.1.       Exercise of Rights by Landlord....................................................................32

</TABLE>

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<TABLE>
<S>       <C>                                                                                                    <C>
   17.2.       Parking...........................................................................................32
   17.3.       Security..........................................................................................32
   17.4.       Cleaning/Janitorial Services/Garbage Removal......................................................32
   17.5.       Emergency Response Team...........................................................................32

</TABLE>

SCHEDULE "A-1"             LEGAL DESCRIPTION OF THE LAND
SCHEDULE "A-2"             LEGAL DESCRIPTION OF THE PHASE V LANDS
SCHEDULE "B-1"             SITE PLAN SHOWING THE LANDS
SCHEDULE "B-2"             SITE PLAN SHOWING THE PHASE V LANDS
SCHEDULE "C"               LEASED PREMISES SHOWN BY CROSS-HATCHING
SCHEDULE "D"               RULES AND REGULATIONS
SCHEDULE "E"               REPAIR OBLIGATIONS IN RESPECT OF THE REMOVAL OF
                           TENANT TRADE FIXTURES [NTD:  TO BE REVIEWED AND
                           CONFIRMED]
SCHEDULE "F"               CONSENT BY LANDLORD TO SUBLEASE
SCHEDULE "C"               TENANT SIGNAGE

<PAGE>

      THIS LEASE made the 27'" day of March, 2001

BETWEEN:

                         MITEL RESEARCH PARK CORPORATION
                         -------------------------------
                      (hereinafter called the " Landlord ")

AND:

                                MITEL CORPORATION
                                -----------------
                        (hereinafter called the "Tenant")

WHEREAS:

      A.  The  parties  have  entered  into  an  Acquisition   Agreement   which
contemplates this Lease.

      NOW  THEREFORE  this  indenture  witnesses  that  for  good  and  valuable
consideration,  the receipt and sufficiency of which is expressly  acknowledged,
the parties covenant and agree as follows:

                                    ARTICLE 1
                                   DEFINITIONS

1.1. In this Lease,

      "Accounting  Period" means the twelve (12) month accounting period adopted
by the  Landlord  from time to time for the  Complex  which is as of the date of
this Lease based on a calendar year.

      "Additional Rent" means all amounts payable by the Tenant under this Lease
other than Basic Rent, whether or not characterised as rent under this Lease.

      "Amortization"  means, for each Accounting Period, the annual amortization
of the Landlord's  capitalized  cost of replacements  and repairs to the Complex
(in each case  over such  asset,  repair or  replacement's  (as the case may be)
useful life) which are not expensed during such Accounting  Period in accordance
generally accepted accounting  principles,  together with simple interest on the
unamortized  portion of such costs, such interest to be calculated each month at
a rate consistent with the Landlord's standard amortization practices.

      "Applicable  Laws"  means  all  statutes,   laws,  by-laws,   regulations,
ordinances and  requirements  having the force of law of  governmental  or other
public  authorities  having  jurisdiction  over the Complex,  and all amendments
thereto at any time and from time to time in force which are  applicable  in the
circumstances.

      "Architect"  means an independent,  duly qualified  architect named by the
Landlord from time to time under the provisions of this Lease.

      "Acquisition  Agreement"  means  the  Acquisition  Agreement  between  the
Tenant,  3755461  Canada Inc. and Dr.  Terence H. Matthews made as of January 2,
2001.

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                                        2

      "Basic Rent" means for each  Accounting  Period  during the Term,  the sum
total of (i) the Rental Rate (Office) multiplied by the Floor Area of the Office
Areas of the Leased Premises:  and (ii) the Rental Rate (Non-Office)  multiplied
by the Floor Area of the Non-Office Areas of the Leased Premises.

      "Business" shall have the same meaning as in the Acquisition Agreement but
restricted to the activities carried on, in or about the Complex;

      "Commencement Date" means March 27, 2001.

      "Common  Facilities"  means those parts of the Complex  together  with all
facilities  from time to time provided by the Landlord near the Complex to serve
the occupants of the Complex,  including as applicable,  without limitation, the
Shared Areas and Facilities,  exterior weather walls and facade, roofs, exterior
and interior  structural  elements and bearing  walls of the Complex,  music and
public address systems, first aid stations,  property management offices related
to the Complex, fire prevention and fire detection systems,  plumbing,  heating,
ventilation,   humidification,   air-conditioning  and  drainage  equipment  and
installations,  fountains,  furniture,  furnishings,  directory boards,  general
signs  including pylon signs,  maintenance  equipment,  service,  janitorial and
mechanical rooms,  transformer vaults,  electrical  distribution rooms and water
meter rooms.

      "Complex"  means the Lands,  the  integrated  buildings  and  improvements
erected thereon and the Common  Facilities,  as may be varied from time to time,
located at municipal address 340, 350 and 360 Leggett Drive, and 400 March Road,
all being in the City Ottawa (formerly, the City of Kanata), Ontario.

      "Complex  Mortgage  Financing" means the first mortgage  financing for the
purchase of the Complex.

      "Complex  Operating  Costs" means, for each Accounting  Period,  the total
cost  to  the  Landlord,   calculated  in  accordance  with  generally  accepted
accounting  principles for operating and insuring the Complex,  and maintaining,
repairing, replacing, refurbishing and furnishing the Common Facilities for such
Accounting Period, including the Amortization of costs and expenses of a capital
nature, costs of electricity, fuel, gas, steam, water, sewage, and other utility
costs and consumptions for the Complex,  but excluding all costs with respect to
Leasable  Areas of the  Complex  of a  character  for which the Tenant is billed
directly  for the  Leased  Premises  (such as, by way of  example,  but  without
limiting the generality of the foregoing,  costs charged  directly to the Tenant
(rather  than being  included  in Complex  Operating  Costs and payable as Basic
Rent)  pursuant to sections  4.3  (Additional  Services  of the  Landlord),  4.4
(Upgrading Building Systems),  5.1 (Utility Services) and 6.3 (Premium Increases
and Cancellation). Complex Operating Costs shall include, without duplication or
limitation,  the  Landlord's  costs for Taxes  assessed  against the Complex and
contract administration costs incurred in connection with the Complex,  building
management fees or an  administrative  fee (not exceeding the going rate charged
by trust  companies or first class  building  management  companies for building
management  in the City of Ottawa for  similar  buildings);  the cost of service
contracts with  independent  contractors and the Landlord's  costs for cleaning,
painting,  controlling pests,  supervising,  policing,  gardening,  landscaping,
striping,   snow   removal,    electricity,    water,   heating,    ventilation,
humidification, air conditioning,  materials, supplies, equipment rental, wages,
salaries  and benefits  paid and  provided for  employees to the extent they are
directly involved

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with  the   maintenance,   operation  and  repair  of  the  Common   Facilities,
maintenance,  repairs,  replacements,  and all  other  expenditures  of a nature
required to be made by a prudent owner.  Complex  Operating  Costs shall exclude
fees,  costs or  commissions  incurred  in leasing  the  Complex and the cost of
installing, operating and maintaining any specialty service for which the Tenant
does not enjoy equal benefit with the other occupants of the Complex, such as by
way of example, a daycare, athletic or recreation club.

      "Environment" means all, or any part, of the air, water and soils in or on
the Complex.

      "Environmental Law" has the meaning set out in the Acquisition Agreement.

      "Environmental Losses" means all fines, penalties, costs, losses, damages,
expenses  or  liabilities  (including  reasonable  legal and other  professional
expenses) resulting from any failure to comply with any Environmental Law.

      "Floor Area of the Leased  Premises"  means,  by agreement of the parties,
111,645  square feet,  being  comprised of  approximately  50,677 square feet of
Office Area and approximately 60,968 square feet of Non-Office.

      "Gross  Building  Area"  means  the  aggregate  area of all  floors of all
buildings in the Complex (excluding for this purpose the building on the Phase V
Lands until the Rent  Commencement  Date as such term is defined in the lease of
even date between the Landlord and the Tenant for the building to be constructed
on the Phase V Lands) as measured by the Landlord using its standard measurement
methodology,   which  area  is  as  at  the  Commencement  Date,   comprised  of
approximately  624,035 square feet,  subject to adjustment based on increases or
decreases in the areas of the buildings comprising the Complex.

      "Hazardous  Substance" means any material or substance that may impair the
quality of the Environment  and as to which  liabilities or standards of conduct
are imposed pursuant to Environmental Laws,  including any material or substance
that is deemed pursuant to any  Environmental  Law to be  "hazardous",  "toxic",
"deleterious",   "caustic",   "dangerous",   a  "contaminant",   a  "pollutant",
"dangerous", "toxic", a "hazardous waste", or a "source of contamination".

      "Lands" means the lands more particularly  described in Schedule "A-1" and
shown in heavy black  outline on Schedule  "B-1",  together  with any  additions
thereto or subtractions  therefrom as may be designated from time to time by the
Landlord in its sole  discretion for use in connection  with the Complex.  If at
any time during the Term, the Landlord sells, transfers or otherwise assigns its
interest in the Phase V Lands,  or if the  Mortgagee  enforces  its Mortgage and
forecloses the Landlord's  interest in the Phase V Lands or sells,  transfers or
otherwise  assigns its interest in the Phase V Lands,  "Lands" as defined herein
shall thereafter be deemed to exclude Phase V Lands.

      "Landlord"  means  Mitel  Research  Park  Corporation  and its  respective
successors and assigns.

      "Landlord's  Address" means 555 Leggett Drive, Tower B, Suite 530, Ottawa,
Ontario, Canada,K2K 2Y3, to the attention of: Treasurer.

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                                        4

      "Lateral Supporting Building Infrastructure" means that production support
infrastructure  (including water,  drain,  electrical,  vacuum,  bulk gases, and
exhaust) not specific to any one part of the  Production  Equipment,  but at the
next hierarchy above, supporting multiple parts of Production Equipment.

      "Lease"  means  this lease as from time to time  amended  in  writing  and
includes all schedules hereto.

      "Leasable Areas of the Complex" means that part of the Complex not forming
part of the Common Facilities.

      "Leasehold   Improvements"   means   all   improvements,    installations,
alterations  and additions  made from time to time to the Leased  Premises on or
after the Commencement Date, including without limitation, all fixed partitions,
light fixtures, and all items which cannot be removed without material damage to
the Leased  Premises,  and  including  trade  fixtures  installed  by or for the
benefit of the Tenant,  which trade fixtures include,  without  limitation,  the
Production  Equipment to the extent any such  equipment is affixed to the Leased
Premises so as to lose its characterization as a chattel.

      "Leased Premises" means those premises forming part of the Complex,  which
premises are shown by cross-hatching outline on Schedule "C" hereto and are more
particularly shown and described on the set of plans showing the Leased Premises
"as-built" as of the Commencement Date, initialed by the Landlord and the Tenant
for identification purposes and to be delivered by the Tenant to the Landlord on
the Commencement Date.

      "Mortgage" means any mortgage, hypothec, charge (including a deed of trust
and mortgage  securing  bonds and all  indentures  supplemental  thereto),  lien
(resulting  from any other  method of  financing  or  refinancing),  or  blanket
mortgage  (affecting  the Complex as well as other  property)  now or  hereafter
secured  upon the Lands and the  Complex or any part  thereof and  includes  all
renewals, modifications, consolidations, replacements and extensions thereof.

      "Mortgagee" means the holder of any Mortgage.

      "Non-Office  Areas of the Leased Premises" means those areas of the Leased
Premises not used by the Tenant for office  purposes and which,  by agreement of
the parties,  are deemed to comprise 60,968 square feet. The Non-Office Areas of
the Leased  Premises are  highlighted on the floor plans of the Leased  Premises
attached as Schedule "C" hereto.

      "Notice"  means `any  notice,  statement  or request  herein  required  or
permitted  to be given by either  party to the other  pursuant to this Lease and
shall be in writing  and, if to the  Landlord,  addressed to the Landlord at the
Landlord's  Address  and,  if to the  Tenant,  addressed  to the  Tenant  at the
Tenant's Address. Each notice shall be either hand delivered,  sent by confirmed
facsimile transmission,  or mailed by registered post (return receipt requested)
and the date of  receipt of such  notice  shall be deemed to be the date of such
hand delivery, the next business day if sent by confirmed facsimile transmission
or the day of return receipt,

      "Office  Areas of the Leased  Premises"  means  those  areas of the Leased
Premises to be used by the Tenant for office purposes and which, by agreement of
the parties, are deemed to

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                                        5

comprise  50,677  square  feet.  The  Office  Areas of the Leased  Premises  are
highlighted on the floor plans of the Leased  Premises  attached as Schedule "C"
hereto.

      "Permitted  Use"  means  the  use of the  Leased  Premises,  only  for the
purposes of offices,  warehousing,  production, and related uses to carry on the
Business  in  substantially  the same  manner as that  carried  on by the Tenant
immediately prior to the Commencement Date.

      "Phase V Lands"  means the Lands more  particularly  described in Schedule
"A-2" and shown in heavy outline on Schedule  "B-2"  together with any additions
thereto or subtractions  therefrom as may be designated from time to time by the
Landlord in its sole discretion for use in connection with the Leased Premises.

      "Production  Equipment" means process  equipment used specifically for the
purposes  of  production,  including  but not limited to  supporting  peripheral
equipment  (including  but not  limited to vacuum  pumps,  gas  cabinets,  local
chillers,  local power shut-off panels,  local scrubbers,  local sump pumps) and
local supporting infrastructure (including but not limited to electric, plumbed,
ducted connections between main tool and peripheral  equipment,  or between such
process equipment and Lateral Supporting Building Infrastructure  (including but
not limited to water, drain, electrical,  vacuum, bulk gases, bottled gases, and
exhaust)).

      "Rent" means Basic Rent and Additional Rent.

      "Rules and  Regulations"  means those rules and regulations  stipulated in
Section 11.4 hereof and any further  reasonable  rules and  regulations of which
the Tenant receives  written  notification  from the Landlord which the Landlord
acting  reasonably may from time to time  stipulate for the proper  operation of
the Complex, and all such further rules and regulations shall be read as forming
part of this Lease as if the same were embodied herein.

      "Shared Areas and Facilities"  means those parts of the Common  Facilities
which are provided by the  Landlord for the common use and  enjoyment or benefit
of the Tenant,  the  Landlord  and other  occupants  of the  Complex,  and their
respective  employees,  contractors,  agents  and  invitees  including,  without
limitation,  any recreational  areas,  landscaped areas,  parking areas,  public
transit shelters, roadways, driveways,  walkways, sidewalks,  skywalks, tunnels,
lobbies,  entrances,  exits, common corridors, halls, stairways and passageways,
public  lavatories,   truck  courts,  truck  docks,  common  loading  areas  and
elevators,  and shall be deemed to include  any  pedestrian  walkways,  parks or
other facilities located on the Lands.

      "Stipulated  Rate of Interest" means the standard rate of interest charged
or imputed by the Landlord,  acting  reasonably,  in respect of the operation of
the Complex, as adjusted from time to time.

      "Taxes" means, for each Accounting Period, the amount paid by the Landlord
for all taxes,  rates,  duties and assessments  whatsoever,  whether  municipal,
provincial,  parliamentary or otherwise,  now charged or hereafter to be charged
upon the  Complex or upon the  Landlord in respect  thereof for such  Accounting
Period.  The  total  of  such  costs  to the  Landlord  shall  include,  without
duplication or  limitation,  school taxes,  municipal  taxes and taxes for local
improvements  or works  assessed  against  the  Complex  and any  costs and fees
reasonably incurred by the Landlord in reasonably contesting or negotiating with
the public  authorities as to the same. Taxes shall not include capital taxes or
large corporations taxes or any other taxes based upon or

<PAGE>
                                       6

computed with reference to the Landlord's  paid-up capital or place of business,
income  taxes of the  Landlord to the extent such income taxes are not levied in
lieu of taxes, rates, duties and assessments against the Complex.

      "Tenant" means Mitel Corporation and its successors and permitted assigns.

      "Tenant's Address" means 400 March Road, Ottawa, Ontario,  Canada, K2K 3H4
to the attention of (i) Manager of Facilities  Engineering and Real Estate;  and
(ii) General Counsel.

      "Tenant's Share" means the share allocated or re-allocated by the Landlord
to the Tenant pursuant to section 3.2, and with respect to those component costs
of the Complex  Operating Costs for which no such allocation or re-allocation is
so made by the Landlord, a fraction which has as its numerator the Floor Area of
the Leased Premises and which has as its denominator the Gross Building Area.

      "Term" means ten (10) years, commencing on the Commencement Date.

      "Termination Date" means, the last day of the Term or such earlier date as
this Lease may be terminated pursuant to the provisions hereof.

      "Unavoidable  Delay" means any delay by a party in the  performance of its
obligations  under  this  Lease  caused  in whole or in part by any acts of God,
strikes, lockouts or other industrial disturbances, acts of the Queen's enemies,
sabotage, war, blockades, insurrections, riots, epidemics, washouts, nuclear and
radiation activity or fallout,  arrests,  restraints of rulers and people, civil
disturbances, explosions, breakage of or accident to machinery, 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 herein
enumerated  or  otherwise  not within the control of such party and which by the
exercise of reasonable  foresight of such party,  could not have been prevented,
but lack of funds on the part of such party shall not  constitute an Unavoidable
Delay.  Notwithstanding  the foregoing,  in no event shall the Tenant be excused
from the payment of Rent hereunder by reason of Unavoidable Delay.

                                   ARTICLE 2
                         DEMISE, DELIVERY AND SURRENDER

2.1.  Demise and Leased Premises

      In consideration of the covenants and agreements  hereinafter set out, the
      Landlord hereby leases the Leased  Premises to the Tenant,  to have and to
      hold during the Term upon the  conditions  contained  in this  Lease.  The
      Tenant  covenants to pay Rent and to observe and perform all the covenants
      and provisos to be observed and  performed by the Tenant  pursuant to this
      Lease.  The parties  further  acknowledge  and agree  that,  in respect of
      certain  areas  comprising  the Leased  Premises,  and in  addition to the
      rights of access  otherwise  afforded to the Landlord under the provisions
      of this  Lease,  the  Landlord  reserves  for its  employees,  agents  and
      contractors,  upon reasonable  notice to the Tenant (except in the case of
      emergencies  or urgent  repairs  and/or  maintenance),  a right of passage
      through,  above and below  the  Leased  Premises  for  people,  equipment,
      machinery and  apparatus for the purpose of allowing  access to the Leased
      Premises to  facilitate  the  Landlord's  performance  of its  obligations
      pursuant to this Lease and to maintain, repair,

<PAGE>
                                       7

      clean,  operate and respond to  emergencies  in the Complex.  The Landlord
      shall undertake reasonable efforts to co-operate with any "Risk Work Plan"
      (as  defined in section  14.2)  process of the Tenant  where such  repairs
      and/or maintenance impact on the Tenant's operations.

2.2.  Shared Areas and Facilities

      Subject to section  17.2 and to the  Landlord's  security  procedures  and
      requirements  with respect to the Complex,  the Landlord  hereby grants to
      the Tenant, its employees, contractors, agents, visitors and other persons
      transacting  business  with it,  in  common  with the  Landlord  and other
      occupants  of the Complex  from time to time,  the right to use the Shared
      Areas and Facilities for their intended purpose.

2.3.  Examination of Leased Premises

      The  Tenant  acknowledges  having  examined  the  Complex  and the  Leased
      Premises and accepts  same in their  present  condition.  The Landlord has
      commissioned a Phase II  environmental  site  assessment in respect of the
      Complex for completion  prior to the  Commencement  Date. The Tenant shall
      deliver to the party engaged to carry out such environmental  assessment a
      copy of all other environmental  reports in its possession relating to the
      Complex.   The  Landlord   shall  deliver  to  the  Tenant  prior  to  the
      Commencement  Date a copy of such report,  together with a reliance letter
      from the party  preparing such reporting  confirming that it may be relied
      upon by the Tenant.

      The Tenant confirms that, save as disclosed in the Acquisition  Agreement,
      it has not received notice of any non-compliance with any Applicable Laws,
      Environmental  Law or the  mandatory  recommendations  of  Factory  Mutual
      Global in  relation  to the  Complex  which have not or will not have been
      complied  with  prior  to the  Commencement  Date,  which  work  shall  be
      completed with due diligence at the Tenant's cost.

      The Tenant agrees that there is no promise,  representation or undertaking
      by or binding upon the Landlord with respect to any  environmental  matter
      or any alteration, remodeling or decoration of the Leased Premises or with
      respect  to the  installation  of  equipment  or  fixtures  in the  Leased
      Premises, except as expressly provided in this Lease.

2.4.  Separation of Leased Premises, Condition and Relocation

      The Tenant,  at its sole cost, shall construct  demising walls to separate
      the Leased  Premises from the balance of the Complex to be retained by the
      Landlord for its own use, by erecting walls, partitions and other security
      measures  as  appropriate  and  shall  complete  such  other  work that is
      reasonably  necessary to achieve such purposes.  The Leased Premises shall
      be  separated  to  avoid,   where  feasible,   electrical  and  mechanical
      modifications,  while ensuring direct access to and egress from the Leased
      Premises to the Shared Areas and  Facilities.  As built plans and drawings
      in respect of the  separation of the Leased  Premises shall be prepared by
      the Tenant and submitted to the Landlord within a reasonable  period after
      the Commencement Date. All electrical and mechanical systems in the Leased
      Premises are accepted by the Tenant "as is" and any modifications  thereto
      shall be at the Tenant's sole expense. All such construction of the Tenant
      shall  be

<PAGE>
                                       8

      completed  to the same  standard  as  applicable  to  similar  renovations
      previously effected by the Tenant in the Complex.

2.5.  Installation and Removal of Trade Fixtures

      The Tenant may, with the prior  approval of the Landlord,  which  approval
      not to be  unreasonably  withheld  or  delayed,  install  trade  fixtures,
      including Production Equipment,  of a type usual for the Permitted Use, in
      good and sufficient manner but not so as to damage or impair the structure
      or the heating, ventilating,  air-conditioning (if applicable),  plumbing,
      electrical and mechanical  systems of the Leased  Premises or the Complex.
      The Landlord shall either give its approval or its reasons for denying the
      same within ten (10) business  days of the Tenant's  request for approval.
      Provided  the  Landlord  has  approved  the  installation  of  such  trade
      fixtures,   the  Tenant  shall  arrange,   coordinate  and  supervise  the
      performance  and  completion  of all such work in a diligent  and good and
      workmanlike  manner.  The  total  cost of the  work  shall  be paid by the
      Tenant.  The Tenant shall also  forthwith  reimburse  the Landlord for all
      costs,  expenses and charges incurred by the Landlord with respect to such
      work,  including  without  limitation,  building  system  modification  or
      enhancement costs or engineering review fees, if any.

      On or before the Termination Date, the Tenant shall have the right, if not
      in default beyond the applicable cure period, to remove,  and shall remove
      if  required  by the  Landlord,  all its  trade  fixtures,  furniture  and
      equipment,  making good at the Tenant's  expense any damage caused by such
      removal,  and the Tenant shall vacate and surrender the Leased Premises to
      the  Landlord in the  condition  required  under  Section  7.1. The Tenant
      further  agrees  that all  Leasehold  Improvements,  whether by or for the
      benefit of the Tenant,  shall  immediately upon affixation or installation
      become the  property  of the  Landlord  and shall  remain  upon the Leased
      Premises,  provided  that at the end of the Term,  if so  directed  by the
      Landlord,  the Tenant shall remove such of the Leasehold  Improvements  as
      the Landlord shall have  previously  indicated  require  removal,  and any
      change, alteration, major repair, addition or improvement to the Leasehold
      Improvements made without the consent of the Landlord being required,  and
      such  Production  Equipment,   trade  fixtures  and  ancillary  telephone,
      telegraphic,  electric or other cabling or wiring  installed in the Leased
      Premises  without  the  consent of the  Landlord  being  required,  as the
      Landlord may, in its sole discretion,  require (excluding, for the purpose
      of clarity, the demising walls and other separation, security measures and
      partitioning  work carried out pursuant to section 2.4),  and make good at
      the Tenant's  expense any damage caused by such removal.  The Landlord may
      also elect to require the Tenant to rebuild partitioning at the end of the
      Term in the Office Areas of the Leased  Premises to a partitioned  area to
      open area ratio of 25:75.  All property of the Tenant  remaining  upon the
      Leased  Premises  after the  termination of the tenancy shall be deemed to
      have been  abandoned  by the Tenant in favour of the  Landlord  and may be
      disposed of by the  Landlord at its  discretion  without  prejudice to the
      rights of the  Landlord  to claim  damages  from the Tenant for failure to
      remove the same.  Nothing  herein  prohibits  the Tenant from claiming the
      cost of Leasehold  Improvements  incurred by the Tenant as deductions  for
      income tax purposes.  For the purpose of clarity,  the Tenant acknowledges
      that in respect  of the  removal  of  certain  of its trade  fixtures  and
      Production  Equipment,  it  shall  be  required  to  repair  as set out in
      Schedule "E".

<PAGE>
                                       9

2.6.  Overholding by Tenant

      If the Tenant remains in possession of the Leased  Premises  subsequent to
      the end of the Term  without the  execution  and  delivery of a new lease,
      there  shall be no tacit  renewal,  and the  Tenant  shall be deemed to be
      occupying  the Leased  Premises  as a tenant  from month to month upon the
      same terms and  conditions  as are set forth in this Lease  insofar as the
      same are  applicable to a month to month  tenancy,  subject to Sections 58
      and 59 of the Commercial Tenancies Act. Such month to month tenancy may be
      terminated by either party at any time upon ninety (90) days Notice.

                                   ARTICLE 3
                                     RENTAL

3.1.  Basic Rent

      The Tenant shall pay to the  Landlord as rent for the Leased  Premises the
      Basic Rent in  advance  on the first day of each and every  month from the
      Commencement Date to the Termination Date, and if the Commencement Date or
      the  Termination  Date  are  not  the  first  and  last  days  of a  month
      respectively then the Basic Rent for the first and last months of the Term
      shall be appropriately prorated.

3.2.  Payment of Additional Rent for Complex Operating Costs

      The Tenant shall in addition to the Basic Rent,  pay the Tenant's Share of
      Complex  Operating Costs to the Landlord as Additional Rent throughout the
      Term,  in advance on the first day of each and every month during the Term
      commencing  with the  Commencement  Date, in equal and consequent  monthly
      installments  on account of the Tenant's Share of Complex  Operating Costs
      based upon the Landlord's  estimate of Complex  Operating Costs determined
      in accordance with section 3.3.

3.3.  Annual Estimation of the Complex Operating Costs

      Prior to the  commencement of each Accounting  Period,  the Landlord shall
      estimate the Complex Operating Costs for the next Accounting Period and in
      so doing shall analyze, weight and if necessary, re-allocate the component
      costs of the Complex Operating Costs to ensure an equitable and reasonable
      allocation of such costs and expenses to the various uses and users in the
      Complex.  Such estimates may be adjusted and re-adjusted from time to time
      by the Landlord.  The Tenant shall pay to the Landlord  monthly in advance
      on the first day of each and every  month  during  the Term,  one  twelfth
      (I/12) of the amount of the estimated  annual Complex  Operating Costs, as
      adjusted or re-adjusted, as the case may.

3.4.  Annual  Adjustment of Basic Rent Based Upon the Actual  Complex  Operating
      Costs

      Within  one  hundred  and  eighty  (180)  days  following  the end of each
      Accounting  Period the Landlord shall compute the actual Complex Operating
      Costs for such  Accounting  Period and the Tenant's  Share of the same and
      shall submit a statement to the Tenant disclosing in reasonable detail the
      various components of the same. If the Complex Operating Costs paid by the
      Tenant in respect of such Accounting Period are less than the

<PAGE>
                                       10

      actual Complex  Operating  Costs for such  Accounting  Period,  the Tenant
      shall  pay  the  difference  to the  Landlord  forthwith.  If the  Complex
      Operating Costs comprising the Basic Rent paid by the Tenant in respect of
      such  Accounting  Period are  greater  than the  amount of actual  Complex
      Operating  Costs  for such  Accounting  Period,  the  difference  shall be
      applied  in  payment  of other  amounts  then  owing by the  Tenant to the
      Landlord,  and  the  balance,  if  any,  shall  be  repaid  to the  Tenant
      concurrent with the delivery of such statement.

      The  Landlord  shall  at  the  Tenant's  expense  provide  to  the  Tenant
      reasonable  supporting  documentation  for its  calculation  of the actual
      Complex Operating Costs and the Tenant's Share of the same for the current
      or immediately  preceding  Accounting Period on the written request of the
      Tenant.

3.5.  Rent Covenant

      The Tenant shall pay to the Landlord  without  demand,  in lawful money of
      Canada, at the times provided in this Lease, at the Landlord's  Address or
      at such other place as the Landlord may designate  from time to time,  the
      Basic Rent and Additional Rent,  without any deduction,  set-off,  counter
      claim or  abatement  whatsoever.  All  amounts  payable  under this Lease,
      unless otherwise  provided,  become due with the next installment of Basic
      Rent.  If the Tenant  defaults  in payment  of any sum due  hereunder  the
      Landlord  shall have the same rights and  remedies  upon default as if the
      sum were Rent in arrears.

3.6.  Waiver of Set-Off

      The Tenant  hereby  waives and  renounces  any and all existing and future
      claims,  offsets and  compensation  against  any Basic Rent or  Additional
      Rent, and agrees to pay all Basic Rent and Additional  Rent  regardless of
      any claim,  offset or compensation  which may be asserted by the Tenant or
      on its behalf. The Tenant agrees that the Landlord may at its option apply
      all sums received from the Tenant or due to the Tenant against amounts due
      or  payable  hereunder  as the  Landlord  determines  notwithstanding  any
      instructions or designations to the contrary. No endorsement on any cheque
      or statement in any letter accompanying a cheque shall be deemed an accord
      or satisfaction and the Landlord may accept any payment without  prejudice
      to any rights the Landlord may have at law or under this Lease.

3.7.  Interest on Overdue Rent

      If the  Tenant  fails to pay  within ten (10) days from when due any Basic
      Rent or Additional Rent, the unpaid amount will bear interest from the due
      date to the date of payment at the  Stipulated  Rate of Interest  and such
      interest shall be calculated and payable monthly.

3.8.  Net Lease

      It is the intent of the parties that this Lease be  absolutely  net to the
      Landlord and that the Tenant shall pay all costs and expenses  relating to
      the  Leased  Premises  and the  business  carried  on  therein  except  as
      expressly provided in this Lease. Any amount or obligation herein relating
      to the Leased  Premises which is not expressly  declared to be that of the

<PAGE>
                                       11

      Landlord shall be deemed to be an obligation of the Tenant to be performed
      by or at the Tenant's expense.

                                   ARTICLE 4
                       OTHER AMOUNTS TO BE PAID BY TENANT

4.1.  Business Taxes, GST and Other Taxes

      The Tenant  shall pay every tax and  license fee imposed in respect of all
      business  carried on in the Leased  Premises,  or in respect of the use or
      occupancy  thereof,  and all such  amounts  shall be paid  promptly to the
      authorities responsible for collection.

      If any business  transfer tax,  valued-added  tax,  multi-stage sales tax,
      sales  tax,  goods and  services  tax,  or any like tax is  imposed on the
      Landlord by any  governmental  authority on the Rent or any other payment,
      cost or charge  payable by the Tenant  under this Lease,  the Tenant shall
      pay  directly  or  reimburse  the  Landlord  for the  amount  of such  tax
      forthwith upon demand (or at any time  designated from time to time by the
      Landlord) as Additional Rent.

4.2.  Third Party Services

      The  Tenant  shall  be  solely  responsible  for and  promptly  pay to the
      appropriate  third party all charges for  services  used or consumed in or
      provided to the Leased Premises,  but excluding  services  supplied by the
      Landlord and charged to the Tenant as Rent.  In no event will the Landlord
      be liable to the Tenant in damages or otherwise  for any failure to supply
      any third party  services to the Leased  Premises.  Nothing  herein  shall
      disentitle  the Tenant  from  pursuing  any third  party  supplier of such
      services for any damages suffered as a result of such failure.

4.3.  Additional Services of the Landlord

      The cost of all additional services requested in writing by the Tenant and
      elected by the  Landlord to be  provided to the Tenant by the  Landlord or
      its agents or  contractors  shall be payable  forthwith by the Tenant upon
      demand by the Landlord  together  with the  Landlord's  management  fee in
      respect thereof.

4.4.  Upgrading Building Systems

      The cost to the Landlord of upgrading the building  systems of the Complex
      to service any  extraordinary  requirements of the Tenant shall be payable
      forthwith by the Tenant upon demand by the Landlord, provided the Landlord
      gives the Tenant  prior  Notice of the  necessity  of such upgrade and the
      Landlord's estimate of the cost to the Tenant for such upgrade, whereafter
      the Tenant  shall have the option of reducing its  requirements  or having
      the proposed upgrade proceed.

4.5.  Leased Premises Heating, Ventilating and Air Conditioning Systems

      The  Tenant   covenants   to  operate   the   heating,   ventilating   and
      air-conditioning  systems  serving the Leased  Premises as would a prudent
      owner and to maintain,  repair and

<PAGE>
                                       12

      replace such systems in accordance  with the standards and  specifications
      provided to the business prior to the  Commencement  Date.  Where any such
      heating,  ventilating  and  air-conditioning  systems  shall be damaged or
      destroyed, or in the opinion of the Landlord require repairs,  inspection,
      overhauling  or  replacement,  the  Tenant  shall,  at its  sole  cost and
      expense, commence and carry out any necessary work with reasonable speed.

                                   ARTICLE 5
                              OPERATION OF COMPLEX

5.1.  Utility Services

      The Landlord shall permit the Tenant to connect its  equipment,  machinery
      and trade  fixtures to the utility  services  serving the Complex.  In the
      event  that the  Tenant  overloads  the  capacity  of any of such  utility
      services,  the Tenant shall pay all costs and expenses  resulting from the
      Tenant's  overloading of the said capacity as Additional  Rent. The Tenant
      shall advise the Landlord  within  twenty (20) business days after written
      request therefore of the nature and quantity of all lights,  equipment and
      machines  using  electricity  in the Leased  Premises and shall permit the
      Landlord  or its  authorized  agents to make  periodic  inspection  of all
      facilities using electricity located within the Leased Premises. Where the
      utility  services of the Complex or any part  thereof  shall be damaged or
      destroyed, or in the opinion of the Landlord require repairs,  inspection,
      overhauling or replacement, the Landlord shall commence and carry out such
      necessary work as would a prudent owner with reasonable speed, unless such
      utility  services  are  wholly  within  and  solely  relate to the  Leased
      Premises,  in which case the Tenant  shall,  at its sole cost and expense,
      commence and carry out such  necessary  work as would a prudent owner with
      reasonable  speed.  To the extent such damage or  destruction is caused by
      the act or  omission  of the  Tenant  or  those  for whom  the  Tenant  is
      responsible  in law, the  Landlord's  cost, if any, of such necessary work
      shall be charged to and paid by the Tenant as Additional Rent.

5.2.  Taxes

      Subject to the payment by the Tenant of Rent,  the  Landlord  covenants to
      pay all Taxes on or before  their due date.  The  Landlord  may appeal any
      official  assessment,  any Taxes based on such assessment or the amount of
      the Taxes relating to the Complex.  In connection with any such appeal the
      Landlord may defer payment of any taxes payable by it under the provisions
      of this  Section 5.2 to the extent  permitted  by law  without  penalty or
      interest, and the Tenant shall cooperate with the Landlord and provide the
      Landlord with all relevant information reasonably required by the Landlord
      in connection with any such appeal.

5.3.  Building and Pedestal Signage

      The Tenant shall not paint,  display,  inscribe or place any sign, symbol,
      notice or lettering of any kind  anywhere  outside the Leased  Premises or
      within the Leased,  Premises  so as to be visible  from the outside of the
      Leased Premises  without the prior written consent of the Landlord.  It is
      agreed and understood,  however, that no corporate  identification signage
      will be permitted to be placed on the exterior  facade of either  Phases I
      or III by either the Tenant,  the Landlord or any other occupant or tenant
      of the  Complex  except for

<PAGE>
                                       13

      corporate  identification  signage above the angled  entrances to Phases I
      and III,  respectively.  Any signage  consented to by the  Landlord  shall
      comply with the Landlord's then current policies and procedures  regarding
      signage in the Complex and include only the corporate name,  business name
      or  logo  of  the  Tenant.   The  exact  size,   location   and  style  of
      identification  shall also be subject to the Landlord's prior approval and
      to all  Applicable  Laws and the  obtaining of all  required  consents and
      licenses relating thereto.  Any signage permitted by this section shall be
      promptly  removed  by the  Tenant  at its  sole  cost and  expense  on the
      termination  or  other  expiration  of this  Lease  and the  Tenant  shall
      promptly  make  good  any and all  damage  caused  by  either  or both the
      installation  and removal of such signage.  The Landlord  hereby  confirms
      that it consents to the signage described in Schedule "G".

                                   ARTICLE 6
                             INSURANCE AND INDEMNITY

6.1.  Landlord's Insurance

      The Landlord,  acting  reasonably,  shall carry such  insurance  with such
      deductibles  and  exclusions  as would a prudent owner for the account and
      benefit  of the  Landlord  as the  Landlord  from  time to time  considers
      useful,  expedient or beneficial,  it being agreed and understood  however
      that such insurance shall include, the following:

      6.1.1 insurance  against All Risks of loss or damage  including  sprinkler
            leakage and damage due to flood or earthquake, covering all property
            owned by the Landlord or for which the Landlord is responsible under
            this Lease  relative to the Complex  including  the  buildings,  the
            Common  Facilities and the Leased Premises,  but excluding all trade
            fixtures, furniture and stock-in-trade belonging to the Tenant;

      6.1.2 insurance  against loss of the  Landlord's  gross profits  including
            loss of Basic Rent;

      6.1.3 insurance  against  mechanical  break-down,  explosion,  rupture  or
            failure of  boilers,  pressure  vessels,  heating,  ventilating  and
            air-conditioning  equipment,  electrical  apparatus  and other  like
            apparatus owned by the Landlord;

      6.1.4 comprehensive  general  liability  insurance  with  respect  to  the
            Landlord's  operation of the Complex  covering bodily injury,  death
            and damage to property of others; and

      6.1.5 insurance against any other form or forms of loss which the Landlord
            or any Mortgagee may require from time to time.

      Notwithstanding  any  contribution  by  the  Tenant  to the  Landlord  for
      insurance  premiums as provided in this Lease,  no  insurable  interest is
      conferred upon the Tenant under policies carried by the Landlord,  and the
      Tenant  shall have no right to receive  any  proceeds  of  insurance  from
      policies  carried  by  the  Landlord.  The  Landlord  shall  in no  way be
      accountable  to the Tenant  regarding  the use of any  insurance  proceeds
      arising from any claim,  and the Landlord  shall not be obliged to account
      for such proceeds, nor to apply such proceeds to the repair or restoration
      of that which was insured  except to the extent  provided  herein.  If the
      Tenant desires to receive  indemnity by way of insurance

<PAGE>
                                       14

      for any property, work or thing whatever including Leasehold Improvements,
      the Tenant shall insure same for its own account and shall not look to the
      Landlord for reimbursement or recovery in the event of loss or damage from
      any cause,  whether or not the  Landlord  has insured  same and  recovered
      therefor. All such policies of insurance shall exclude the exercise of any
      claim of the insurers,  whether by subrogation  or otherwise,  against the
      Tenant or those for whom the Tenant is in law responsible.

6.2.  Tenant's Insurance

      The Tenant  shall keep in force  during  the Term at its own  expense  the
      following:

      6.2.1 insurance  against All Risks of loss or damage to Tenant's  property
            and  property  for which  Tenant is  responsible  under this  Lease,
            including   damage  due  to  floods  or  earthquakes  for  the  full
            replacement   value  of  the  equipment,   inventory  and  Leasehold
            Improvements;

      6.2.2 comprehensive  general liability  insurance,  including Tenant's All
            Risk legal liability insurance in respect of the Leased Premises, in
            an amount not less than Ten Million Dollars  ($10,000,000),  or such
            greater  amount as may be  stipulated  by the Landlord  from time to
            time,  in  respect  of  injury  to or death of one or more  than one
            person, and for damage to tangible personal property,  regardless of
            the number of claims arising as a result of any one occurrence;

      6.2.3 insurance  for  boilers,  machinery,  rotating  apparatus,  pressure
            vessels,  electrical apparatus, and production equipment,  tools and
            systems  issued on a broad form basis in an amount not less than the
            full insurable value, calculated on a replacement cost basis without
            deduction for depreciation, covering all objects in or on the Leased
            Premises  insurable  under  this form of  insurance,  and  resulting
            business interruption coverages;

      6.2.4 motor vehicle insurance having third party liability limits not less
            than Five Million Dollars  ($5,000,000)  covering all vehicles owned
            or operated by the Tenant from the Complex;

      6.2.5 insurance  against any acts of  infidelity or sabotage by the Tenant
            or  its  officers,   directors,   employees,   agents,  contractors,
            customers  or  invitees in such forms and with such limits as may be
            requested by the Landlord from time to time; and

      6.2.6 such other insurance as the Landlord or any Mortgagee may reasonably
            require  from  time  to  time  with  respect  to  the  property  and
            operations of the Tenant from the Complex.

      All such policies of insurance  shall be placed with insurers  licensed to
      do  business in Canada or the United  States of America and shall  exclude
      the  exercise  of any  claim  of  the  insurer  or  insurers,  whether  by
      subrogation  or otherwise,  against the Landlord or any Mortgagee or those
      for whom any of them are in law  responsible  and the Tenant shall deliver
      certificates  of insurance to the Landlord  evidencing such coverages in a
      form acceptable to the Landlord on or before the  Commencement  Date. Each
      such policy  shall  include the  Landlord  and any  Mortgagee  of whom the
      Tenant has been given Notice as

<PAGE>
                                       15

      additional  insureds  as their  interests  may appear and shall  contain a
      waiver,  in favour of the  Landlord and any such  Mortgagee  and those for
      whom any of them are in law responsible, of any breach or violation of any
      warranties,  representations,  declarations or conditions contained in the
      policies. All such insurance shall be primary insurance and shall not call
      into  contribution any insurance carried by the Landlord or any Mortgagee.
      All policies of comprehensive  general liability insurance shall contain a
      severability  of interest clause and a  cross-liability  clause as between
      the Tenant,  the  Landlord  and any  Mortgagee  included as an  additional
      insured on such policy.  All policies shall contain a provision  requiring
      that at least  thirty (30) days'  written  notice be given to the Landlord
      and any Mortgagee  included as an  additional  insured as aforesaid by the
      insurer  prior to  cancellation  or expiry,  and the Tenant  shall  obtain
      undertakings from all insurers to that effect. If after three (3) business
      days'  Notice of default to the  Tenant,  the Tenant  fails to perform its
      obligations  pursuant  to this  Section 6.2 the  Landlord  may effect such
      insurance  on behalf of the Tenant,  and any premium  paid by the Landlord
      which is otherwise the  responsibility  of the Tenant  hereunder  shall be
      payable  forthwith by the Tenant upon demand by the Landlord as Additional
      Rent.

6.3.  Premium Increases and Cancellation

      The Tenant shall promptly  comply with all  requirements of the Landlord's
      and Mortgagee's insurance underwriters regarding the use and occupation of
      the Leased  Premises,  and the Tenant shall not do, omit,  or permit to be
      done or omitted  anything  which shall cause any  insurance  premium  with
      respect to the Complex or any part thereof to be  increased,  or which may
      cause any policy of insurance of the Landlord  with respect to the Complex
      to be cancelled.  To the extent anything done or omitted to be done by the
      Tenant  causes any  insurance  premium of the Landlord with respect to the
      Complex to be so increased the Tenant shall pay to the Landlord  forthwith
      upon  demand the amount of such  increase.  If any  insurer  threatens  to
      cancel,  cancels or refuses to renew any insurance  policy of the Landlord
      upon the Complex by reason of the use or occupation of the Leased Premises
      or any part thereof by the Tenant,  the Tenant shall  forthwith  remedy or
      rectify  such use or  occupation  within  the time limit  required  by the
      insurer upon being  requested to do so by Notice by the  Landlord,  and if
      the Tenant  shall fail to do so within a  reasonable  period of time after
      such  Notice,  the Landlord  may at its option,  without  prejudice to any
      other  rights it may have,  terminate  this Lease by Notice to the Tenant.
      Thereupon the Tenant shall pay Basic Rent and Additional Rent owing to the
      date of such  termination and shall  immediately  deliver up possession of
      the Leased Premises to the Landlord,  and, without  prejudice to all other
      rights and remedies available to it for breach of this Lease, the Landlord
      shall have the right to re-enter the Leased Premises.

6.4.  Compliance with Landlord's Insurance Requirements

      In its use and occupation of the Leased  Premises and of the Complex,  the
      Tenant  shall  comply  with  all  fire   protection  and  loss  prevention
      requirements  imposed  by  Factory  Mutual  Global in  respect  of Level I
      Priority  Recommendations,  and in all other cases as negotiated  with the
      Factory  Mutual  Global,  and,  without  limiting  the  generality  of the
      foregoing,   shall   ensure   that  all  of  its   operations,   equipment
      modifications,  equipment  installation,  tools, emergency  organizations,
      fire protection and loss prevention  response team procedures  comply with
      all Factory Mutual Global  standards and  requirements  as

<PAGE>
                                       16

      aforesaid.  The Landlord and the Landlord's underwriter shall consult with
      Tenant in respect of the  negotiation  of  compliance  issues  taking into
      consideration a reasonable cost risk benefit analysis in relation thereto.
      The Tenant  shall  undertake  its best efforts to ensure that the Landlord
      receives the benefit of any "grandfathering"  status presently held by the
      Tenant in respect of  current  exceptions  relevant  to the  Business.  If
      within a reasonable period of time after Notice the Tenant fails to comply
      with the foregoing requirements and standards, the Landlord shall have the
      right, at its option, to implement or enforce necessary  corrections,  and
      the cost thereof  shall be payable  forthwith by the Tenant upon demand by
      the Landlord as Additional Rent.

6.5.  Limitation of Landlord's Liability

      Except to the extent  caused or  contributed  by an act or omission of the
      Landlord or those for whom it is  responsible  in law, the Landlord  shall
      not be liable or responsible in any way for any death or any injury of any
      nature  whatsoever  that may be suffered or sustained by the Tenant or any
      employee,  contractor, agent or customer of the Tenant or any other person
      who may be upon the Leased  Premises,  or for any loss or damage or injury
      to any  property  belonging  to the  Tenant  or its  employees,  agents or
      contractors  or to any other person  while such  property is on the Leased
      Premises. Without limiting the generality of the foregoing,  except to the
      extent  caused or  contributed  by an act or omission  of the  Landlord or
      those for whom it is  responsible in law, the Landlord shall not be liable
      for any damage or damages of any nature  whatsoever to persons or property
      on the Leased Premises caused by explosion,  fire,  theft or breakage,  by
      sprinkler,  drainage  or  plumbing  systems,  by failure  for any cause to
      supply adequate  drainage or snow or ice removal,  by the  interruption of
      any public utility or service,  by steam, gas, water, rain, snow, or other
      substances  leaking,  issuing  or  flowing  into  any  part of the  Leased
      Premises,  or by anything  done or omitted to be done by any other tenant,
      occupant or person in the Complex.  In addition the Landlord  shall not be
      liable for any loss or damage for which the Tenant is  required  to insure
      pursuant to Section 6.2.

      The Landlord shall not be liable for any indirect or consequential  damage
      of any type,  or for damages  for  personal  discomfort  or illness of the
      Tenant,  its  officers,  directors,  employees,   contractors,   invitees,
      clients,  customers or other persons.  The Tenant shall not be entitled to
      any  compensation,  any  diminution  or abatement  of Rent,  any claim for
      constructive  or actual  eviction or any claim of breach of the Landlord's
      covenant of quiet enjoyment by reason of the operation or non-operation of
      any of the equipment or systems  referred to in this Lease,  or by failure
      of the Landlord to provide any of the services  referred to in this Lease,
      or for any act or  omission on the part of any third  parties  employed or
      retained by the Landlord to perform any work or perform any service  under
      this Lease.

6.6.  Indemnity by Tenant

      The Tenant shall indemnify the Landlord against and from all loss,  costs,
      claims,  or demands in respect of any  injury,  loss or damage of the type
      referred to in Section 6.5 or resulting  from a default under Section 6.4,
      to the extent caused by an act or omission of the Tenant or those for whom
      the Tenant is at law  responsible,  and against and from any breach by the
      Tenant of any provision of this Lease.

<PAGE>
                                       17

6.7.  Limitation of Tenant's Liability

      Notwithstanding  anything in this Lease to the contrary,  the Tenant shall
      not be liable for any loss or damage for which the  Landlord is insured or
      required  to be  insured  pursuant  to section  6.1.  The  Landlord  shall
      indemnify  the Tenant  against  and from all  losses,  costs,  claims,  or
      damages in respect of any injury,  loss or damage to the extent  caused by
      an act or omission of the  Landlord or those for whom the  Landlord is law
      responsible, or any breach by the Landlord of any provision of this Lease.

      The Tenant shall not be liable for any indirect or consequential damage of
      any type,  or for  damages  for  personal  discomfort  or  illness  of the
      Landlord,  its  officers,  directors,  employees,  contractors,  invitees,
      clients, customers or other persons.

                                   ARTICLE 7
                             REPAIRS AND ALTERATIONS

7.1.  Tenant's Repairs

      Subject to the Landlord's  obligations pursuant to Section 7.8, throughout
      the Term, the Tenant shall repair,  maintain and keep in proper  operating
      condition,  subject to normal wear and tear, all as would a careful owner,
      the Leased Premises and every part thereof  including  without  limitation
      the Leasehold Improvements,  equipment,  fixtures,  furnishing, all glass,
      every   part   of   the   structural,   heating,   cooling,   ventilating,
      air-conditioning,  plumbing and other mechanical installations serving the
      Leased Premises, whether or not any such items were installed or furnished
      by the Tenant.  It is further agreed and understood  that so long as Mitel
      Corp. is in actual  occupation of not less than eighty-five  percent (85%)
      of the area of the Leased  Premises,  the  Tenant shall in addition to the
      foregoing,  throughout the Term at its sole cost and expense, also repair,
      maintain and keep in proper  operating  condition,  all as would a careful
      owner,  the  structural  components  and roof of those parts of the Leased
      Premises known as Phase III and Block C of Phase I, respectively,  and the
      Landlord shall be relieved of such responsibility pursuant to section 7.8.

7.2.  Tenant to Notify of Defects

      The Tenant shall  promptly  notify the Landlord of any damage to or defect
      in any part of the Leased Premises,  or in any equipment or utility system
      serving the Leased  Premises,  of which the Tenant becomes aware and which
      may  cause or  result  in death or  injury  to any  person  or  damage  to
      property.

7.3.  Tenant Work

      The Tenant shall not, without the Landlord's prior written approval, which
      approval  may not be  unreasonably  withheld  by the  Landlord,  make  any
      change,  alteration,  repair,  addition or improvement in or to the Leased
      Premises which affects in a material way the structure or perimeter walls,
      any  sprinkler  system,   life  safety  equipment  or  systems,   heating,
      ventilating,  and/or air-conditioning  equipment or systems, the plumbing,
      electrical and mechanical  equipment or systems,  the bearing floors,  the
      signage, the ceilings, the columns or the roof. The Tenant shall submit to
      the Landlord adequate

<PAGE>
                                       18

      details of any such proposed work which requires the  Landlord's  approval
      including  drawings  and  specifications  conforming  to good  engineering
      practice  which have been prepared by qualified  engineers and  designers.
      Within  ten (10)  business  days of receipt of the  Tenant's  request  for
      approval,  the  Landlord  shall  either  give its  approval or describe in
      writing with reasonable particularity the reasons for denying the same. At
      the time of granting the approval, the Landlord shall advise the Tenant as
      to whether the Tenant shall be required on the Termination Date, to remove
      such  alterations  and restore  the Leased  Premises  in  accordance  with
      Section 2.5. All work carried out by the Tenant  (whether or not requiring
      the  Landlord's  consent)  shall be carried out in a good and  workmanlike
      manner,  with quality materials and in accordance with all Applicable Laws
      and the drawings and specifications approved by the Landlord, and shall be
      performed by  contractors  and  subcontractors  who have been  approved in
      advance by the Landlord and by competent workers.  The Tenant shall submit
      to the Landlord's  supervision over construction and promptly pay when due
      the  cost of all such  work  and of all  materials,  labour  and  services
      involved  therein.  Upon the  completion  of the work,  the  Tenant  shall
      deliver to the Landlord "as built" CAD drawings with respect to such work.

      The Tenant shall  ensure that its general  contract or takes out and keeps
      in force  contractor's  general  liability  insurance,  all risks property
      insurance   insuring   physical  loss  or  damage  during  the  course  of
      construction,  including  without  limitation,  damage  due  to  flood  or
      earthquakes,  for the full  replacement  value of the work, and boiler and
      pressure  vessel  insurance  issued on a broad form basis in an amount not
      less than replacement value (collectively,  the "Contractor's Insurance").
      The term of each policy of insurance comprising the Contractor's Insurance
      shall be from the date of the commencement of the work until ten (10) days
      after the work has been completed. The Tenant shall during the term of the
      Contractor's  Insurance  monitor the limit of both the all risks  property
      insurance  and  the  boiler  and  pressure   insurance   included  in  the
      Contractor's  Insurance  to include  the cost of changes in the work.  The
      Tenant  shall also  ensure  that the  Landlord  is added as an  additional
      insured to the  Contractor's  Insurance.  Prior to the commencement of any
      such work, the Tenant shall require its general  contractor to provide the
      Landlord  with proof that the  Contractor's  Insurance  is in place and in
      good  standing  and to  promptly  provide  the  Landlord,  on  request,  a
      certified true copy of each insurance  policy  comprising the Contractor's
      Insurance.  If the general  contractor  fails to provide or  maintain  the
      Contractor's  Insurance as required by this  section,  the Landlord  shall
      have the right to provide and maintain such  insurance,  in which case the
      cost thereof shall be payable by the Tenant to the Landlord on demand.  In
      the case of an insured  loss,  any  deductible  amount  payable  under the
      Contractor's  Insurance  and paid or  absorbed  by the  Landlord  shall be
      reimbursed by the Tenant forthwith on demand.

      During the course of  construction,  the  Landlord and its  employees  and
      consultants shall have reasonable access to the Leased Premises to inspect
      and  examine  all work  being  carried  out,  provided  that such right of
      inspection and examination  shall not be exercised in a manner which would
      interfere  with the  construction  and  completion  of such  work.  If the
      Landlord  gives the  Tenant  Notice  that the work  being  carried  out is
      deficient or is otherwise not in compliance with the approved drawings and
      specifications,  which Notice  shall  contain  particulars  of the alleged
      deficiency or non-compliance,  the Tenant shall immediately provide a copy
      of such Notice to the Tenant's architect and shall immediately  attempt to
      cure such  deficiency  or  non-compliance  by  enforcing  its  remedies

<PAGE>
                                       19

      as  appropriate  in accordance  with the  provisions  of the  construction
      contract with its general  contractor or otherwise with the intention that
      such alleged  deficiency  or  non-compliance  be rectified in the shortest
      possible time. The Tenant's  architect  shall promptly notify the Landlord
      whether  or to the  extent  he/she  concurs  with  the  provisions  of the
      Landlord's Notice. Either the Landlord or Tenant may refer the decision of
      the Tenant's Architect to arbitration.

      Within thirty (30) days of substantial completion (as such term in defined
      in the Construction Lien Act, as amended or replaced from time to time) of
      such work,  the Tenant  shall  deliver to the  Landlord  (i) copies of all
      guarantees and warranties provided by any contractors,  subcontractors, or
      material suppliers with respect to the work, and (ii) a certificate issued
      by the Tenant's  Architect  certifying that the work has been completed in
      accordance  with all Applicable  Laws and in accordance  with the approved
      drawings and specifications.  The Tenant agrees to use its best efforts to
      complete  any  incomplete  work  as  noted  in  the  Tenant's  Architect's
      certificate (or as determined by  arbitration)  promptly and in a good and
      workmanlike  manner and agrees to use its best  efforts to cause any noted
      deficiencies or incomplete work to be remedied within a reasonable  period
      given the nature of the deficiency.

      Any dispute  between  Landlord and Tenant  arising under any provisions of
      this Article which cannot be resolved by good faith  negotiations shall be
      determined by arbitration in accordance with the Arbitration  Act, 1991 of
      Ontario, as amended or replaced from time to time.

7.4.  Construction or Mechanic's Lien

      The Tenant shall promptly pay all charges  incurred by or on behalf of the
      Tenant  for any  work,  materials  or  services  which  may give rise to a
      privilege or construction, mechanic's or other lien. If any such privilege
      or lien is registered against the Complex or any part thereof,  the Tenant
      shall cause such privilege or lien to be discharged forthwith,  and if the
      Tenant  fails to do so within ten (10)  business  days of Notice  from the
      Landlord,  then in addition to any other right or remedy of the  Landlord,
      the Landlord may but shall not be obligated to discharge such privilege or
      lien by paying the amount claimed to be due into court. The Landlord shall
      charge to the  Tenant  all  costs  and  expenses,  including  legal  fees,
      incurred by the Landlord in  discharging  the privilege or lien,  and such
      amount  shall be  payable  forthwith  by the  Tenant  upon  demand  by the
      Landlord as Additional Rent.

7.5.  No Interference with Tenant's Operations

      Any work  undertaken  by the Landlord  pursuant to this Article 7 shall be
      carried  out in a good and  workmanlike  manner  at a cost  structure  not
      exceeding the cost structure of comparable  work performed by the Landlord
      for  its  own  purposes,   and  in  such  a  manner  as  to  minimize  any
      interference,  disruption or conflict with any activities of the Tenant in
      the Leased Premises.

7.6.  Installation of Meters

      At the  Tenant's  request and  expense,  the Landlord  shall  install,  at
      locations  appropriate for such purposes,  devices to measure  temperature
      and humidity within the Leased

<PAGE>
                                       20

      Premises,  and separate  meters or sub-meters  for measuring the amount of
      electricity,  water,  chilled  water,  fuel,  gas, steam or other material
      supplied to the Leased Premises.  If as a result of such metering there is
      a  material  discrepancy  between  the actual  consumption  values and the
      values  allocated by the  Landlord to the Tenant as the Tenant's  Share of
      the such  components  of the Complex  Operating  Costs for the  Accounting
      Period in question,  the Landlord shall,  within ninety (90) days thereof,
      adjust the  Tenant's  Share of such  components  of the Complex  Operating
      Costs to reflect such actual consumption values. If the actual consumption
      values  determined by such metering are not material,  the  adjustments to
      reflect  the  metered  data  shall not be made  until the next  Accounting
      Period.

7.7.  Repair Where Tenant at Fault

      If the  Complex  or any part  thereof,  including  the  Shared  Areas  and
      Facilities, require repair or become damaged or destroyed through any act,
      omission,  negligence or carelessness of the Tenant, its servants, agents,
      employees,  contractors,  sublessees,  or licensees,  where such damage or
      destruction  exceeds  $10,000,  the Landlord  shall  effect the  necessary
      alterations,  replacements or repairs and shall charge the Tenant the cost
      thereof,  and such amount  shall be payable  forthwith  by the Tenant upon
      demand by the Landlord as Additional Rent.

7.8.  Repairs by Landlord

      Subject to Section 7.7 and Article 8, the Landlord shall maintain and make
      such repairs and replacements to the Common  Facilities and the structural
      components and roof of the Leased Premises,  as would a prudent owner, and
      the  cost  thereof   shall  be  included  in  Complex   Operating   Costs.
      Notwithstanding  the  foregoing,  so  long as  Mitel  Corp.  is in  actual
      occupation of not less than eighty-five percent (85%) of the area of those
      parts of the  Leased  Premises  known as Phase III and Block C of Phase I,
      respectively,  the Landlord shall be relieved of its obligations hereunder
      with  respect to that part of the Leased  Premises  known as Phase III, it
      being agreed and understood that Mitel Corp. shall assume such obligations
      pursuant to Section 7.1.

7.9.  Door Locks

      If the  Tenant  replaces  any  lock  in the  Leased  Premises  with a high
      security  device,  the Tenant shall on or before the Termination  Date, if
      requested by the  Landlord,  replace such high  security  lock with a lock
      equal in quality and  comparable  in design to the original lock and shall
      surrender  to the  Landlord  all keys,  passcodes  and access codes to the
      Leased Premises and the Complex. The Tenant shall provide keys or passcode
      access to the Landlord  for all areas of the Leased  Premises for purposes
      of emergency maintenance, repair and loss prevention.

<PAGE>
                                       21

                                   ARTICLE 8
                              DAMAGE OR DESTRUCTION

8.1.  Right to Terminate

      If  twenty-five  percent  (25%) or more of the  Floor  Area of the  Leased
      Premises is damaged or  destroyed by any cause  whatsoever,  to the extent
      that in the  opinion  of the  Architect  the  Leased  Premises  cannot  be
      repaired or rebuilt with reasonable diligence within six (6) months of the
      date of the  occurrence of such damage or  destruction,  then either party
      may,  at its  option to be  exercised  by Notice to the other  within  the
      thirty (30) days next following such  occurrence,  elect to terminate this
      Lease. If either or both parties so elect,  the Term of this Lease and the
      tenancy  hereby  created  shall expire by lapse of time upon the thirtieth
      (30th) day after such Notice is given,  and the Tenant shall,  within such
      thirty (30) day period,  vacate the Leased Premises and surrender the same
      to the  Landlord,  failing  which  the  Landlord  shall  have the right to
      re-enter and repossess the Leased Premises discharged of this Lease and to
      remove all persons and property therefrom.  In no event shall the Landlord
      be liable to reimburse the Tenant for damage to or  replacement  or repair
      of  fixtures,   floor   coverings,   furniture,   equipment  or  Leasehold
      Improvements.

8.2.  Repair and Rebuilding

      If neither party elects to terminate  this Lease  pursuant to Section 8.1,
      the  Landlord  shall  proceed to repair or rebuild  the  Complex  with due
      diligence,  including the structural and infrastructural  component of the
      Leased  Premises,  to the  extent  possible  with the  insurance  proceeds
      received by the Landlord from the Landlord's insurers, or which would have
      been  received  had the  Landlord  insured as required  by this Lease.  In
      repairing,  reconstructing,  or rebuilding the Complex or any part thereof
      the Landlord may use designs,  plans, and specifications  other than those
      used in the original construction, and may alter or relocate, or both, any
      or all of the buildings, facilities and improvements, including the Leased
      Premises,  provided that the Leased Premises as altered or relocated shall
      be of  substantially  the  same  size,  and  be in all  material  respects
      reasonably comparable to the Leased Premises as defined herein,  excluding
      only the  Leasehold  Improvements.  Upon its  completion of its repair and
      rebuilding,  the Tenant shall forthwith commence and expeditiously  finish
      the repair and  rebuilding of the interior of the Leased  Premises and the
      Leasehold  Improvements  in accordance with the provisions of Section 7.1.
      All such repair and rebuilding of the interior of the Leased  Premises and
      the Leasehold Improvements shall be at the Tenant's cost.

8.3.  Abatement of Rent

      The Rent  shall  abate  in  proportion  to the  Floor  Area of the  Leased
      Premises rendered  untenantable by the occurrence of damage or destruction
      to the Complex.  The abatement of Rent shall continue until the earlier of
      thirty  (30)  days  following  Notice  to the  Tenant  from  the  Landlord
      confirming  that the Landlord has repaired or rebuilt the Leased  Premises
      to the extent  required,  or the day the  Tenant  opens the  repaired  and
      rebuilt portion of the Leased Premises for business.

<PAGE>
                                       22

8.4.  Certificate of Architect Binding

      The  certificate of the Architect  shall be binding upon the parties as to
      the percentage of the Floor Area of the Leased Premises and the percentage
      of  the  Gross   Building  Area   destroyed  or  damaged,   the  state  of
      tenantability  of the  Leased  Premises,  and  the  date  upon  which  the
      Landlord's reconstruction and repair is substantially completed.

                                   ARTICLE 9
                              LANDLORD'S COVENANTS

9.1.  Landlord's Covenant for Quiet Enjoyment

      The Landlord  hereby  covenants to perform all of the  obligations  of the
      Landlord hereunder and further covenants that if the Tenant pays the Basic
      Rent and Additional Rent and  continuously  and strictly  performs all its
      obligations hereunder,  the Tenant shall and may, subject to the terms and
      conditions of the Lease,  peaceably  possess and enjoy the Leased Premises
      throughout  the Term  without any  interruption  or  disturbance  from the
      Landlord  or any other  person or persons  lawfully  claiming  by, from or
      under the Landlord.

                                   ARTICLE 10
                                TITLE OF COMPLEX

10.1. Subordination

      The Tenant shall promptly upon the written request of the Landlord,  enter
      into an agreement:

      (a)   subordinating the Term and the rights of the Tenant hereunder to any
            Mortgage; and

      (b)   agreeing that the Term hereof shall be subsequent in priority to any
            such Mortgage;

      provided  that the  Tenant's  obligations  under this  paragraph  shall be
      conditional  upon  any  such  Mortgagee  entering  into a  non-disturbance
      agreement with the Tenant under which the Tenant's continued possession of
      the  Leased  Premises  under the terms of this Lease is ensured so long as
      the Tenant is not in default  hereunder  notwithstanding  any act taken by
      the Mortgagee.

10.2. Attornment

      The  rights  of  the  Landlord  under  this  Lease  may  be  hypothecated,
      mortgaged, pledged, ceded, charged, transferred or assigned to a purchaser
      or  Mortgagee.  Upon any request of the  Landlord,  the  Mortgagee  or any
      purchaser,  the  Tenant  shall  attorn to and  become  the  tenant of such
      Mortgagee or such purchaser  (provided the Mortgagee or purchaser,  as the
      case may be,  accepts such  attornment) on the same terms as are contained
      in this Lease.

<PAGE>
                                       23

10.3. Status of Lease Statement

      Upon  any  request  of  either  party,  the  other  party  shall  execute,
      acknowledge and transmit  forthwith to the requesting party a statement in
      writing   certifying  to  the  requesting  party  (and  its  Mortgagee  or
      purchaser,  as  applicable)  that this Lease is in full force and  effect,
      certifying the extent of any prepayment of Basic Rent or Additional  Rent,
      certifying the existence or  non-existence of defaults of which such party
      has actual knowledge,  and certifying any other matters pertaining to this
      Lease  as to  which  the  requesting  party  shall  reasonably  request  a
      certificate.

10.4. Registration of Lease Prohibited

      Each of the  parties  covenants  with the other that it will not  register
      this Lease in this form  against the title to the Lands,  except by way of
      notice or short form of lease,  which  notice or short form of lease shall
      not disclose any  financial  terms of this Lease,  which  financial  terms
      include,  without limiting the generality of the foregoing,  rental rates,
      rent free, rent deferred and rent reduced  periods,  and any other form of
      tenant  inducement.  The Landlord hereby agrees to execute a short form of
      lease which  complies with this  section,  if necessary for the purpose of
      supporting of an application for registration of notice of this Lease.

                                   ARTICLE 11
                             USE OF LEASED PREMISES

11.1. Type of Business Permitted

      The Tenant  covenants not to use or permit the Leased Premises or any part
      thereof to be used for any unlawful purpose,  lodging,  cooking (except in
      the  cafeteria),  sleeping or any other  purpose  other than the Permitted
      Use.

11.2. Compliance With Applicable Laws and Government Requirements

      Subject to the  provisions  of section  11.5,  the Tenant shall at its own
      expense comply with all Applicable  Laws,  including  Environmental  Laws,
      applicable to the Leased Premises and the business conducted therein,  and
      all other present and future  requirements  of all municipal,  provincial,
      federal and other applicable  governmental  authorities  pertaining to the
      Leased Premises or the Tenant's use thereof.

11.3. Waste/Nuisance

      The  Tenant  shall not  commit or permit any waste or injury to the Leased
      Premises including without limitation the Leasehold Improvements and trade
      fixtures  therein.  The Tenant  shall not commit or permit any nuisance in
      the Complex.  The Tenant shall not cause  annoyance to the other occupants
      of the Complex by any means  including  the creation of  objectionable  or
      offensive noises, vibrations or odours and the Landlord shall determine in
      its sole discretion,  acting  reasonably,  whether such annoyance is being
      caused.

<PAGE>
                                       24

11.4. Rules and Regulations

      The Tenant  covenants and agrees that the Rules and  Regulations  shall in
      all  respects be observed  and  performed  by the Tenant,  its  employees,
      contractors and agents and, to the extent the Tenant can require the same,
      by its invitees and others over whom the Tenant can reasonably be expected
      to exercise control.  The Landlord shall have available to it all remedies
      provided in this Lease and all other legal remedies available at law or in
      equity  upon a breach of the  Rules and  Regulations  by the  Tenant.  The
      Landlord may  terminate  this Lease  forthwith  upon such breach if, after
      Notice of such  breach,  the Tenant  fails to remedy or commence to remedy
      such breach within  fifteen (15) days or fails to  diligently  continue to
      rectify  such  breach.  The Tenant  acknowledges  that the Landlord has no
      obligation  and  there  shall  be  no  liability  upon  the  Landlord  for
      non-enforcement  of the  Rules  and  Regulations.  The  current  Rules and
      Regulations are set out in Schedule "D" hereto.

11.5. Environment

      The Tenant's storage, generation, use, handling, manufacture,  processing,
      labelling,  transportation,  treatment,  emission, discharge or release of
      general wastes and Hazardous  Substances in the Leased Premises and in the
      Complex shall be in compliance with  Environmental Law. The Tenant further
      covenants to provide written notification to the Landlord of any Hazardous
      Substance which the Tenant intends to bring into the Complex,  unless such
      Hazardous  Substances  are in use in the  Complex  as at the  Commencement
      Date,  so as to enable the  Landlord to  determine  whether  its  existing
      Environmental  Process Management and Hazardous  Substance Control systems
      are  capable of  accommodating  such  Hazardous  Substance.  A list of the
      Hazardous  Substances  in use in the Complex as at the  Commencement  Date
      shall be provided to the Landlord by the Tenant on the Commencement  Date.
      If the Tenant  wishes to bring into the Complex any  Hazardous  Substances
      which  cannot  safely be  accommodated  by the  Landlord's  then  existing
      Environmental  Process Management and Hazardous Substance Control systems,
      the  Tenant  shall on  Notice  to the  Landlord  confirming  the  Tenant's
      intention to proceed to bring such Hazardous  Substances into the Complex,
      and after such time as the Landlord shall require to implement appropriate
      safety  measures  in  that  regard,  pay all  costs  associated  with  the
      modifications or upgrades required to be made to such systems, and for all
      permits and licenses required to be obtained in that regard.

      The Tenant,  prior to the expiry of the Term, at its expense,  shall cause
      an environmental engineering firm or environmental consultant,  acceptable
      to the Landlord,  which acceptance will not be unreasonably  withheld,  to
      conduct a Phase II Environmental Assessment of the Environment,  excluding
      any location where waste from the Leased  Premises has been  disposed,  to
      determine  whether  there has been any release or  discharge  of Hazardous
      Substances to the Environment during the Term (the "Study"), the scope and
      commencement  date of such Study to be acceptable  to the Landlord,  which
      acceptance will not be unreasonably withheld, and to summarize the results
      of the Study in a report to the Tenant (the  "Report"),  which  report the
      Tenant  shall  disclose to the Landlord at least thirty (30) days prior to
      the expiry of the Term.  The Tenant  shall  undertake  at its expense such
      remedial  work,  if any, in respect of releases or discharges of Hazardous
      Substances to the Environment  identified in the Report as are required to

<PAGE>
                                       25

      bring the Environment into compliance with  Environmental Law so as not to
      give rise to  liability  on the part of the  Landlord  for the  removal or
      remediation  of such Hazardous  Substances or generally for  Environmental
      Losses (the "Remedial Work") provided it is established that the Hazardous
      Substance has been released or discharged by the Tenant.

      To the extent that the Remedial Work, or any portion thereof,  is required
      to be undertaken or completed  after the expiry of the Term,  the Landlord
      shall  ensure  the Tenant is granted a free,  unlimited  and  unrestricted
      right of access to the Complex for the purpose of allowing the Tenant, its
      employees,  agents  and  subcontractors  to  undertake  and  complete  the
      Remedial  Work.  The Tenant shall use  reasonable  efforts to minimize any
      disruption  to the business of the  Landlord or any other  occupant of the
      Complex likely to be caused by the Tenant's  undertaking the Remedial Work
      after the expiry of the Term.

      Notwithstanding  anything to the contrary in this Lease,  Tenant shall not
      be liable for or responsible  for nor liable to pay any costs with respect
      to: (i) Environmental Losses arising from the migration during the Term of
      Hazardous  Substances from another property to the Lands or from the Lands
      to another property (in each case except to the extent the release of such
      Hazardous  Substances  was  caused  by  Tenant);  and the  Landlord  shall
      indemnify and hold harmless the Tenant,  its officers and  directors,  and
      those for whom it is at law  responsible,  from any  claim,  liability  or
      damage arising therefrom.

                                   ARTICLE 12
                           ASSIGNMENT AND SUB-LETTING

12.1. Assignment by Landlord

      To the extent that the  Landlord's  covenants and  obligations  under this
      Lease are  assumed by a  purchaser  or lessee of the  Complex or a portion
      thereof,  or are  assumed by an  assignee  of this  Lease or any  interest
      therein, the Landlord shall without further written agreement be freed and
      relieved of such covenants and obligations.

12.2. Assignment and Subletting by Tenant

      The Tenant  shall not  assign  this Lease nor sublet or part with or share
      the  occupation,  control or possession of the Leased Premises or any part
      thereof without the prior written  consent of the Landlord,  which consent
      may not be unreasonably  withheld.  The Tenant may,  however,  without the
      consent of the Landlord,  assign this Lease or sublet the Leased Premises,
      in whole or in  part,  to any  corporation  which is an  affiliate  of the
      Tenant (such transfer being called an "Excepted  Transfer")  provided that
      as soon  as is  reasonably  practicable  (and in any  event  prior  to the
      effective  date of the  Excepted  Transfer),  the  Tenant  shall  give the
      Landlord  Notice of such Excepted  Transfer and deliver to the Landlord an
      agreement  wherein  such  assignee  or  subtenant,  as the  case  may  be,
      covenants  to the  Landlord  to  perform,  observe and keep each and every
      covenant,  condition and agreement in this Lease on the part of the Tenant
      to be performed,  observed or kept (or in the case of a subletting, to the
      extent the Tenant's  covenants,  conditions and agreements  relate to that
      part of the Leased Premises sublet to the subtenant), and further provided
      the  Tenant  shall,   notwithstanding   such  Excepted

<PAGE>
                                       26

      Transfer,  remain  responsible to the Landlord for the  performance of all
      terms,  covenants,  conditions and  agreements  imposed upon the Tenant by
      this Lease.  If subsequent to an Excepted  Transfer,  such affiliate is no
      longer  affiliated  with the Tenant (unless the shares of such company are
      listed and traded on any  recognized  public stock  exchange or the Tenant
      remains its largest single common shareholder), such event shall be deemed
      to be an assignment  or  subletting of this Lease,  as the case may be, to
      which the  provisions  of  sections  12.2 and 12.3  shall  apply.  For the
      purposes of this Section,  the term "affiliate" or "affiliated" shall have
      the meanings ascribed thereto in the Canada Business  Corporations Act, as
      amended from time to time.

      Provided  further that the Tenant may,  without  consent of the  Landlord,
      enter into a short term  licence of a portion of the Leased  Premises to a
      third party whose presence in the Leased Premises is required to assist in
      the  Tenant's  business  operations  (as for example for system  design or
      consulting  purposes).  In such event,  the Tenant shall give the Landlord
      Notice of such  short  term  licence  and  ensure  that such  third  party
      observes all requirements of this Lease relating to the use and occupation
      of the  Complex,  and  notwithstanding  such  licence,  the  Tenant  shall
      continue to be responsible  for the due and timely  performance in full of
      all of its obligations under this Lease.

12.3. Request to Assign or Sublet

      If the Tenant  requests the  Landlord's  consent to an  assignment of this
      Lease or to a subletting of the whole or any part of the Leased  Premises,
      the  Tenant  shall  submit to the  Landlord  the name and  address  of the
      proposed  assignee  or  subtenant  together  with a copy  of an  offer  or
      agreement  to  assign or sublet or the  sublease  or  assignment  and such
      additional  information as to the nature of its business and its financial
      responsibility  and  standing  (including  financial  statements)  as  the
      Landlord may reasonably require.

12.4. Assignment or Sublet Agreement

      The  Landlord's  consent to any assignment  shall be conditional  upon the
      assignee  entering  into  an  assignment  agreement  in form  and  content
      satisfactory to the Landlord, to perform,  observe and keep each and every
      covenant, condition and' agreement in this Lease on the part of the Tenant
      to be performed,  observed and kept  including the payment of Rent and all
      other sums and payments  agreed to be paid or payable  under this Lease on
      the days and times and in the manner specified.  The Landlord's consent to
      any sublease  shall be  conditional  upon the  subtenant  entering  into a
      consent to sublease  agreement in the form attached as Schedule "F". In no
      event shall any  assignment  or  subletting 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 to be
      performed.

12.5. Changes in Corporate Control

      If the  Tenant  is a private  corporation  whose  shares  and those of its
      parent company are not listed on a recognized public securities  exchange,
      and if for any reason the effective  voting control of such corporation is
      transferred  from the person or persons having  effective  control of such
      corporation at the  Commencement  Date (unless such transfer of control is
      to an affiliated company of the Tenant),  such transfer shall be deemed to
      be an

<PAGE>
                                       27

      assignment of this Lease to which the provisions of sections 12.2 and 12.3
      shall apply (it being agreed and  understood  that if  subsequent  to such
      transfer,  the transferee is no longer affiliated with the Tenant, (unless
      the shares of such  company are listed on a recognized  public  securities
      exchange or the Tenant  remains its largest  single  common  shareholder),
      such event shall be deemed to be an  assignment of this Lease to which the
      provisions of sections 12.2 and 12.3 shall apply.  The Tenant shall advise
      the Landlord in writing  forthwith of any such change in effective  voting
      control and shall make available to the Landlord for  inspection,  copying
      or both, all books and records of the Tenant and affiliated  company which
      alone or with  other  data  show the  person,  persons  or  entity  having
      effective  voting  control  of the  Tenant  and  affiliated  company.  The
      Landlord  may  terminate  this Lease upon thirty (30) days' Notice if such
      books and records are not made available as requested by the Landlord. For
      the purposes of this section,  the term "affiliate" or "affiliated"  shall
      have the meanings  ascribed  thereto in the Canada  Business  Corporations
      Act, as amended from time to time.

                                   ARTICLE 13
                                DEFAULT OF TENANT

13.1. Landlord's Right of Re-Entry

      If the Tenant shall be in default of any of its covenants  hereunder,  the
      Landlord shall give to the Tenant Notice in writing  stating that the said
      default is to be remedied  and that if such default is not remedied by the
      Tenant within fifteen (15) days after the receipt of such Notice,  or such
      longer period as may be reasonably  necessary in view of the nature of the
      default,  the Landlord may, at its option,  either enter into and upon the
      said  Leased  Premises or any part  thereof in the name of the whole,  and
      this Lease shall be terminated; or the Landlord itself may take such steps
      and do or cause to be done such things as may be  necessary  to remedy and
      correct such defaults and may thereupon  charge its total reasonable costs
      and expenses,  including  legal fees,  incurred in respect  thereof to the
      Tenant,  who hereby  covenants  and agrees to pay the same  forthwith  and
      further covenants that any and all such costs and expenses incurred by the
      Landlord and unpaid by the Tenant shall be  recoverable by the Landlord as
      Additional  Rent  as if the  same  were  and in the  same  manner  as Rent
      reserved and in arrears under the terms of this Lease.

13.2. Bankruptcy of Tenant and Other Events of Default

      All arrears of Basic  Rent,  together  with the Basic Rent and  Additional
      Rent for the next ensuing  three (3) months shall  immediately  become due
      and be paid as  accelerated  rent in the same  manner as if it were  Basic
      Rent in arrears in each of the  following  cases:  if any of the  Tenant's
      goods and moveable  effects and chattels on the Leased Premises are seized
      or taken in execution or attachment  by any creditor of the Tenant,  or if
      the Tenant shall make any assignment  for the benefit of creditors,  or if
      the Tenant  makes any bulk sale other than a bulk sale to an  assignee  or
      sublessee pursuant to an assignment or sublease consented to under Article
      12, or if the Tenant becomes bankrupt or insolvent or takes the benefit of
      any statute now or hereafter  in force for bankrupt or insolvent  debtors,
      or if any order is made or  proceedings  taken for the  winding-up  of the
      Tenant or for the termination of its existence,  or if the Leased Premises
      are used by any other

<PAGE>
                                       28

      persons than those entitled to use them under the terns of this Lease,  or
      if a  trustee  or  receiver  or any  person,  firm or  corporation  in any
      capacity  whatsoever takes or obtains  possession or effective  control of
      the assets of the Tenant,  or a  substantial  portion  thereof,  or of the
      conduct  of  the  Tenant's  business,  or a  substantial  portion  thereof
      pursuant  to any  security  or other  agreement  other than  pursuant to a
      permitted  assignment.  In  each  of the  above  cases  the  Landlord  may
      terminate  this Lease by Notice to the Tenant  and may  re-enter  and take
      possession  of the  Leased  Premises  as  though  the  Tenant or any other
      occupant of the Leased  Premises were holding over after the expiration of
      the Term, and any Notices required to be given in such circumstances being
      deemed  to have  been  given  and the  notice  period  prescribed  therein
      expired.

13.3. Excuse of Performance

      Notwithstanding anything contained in this Lease, neither the Landlord nor
      the  Tenant  shall  be  deemed  to be  in  default  with  respect  to  the
      performance  of any of the terms,  covenants and conditions of this Lease,
      except the Tenant's  obligations to pay Basic Rent and Additional Rent, if
      such default is due to Unavoidable Delay.

13.4. Cross - Default

      A default by the Tenant of its  obligations  under any other lease between
      the Tenant and the Landlord  shall  constitute a default  under this Lease
      and any default under this Lease by the Tenant shall  constitute a default
      by the Tenant under such other lease.

                                   ARTICLE 14
                           LANDLORD'S RIGHT OF ACCESS

14.1. Right of Access and Method of Re-Entry

      The Landlord and its  representatives,  employees,  contractors and agents
      who  have  received  prior  security   clearances  and  have  been  issued
      contractor badges shall have the right to enter the Leased Premises during
      the Tenant's normal business hours upon reasonable prior Notice, or at any
      time without notice during an emergency, as determined by the Landlord, to
      examine  the  state  of  the  Leased   Premises   and  of  the   Leasehold
      Improvements,  equipment  and  fixtures  therein,  to make  such  changes,
      repairs, alterations,  improvements,  additions or installations in and to
      the Complex as the Landlord is otherwise entitled or required to carry out
      pursuant to this Lease and to take into the Leased  Premises  all material
      and equipment  required in connection with the foregoing.  The Landlord or
      its  employees,  contractors  or agents  shall have the right to enter the
      Leased Premises in the company of a representative  of the Tenant,  during
      normal  business  hours upon  reasonable  prior  Notice to show the Leased
      Premises to any  prospective  assignee of the Head Lease or Mortgagee.  In
      the case of emergency,  if the Leased  Premises are locked the Landlord or
      its employees, contractors or agents may enter the Leased Premises using a
      master key or passcode, if available, and, in the case of an emergency, by
      force if  necessary  without  liability of any type of the Landlord to the
      Tenant.

<PAGE>
                                       29

14.2. Building Systems

      Where any part of the  building  systems  adjacent to the Leased  Premises
      require maintenance or repair, the Tenant shall on reasonable prior Notice
      permit the Landlord to enter upon the Leased  Premises in the company of a
      representative  of the  Tenant  to do  such  work  as the  Landlord  deems
      necessary.   The  Landlord  shall  undertake  its  reasonable  efforts  to
      co-operate  with the "Risk  Work Plan"  process  of the Tenant  where such
      repairs and/or maintenance may impact on the Tenant's operations.  For the
      purposes of this Section,  "Risk Work Plan" shall mean those  policies and
      procedures  which  the  Tenant  itself  has  in  place  ensuring  that  no
      detrimental impact is made on and protection is given to the manufacturing
      process or other work being carried out in the Leased Premises.

14.3. Obligations of Tenant and Landlord

      No entry under  Article 14 shall  constitute  an eviction of the Tenant in
      whole or in part, and the Basic Rent and  Additional  Rent shall not abate
      while   changes,   repairs,   alterations,   improvements,   additions  or
      installations  in and to the Complex  are being  made.  Nor shall any such
      entry affect the obligations and covenants of the Tenant under this Lease,
      and the Tenant  shall have no claim by reason of loss or  interruption  of
      business.  Nothing  in this  Article  14 shall be deemed or  construed  to
      impose upon the Landlord any obligation,  responsibility  or liability for
      the  care,  maintenance  or  repair of the  Leased  Premises,  or any part
      thereof save as otherwise expressly set out in this Lease.

                                   ARTICLE 15
                           SHARED AREAS AND FACILITIES

15.1. Non-Exclusive Right to Use Shared Areas and Facilities

      Subject to section 17.2 and the other terms and  conditions of this Lease,
      the Tenant, its officers, employees and customers shall have the right, in
      common with others  designated by the Landlord or otherwise  entitled,  to
      use the Shared Areas and Facilities for their proper and intended  purpose
      provided, however, no access shall be permitted to service, janitorial and
      mechanical rooms,  transformer  vaults,  electrical  distribution rooms or
      water  meter  rooms.  The Tenant  acknowledges  that the Shared  Areas and
      Facilities are under the exclusive  control and management of the Landlord
      and that the Tenant is permitted  to use the Shared  Areas and  Facilities
      under an irrevocable  licence. If changes are made to the Shared Areas and
      Facilities  by the  Landlord,  the  Landlord  shall not be  subject to any
      liability  nor shall the Tenant be  entitled  to any  compensation  or any
      diminution or abatement of Rent and such changes shall not be deemed to be
      a constructive or actual  eviction or a breach of the Landlord's  covenant
      for quiet enjoyment, unless such changes represent a material interference
      with the normal business operations of the Tenant at the Leased Premises.

15.2. Alterations to Shared Areas and Facilities

      The Landlord shall have the right at any time from time to time during the
      Term to change, add to, subtract from, rearrange or alter the Shared Areas
      and Facilities and other parts of the Complex  including the Lands and all
      buildings  thereon,  to dedicate  portions of the Lands for  municipal and
      other governmental  purposes and to convey portions of

<PAGE>
                                       30

      the Lands to others for any purposes  whatsoever.  The Landlord  shall use
      its best  efforts not to  materially  interfere  with the normal  business
      operations  of the  Tenant,  but the  Landlord  shall not be liable to the
      Tenant for any interference or  inconvenience  caused by any action of the
      Landlord  under the  provisions  of this  Section 15.2 unless such actions
      represent a material  interference with the normal business  operations of
      the Tenant at the Leased Premises.

                                   ARTICLE 16
                        INTERPRETATION AND MISCELLANEOUS

16.1. No Partnership

      Nothing contained in this Lease or in any acts of the parties hereto shall
      be construed  to create any  relationship  between the parties  other than
      that  of  Landlord,  Tenant  and  Covenantor,  if  any,  or  to  create  a
      relationship  of  partnership  or of joint  venture  between  the  parties
      hereto, or to constitute this Lease as an emphyteutic  lease, or to create
      any right of ownership in the Tenant.

16.2. Agency

      The Tenant  acknowledges  that the  Landlord may perform any or all of the
      Landlord's  obligations or exercise any of the Landlord's rights hereunder
      through or by means of such  manager,  or other  agency or agencies as the
      Landlord may from time to time determine.

16.3. Lease is Entire Agreement

      With the exception of the Acquisition Agreement, this Lease sets forth the
      entire  agreement  between the Tenant and the Landlord with respect to the
      Leased Premises.  Any offer to lease or agreement to lease entered into by
      the  Landlord  and Tenant  prior to the  execution  of this Lease shall be
      deemed to have been merged and extinguished in this Lease. No amendment or
      addition to this Lease will bind the  Landlord  or the Tenant  unless such
      amendment  or  addition  is in writing  and signed by all  parties to this
      Lease.

16.4. Joint and Several Liability

      The  liability  to pay Rent and perform all other  obligations  under this
      Lease of each individual, corporation, partnership or business association
      signing this Lease and of each member of any such  partnership or business
      association,  the  members  of  which  are  by  law  subject  to  personal
      liability, shall be deemed to be joint and several.

16.5. Governing Law

      This Lease shall he construed  and governed by the laws of the Province of
      Ontario and the laws of Canada  applicable  therein,  and for this purpose
      each party  attorns  to the  exclusive  jurisdiction  of the courts of the
      Province of Ontario in respect of any dispute under this Lease.

<PAGE>
                                       31

16.6. Interpretation

      Words  importing  the singular  number shall  include the plural and words
      importing firms and corporations shall include persons. Each obligation of
      the  Tenant in this  Lease,  although  not  expressed  as a  covenant,  is
      considered  to be a covenant  for all  purposes.  The  article and section
      headings  and index of this Lease form no part hereof and are inserted for
      convenience  only.  If any  section,  article,  paragraph,  sub-paragraph,
      clause or sub-clause in this Lease is held invalid or unenforceable by any
      court of competent  jurisdiction,  this Lease shall be  interpreted  as if
      such section, article, paragraph,  sub-paragraph, clause or sub-clause had
      not been a part of this Lease.

16.7. Successors and Assigns

      This Lease  shall be binding  upon,  extend to and enure to the benefit of
      the  Landlord,  Tenant  and  Covenantor,  if any,  and to  each  of  their
      respective, successors and permitted assignees.

16.8. Reasonableness

      Except where specifically provided to the contrary in this Lease:

            (i)   whenever   this  Lease   requires  an  approval,   consent  or
                  authorization by the Landlord or an agent of the Landlord, the
                  approval,  consent or authorization  shall not be unreasonably
                  withheld or delayed;

            (ii)  whenever this Lease  requires a  determination,  estimation or
                  other action or exercise of  discretion  by the Landlord or an
                  agent of the Landlord, the determination,  estimation,  action
                  or  exercise  of  discretion   shall  be  reasonable   and  in
                  accordance  with  any  applicable  professional  practice  and
                  standards; and

            (iii) whenever this Lease  provides for costs,  expenses and fees to
                  be paid by the Tenant,  the costs,  expenses and fees shall be
                  reasonable.

16.9. Counterparts and Facsimile

      This Lease may be executed in any number of  counterparts.  Each  executed
      counterpart   shall  be  deemed  to  be  an  original   and  all  executed
      counterparts  taken together shall  constitute one agreement.  Each of the
      parties  hereto may execute  this Lease by signing  any such  counterpart.
      Each party hereto agrees that a copy of any  signature  page of this Lease
      with a facsimile  form of the  signature of the person or persons  signing
      this Lease on behalf of such party shall constitute all required  evidence
      of the execution and delivery of this Lease by such party.

<PAGE>
                                       32

                                   ARTICLE 17
                               SPECIAL PROVISIONS

17.1. Exercise of Rights by Landlord

      Landlord  shall act  reasonably  and as a prudent owner in exercising  all
      rights and so as not to interfere more than is reasonably  necessary under
      the circumstances with Tenant's use and enjoyment of the Premises.

17.2. Parking

      The Tenant shall have access and use of, in common with other occupants of
      the Complex,  and at no additional cost, 2.48 unreserved  parking spots on
      the  designated  parking areas on the Lands for every 1,000 square feet of
      the Area of the Leased Premises for the use of its employees and visitors.

17.3. Security

      The Tenant shall comply with  security  measures in place for the Complex.
      The Landlord shall consult with the Tenant in the establishment or changes
      to such  requirements for the Leased  Premises,  provided that any special
      requirements of the Landlord or the Tenant shall be at such party's costs.

17.4. Cleaning/Janitorial Services/Garbage Removal

      The  Tenant  shall at its own cost and  expense,  provide  janitorial  and
      garbage removal  services to the Leased Premises as would a prudent owner.
      The  Tenant  shall  ensure  that  materials  subject  to  hazardous  waste
      regulations  or other  Environmental  Laws are  disposed  of by  Tenant at
      Tenant's  expense as required  by such  Environmental  Laws,  and where so
      prohibited, not as part of the regular garbage. The Landlord may from time
      to time  monitor  the  disposal  and  removal  of all  general  waste  and
      Hazardous  Substances.  The Landlord's costs and expenses  associated with
      such  activities  shall be charged to the Tenant as an additional  service
      pursuant to section 4.3.

17.5. Emergency Response Team

      The Landlord and Tenant shall cooperate in the establishment and operation
      of a joint  emergency  response team with the purpose of responding to all
      environmental, health and safety emergencies at the Leased Premises.

      IN WITNESS WHEREOF...

<PAGE>
                                       33

      IN WITNESS WHEREOF the parties hereto have executed this Lease.

DATED this 27th day of March, 2001

                                                MITEL RESEARCH PARK CORPORATION

                                                Per: /s/ Jose Medeiros
                                                    ----------------------------
                                                Name:  Jose Medeiros
                                                Title: Treasurer

                                                Per:
                                                    ----------------------------
                                                Name:
                                                Title:

                                                I/We have the authority to bind
                                                the corporation

DATED this 27th day of March, 2001

                                                MITEL CORPORATION
                                                Per: /s/ Shirley Mears
                                                    ----------------------------
                                                Name:  Shirley Mears
                                                Title: Vice President, Treasurer

                                                I/We have the authority to bind
                                                the corporation

<PAGE>
                                       34

                                 SCHEDULE "A-1"
                                 --------------

                          LEGAL DESCRIPTION OF THE LAND
                          -----------------------------

      PIN 04517-0533 (LT)

      Parcel 8-1, in the  Register  for  Section  4M-280,  being Block 8 on Plan
      4M-280,  save and except Parts 19 and 20 on Plan 4R-11340,  in the City of
      Ottawa, formerly City of Kanata.

      PIN 04517-0535 (LT)

      Parcel 10-1,  in the Register for Section  4M-280,  being Block 10 on Plan
      4M-280,  Subject to Instrument Numbers LT237263,  LT476569 and NS62066, in
      the City of Ottawa, formerly City of Kanata.

      PIN 04517-0537(LT)

      Parcel 12-1,  in the Register for Section  4M-280,  being Block 12 on Plan
      4M-280,  Subject to Instrument Numbers LT237263 and LT476569,  in the City
      of Ottawa, formerly City of Kanata.

      PIN 04517-0560 (LT)

      Parcel 26-1,  in the Register for Section  4M-280,  being Block 26 on Plan
      4M-280,  Subject to Instrument Numbers LT405509,  LT646448, in the City of
      Ottawa, formerly City of Kanata.

      PIN 04517-0561(LT)

      Parcel 27-1,  in the Register for Section  4M-280,  being Block 27 on Plan
      4M-280,  Subject to Instrument Numbers LT405509,  LT646448, in the City of
      Ottawa, formerly City of Kanata.

      PIN 04517-0562 (LT)

      Parcel 28-1,  in the Register for Section  4M-280,  being Block 28 on Plan
      4M-280,  Subject to Instrument Numbers LT405509,  LT646448, in the City of
      Ottawa, formerly City of Kanata.

      PIN 04517-0569 (LT)

      Parcel 33-3, in the Register for Section 4M-280, being Part of Block 33 on
      Plan 4M-280,  being Parts 2 and 17 on Plan 4R-4098,  Subject to Instrument
      Numbers  LT323584 and  LT236161,  in the City of Ottawa,  formerly City of
      Kanata.

      PIN 045717-0574 (LT)

      Parcel 34-3, in the Register for Section  4M-280,  being Part of Block 34,
      Plan 4M-280,  being Parts 1 and 18 on Plan 4R-4098,  Subject to Instrument
      Number LT323584, in the City of Ottawa, formerly City of Kanata.

<PAGE>
                                       35

      PIN 04517-0577 (LT)

      Parcel 35-1,  in the Register for Section  4M-280,  being Block 35 on Plan
      4M-280,  Subject to  Instrument  Number  LT323584,  in the City of Ottawa,
      formerly City of Kanata.

      PIN 04517-0578 (LT)

      Parcel 36-1,  in the Register for Section  4M-280,  being Block 36 on Plan
      4M-280, Subject to Instrument Number LT323584 and LT236161, in the City of
      Ottawa, formerly City of Kanata.

      PIN 04517-0644 (LT)

      Block 9 on Plan 4M-280, Save and Except Parts 1, 2 and 3 on Plan 4R-11713,
      in the City of Ottawa, formerly City of Kanata.

      PIN 04517-0646 (LT)

      Block 11 on Plan 4M-280,  Save and Except Part 4 on Plan 4R-11713,  in the
      City of Ottawa,  formerly City of Kanata. Subject to an Easement in favour
      of Bell  Canada  over  Part 2 on Plan  5R-4290,  as in  Instrument  Number
      NS62066,  subject to an Easement in favour of The  Corporation of the City
      of Nepean, as in Instrument No. LT237263, in the City of Ottawa,  formerly
      City of Kanata.

      PIN 04517-0648 (LT)

      Block 13 on Plan 4M-280, save and Except Part 5 on Plan 4R-11713,  Kanata.
      Subject to an Easement in favour of the Corporation of the City of Kanata,
      as in Instrument Number LT237263, subject to an Easement in favour of Bell
      Canada over Part 6 on Plan 4R-11713, as in Instrument No. LT966819, in the
      City of Ottawa, formerly City of Kanata.

      PIN 04517-0650 (LT)

      Block 14 on Plan 4M-280, Save and Except Part 7 on Plan 4R-11713,  Kanata,
      subject  to an  Easement  in  favour  of Bell  Canada  over Part 9 on Plan
      4R-11713, as in LT966819, in the City of Ottawa, formerly City of Kanata.

      PIN 04517-0652 (LT)

      Part of Block 15 on Plan 4M-280,  being Part 10 on Plan 4R-11713,  Kanata,
      subject to an Easement in favour of the Corporation of the City of Kanata,
      as in Instrument  No.  LT476569,  in the City of Ottawa,  formerly City of
      Kanata.

      PIN 04517-0660 (LT)

      Block 22 on Plan 4M-280, Save and Except Parts 11 and 12 on Plan 4R-11340,
      subject to an Easement in favour of the Corporation of the City of Kanata,
      as in LT236160, in the City of Ottawa_ formerly City of Kanata.

      PIN 04517-0662 (LT)

<PAGE>
                                       36

      Block 23 on Plan 4M-280, Save and Except Parts 13 and 14 on Plan 4R-11340,
      in the City of Ottawa, formerly City of Kanata.

      PIN 04517-0664 (LT)

      Block 24 on Plan 4M-280, Save and Except Parts 15 and 16 on Plan 4R-11340,
      in the City of Ottawa, formerly City of Kanata.

      PIN 04517-0666 (LT)

      Block 25 on Plan 4M-280, Save and Except Parts 17 and 18 on Plan 4R-11340,
      Subject  to an  Easement  in  favour  of Bell  Canada  over Part 6 on Plan
      4R-4626, as in Instrument Number LT405509, in the City of Ottawa, formerly
      City of Kanata.

<PAGE>
                                       37

                                 SCHEDULE "A-2"
                                 --------------

                     LEGAL DESCRIPTION OF THE PHASE V LANDS
                     --------------------------------------

      PIN 04517-0664 (LT)

      Block 24 on Plan  4M-280.  Save and  Except  Parts 15 and 16 on Plan  4R-1
      1340, in the City of Ottawa, formerly City of Kanata.

<PAGE>
                                       38

                                 SCHEDULE "B-1"
                                 --------------

                           SITE PLAN SHOWING THE LANDS
                           ---------------------------

      [2 pages of graphics]

<PAGE>
                                       39

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

                              RULES AND REGULATIONS
                              ---------------------

      1     Animals and Birds

      No animals  (except  seeing eye dogs) or birds shall be kept in the Leased
      Premises.

      2     Care of Interior of Leased Premises

      The Tenant shall keep the interior of the Leased Premises  clean,  orderly
      and tidy. The Tenant shall keep  perishable  items properly  refrigerated.
      The Tenant shall deposit all debris,  trash and recyclables in appropriate
      areas,  at times  and in such  manner  as the  Landlord  shall  reasonably
      designate.

      3     Doors, Windows and Window Coverings

      The  skylights  and windows  that reflect or admit light into any place in
      the  Complex  shall not be covered or  obstructed  by the  Tenant,  and no
      awnings,  curtains or blinds shall be installed  without the prior written
      consent of the Landlord. Windows and doors shall not be left open so as to
      admit  rain or snow or to  interfere  with the  heating  or cooling of the
      Complex.  The  Tenant  shall  not and  shall  not  permit  its  employees,
      contractors,  agents or invitees to throw  anything  out of the windows or
      doors of the Complex or into any passageways,  stairways,  lightwells,  or
      elevator shafts of the Complex.

      4     Loading, Unloading, Delivery of Merchandise

      Deliveries,  shipments  and all loading and  unloading of all items to and
      from the Leased  Premises  shall be made at and from the Tenant's  loading
      bays and in such manner as the Landlord shall reasonably designate.

      5     Obstruction of Plumbing and Washroom Facilities

      The  Tenant  agrees  that  it  will  not  use  or  permit  its  employees,
      contractors, agents or invitees to use the plumbing or washroom facilities
      of the Leased  Premises or the Complex for any purpose other than that for
      which they were constructed.

      6     Overloading of Floors

      The  Tenant  shall not  permit  any  floor of the  Leased  Premises  to be
      overloaded.  All  equipment  and other heavy  objects  liable to injure or
      destroy any part of the Leased  Premises or the Complex  shall be moved at
      such  times,  by such  means and by such  persons  as the  Landlord  shall
      reasonably  direct.  Upon the  termination  of this Lease the Tenant shall
      forthwith inform the Landlord in writing of the combinations of all locks,
      safes and vaults in or on the Leased Premises.

      7     Parking

      The Tenant and all persons  employed by or doing  business with the Tenant
      shall park not more than the number of motor  vehicles  which the Landlord
      has expressly permitted,

<PAGE>
                                       40

      provided  that no person or tenant  shall  have the  exclusive  use of any
      particular  parking  space  and no motor  vehicle  shall be  parked on any
      portion of the Complex which is a loading zone or is not designated by the
      Landlord for parking or where signs are in place  indicating  that parking
      is  prohibited  and the Tenant shall  reimburse the Landlord on demand for
      the cost of removal of any motor  vehicle which is parked in excess of the
      number  expressly  allowed  by the  Landlord,  parked for a period of time
      deemed by the  Landlord to be excessive or parked in breach of this clause
      and  which  belong  to or is parked  by any  person  employed  by or doing
      business with the Tenant.

      8     Radio and Television

      The Tenant shall remove any radio,  television or other similar  device in
      the Leased  Premises if in the  judgment of the  Landlord and in agreement
      with the Tenant such radio, television or other similar device is creating
      a nuisance.  The Tenant shall not in any case erect or cause to be erected
      any aerial  anywhere in the Complex without the express written consent of
      the Landlord.  The Tenant's aerials erected in the Complex in existence on
      the Commencement Date shall be permitted to remain in the Complex provided
      that the Tenant will remove such  aerials and repair any damage  caused by
      the installation or removal thereof as such aerials become obsolete or are
      no longer being used by the Tenant.

      9     Signs, Advertising and Displays

      The Tenant shall not, in or about the Leased Premises  without the written
      consent of the Landlord,  erect  exterior  signs,  install  window or door
      signs,  affix  window or door  lettering,  erect  awnings or  canopies  or
      display  advertising  media or devices  which may be seen or heard outside
      the  Leased  Premises.  The  Tenant  shall  remove  forthwith  all  signs,
      lettering,  awnings, canopies and displays which are found by the Landlord
      to be  objectionable.  The Tenant shall  indemnify  and save  harmless the
      Landlord  from all  claims,  demands,  loss or  damage  to any  person  or
      property arising out of or in any way caused by the erection, maintenance,
      or removal of any sign or other  installation  erected or  installed on or
      about the  exterior of the Leased  Premises.  The Tenant  shall at its own
      expense,  maintain in good condition and repair all such signs, lettering,
      awnings,  canopies  and  displays,  shall keep all  displays and signs lit
      during  reasonable  business  hours and shall  observe and comply with all
      requirements  of  any  competent  authority  regarding  the  erection  and
      maintenance of signs including the payment of licence or other fees.

      10    Temperature and Humidity of Leased Premises

      To the extent that the Tenant may exercise control,  the Tenant shall keep
      the Leased Premises at a temperature sufficient to prevent the freezing of
      pipes in the Leased Premises and the Tenant shall keep the temperature and
      humidity of the Leased  Premises at a reasonable  level.  The Tenant shall
      not vent the Leased  Premises into other enclosed parts of the Complex nor
      appropriate warm or cool air from other enclosed parts of the Complex.

      11    Use of Entrances, Etc.

<PAGE>
                                       41

      The sidewalks,  entrances, lobbies, elevators, stairways and corridors (if
      applicable)  of the Complex  shall not be obstructed by the Tenant or used
      by it for any other  purpose  than for  ingress and egress to and from the
      Leased  Premises  and the Tenant  shall not place or allow to be placed in
      any such areas any waste paper, dust, garbage, refuse or anything whatever
      that shall tend to make such areas appear unclean or untidy.

      12    Wheeled Vehicles

      All wheeled  vehicles  used within the Leased  Premises  shall be equipped
      with  rubber  wheels and rubber  guards so as not to damage the floors and
      walls of the Complex. No motorized vehicles shall be permitted for loading
      or unloading or parking  purposes  within the Leased  Premises  other than
      electrically or propane operated material handling equipment,  except with
      the prior  written  consent of the  Landlord,  and the Tenant shall comply
      with  the  rules  and   regulations  of  any   regulatory   agency  having
      jurisdiction in that regard, in the use, operation and storage of all such
      equipment.

<PAGE>
                                       42

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

          REPAIR OBLIGATIONS IN RESPECT OF THE REMOVAL OF TENANT TRADE
          ------------------------------------------------------------

                  FIXTURES [NTD: TO BE REVIEWED AND CONFIRMED]
                  --------------------------------------------

--------------------------------------------------------------------------------
            Type of infrastructure              Requirement for removal/addition
            affected by tool or
            fixture installation/removal
--------------------------------------------------------------------------------
       1 Consequential interior demolition      Demolition to allow tool removal
         of other areas                         and reinstatement to condition
                                                before addition/removal.
--------------------------------------------------------------------------------
       2 Local supporting infrastructure        Installed for addition, removed
                                                to Lateral Supporting Building
                                                Infrastructure in case of
                                                demolition (per definition of
                                                Production Tool).
--------------------------------------------------------------------------------
       3 Cleanroom wall systems                 Not  required  to  be  replaced
                                                unless   such    condition   is
                                                detrimental to maintaining  the
                                                integrity   of   cleanroom   as
                                                certified or airstream  within,
                                                in  which  case,  patching  the
                                                wall system with a
                                                landlord- approved material
                                                will suffice.
--------------------------------------------------------------------------------
       4 Ceiling systems, including, where      Replacement or infill of system
         applicable,  HEPA filters              with equivalent to system used
                                                adjacent to affected area.
--------------------------------------------------------------------------------
       5 Floor  systems,  including  access     Replacement or infill of system
         floor  systems                         with equivalent to system used
                                                adjacent to affected area.
--------------------------------------------------------------------------------
       6 Building envelope                      Reinstatement to condition
                                                before addition/removal,
                                                including recertification of
                                                envelope where required by
                                                Landlord's underwriter.
--------------------------------------------------------------------------------
       7 Cleanrooms                             Recertification required at
                                                Landlord's discretion where
                                                cleanroom wall / floor / ceiling
                                                breached.
--------------------------------------------------------------------------------

<PAGE>
                                       43

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

                         CONSENT BY LANDLORD TO SUBLEASE
                         -------------------------------

      |_| is the landlord (the "Landlord") of those certain "Leased Premises" as
      defined in section |_| of that  certain  lease  agreement  dated as of |_|
      (the  "Lease"),  made and entered into by and between the Landlord and |_|
      (the "Tenant") which Lease is incorporated  herein by this reference.  The
      Lease  contains a  restriction  against  assignment  or  subletting by the
      Tenant without the Landlord's prior written consent thereto.  The Landlord
      does hereby consent, subject to the following terms and conditions, to the
      proposed offer to sublease  agreement (the  "Sublease") by and between the
      Tenant,  as sublandlord,  to |_| (the  "Subtenant") of that part of Leased
      Premises   comprising   approximately   |_|  (|_|   square  feet  as  more
      particularly  described  in such  Sublease  as the "|_|"  (such part being
      hereinafter  called the "Sublet  Premises"),  a copy of which  Sublease is
      attached  hereto  as  Schedule  "A"  and is  incorporated  herein  by this
      reference.

      1. The Landlord's  consent is expressly  conditional  upon the performance
      and observance by the Tenant of the  covenants,  conditions and agreements
      in the Lease,  and this  consent  shall in no way  affect or  release  the
      Tenant from its  liabilities and  responsibilities  under the terms of the
      Lease.  The Tenant  acknowledges  that,  notwithstanding  the terms of the
      Sublease,  it shall  remain  principally  liable and  responsible  for all
      liabilities and responsibilities of "Tenant" under the Lease.

      2. This consent is given without  prejudice to the Landlord's rights under
      the Lease,  this consent being  limited to the Sublease to the  Subtenant,
      and  shall  not be deemed to be an  authorization  for or  consent  to any
      further or other  assignment  or  subletting  or  parting  with or sharing
      possession  of all or  any  part  of the  Leased  Premises  or the  Sublet
      Premises.

      3. The Landlord  joins in this consent solely to grant its consent and, by
      doing so, the Landlord does not thereby:

      (a) make any representations or warranties; or

      (b)  acknowledge or approve of any of the terms of the Sublease as between
      the Tenant, as sublandlord, and the Subtenant.

      Further,  nothing  contained  in the  Sublease  or this  consent  shall be
      construed  as  modifying,  waiving  or  affecting  any of the  provisions,
      covenants and conditions or any of the Landlord's rights or remedies under
      the Lease.

      4. In consideration of the Landlord's consent to the Sublease,  the Tenant
      and Subtenant agree as follows:

      (a) The  Subtenant  covenants  that the  Sublease  shall be subject to and
      subordinate  to the  Lease  and  further  covenants  and  agrees  that the
      Subtenant will observe,  comply with and perform all terms, conditions and
      covenants  in the  Lease  and  to  perform  all  obligations  of any  kind
      whatsoever of the "Tenant" under the Lease as and when the same are due to
      be performed by the Tenant pursuant to the terms of the Lease and to be

<PAGE>
                                       44

      subject to all of the Landlord's  rights thereunder during the entire term
      of the  Sublease,  as though the Subtenant  was named  "Tenant"  under the
      Lease,  to  the  extent  that  such  covenants,   obligations,  terms  and
      conditions  relate to that  portion of the Leased  Premises  sublet to the
      Subtenant under the Sublease. The Subtenant further expressly acknowledges
      and  agrees  to be  subject  to  the  prohibition  in  the  Lease  against
      subletting,   assigning,  mortgaging  or  encumbering  or  permitting  the
      occupation or use of all or part of the Leased Premises by others.

      (b) The Tenant and  Subtenant  each  represent  and warrant that they have
      dealt with no broker, finder, agent or other person in connection with the
      Sublease  other than |_| (the  "Broker"),  and they agree to indemnify and
      hold the Landlord harmless from and against any claims or causes of action
      for a commission or other form of  compensation  arising from the Sublease
      or the  Lease,  whether  advanced  by the  Broker or any  other  person or
      entity.  The provisions of this paragraph shall survive the termination of
      the Lease,  the Sublease and any renewal or extension of either or both of
      them.

      (c) The  Subtenant  waives  any rights it may have as  under-lessee  under
      section 21 of the Commercial Tenancies-Act, R.S.O. 1990 c. L.7, as amended
      or replaced from time to time (the "Act"), or any like rights under common
      law. For the purpose of clarity, the Subtenant agrees that notwithstanding
      the Landlord has consented to the Sublease,  the Subtenant shall not claim
      or  apply  for an  order  vesting  the term of the  Sublease,  the  Leased
      Premises,  or any  part  thereof,  in the  Subtenant,  upon  the  Landlord
      re-entering the Leased Premises or forfeiting the Lease.

      (d) The  Subtenant  waives  any rights it may have as  under-tenant  under
      subsection  32(2) of the Act or any like rights  under common law. For the
      purpose of clarity, the Subtenant agrees that notwithstanding the Landlord
      has consented to the Sublease,  if the Landlord  distrains or threatens to
      distrain  any  goods or  chattels  situate  on the  Sublet  Premises,  the
      Subtenant  shall not seek to protect  such  chattels  from the  Landlord's
      distress as contemplated by subsection 32 (2) of the Act.

      (e) The Subtenant  waives any rights it may have under subsection 39(2) of
      the Act, or any like rights  under common law. For the purpose of clarity,
      the Subtenant  agrees that  notwithstanding  the Landlord has consented to
      the Sublease,  if a receiving order in bankruptcy,  or a winding-up  order
      has been made  against  the Tenant,  the  Subtenant  hereby  agrees not to
      exercise its election as  under-lessee  to stand in the same position with
      the Landlord as though the Subtenant were a direct lessee of the Landlord.

      5. The Tenant and Subtenant  jointly and severally  acknowledge that there
      are no covenants,  representations,  warranties,  agreements or conditions
      expressed or implied,  collateral  or otherwise  foaming part of or in any
      way affecting or relating to the  Landlord's  consent to the Sublease save
      as expressly  set out herein and that this consent  agreement  constitutes
      the entire agreement between the Landlord and the Subtenant and may not be
      modified  except by  subsequent  agreement  in writing and executed by the
      Landlord, the Tenant and the Subtenant.

<PAGE>
                                       45

      IN WITNESS WHEREOF the undersigned have executed this consent as of |_|.

      SIGNED, SEALED AND DELIVERED

      In the presence of

      SIGNED, SEALED AND DELIVERED

      In the presence of

                                                    |_| [Landlord]

                                                    Per: _______________________
                                                    Name:
                                                    Title:

                                                    |_| [Tenant]

                                                    Per: _______________________
                                                    Name:
                                                    Title:

                                                    |_| [Subtenant]

                                                    Per: _______________________
                                                    Name:
                                                    Title:
<PAGE>
                                       46

                                  SCHEDULE "G"
                                  ------------

                                 TENANT SIGNAGE
                                 --------------

      The Tenant shall be entitled to have curb signage  rights on all monuments
      leading to the Leased Premises. The Tenant shall also be entitled to mount
      an illuminated  sign above the angled  entrance to that part of the Leased
      Premises  known as Phase  III and a  directional  sign  over the Phase III
      shipping and receiving area.EXHIBIT 4.2

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

                             PHASE V LEASE AGREEMENT

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

DATE:                      MARCH 27, 2001

LANDLORD:                  MITEL RESEARCH PARK CORPORATION

TENANT:                    MITEL CORPORATION

PREMISES:                  PHASE V, 400 MARCH ROAD, OTTAWA, ONTARIO

<PAGE>

                                      INDEX

<TABLE>
<CAPTION>
<S>     <C>                                                                                                      <C>
ARTICLE 1 DEFINITIONS.............................................................................................1

ARTICLE 2 DEMISE, DELIVERY AND SURRENDER..........................................................................7
     2.1          Demise and Leased Premises......................................................................7
     2.2          Shared Areas and Facilities.....................................................................7
     2.3          Examination of Leased Premises..................................................................7
     2.4          Measurement of the Leased Premises..............................................................8
     2.5          Installation and Removal of Trade Fixtures......................................................8
     2.6          Overholding by Tenant...........................................................................9

ARTICLE 3 RENTAL .................................................................................................9
     3.1          Basic Rent......................................................................................9
     3.2          Payment of Additional Rent for Complex Operating Costs..........................................9
     3.3          Annual Estimation of the Complex Operating Costs...............................................10
     3.4          Annual Adjustment of Basic Rent Based Upon the Actual Complex Operating Costs..................10
     3.5          Rent Covenant..................................................................................10
     3.6          Waiver of Set-Off..............................................................................11
     3.7          Interest on Overdue Rent.......................................................................11
     3.8          Net Lease......................................................................................11

ARTICLE 4 OTHER AMOUNTS TO BE PAID BY TENANT.....................................................................11
     4.1          Business Taxes, GST and Other Taxes............................................................11
     4.2          Third Party Services...........................................................................11
     4.3          Additional Services of the Landlord............................................................12
     4.4          Upgrading Building Systems.....................................................................12
     4.5          Leased Premises Heating, Ventilating and Air Conditioning Systems..............................12

ARTICLE 5 OPERATION OF COMPLEX...................................................................................12
     5.1          Utility Services...............................................................................12
     5.2          Taxes..........................................................................................13
     5.3          Building and Pedestal Signage..................................................................13

ARTICLE 6 INSURANCE AND INDEMNITY................................................................................13
     6.1          Landlord's Insurance...........................................................................13
     6.2          Tenant's Insurance.............................................................................14
     6.3          Premium Increases and Cancellation.............................................................15
     6.4          Compliance with Landlord's Insurance Requirements..............................................16
     6.5          Limitation of Landlord's Liability.............................................................16
     6.6          Indemnity by Tenant............................................................................17
     6.7          Limitation of Tenant's Liability...............................................................17

ARTICLE 7 REPAIRS AND ALTERATIONS................................................................................17
     7.1          Tenant's Repairs...............................................................................17
     7.2          Tenant to Notify of Defects....................................................................18
     7.3          Tenant Work....................................................................................18
     7.4          Construction or Mechanic's Lien................................................................19
     7.5          No Interference with Tenant's Operations.......................................................20
     7.6          Installation of Meters.........................................................................20
     7.7          Repair Where Tenant at Fault...................................................................20
     7.8          Repairs by Landlord............................................................................20
     7.9          Door Locks.....................................................................................21
</TABLE>

                                      -i-
<PAGE>

<TABLE>
<CAPTION>
<S>     <C>                                                                                                      <C>
ARTICLE 8 DAMAGE OR DESTRUCTION..................................................................................21
     8.1          Right to Terminate.............................................................................21
     8.2          Repair and Rebuilding..........................................................................21
     8.3          Abatement of Rent..............................................................................22
     8.4          Certificate of Architect Binding...............................................................22

ARTICLE 9 LANDLORD'S COVENANTS...................................................................................22
     9.1          Landlord's Covenant for Quiet Enjoyment........................................................22

ARTICLE 10 TITLE OF COMPLEX......................................................................................22
     10.1         Subordination..................................................................................22
     10.2         Attornment.....................................................................................23
     10.3         Status of Lease Statement......................................................................23
     10.4         Registration of Lease Prohibited...............................................................23

ARTICLE 11 USE OF LEASED PREMISES................................................................................23
     11.1         Type of Business Permitted.....................................................................23
     11.2         Compliance With Applicable Laws and Government Requirements....................................23
     11.3         Waste/Nuisance.................................................................................24
     11.4         Rules and Regulations..........................................................................24
     11.5         Environment....................................................................................24

ARTICLE 12 ASSIGNMENT AND SUB-LETTING............................................................................25
     12.1         Assignment by Landlord.........................................................................25
     12.2         Assignment and Subletting by Tenant............................................................25
     12.3         Request to Assign..............................................................................26
     12.4         Assignment Agreement...........................................................................26
     12.5         Changes in Corporate Control...................................................................27

ARTICLE 13 DEFAULT OF TENANT.....................................................................................27
     13.1         Landlord's Right of Re-Entry...................................................................27
     13.2         Bankruptcy of Tenant and Other Events of Default...............................................27
     13.3         Excuse of Performance..........................................................................28
     13.4         Cross - Default................................................................................28

ARTICLE 14 LANDLORD'S RIGHT OF ACCESS............................................................................28
     14.1         Right of Access and Method of Re-Entry.........................................................28
     14.2         Building Systems...............................................................................29
     14.3         Obligations of Tenant and Landlord.............................................................29

ARTICLE 15 SHARED AREAS AND FACILITIES...........................................................................29
     15.1         Non-Exclusive Right to Use Shared Areas and Facilities.........................................29
     15.2         Alterations to Shared Areas and Facilities.....................................................30

ARTICLE 16 INTERPRETATION AND MISCELLANEOUS......................................................................30
     16.1         No Partnership.................................................................................30
     16.2         Agency.........................................................................................30
     16.3         Lease is Entire Agreement......................................................................30
     16.4         Joint and Several Liability....................................................................30
     16.5         Governing Law..................................................................................31
     16.6         Interpretation.................................................................................31
     16.7         Successors and Assigns.........................................................................31
     16.8         Reasonableness.................................................................................31
     16.9         Counterparts and Facsimile.....................................................................31
</TABLE>

                                      -ii-
<PAGE>

<TABLE>
<CAPTION>
<S>     <C>                                                                                                      <C>
ARTICLE 17 SPECIAL PROVISIONS....................................................................................32
     17.1         Exercise of Rights by Landlord.................................................................32
     17.2         Parking........................................................................................32
     17.3         Security.......................................................................................32
     17.4         Cleaning/Janitorial Services/Garbage Removal...................................................32
     17.5         Emergency Response Team........................................................................32

ARTICLE 18 CONSTRUCTION..........................................................................................32
     18.1         Construction Obligations of the Tenant.........................................................32

ARTICLE 19 IMPROVEMENT ALLOWANCE.................................................................................35
     19.1         Improvement Allowance..........................................................................35
     19.2         Option to Purchase.............................................................................36

SCHEDULE "A-1" LEGAL DESCRIPTION OF THE LAND.....................................................................40

SCHEDULE "A-2" LEGAL DESCRIPTION OF THE PHASE V LANDS............................................................43

SCHEDULE "B-1" SITE PLAN SHOWING THE LANDS.......................................................................44

SCHEDULE "B-2" SITE PLAN SHOWING THE PHASE V LANDS...............................................................45

SCHEDULE "C" LEASED PREMISES SHOWN IN HEAVY BLACK OUTLINE........................................................46

SCHEDULE "D" RULES AND REGULATIONS...............................................................................47

SCHEDULE "E" METHODOLOGY TO DETERMINE ADJUSTMENTS TO THE BASIC RENT RATE.........................................50

SCHEDULE "F" CONSENT BY LANDLORD TO SUBLEASE.....................................................................51

SCHEDULE "G" TENANT SIGNAGE......................................................................................54

Form 6...........................................................................................................55

ACKNOWLEDGEMENT OF RENT COMMENCEMENT DATE AND BASIC RENT PAYABLE.................................................56
</TABLE>

                                     -iii-
<PAGE>

         THIS LEASE made the 27th day of March, 2001

BETWEEN:

                         MITEL RESEARCH PARK CORPORATION
                      (hereinafter called the " Landlord ")

AND:

                                MITEL CORPORATION
                        (hereinafter called the "Tenant")

WHEREAS:

A.    The parties have entered into an Acquisition Agreement which contemplates
      this Lease.

      NOW THEREFORE this indenture witnesses that for good and valuable
consideration, the receipt and sufficiency of which is expressly acknowledged,
the parties covenant and agree as follows:

                                   ARTICLE 1
                                   DEFINITIONS

1.1   In this Lease,

"Accounting Period" means the twelve (12) month accounting period adopted by the
Landlord from time to time for the Complex which is as of the date of this Lease
based on a calendar year.

"Acquisition  Agreement"  means the  Acquisition  Agreement  between the Tenant,
3755461 Canada Inc. and Dr. Terence H. Matthews made as of January 2, 2001.

"Additional Rent" means all amounts payable by the Tenant under this Lease other
than Basic Rent, whether or not characterised as rent under this Lease.

"Amortization" means, for each Accounting Period, the annual amortization of the
Landlord's  capitalized cost of replacements and repairs to the Complex (in each
case over such asset,  repair or replacement's (as the case may be) useful life)
which are not expensed  during such  Accounting  Period in accordance  generally
accepted accounting principles, together with simple interest on the unamortized
portion of such  costs,  such  interest  to be  calculated  each month at a rate
consistent with the Landlord's standard amortization practices.

"Applicable Laws" means all statutes, laws, by-laws, regulations, ordinances and
requirements having the force of law of governmental or other public authorities
having jurisdiction over the Complex, and all amendments thereto at any time and
from time to time in force which are applicable in the circumstances.

"Architect" means an independent, duly qualified architect named by the Landlord
from time to time under the provisions of this Lease.

<PAGE>

"Area of the Leased  Premises"  means the rentable  area of the Leased  Premises
measured  in  accordance  with the BOMA  Standard of  Measurement  (ANSI Z65.1 -
1996).

"Basic Rent" means for each Accounting  Period during the Term, the sum total of
the Rental Rate multiplied by the Area of the Leased Premises.

"Business"  shall have the same  meaning  as in the  Acquisition  Agreement  but
restricted to the activities carried on, in or about the Complex;

"Commencement Date" means March 27, 2001.

"Common  Facilities"  means  those  parts  of  the  Complex  together  with  all
facilities  from time to time provided by the Landlord near the Complex to serve
the occupants of the Complex,  including as applicable,  without limitation, the
Shared Areas and Facilities,  exterior weather walls and facade, roofs, exterior
and interior  structural  elements and bearing  walls of the Complex,  music and
public address systems, first aid stations,  property management offices related
to the Complex, fire prevention and fire detection systems,  plumbing,  heating,
ventilation,   humidification,   air-conditioning  and  drainage  equipment  and
installations,  fountains,  furniture,  furnishings,  directory boards,  general
signs  including pylon signs,  maintenance  equipment,  service,  janitorial and
mechanical rooms,  transformer vaults,  electrical  distribution rooms and water
meter rooms.

"Completion" or "Completed"  means when the construction of the Phase V Work has
been  completed,  as such term is  defined  in the  Construction  Lien  Act,  as
amended.

"Complex" means the Lands,  the integrated  buildings and  improvements  erected
thereon and the Common  Facilities,  as may be varied from time to time, located
at municipal  address 340, 350 and 360 Leggett  Drive,  and 400 March Road,  are
being in the City of Ottawa (formerly Kanata), Ontario.

"Complex  Operating Costs" means, for each Accounting  Period, the total cost to
the Landlord,  calculated  in  accordance  with  generally  accepted  accounting
principles for operating and insuring the Complex,  and maintaining , repairing,
replacing, refurbishing and furnishing the Common Facilities for such Accounting
Period,  including the  Amortization  of costs and expenses of a capital nature,
costs of electricity,  fuel, gas, steam, water,  sewage, and other utility costs
and  consumptions  for the  Complex,  but  excluding  all costs with  respect to
Leasable  Areas of the  Complex  of a  character  for which the Tenant is billed
directly  for the  Leased  Premises  (such as, by way of  example,  but  without
limiting the generality of the foregoing,  costs charged  directly to the Tenant
(rather  than being  included  in Complex  Operating  Costs and payable as Basic
Rent)  pursuant to sections  4.3  (Additional  Services  of the  Landlord),  4.4
(Upgrading Building Systems),  5.1 (Utility Services) and 6.3 (Premium Increases
and Cancellation). Complex Operating Costs shall include, without duplication or
limitation,  the  Landlord's  costs for Taxes  assessed  against the Complex and
contract administration costs incurred in connection with the Complex,  building
management fees or an  administrative  fee (not exceeding the going rate charged
by trust  companies or first class  building  management  companies for building
management  in the City of Ottawa for  similar  buildings);  the cost of service
contracts with  independent  contractors and the Landlord's  costs for cleaning,
painting,  controlling pests,

                                      -2-
<PAGE>

supervising,   policing,   gardening,   landscaping,   striping,  snow  removal,
electricity,  water,  heating,  ventilation,  humidification,  air conditioning,
materials,  supplies,  equipment rental,  wages,  salaries and benefits paid and
provided  for  employees  to the  extent  they are  directly  involved  with the
maintenance,  operation  and  repair  of  the  Common  Facilities,  maintenance,
repairs,  replacements,  and all other  expenditures  of a nature required to be
made by a prudent owner.  Complex  Operating Costs shall exclude fees,  costs or
commissions  incurred  in  leasing  the  Complex  and the  cost  of  installing,
operating and  maintaining  any specialty  service for which the Tenant does not
enjoy equal benefit with the other  occupants of the Complex,  such as by way of
example, a daycare, athletic or recreation club.

"Date of Substantial  Completion"  means the date when the Leased  Premises have
been Substantially  Completed as evidenced by the Tenant's Architect  delivering
to the Landlord a certificate of the Tenant's  Architect  certifying  same or as
determined by arbitration.

"Environment"  means all, or any part, of the air,  water and soils in or on the
Complex.  "Environmental  Law"  has  the  meaning  set  out in  the  Acquisition
Agreement.

"Environmental  Losses"  means all fines,  penalties,  costs,  losses,  damages,
expenses  or  liabilities  (including  reasonable  legal and other  professional
expenses) resulting from any failure to comply with any Environmental Law.

"Expiry Date" means the last day of the Term.

"Gross Building Area" means the aggregate area of all floors of all buildings in
the Complex  (excluding for this purpose the building on the Phase V Lands until
the Rent  Commencement  Date) as measured  by the  Landlord  using its  standard
measurement methodology, which area is as at the Commencement Date, comprised of
approximately  624,035 square feet,  subject to adjustment based on increases or
decreases in the areas of the buildings comprising the Complex.

"Hazardous  Substance"  means any  material  or  substance  that may  impair the
quality of the Environment  and as to which  liabilities or standards of conduct
are imposed pursuant to Environmental Laws,  including any material or substance
that is deemed pursuant to any  Environmental  Law to be  "hazardous",  "toxic",
"deleterious",   "caustic",   "dangerous",   a  "contaminant",   a  "pollutant",
"dangerous", "toxic", a "hazardous waste", or a "source of contamination".

"Lands" means the lands more particularly  described in Schedule "A-1" and shown
in heavy black outline on Schedule "B-1", together with any additions thereto or
subtractions therefrom as may be designated from time to time by the Landlord in
its sole  discretion  for use in  connection  with the  Complex.  If at any time
during the Term, the Landlord sells, transfers or otherwise assigns its interest
in the Phase V Lands,  or if the Mortgagee  enforces its Mortgage and forecloses
the  Landlord's  interest in the Phase V Lands or sells,  transfers or otherwise
assigns  its  interest  in the Phase V Lands,  "Lands" as defined  herein  shall
thereafter be deemed to be limited to the Phase V Lands, to the exclusion of all
other lands.

"Landlord" means Mitel Research Park  Corporation and its respective  successors
and assigns.

                                      -3-
<PAGE>

"Landlord's  Address"  means 555  Leggett  Drive,  Tower B, Suite  530,  Ottawa,
Ontario, Canada, K2K 2Y3, to the attention of: Treasurer.

"Lease"  means this lease as from time to time  amended in writing and  includes
all schedules hereto.

"Leasable  Areas of the Complex" means that part of the Complex not forming part
of the Common Facilities.

"Leasehold Improvements" means all improvements,  installations, alterations and
additions  made from time to time from and after the Rent  Commencement  Date to
the Leased Premises,  including without limitation, all fixed partitions,  light
fixtures,  and all items which cannot be removed without  material damage to the
Leased Premises, and including trade fixtures installed by or for the benefit of
the Tenant.

"Leased  Premises"  means those  premises  forming  part of the  Complex,  which
premises are shown in heavy black outline on Schedule "C" hereto.

"Methodology"  means the agreed methodology for adjusting the Basic Rent, a copy
of which methodology is attached as Schedule "E".

"Mortgage" means any mortgage,  hypothec,  charge (including a deed of trust and
mortgage  securing  bonds  and  all  indentures   supplemental  thereto),   lien
(resulting  from any other  method of  financing  or  refinancing),  or  blanket
mortgage  (affecting  the Complex as well as other  property)  now or  hereafter
secured  upon the Lands and the  Complex or any part  thereof and  includes  all
renewals, modifications, consolidations, replacements and extensions thereof.

"Mortgagee" means the holder of any Mortgage.

"Notice" means any notice,  statement or request herein required or permitted to
be given by either  party to the other  pursuant  to this  Lease and shall be in
writing and, if to the  Landlord,  addressed  to the Landlord at the  Landlord's
Address and, if to the Tenant,  addressed to the Tenant at the Tenant's Address.
Each  notice  shall  be  either  hand  delivered,  sent by  confirmed  facsimile
transmission,  or mailed by registered post (return  receipt  requested) and the
date of  receipt  of such  notice  shall be  deemed  to be the date of such hand
delivery,  the next business day if sent by confirmed facsimile  transmission or
the day of return receipt.

"Option"  shall have the meaning  described to this term in section 19.2 of this
Lease.

"Permitted Use" means the use of the Leased  Premises,  only for the purposes of
offices and related  uses to carry on the  Business  in  substantially  the same
manner as that carried on by the Tenant  immediately  prior to the  Commencement
Date.

"Phase V Mortgage  Financing" means the mortgage  financing of the Phase V Lands
to be on terms no less  favourable  to the Landlord as would prevail in an arm's
length mortgage transaction.

                                      -4-
<PAGE>

"Phase V Lands" means the Lands more  particularly  described in Schedule  "A-2"
and shown in heavy outline on Schedule "B-2" together with any additions thereto
or subtractions therefrom as may be designated from time to time by the Landlord
in its sole discretion for use in connection with the Leased Premises.

"Phase V Work" shall have the meaning  ascribed to this term in section  18.1 of
this Lease.

"Plans and Specifications" means the plans and specifications in existence as of
the date of the Acquisition  Agreement as disclosed to the Landlord,  amended as
is  necessary  for the  Phase V Lands  to be  serviced  as a  stand-alone  site,
including  without   limitation,   the  separate  provision  of  water,   sewer,
electricity, gas (if applicable) and all other utilities, and as further amended
from time to time by written amendment  approved in writing by both the Landlord
and the Tenant.

"Rent" means Basic Rent and Additional Rent.

"Rent  Commencement  Date" means the earlier of: (i) September 27, 2002; or (ii)
the Date of Substantial Completion of the Leased Premises.

"Rental Rate" means,  Fifteen  Dollars ($15) per square foot per year subject to
adjustment in accordance with section 3.1.

"Rules and Regulations" means those rules and regulations  stipulated in Section
11.4 hereof and any further reasonable rules and regulations of which the Tenant
receives  written  notification  from the  Landlord  which the  Landlord  acting
reasonably  may from time to time  stipulate  for the  proper  operation  of the
Complex,  and all such further  rules and  regulations  shall be read as forming
part of this Lease as if the same were embodied herein.

"Shared Areas and Facilities"  means those parts of the Common  Facilities which
are provided by the Landlord for the common use and  enjoyment or benefit of the
Tenant,  the Landlord and other occupants of the Complex,  and their  respective
employees,  contractors,  agents and invitees including, without limitation, any
fitness facility,  cafeteria,  recreational  areas,  landscaped  areas,  parking
areas,  public  transit  shelters,  roadways,  driveways,  walkways,  sidewalks,
skywalks, tunnels, lobbies, entrances, exits, common corridors, halls, stairways
and passageways,  public lavatories,  truck courts,  truck docks, common loading
areas and  elevators,  and shall be deemed to include any  pedestrian  walkways,
parks or other facilities located on the Lands.

"Site  Plan"  means the site plan  drawings  (i)  identified  as L1 and L2 as of
January 10, 2001, (ii) identified as C1, C2 and C3 as of January 10, 2001, (iii)
identified  as A051 as of January 18, 2001,  and (iv)  identified  as A201 as of
January 8, 2001,  in each case amended as is necessary  for the Phase V Lands to
be serviced as a stand-alone site,  including without  limitation,  the separate
provision  of  water,  sewer,  electricity,  gas (if  applicable)  and all other
utilities,  and as may be further amended from time to time by written amendment
approved in writing by both the  Landlord  and the  Tenant.  Copies of the above
described  drawings  (L1,  L2,  Cl,  C2, C3,  A051 and A201)  together  with all
existing  amendments thereto shall be delivered by the Tenant to the Landlord by
April 3, 2001, it being agreed and understood that all such existing  amendments
shall be subject to the Landlord's approval as described in subsection 18.1(a).

                                      -5-
<PAGE>

"Stipulated  Rate of Interest"  means the standard  rate of interest  charged or
imputed by the Landlord,  acting reasonably,  in respect of the operation of the
Complex, as adjusted from time to time.

"Substantial Completion" or "Substantially Complete" means when the construction
of Phase V Work has been substantially performed, as such term as defined in the
Construction Lien Act, as amended.

"Taxes" means, for each Accounting  Period,  the amount paid by the Landlord for
all  taxes,  rates,  duties  and  assessments  whatsoever,   whether  municipal,
provincial,  parliamentary or otherwise,  now charged or hereafter to be charged
upon the  Complex or upon the  Landlord in respect  thereof for such  Accounting
Period.  The  total  of  such  costs  to the  Landlord  shall  include,  without
duplication or  limitation,  school taxes,  municipal  taxes and taxes for local
improvements  or works  assessed  against  the  Complex  and any  costs and fees
reasonably incurred by the Landlord in reasonably contesting or negotiating with
the public  authorities as to the same. Taxes shall not include capital taxes or
large  corporations  taxes  or any  other  taxes  based  upon or  computed  with
reference to the Landlord's  paid-up capital or place of business,  income taxes
of the Landlord to the extent such income taxes are not levied in lieu of taxes,
rates, duties and assessments against the Complex.

"Tenant" means Mitel Corporation and its successors and permitted assigns.

"Tenant's Address" means 400 March Road, Ottawa, Ontario, Canada, K2K 3H4 to the
attention of (i) Manager of  Facilities  Engineering  and Real Estate;  and (ii)
General Counsel.

"Tenant's Architect" means an independent, duly qualified architect named by the
Tenant from time to time under the provisions of this Lease.

"Tenant's  Share" means the share  allocated or  re-allocated by the Landlord to
the Tenant pursuant to section 3.2, and with respect to those component costs of
the Complex  Operating Costs for which no such allocation or re-allocation is so
made by the  Landlord,  a fraction  which has as its  numerator  the Area of the
Leased Premises and which has as its denominator the Gross Building Area.

"Term" means the period  commencing  on the  Commencement  Date and expiring ten
(10) years after the Rent Commencement Date.

"Termination  Date" means, the last day of the Term or such earlier date as this
Lease may be terminated pursuant to the provisions hereof.

"Unavoidable  Delay"  means  any  delay  by a party  in the  performance  of its
obligations  under  this  Lease  caused  in whole or in part by any acts of God,
strikes, lockouts or other industrial disturbances, acts of the Queen's enemies,
sabotage, war, blockades, insurrections, riots, epidemics, washouts, nuclear and
radiation activity or fallout,  arrests,  restraints of rulers and people, civil
disturbances, explosions, breakage of or accident to machinery, 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 herein
enumerated  or  otherwise  not within the control of such party and which by the
exercise of reasonable  foresight of such party,  could

                                      -6-
<PAGE>

not have been  prevented,  but lack of funds on the part of such party shall not
constitute an Unavoidable  Delay.  Notwithstanding  the  foregoing,  in no event
shall the Tenant be excused  from the  payment  of Rent  hereunder  by reason of
Unavoidable Delay.

                                   ARTICLE 2
                         DEMISE, DELIVERY AND SURRENDER

2.1   Demise and Leased Premises

In  consideration  of the  covenants  and  agreements  hereinafter  set out, the
Landlord  hereby leases the Leased  Premises to the Tenant,  to have and to hold
during  the  Term  upon the  conditions  contained  in this  Lease.  The  Tenant
covenants to pay Rent and to observe and perform all the  covenants and provisos
to be observed and performed by the Tenant  pursuant to this Lease.  The parties
further  acknowledge and agree that, in respect of certain areas  comprising the
Leased Premises,  and in addition to the rights of access otherwise  afforded to
the Landlord under the provisions of this Lease,  the Landlord  reserves for its
employees, agents and contractors,  upon reasonable notice to the Tenant (except
in the case of emergencies or urgent  repairs  and/or  maintenance),  a right of
passage  through,  above and below the Leased  Premises  for people,  equipment,
machinery  and  apparatus  for the  purpose  of  allowing  access to the  Leased
Premises to facilitate the Landlord's performance of its obligations pursuant to
this Lease and to maintain, repair, clean, operate and respond to emergencies in
the Complex.  The Landlord shall undertake reasonable efforts to co-operate with
any "Risk Work Plan" (as defined in section  14.2)  process of the Tenant  where
such repairs and/or maintenance impact on the Tenant's operations.

2.2   Shared Areas and Facilities

Subject  to  section  17.2  and  to  the  Landlord's   security  procedures  and
requirements  with respect to the Complex,  the  Landlord  hereby  grants to the
Tenant,  its  employees,   contractors,   agents,  visitors  and  other  persons
transacting business with it, in common with the Landlord and other occupants of
the Complex from time to time,  the right to use the Shared Areas and Facilities
for their intended purpose.

2.3   Examination of Leased Premises

The Tenant  acknowledges having examined the Complex and the Leased Premises and
accepts same in their present  condition.  The Landlord has commissioned a Phase
II environmental  site assessment in respect of the Complex for completion prior
to the Commencement Date. The Tenant shall deliver to the party engaged to carry
out such environmental  assessment a copy of all other environmental  reports in
its possession relating to the Complex. The Landlord shall deliver to the Tenant
prior to the Commencement  Date a copy of such report,  together with a reliance
letter from the party preparing such reporting  confirming that it may be relied
upon by the Tenant.

The Tenant confirms that, save as disclosed in the Acquisition Agreement, it has
not  received   notice  of  any   non-compliance   with  any  Applicable   Laws,
Environmental Law or the mandatory  recommendations  of Factory Mutual Global in
relation to the Complex which have not or will not have been complied with prior
to the Commencement Date.

                                      -7-
<PAGE>

The Tenant agrees that there is no promise,  representation or undertaking by or
binding  upon the  Landlord  with  respect  to any  environmental  matter or any
alteration,  remodelling or decoration of the Leased Premises or with respect to
the  installation  of  equipment or fixtures in the Leased  Premises,  except as
expressly provided in this Lease.

2.4   Measurement of the Leased Premises.

Forthwith  after the Date of Substantial  Completion,  the Landlord shall direct
Fairhill  Moffatt and Woodland  Limited,  Ontario Land  Surveyors to measure the
Area of the Leased Premises and to deliver to both the Landlord and the Tenant a
certificate  confirming  the same,  the cost of which  shall be  shared  equally
between the parties.

2.5   Installation and Removal of Trade Fixtures

The Tenant may, with the prior  approval of the Landlord,  which approval not to
be  unreasonably  withheld  or  delayed,   install  trade  fixtures,   including
Production  Equipment,  of a type  usual  for the  Permitted  Use,  in good  and
sufficient  manner  but not so as to  damage  or  impair  the  structure  or the
heating, ventilating, air-conditioning (if applicable), plumbing, electrical and
mechanical  systems of the Leased  Premises or the Complex.  The Landlord  shall
either  give its  approval  or its  reasons for denying the same within ten (10)
business days of the Tenant's  request for  approval.  Provided the Landlord has
approved the  installation  of such trade  fixtures,  the Tenant shall  arrange,
coordinate  and supervise the  performance  and completion of all such work in a
diligent and good and  workmanlike  manner.  The total cost of the work shall be
paid by the Tenant.  The Tenant shall also forthwith  reimburse the Landlord for
all costs,  expenses and charges  incurred by the Landlord  with respect to such
work, including without limitation,  building system modification or enhancement
costs or engineering review fees, if any.

On or before the  Termination  Date, the Tenant shall have the right,  if not in
default  beyond the  applicable  cure  period,  to remove,  and shall  remove if
required by the  Landlord,  all its trade  fixtures,  furniture  and  equipment,
making good at the Tenant's  expense any damage caused by such removal,  and the
Tenant shall  vacate and  surrender  the Leased  Premises to the Landlord in the
condition  required  under  Section  7.1.  The Tenant  further  agrees  that all
Leasehold  Improvements,  whether  by or for the  benefit of the  Tenant,  shall
immediately upon affixation or installation  become the property of the Landlord
and shall remain upon the Leased Premises, provided that at the end of the Term,
if so directed by the  Landlord,  the Tenant shall remove such of the  Leasehold
Improvements as the Landlord shall have previously  indicated  require  removal,
and any  change,  alteration,  major  repair,  addition  or  improvement  to the
Leasehold  Improvements made without the consent of the Landlord being required,
and  such  Production   Equipment,   trade  fixtures  and  ancillary  telephone,
telegraphic,  electric  or other  cabling  or  wiring  installed  in the  Leased
Premises  without the consent of the Landlord  being  required,  as the Landlord
may, in its sole discretion, require (excluding, for the purpose of clarity, the
demising walls and other  separation,  security  measures and partitioning  work
carried out pursuant to section 2.4), and make good at the Tenant's  expense any
damage caused by such removal. The Landlord may also elect to require the Tenant
to rebuild partitioning at the end of the Term in the Office Areas of the Leased
Premises to a partitioned  area to open area ratio of 30:70. All property of the
Tenant  remaining upon the Leased  Premises after the termination of the tenancy
shall be deemed to have been  abandoned  by the Tenant in favour of the Landlord
and may be

                                      -8-
<PAGE>

disposed of by the Landlord at its discretion without prejudice to the rights of
the  Landlord to claim  damages  from the Tenant for failure to remove the same.
Nothing  herein  prohibits  the  Tenant  from  claiming  the  cost of  Leasehold
Improvements  incurred by the Tenant as deductions for income tax purposes.  For
the purpose of clarity,  the Tenant  acknowledges that in respect of the removal
of certain of its trade fixtures and Production Equipment,  it shall be required
to repair as set out in Schedule "E".

2.6   Overholding by Tenant

If the Tenant remains in possession of the Leased Premises subsequent to the end
of the Term without the execution and delivery of a new lease, there shall be no
tacit  renewal,  and the  Tenant  shall be deemed  to be  occupying  the  Leased
Premises as a tenant from month to month upon the same terms and  conditions  as
are set forth in this  Lease  insofar as the same are  applicable  to a month to
month tenancy,  subject to Sections 58 and 59 of the  Commercial  Tenancies Act.
Such month to month  tenancy may be  terminated by either party at any time upon
ninety (90) days Notice.

                                   ARTICLE 3
                                     RENTAL

3.1   Basic Rent

The Tenant shall pay to the  Landlord as rent for the Leased  Premises the Basic
Rent in  advance  on the  first  day of each  and  every  month  from  the  Rent
Commencement  Date to the Termination Date, and if the Rent Commencement Date or
the  Termination  Date are not the first  and last days of a month  respectively
then  the  Basic  Rent  for the  first  and last  months  of the  Teen  shall be
appropriately prorated.

The Basic  Rent as set forth in section  1.1 is based in part on the  Landlord's
estimated cost of the Phase V Mortgage Financing amortized over twenty-five (25)
years and  calculated at an estimated  interest rate of 8.5 percent for ten (10)
years,  compounded  semi-annually and payable monthly in arrears.  If there is a
change (i) in the  interest  rate  charged  by the  Landlord's  lender  from the
estimated rate of 8.5 percent,  compounded  semi-annually and payable monthly in
arrears, or (ii) in either the assumed twenty-five (25) year amortization period
or the ten (10) year term, the cost or benefit of the change shall be paid by or
credited to the Tenant in  accordance  with the  Methodology  and the Basic Rent
payable by the Tenant shall be adjusted accordingly for each month of the Term.

3.2   Payment of Additional Rent for Complex Operating Costs

The Tenant  shall in  addition  to the Basic  Rent,  pay the  Tenant's  Share of
Complex  Operating Costs to the Landlord as Additional Rent throughout the Term,
in advance on the first day of each and every month  during the Term  commencing
with the Rent Commencement Date, in equal and consequent monthly  instalments on
account  of the  Tenant's  Share  of  Complex  Operating  Costs  based  upon the
Landlord's  estimate of Complex  Operating  Costs  determined in accordance with
section 3.3.

                                      -9-
<PAGE>

Additionally, for the period from the Commencement Date to the day preceding the
Rent Commencement  Date, the Tenant shall pay to the Landlord the Tenant's Share
of Taxes and shall also be responsible for the cost of garbage and waste removal
and all  utilities  consumed by the Tenant with  respect to its  possession  and
construction of the Leased Premises during such period.

3.3   Annual Estimation of the Complex Operating Costs

Prior to the commencement of each Accounting Period, the Landlord shall estimate
the Complex Operating Costs for the next Accounting Period and in so doing shall
analyse, weight and if necessary, re-allocate the component costs of the Complex
Operating  Costs to ensure an equitable and reasonable  allocation of such costs
and expenses to the various uses and users in the Complex. Such estimates may be
adjusted and re-adjusted from time to time by the Landlord. The Tenant shall pay
to the  Landlord  monthly in  advance  on the first day of each and every  month
during  the Term,  one  twelfth  (1/12) of the  amount of the  estimated  annual
Complex Operating Costs, as adjusted or re-adjusted, as the case may.

3.4   Annual  Adjustment of Basic Rent Based Upon the Actual  Complex  Operating
      Costs

Within one hundred and eighty (180) days  following  the end of each  Accounting
Period the Landlord  shall compute the actual Complex  Operating  Costs for such
Accounting  Period  and the  Tenant's  Share  of the  same  and  shall  submit a
statement to the Tenant disclosing in reasonable  detail the various  components
of the same.  If the  Complex  Operating  Costs paid by the Tenant in respect of
such Accounting Period are less than the actual Complex Operating Costs for such
Accounting  Period,  the  Tenant  shall  pay  the  difference  to  the  Landlord
forthwith.  If the Complex Operating Costs comprising the Basic Rent paid by the
Tenant in  respect of such  Accounting  Period  are  greater  than the amount of
actual Complex Operating Costs for such Accounting  Period, the difference shall
be applied in payment of other amounts then owing by the Tenant to the Landlord,
and the  balance,  if any,  shall be repaid to the  Tenant  concurrent  with the
delivery of such statement.

The Landlord  shall at the  Tenant's  expense  provide to the Tenant  reasonable
supporting  documentation  for its  calculation of the actual Complex  Operating
Costs  and the  Tenant's  Share  of the  same  for the  current  or  immediately
preceding Accounting Period on the written request of the Tenant.

3.5   Rent Covenant

The Tenant shall pay to the Landlord without demand,  in lawful money of Canada,
at the times provided in this Lease, at the Landlord's  Address or at such other
place as the  Landlord  may  designate  from time to time,  the  Basic  Rent and
Additional  Rent,  without any  deduction,  set-off,  counter claim or abatement
whatsoever.  All amounts payable under this Lease,  unless  otherwise  provided,
become due with the next  instalment  of Basic Rent.  If the Tenant  defaults in
payment of any sum due  hereunder  the  Landlord  shall have the same rights and
remedies upon default as if the sum were Rent in arrears.

                                      -10-
<PAGE>

3.6   Waiver of Set-Off

The Tenant hereby  waives and renounces any and all existing and future  claims,
offsets and  compensation  against any Basic Rent or Additional Rent, and agrees
to pay all Basic Rent and  Additional  Rent  regardless of any claim,  offset or
compensation  which may be asserted  by the Tenant or on its behalf.  The Tenant
agrees that the  Landlord  may at its option  apply all sums  received  from the
Tenant or due to the Tenant  against  amounts  due or payable  hereunder  as the
Landlord  determines  notwithstanding  any  instructions  or designations to the
contrary. No endorsement on any cheque or statement in any letter accompanying a
cheque shall be deemed an accord or satisfaction and the Landlord may accept any
payment  without  prejudice  to any rights the Landlord may have at law or under
this Lease.

3.7   Interest on Overdue Rent

If the Tenant  fails to pay within ten (10) days from when due any Basic Rent or
Additional  Rent,  the unpaid amount will bear interest from the due date to the
date of payment at the  Stipulated  Rate of Interest and such interest  shall be
calculated and payable monthly.

3.8   Net Lease

It is the  intent  of the  parties  that  this  Lease be  absolutely  net to the
Landlord and that the Tenant  shall pay all costs and  expenses  relating to the
Leased Premises and the business carried on therein except as expressly provided
in this Lease.  Any amount or obligation  herein relating to the Leased Premises
which is not expressly declared to be that of the Landlord shall be deemed to be
an obligation of the Tenant to be performed by or at the Tenant's expense.

                                   ARTICLE 4
                       OTHER AMOUNTS TO BE PAID BY TENANT

4.1   Business Taxes, GST and Other Taxes

The  Tenant  shall pay every tax and  license  fee  imposed  in  respect  of all
business  carried  on in the  Leased  Premises,  or in  respect  of  the  use or
occupancy  thereof,  and  all  such  amounts  shall  be  paid  promptly  to  the
authorities responsible for collection.

If any business  transfer tax,  valued-added  tax,  multi-stage sales tax, sales
tax,  goods and services  tax, or any like tax is imposed on the Landlord by any
governmental  authority on the Rent or any other payment, cost or charge payable
by the Tenant under this Lease,  the Tenant shall pay directly or reimburse  the
Landlord  for the  amount  of such tax  forthwith  upon  demand  (or at any time
designated from time to time by the Landlord) as Additional Rent.

4.2   Third Party Services

The Tenant shall be solely  responsible  for and promptly pay to the appropriate
third  party all  charges  for  services  used or consumed in or provided to the
Leased Premises,  but excluding services supplied by the Landlord and charged to
the  Tenant as Rent.  In no event will the  Landlord  be liable to the Tenant in
damages or otherwise  for any failure to supply any third party

                                      -11-
<PAGE>

services to the Leased Premises. Nothing herein shall disentitle the Tenant from
pursuing any third party supplier of such services for any damages suffered as a
result of such failure.

4.3 Additional Services of the Landlord

The cost of all  additional  services  requested  in  writing  by the Tenant and
elected by the  Landlord  to be  provided  to the Tenant by the  Landlord or its
agents or  contractors  shall be payable  forthwith by the Tenant upon demand by
the Landlord together with the Landlord's management fee in respect thereof.

4.4   Upgrading Building Systems

The cost to the  Landlord  of  upgrading  the  building  systems  of the  Leased
Premises  to service  any  extraordinary  requirements  of the  Tenant  shall be
payable  forthwith  by the Tenant  upon  demand by the  Landlord,  provided  the
Landlord  gives the Tenant prior Notice of the necessity of such upgrade and the
Landlord's  estimate of the cost to the Tenant for such upgrade,  whereafter the
Tenant shall have the option of reducing its requirements or having the proposed
upgrade proceed.

4.5   Leased Premises Heating, Ventilating and Air Conditioning Systems

The Tenant  covenants to operate the heating,  ventilating and  air-conditioning
systems  serving the Leased  Premises as would a prudent  owner and to maintain,
repair  and  replace  such  systems  in   accordance   with  the  standards  and
specifications  provided to the business prior to the  Commencement  Date. Where
any such heating,  ventilating and air-conditioning  systems shall be damaged or
destroyed,  or in the  opinion  of the  Landlord  require  repairs,  inspection,
overhauling  or  replacement,  the Tenant  shall,  at its sole cost and expense,
commence and carry out any necessary work with reasonable speed.

                                   ARTICLE 5
                              OPERATION OF COMPLEX

5.1 Utility Services

The Landlord  shall permit the Tenant to connect its  equipment,  machinery  and
trade fixtures to the utility  services  serving the Complex.  In the event that
the Tenant  overloads the capacity of any of such utility  services,  the Tenant
shall pay all costs and expenses resulting from the Tenant's  overloading of the
said capacity as Additional  Rent.  The Tenant shall advise the Landlord  within
twenty (20)  business  days after  written  request  therefore of the nature and
quantity of all lights,  equipment and machines using  electricity in the Leased
Premises and shall permit the Landlord or its authorized agents to make periodic
inspection  of all  facilities  using  electricity  located  within  the  Leased
Premises. Where the utility services of the Complex or any part thereof shall be
damaged  or  destroyed,  or in the  opinion  of the  Landlord  require  repairs,
inspection,  overhauling or  replacement,  the Landlord shall commence and carry
out such necessary work as would a prudent owner with reasonable  speed,  unless
such  utility  services  are  wholly  within  and  solely  relate to the  Leased
Premises, in which case the Tenant shall, at its sole cost and expense, commence
and  carry out such  necessary  work as would a prudent  owner  with

                                      -12-
<PAGE>

reasonable  speed. To the extent such damage or destruction is caused by the act
or  omission of the Tenant or those for whom the Tenant is  responsible  in law,
the Landlord's cost, if any, of such necessary work shall be charged to and paid
by the Tenant as Additional Rent.

5.2   Taxes

Subject to the payment by the Tenant of Rent, the Landlord  covenants to pay all
Taxes on or  before  their  due date.  The  Landlord  may  appeal  any  official
assessment,  any  Taxes  based on such  assessment  or the  amount  of the Taxes
relating to the  Complex.  In  connection  with any such appeal the Landlord may
defer  payment of any taxes  payable by it under the  provisions of this Section
5.2 to the extent  permitted by law without penalty or interest,  and the Tenant
shall  cooperate  with the Landlord  and provide the Landlord  with all relevant
information  reasonably  required by the  Landlord in  connection  with any such
appeal.

5.3   Building and Pedestal Signage

The Tenant shall not paint, display,  inscribe or place any sign, symbol, notice
or  lettering  of any kind  anywhere  outside the Leased  Premises or within the
Leased  Premises  so as to be visible  from the  outside of the Leased  Premises
without the prior written consent of the Landlord.  Any signage  consented to by
the  Landlord  shall  comply  with the  Landlord's  then  current  policies  and
procedures regarding signage in the Complex and include only the corporate name,
business  name or logo of the  Tenant.  The exact  size,  location  and style of
identification shall also be subject to the Landlord's prior approval and to all
Applicable Laws and the obtaining of all required consents and licenses relating
thereto.  Any signage permitted by this section shall be promptly removed by the
Tenant at its sole cost and expense on the  termination  or other  expiration of
this Lease and the Tenant shall  promptly make good any and all damage caused by
either or both the installation and removal of such signage. The Landlord hereby
confirms that it consents to the signage described in Schedule "G".

                                   ARTICLE 6
                             INSURANCE AND INDEMNITY

6.1   Landlord's Insurance

The  Landlord,   acting  reasonably,   shall  carry  such  insurance  with  such
deductibles  and exclusions as would a prudent owner for the account and benefit
of the Landlord as the Landlord from time to time considers useful, expedient or
beneficial,  it being agreed and understood  however that such  insurance  shall
include, the following:

6.1.1.  insurance  against  All  Risks  of loss or  damage  including  sprinkler
        leakage and damage due to flood or  earthquake,  covering  all  property
        owned by the  Landlord or for which the  Landlord is  responsible  under
        this Lease relative to the Complex  including the buildings,  the Common
        Facilities and the Leased  Premises,  but excluding all trade  fixtures,
        furniture and stock-in-trade belonging to the Tenant;

6.1.2.  insurance against loss of the Landlord's gross profits including loss of
        Basic Rent;

                                      -13-
<PAGE>

6.1.3.  insurance against mechanical break-down,  explosion,  rupture or failure
        of boilers, pressure vessels, heating,  ventilating and air-conditioning
        equipment,  electrical  apparatus and other like apparatus  owned by the
        Landlord;

6.1.4.  comprehensive general liability insurance with respect to the Landlord's
        operation of the Complex  covering  bodily  injury,  death and damage to
        property of others; and

6.1.5.  insurance  against any other form or forms of loss which the Landlord or
        any Mortgagee may require from time to time.

Notwithstanding  any  contribution  by the Tenant to the Landlord for  insurance
premiums as provided in this Lease, no insurable  interest is conferred upon the
Tenant  under  policies  carried by the  Landlord,  and the Tenant shall have no
right to  receive  any  proceeds  of  insurance  from  policies  carried  by the
Landlord.  The Landlord shall in no way be  accountable to the Tenant  regarding
the use of any insurance proceeds arising from any claim, and the Landlord shall
not be obliged to account for such  proceeds,  nor to apply such proceeds to the
repair or restoration  of that which was insured  except to the extent  provided
herein.  If the Tenant desires to receive  indemnity by way of insurance for any
property,  work or thing whatever including Leasehold  Improvements,  the Tenant
shall  insure same for its own account  and shall not look to the  Landlord  for
reimbursement or recovery in the event of loss or damage from any cause, whether
or not the Landlord has insured same and recovered  therefor.  All such policies
of insurance shall exclude the exercise of any claim of the insurers, whether by
subrogation or otherwise,  against the Tenant or those for whom the Tenant is in
law responsible.

6.2     Tenant's Insurance

The Tenant shall keep in force during the Term at its own expense the following:

6.2.1.  insurance  against All Risks of loss or damage to Tenant's  property and
        property for which  Tenant is  responsible  under this Lease,  including
        damage due to floods or earthquakes  for the full  replacement  value of
        the equipment, inventory and Leasehold Improvements;

6.2.2.  comprehensive  general liability insurance,  including Tenant's All Risk
        legal  liability  insurance  in respect of the  Leased  Premises,  in an
        amount not less than Ten Million Dollars ($10,000,000),  or such greater
        amount  as may be  stipulated  by the  Landlord  from  time to time,  in
        respect  of injury to or death of one or more than one  person,  and for
        damage to tangible personal property, regardless of the number of claims
        arising as a result of any one occurrence;

6.2.3.  insurance for boilers, machinery,  rotating apparatus, pressure vessels,
        electrical apparatus, and production equipment, tools and systems issued
        on a broad  form  basis in an amount  not less  than the full  insurable
        value,  calculated  on a replacement  cost basis  without  deduction for
        depreciation,  covering  all  objects  in  or  on  the  Leased  Premises
        insurable  under  this  form  of  insurance,   and  resulting   business
        interruption coverages;

                                      -14-
<PAGE>

6.2.4.  motor vehicle  insurance  having third party  liability  limits not less
        than Five Million  Dollars  ($5,000,000)  covering all vehicles owned or
        operated by the Tenant from the Complex;

6.2.5.  insurance  against any acts of  infidelity  or sabotage by the Tenant or
        its officers,  directors,  employees, agents, contractors,  customers or
        invitees in such forms and with such limits as may be  requested  by the
        Landlord from time to time; and

6.2.6.  such other  insurance as the Landlord or any  Mortgagee  may  reasonably
        require from time to time with respect to the property and operations of
        the Tenant from the Complex.

All such  policies of  insurance  shall be placed with  insurers  licensed to do
business  in Canada  or the  United  States of  America  and shall  exclude  the
exercise  of any claim of the insurer or  insurers,  whether by  subrogation  or
otherwise,  against the Landlord or any  Mortgagee or those for whom any of them
are in law responsible and the Tenant shall deliver certificates of insurance to
the Landlord  evidencing  such coverages in a form acceptable to the Landlord on
or before the Commencement Date. Each such policy shall include the Landlord and
any Mortgagee of whom the Tenant has been given Notice as additional insureds as
their interests may appear and shall contain a waiver, in favour of the Landlord
and any such Mortgagee and those for whom any of them are in law responsible, of
any breach or  violation of any  warranties,  representations,  declarations  or
conditions  contained  in the  policies.  All such  insurance  shall be  primary
insurance  and shall not call into  contribution  any  insurance  carried by the
Landlord or any  Mortgagee.  All  policies of  comprehensive  general  liability
insurance shall contain a severability of interest clause and a  cross-liability
clause as between the Tenant,  the  Landlord  and any  Mortgagee  included as an
additional  insured on such  policy.  All  policies  shall  contain a  provision
requiring  that at  least  thirty  (30)  days'  written  notice  be given to the
Landlord and any Mortgagee included as an additional insured as aforesaid by the
insurer  prior  to  cancellation   or  expiry,   and  the  Tenant  shall  obtain
undertakings from all insurers to that effect. If after three (3) business days'
Notice of default to the Tenant,  the Tenant  fails to perform  its  obligations
pursuant to this Section 6.2 the Landlord may effect such insurance on behalf of
the  Tenant,  and any  premium  paid by the  Landlord  which  is  otherwise  the
responsibility  of the Tenant hereunder shall be payable forthwith by the Tenant
upon demand by the Landlord as Additional Rent.

6.3   Premium Increases and Cancellation

The Tenant shall  promptly  comply with all  requirements  of the Landlord's and
Mortgagee's  insurance  underwriters  regarding  the use and  occupation  of the
Leased  Premises,  and the Tenant  shall not do,  omit,  or permit to be done or
omitted  anything  which shall cause any  insurance  premium with respect to the
Complex or any part  thereof to be  increased,  or which may cause any policy of
insurance of the Landlord  with respect to the Complex to be  cancelled.  To the
extent  anything  done or omitted to be done by the Tenant  causes any insurance
premium of the  Landlord  with  respect to the  Complex to be so  increased  the
Tenant  shall pay to the  Landlord  forthwith  upon  demand  the  amount of such
increase.  If any insurer  threatens to cancel,  cancels or refuses to renew any
insurance  policy  of the  Landlord  upon the  Complex  by  reason of the use or
occupation of the Leased Premises or any part thereof by the Tenant,  the Tenant
shall forthwith  remedy or rectify such use or occupation  within the time limit
required by the insurer upon being requested to do so by Notice by the Landlord,
and if the Tenant shall fail to do so within a

                                      -15-
<PAGE>

reasonable  period of time after such  Notice,  the  Landlord may at its option,
without  prejudice  to any other  rights it may have,  terminate  this  Lease by
Notice to the Tenant.  Thereupon the Tenant shall pay Basic Rent and  Additional
Rent  owing to the date of such  termination  and shall  immediately  deliver up
possession of the Leased Premises to the Landlord, and, without prejudice to all
other rights and remedies available to it for breach of this Lease, the Landlord
shall have the right to re-enter the Leased Premises.

6.4   Compliance with Landlord's Insurance Requirements

In its use and occupation of the Leased Premises and of the Complex,  the Tenant
shall comply with all fire protection and loss prevention  requirements  imposed
by Factory Mutual Global in respect of Level I Priority Recommendations,  and in
all other cases as  negotiated  with the Factory  Mutual  Global,  and,  without
limiting  the  generality  of  the  foregoing,  shall  ensure  that  all  of its
operations,  equipment modifications,  equipment installation,  tools, emergency
organizations,  fire  protection and loss  prevention  response team  procedures
comply with all Factory Mutual Global  standards and  requirements as aforesaid.
The Landlord and the Landlord's underwriter shall consult with Tenant in respect
of the negotiation of compliance  issues taking into  consideration a reasonable
cost risk benefit analysis in relation  thereto.  The Tenant shall undertake its
best  efforts  to  ensure  that  the  Landlord   receives  the  benefit  of  any
"grandfathering"  status  presently  held by the  Tenant in  respect  of current
exceptions relevant to the Business. If within a reasonable period of time after
Notice the Tenant fails to comply with the foregoing requirements and standards,
the  Landlord  shall have the right,  at its  option,  to  implement  or enforce
necessary  corrections,  and the cost thereof shall be payable  forthwith by the
Tenant upon demand by the Landlord as Additional Rent.

6.5   Limitation of Landlord's Liability

Except to the extent caused or contributed by an act or omission of the Landlord
or those for whom it is  responsible in law, the Landlord shall not be liable or
responsible in any way for any death or any injury of any nature whatsoever that
may be suffered or sustained by the Tenant or any employee, contractor, agent or
customer of the Tenant or any other person who may be upon the Leased  Premises,
or for any loss or damage or injury to any  property  belonging to the Tenant or
its employees,  agents or contractors or to any other person while such property
is on the Leased  Premises.  Without  limiting the  generality of the foregoing,
except to the extent caused or contributed by an act or omission of the Landlord
or those for whom it is responsible in law, the Landlord shall not be liable for
any damage or damages of any nature  whatsoever  to persons or  property  on the
Leased  Premises  caused by explosion,  fire,  theft or breakage,  by sprinkler,
drainage  or  plumbing  systems,  by  failure  for any cause to supply  adequate
drainage or snow or ice removal,  by the  interruption  of any public utility or
service, by steam, gas, water, rain, snow, or other substances leaking,  issuing
or flowing into any part of the Leased Premises,  or by anything done or omitted
to be done by any other tenant,  occupant or person in the Complex.  In addition
the Landlord  shall not be liable for any loss or damage for which the Tenant is
required to insure pursuant to Section 6.2.

The Landlord shall not be liable for any indirect or consequential damage of any
type,  or for  damages for  personal  discomfort  or illness of the Tenant,  its
officers,  directors,  employees,  contractors,  invitees, clients, customers or
other  persons.  The  Tenant  shall not be  entitled  to any

                                      -16-
<PAGE>

compensation, any diminution or abatement of Rent, any claim for constructive or
actual  eviction  or any  claim of breach of the  Landlord's  covenant  of quiet
enjoyment by reason of the operation or non-operation of any of the equipment or
systems  referred to in this Lease, or by failure of the Landlord to provide any
of the  services  referred to in this  Lease,  or for any act or omission on the
part of any third  parties  employed or retained by the  Landlord to perform any
work or perform any service under this Lease.

6.6   Indemnity by Tenant

The Tenant  shall  indemnify  the  Landlord  against  and from all loss,  costs,
claims, or demands in respect of any injury, loss or damage of the type referred
to in Section 6.5 or resulting  from a default  under Section 6.4, to the extent
caused by an act or  omission  of the  Tenant or those for whom the Tenant is at
law responsible,  and against and from any breach by the Tenant of any provision
of this Lease.

6.7   Limitation of Tenant's Liability

Notwithstanding  anything in this Lease to the contrary, the Tenant shall not be
liable for any loss or damage for which the  Landlord  is insured or required to
be insured  pursuant to section  6.1. The Landlord  shall  indemnify  the Tenant
against and from all losses, costs, claims, or damages in respect of any injury,
loss or damage to the extent  caused by an act or  omission  of the  Landlord or
those for whom the Landlord is law responsible, or any breach by the Landlord of
any provision of this Lease.

The Tenant shall not be liable for any indirect or  consequential  damage of any
type, or for damages for personal  discomfort  or illness of the  Landlord,  its
officers,  directors,  employees,  contractors,  invitees, clients, customers or
other persons.

                                   ARTICLE 7
                             REPAIRS AND ALTERATIONS

7.1   Tenant's Repairs

Subject to the Landlord's  obligations  pursuant to Section 7.8,  throughout the
Term, the Tenant shall repair,  maintain and keep in proper operating condition,
subject  to normal  wear and  tear,  all as would a careful  owner,  the  Leased
Premises and every part  thereof  including  without  limitation  the  Leasehold
Improvements,  equipment,  fixtures,  furnishing,  all glass,  every part of the
structural, heating, cooling, ventilating, air-conditioning,  plumbing and other
mechanical  installations  serving the Leased Premises,  whether or not any such
items were  installed  or  furnished  by the  Tenant.  It is further  agreed and
understood that so long as Mitel Corp. is in actual  occupation of not less than
eighty-five  percent (85%) of the area of the Leased Premises,  the Tenant shall
in addition to the foregoing,  throughout the Term at its sole cost and expense,
also repair,  maintain and keep in proper  operating  condition,  all as would a
careful owner, the structural components and roof of the Leased Premises and the
Landlord shall be relieved of such responsibility pursuant to section 7.8.

                                      -17-
<PAGE>

7.2   Tenant to Notify of Defects

The Tenant shall promptly  notify the Landlord of any damage to or defect in any
part of the Leased  Premises,  or in any equipment or utility system serving the
Leased Premises, of which the Tenant becomes aware and which may cause or result
in death or injury to any person or damage to property.

7.3   Tenant Work

The Tenant shall not,  without the  Landlord's  prior  written  approval,  which
approval  may not be  unreasonably  withheld by the  Landlord,  make any change,
alteration,  repair,  addition or improvement in or to the Leased Premises which
affects in a material  way the  structure  or  perimeter  walls,  any  sprinkler
system,  life  safety  equipment  or  systems,  heating,   ventilating,   and/or
air-conditioning  equipment or systems, the plumbing,  electrical and mechanical
equipment or systems, the bearing floors, the signage, the ceilings, the columns
or the roof.  The Tenant shall submit to the  Landlord  adequate  details of any
such proposed work which requires the Landlord's approval including drawings and
specifications  conforming to good engineering practice which have been prepared
by qualified  engineers and designers.  Within ten (10) business days of receipt
of the  Tenant's  request  for  approval,  the  Landlord  shall  either give its
approval or describe in writing with  reasonable  particularity  the reasons for
denying the same.  At the time of granting  the  approval,  the  Landlord  shall
advise the Tenant as to whether the Tenant shall be required on the  Termination
Date, to remove such  alterations  and restore the Leased Premises in accordance
with Section 2.5. All work carried out by the Tenant  (whether or not  requiring
the Landlord's  consent) shall be carried out in a good and workmanlike  manner,
with  quality  materials  and in  accordance  with all  Applicable  Laws and the
drawings and specifications  approved by the Landlord, and shall be performed by
contractors and subcontractors who have been approved in advance by the Landlord
and by competent workers. The Tenant shall submit to the Landlord's  supervision
over construction and promptly pay when due the cost of all such work and of all
materials,  labour and services  involved  therein.  Upon the  completion of the
work,  the Tenant shall  deliver to the  Landlord  "as built" CAD drawings  with
respect to such work.

The Tenant  shall  ensure  that its  general  contract or takes out and keeps in
force  contractor's  general liability  insurance,  all risks property insurance
insuring  physical loss or damage during the course of  construction,  including
without limitation, damage due to flood or earthquakes, for the full replacement
value of the work, and boiler and pressure  vessel  insurance  issued on a broad
form  basis in an amount  not less than  replacement  value  (collectively,  the
"Contractor's  Insurance").  The term of each policy of insurance comprising the
Contractor's  Insurance  shall be from the date of the  commencement of the work
until ten (10) days after the work has been  completed.  The Tenant shall during
the term of the Contractor's  Insurance  monitor the limit of both the all risks
property  insurance  and the  boiler  and  pressure  insurance  included  in the
Contractor's  Insurance  to include the cost of changes in the work.  The Tenant
shall also ensure that the  Landlord  is added as an  additional  insured to the
Contractor's  Insurance.  Prior to the commencement of any such work, the Tenant
shall require its general contractor to provide the Landlord with proof that the
Contractor's  Insurance is in place and in good standing and to promptly provide
the  Landlord,  on  request,  a  certified  true copy of each  insurance  policy
comprising  the  Contractor's  Insurance.  If the  general  contractor  fails to
provide or maintain the

                                      -18-
<PAGE>

Contractor's  Insurance as required by this section, the Landlord shall have the
right to provide and  maintain  such  insurance,  in which case the cost thereof
shall be  payable  by the Tenant to the  Landlord  on demand.  In the case of an
insured loss, any deductible amount payable under the Contractor's Insurance and
paid or absorbed by the Landlord shall be reimbursed by the Tenant  forthwith on
demand.

During  the  course  of  construction,   the  Landlord  and  its  employees  and
consultants  shall have reasonable  access to the Leased Premises to inspect and
examine all work being carried out,  provided that such right of inspection  and
examination  shall not be exercised in a manner which would  interfere  with the
construction  and  completion  of such work.  If the  Landlord  gives the Tenant
Notice  that the work being  carried out is  deficient  or is  otherwise  not in
compliance  with the approved  drawings and  specifications,  which Notice shall
contain  particulars  of the alleged  deficiency or  non-compliance,  the Tenant
shall  immediately  provide a copy of such Notice to the Tenant's  architect and
shall immediately attempt to cure such deficiency or non-compliance by enforcing
its  remedies  as  appropriate   in  accordance   with  the  provisions  of  the
construction  contract  with  its  general  contractor  or  otherwise  with  the
intention  that such alleged  deficiency or  non-compliance  be rectified in the
shortest  possible  time.  The  Tenant's  architect  shall  promptly  notify the
Landlord  whether or to the extent  he/she  concurs with the  provisions  of the
Landlord's  Notice.  Either the Landlord or Tenant may refer the decision of the
Tenant's Architect to arbitration.

Within thirty (30) days of  substantial  completion  (as such term in defined in
the  Construction  Lien Act, as amended or  replaced  from time to time) of such
work,  the Tenant shall deliver to the Landlord (i) copies of all guarantees and
warranties  provided by any contractors,  subcontractors,  or material suppliers
with  respect  to the  work,  and  (ii) a  certificate  issued  by the  Tenant's
Architect  certifying  that the work has been  completed in accordance  with all
Applicable Laws and in accordance with the approved drawings and specifications.
The Tenant  agrees to use its best  efforts to complete any  incomplete  work as
noted in the Tenant's Architect's  certificate (or as determined by arbitration)
promptly and in a good and workmanlike manner and agrees to use its best efforts
to cause any noted  deficiencies  or  incomplete  work to be  remedied  within a
reasonable period given the nature of the deficiency.

Any dispute  between  Landlord and Tenant  arising under any  provisions of this
Article which cannot be resolved by good faith  negotiations shall be determined
by  arbitration  in accordance  with the  Arbitration  Act, 1991 of Ontario,  as
amended or replaced from time to time.

7.4   Construction or Mechanic's Lien

The Tenant shall promptly pay all charges incurred by or on behalf of the Tenant
for any work  materials  or  services  which  may give  rise to a  privilege  or
construction,  mechanic's  or  other  lien.  If any  such  privilege  or lien is
registered against the Complex or any part thereof,  the Tenant shall cause such
privilege or lien to be discharged  forthwith,  and if the Tenant fails to do so
within ten (10) business  days of Notice from the Landlord,  then in addition to
any other right or remedy of the  Landlord,  the  Landlord  may but shall not be
obligated to discharge such privilege or lien by paying the amount claimed to be
due into court.  The Landlord shall charge to the Tenant all costs and expenses,
including  legal fees,  incurred by the Landlord in discharging the

                                      -19-
<PAGE>

privilege or lien, and such amount shall be payable forthwith by the Tenant upon
demand by the Landlord as Additional Rent.

7.5   No Interference with Tenant's Operations

Any work undertaken by the Landlord  pursuant to this Article 7 shall be carried
out in a good and workmanlike  manner at a cost structure not exceeding the cost
structure of comparable work performed by the Landlord for its own purposes, and
in such a manner as to minimize any  interference,  disruption  or conflict with
any activities of the Tenant in the Leased Premises.

7.6   Installation of Meters

At the Tenant's  request and expense,  the Landlord shall install,  at locations
appropriate  for such  purposes,  devices to measure  temperature  and  humidity
within the Leased Premises,  and separate meters or sub-meters for measuring the
amount of electricity,  water, chilled water, fuel, gas, steam or other material
supplied  to the Leased  Premises.  If as a result of such  metering  there is a
material  discrepancy  between  the  actual  consumption  values  and the values
allocated  by the  Landlord  to the  Tenant  as the  Tenant's  Share of the such
components of the Complex Operating Costs for the Accounting Period in question,
the Landlord shall,  within ninety (90) days thereof,  adjust the Tenant's Share
of such  components  of the  Complex  Operating  Costs to  reflect  such  actual
consumption values. If the actual consumption values determined by such metering
are not material,  the adjustments to reflect the metered data shall not be made
until the next Accounting Period.

7.7   Repair Where Tenant at Fault

If the Complex or any part thereof,  including the Shared Areas and  Facilities,
require  repair  or become  damaged  or  destroyed  through  any act,  omission,
negligence  or  carelessness  of the Tenant,  its servants,  agents,  employees,
contractors,  sublessees, or licensees, where such damage or destruction exceeds
$10,000,  the Landlord shall effect the necessary  alterations,  replacements or
repairs and shall charge the Tenant the cost  thereof,  and such amount shall be
payable forthwith by the Tenant upon demand by the Landlord as Additional Rent.

7.8   Repairs by Landlord

Subject to Section 7.7 and Article 8, the Landlord  shall maintain and make such
repairs and replacements to the Common  Facilities,  and provided Mitel Corp. is
in actual  occupation of less than  eighty-five  (85%) of the area of the Leased
Premises,  the structural components and roof of the Leased Premises, as would a
prudent  owner,  and the cost  thereof  shall be included  in Complex  Operating
Costs.  Notwithstanding  the  foregoing,  so long as Mitel  Corp.  is in  actual
occupation of not less than eighty-five  percent (85%) of the area of the Leased
Premises,  the  Landlord  shall be relieved of its  obligations  hereunder  with
respect to the Leased Premises,  it being agreed and understood that Mitel Corp.
shall assume such obligations pursuant to Section 7.1.

                                      -20-
<PAGE>

7.9   Door Locks

If the Tenant  replaces  any lock in the Leased  Premises  with a high  security
device,  the Tenant shall on or before the Termination Date, if requested by the
Landlord,  replace  such high  security  lock with a lock equal in  quality  and
comparable  in design to the original  lock and shall  surrender to the Landlord
all keys, passcodes and access codes to the Leased Premises and the Complex. The
Tenant shall  provide  keys or passcode  access to the Landlord for all areas of
the Leased  Premises  for  purposes of  emergency  maintenance,  repair and loss
prevention.

                                   ARTICLE 8
                              DAMAGE OR DESTRUCTION

8.1   Right to Terminate

If  twenty-five  percent  (25%) or more of the Area of the  Leased  Premises  is
damaged or destroyed by any cause whatsoever,  to the extent that in the opinion
of the  Architect  the  Leased  Premises  cannot be  repaired  or  rebuilt  with
reasonable diligence within six (6) months of the date of the occurrence of such
damage or  destruction,  then either party may, at its option to be exercised by
Notice to the other within the thirty (30) days next following such  occurrence,
elect to terminate this Lease.  If either or both parties so elect,  the Term of
this Lease and the tenancy hereby created shall expire by lapse of time upon the
thirtieth  (30th) day after such Notice is given,  and the Tenant shall,  within
such thirty (30) day period,  vacate the Leased  Premises and surrender the same
to the Landlord, failing which the Landlord shall have the right to re-enter and
repossess the Leased Premises discharged of this Lease and to remove all persons
and  property  therefrom.  In no event shall the Landlord be liable to reimburse
the Tenant for damage to or replacement or repair of fixtures,  floor coverings,
furniture, equipment or Leasehold Improvements.

8.2   Repair and Rebuilding

If neither  party  elects to terminate  this Lease  pursuant to Section 8.1, the
Landlord  shall  proceed to repair or rebuild  the Complex  with due  diligence,
including the structural and  infrastructural  component of the Leased Premises,
to the extent possible with the insurance proceeds received by the Landlord from
the  Landlord's  insurers,  or which would have been  received  had the Landlord
insured as required by this Lease. In repairing,  reconstructing,  or rebuilding
the  Complex or any part  thereof  the  Landlord  may use  designs,  plans,  and
specifications other than those used in the original construction, and may alter
or relocate, or both, any or all of the buildings,  facilities and improvements,
including the Leased  Premises,  provided that the Leased Premises as altered or
relocated  shall be of  substantially  the  same  size,  and be in all  material
respects  reasonably  comparable  to the  Leased  Premises  as  defined  herein,
excluding only the Leasehold Improvements. Upon its completion of its repair and
rebuilding,  the Tenant shall forthwith  commence and  expeditiously  finish the
repair and  rebuilding of the interior of the Leased  Premises and the Leasehold
Improvements  in accordance  with the provisions of Section 7.1. All such repair
and  rebuilding  of the  interior  of the  Leased  Premises  and  the  Leasehold
Improvements shall be at the Tenant's cost.

                                      -21-
<PAGE>

8.3   Abatement of Rent

The Rent shall abate in proportion to the Area of the Leased  Premises  rendered
untenantable  by the  occurrence of damage or  destruction  to the Complex.  The
abatement of Rent shall continue until the earlier of thirty (30) days following
Notice to the Tenant from the Landlord confirming that the Landlord has repaired
or rebuilt  the Leased  Premises to the extent  required,  or the day the Tenant
opens the repaired and rebuilt portion of the Leased Premises for business.

8.4   Certificate of Architect Binding

The  certificate  of the  Architect  shall be binding upon the parties as to the
percentage  of the Area of the Leased  Premises and the  percentage of the Gross
Building Area  destroyed or damaged,  the state of  tenantability  of the Leased
Premises,  and the date upon which the Landlord's  reconstruction  and repair is
substantially completed.

                                   ARTICLE 9
                              LANDLORD'S COVENANTS

9.1   Landlord's Covenant for Quiet Enjoyment

The Landlord hereby  covenants to perform all of the obligations of the Landlord
hereunder  and  further  covenants  that if the  Tenant  pays the Basic Rent and
Additional  Rent and  continuously  and strictly  performs  all its  obligations
hereunder,  the Tenant shall and may, subject to the terms and conditions of the
Lease,  peaceably  possess  and enjoy the Leased  Premises  throughout  the Term
without any interruption or disturbance from the Landlord or any other person or
persons lawfully claiming by, from or under the Landlord.

                                   ARTICLE 10
                                TITLE OF COMPLEX

10.1  Subordination

The Tenant shall promptly upon the written  request of the Landlord,  enter into
an agreement:

      (a)   subordinating the Term and the rights of the Tenant hereunder to any
            Mortgage; and

      (b)   agreeing that the Term hereof shall be subsequent in priority to any
            such Mortgage;

provided that the Tenant's obligations under this paragraph shall be conditional
upon any such  Mortgagee  entering  into a  non-disturbance  agreement  with the
Tenant  under which the Tenant's  continued  possession  of the Leased  Premises
under the terms of this Lease is ensured so long as the Tenant is not in default
hereunder notwithstanding any act taken by the Mortgagee.

                                      -22-
<PAGE>

10.2  Attornment

The rights of the  Landlord  under this  Lease may be  hypothecated,  mortgaged,
pledged,  ceded,  charged,  transferred or assigned to a purchaser or Mortgagee.
Upon any request of the  Landlord,  the Mortgagee or any  purchaser,  the Tenant
shall  attorn to and  become  the  tenant of such  Mortgagee  or such  purchaser
(provided  the  Mortgagee  or  purchaser,  as the  case  may  be,  accepts  such
attornment) on the same terms as are contained in this Lease.

10.3  Status of Lease Statement

Upon any request of either party, the other party shall execute, acknowledge and
transmit  forthwith to the requesting party a statement in writing certifying to
the requesting  party (and its Mortgagee or purchaser,  as applicable) that this
Lease is in full force and effect,  certifying  the extent of any  prepayment of
Basic Rent or Additional  Rent,  certifying  the existence or  non-existence  of
defaults  of which such party has actual  knowledge,  and  certifying  any other
matters  pertaining  to this  Lease  as to  which  the  requesting  party  shall
reasonably request a certificate.

10.4  Registration of Lease Prohibited

Each of the  parties  covenants  with the other that it will not  register  this
Lease in this form  against  the title to the Lands,  except by way of notice or
short form of lease,  which notice or short form of lease shall not disclose any
financial terms of this Lease,  which financial terms include,  without limiting
the generality of the foregoing, rental rates, rent free, rent deferred and rent
reduced periods,  and any other form of tenant  inducement.  The Landlord hereby
agrees to execute a short form of lease which  complies  with this  section,  if
necessary for the purpose of supporting of an application  for  registration  of
notice of this Lease.

                                   ARTICLE 11
                             USE OF LEASED PREMISES

11.1  Type of Business Permitted

The  Tenant  covenants  not to use or permit  the  Leased  Premises  or any part
thereof to be used for any unlawful purpose,  lodging,  cooking, sleeping or any
other purpose other than the Permitted Use.

11.2  Compliance With Applicable Laws and Government Requirements

Subject to the  provisions of section 11.5,  the Tenant shall at its own expense
comply with all Applicable Laws, including Environmental Laws, applicable to the
Leased Premises and the business  conducted  therein,  and all other present and
future requirements of all municipal,  provincial,  federal and other applicable
governmental  authorities  pertaining to the Leased Premises or the Tenant's use
thereof.

                                      -23-
<PAGE>

11.3  Waste/Nuisance

The Tenant shall not commit or permit any waste or injury to the Leased Premises
including  without  limitation  the Leasehold  Improvements  and trade  fixtures
therein.  The Tenant shall not commit or permit any nuisance in the Complex. The
Tenant shall not cause  annoyance  to the other  occupants of the Complex by any
means including the creation of objectionable or offensive noises, vibrations or
odours  and  the  Landlord  shall  determine  in  its  sole  discretion,  acting
reasonably, whether such annoyance is being caused.

11.4  Rules and Regulations

The Tenant  covenants  and agrees  that the Rules and  Regulations  shall in all
respects be observed and performed by the Tenant, its employees, contractors and
agents and, to the extent the Tenant can require the same,  by its  invitees and
others over whom the Tenant can reasonably be expected to exercise control.  The
Landlord shall have available to it all remedies  provided in this Lease and all
other legal  remedies  available  at law or in equity upon a breach of the Rules
and  Regulations by the Tenant.  The Landlord may terminate this Lease forthwith
upon such breach if, after Notice of such breach,  the Tenant fails to remedy or
commence to remedy such breach  within  fifteen (15) days or fails to diligently
continue to rectify such breach.  The Tenant  acknowledges that the Landlord has
no  obligation   and  there  shall  be  no  liability   upon  the  Landlord  for
non-enforcement of the Rules and Regulations.  The current Rules and Regulations
are set out in Schedule "D" hereto.

11.5  Environment

The  Tenant's  storage,  generation,  use,  handling,  manufacture,  processing,
labelling, transportation,  treatment, emission, discharge or release of general
wastes and Hazardous  Substances in the Leased Premises and in the Complex shall
be in compliance with Environmental Law. The Tenant further covenants to provide
written notification to the Landlord of any Hazardous Substance which the Tenant
intends to bring into the Complex,  unless such Hazardous  Substances are in use
in the  Complex as at the  Commencement  Date,  so as to enable the  Landlord to
determine whether its existing  Environmental  Process  Management and Hazardous
Substance Control systems are capable of accommodating such Hazardous Substance.
A list of the Hazardous  Substances in use in the Complex as at the Commencement
Date shall be provided to the Landlord by the Tenant on the  Commencement  Date.
If the Tenant  wishes to bring into the Complex any Hazardous  Substances  which
cannot safely be  accommodated  by the  Landlord's  then existing  Environmental
Process Management and Hazardous Substance Control systems,  the Tenant shall on
Notice to the Landlord  confirming  the  Tenant's  intention to proceed to bring
such Hazardous  Substances into the Complex, and after such time as the Landlord
shall require to implement  appropriate  safety measures in that regard, pay all
costs associated with the  modifications or upgrades required to be made to such
systems,  and for all  permits  and  licenses  required  to be  obtained in that
regard.

The  Tenant,  prior to the expiry of the Term,  at its  expense,  shall cause an
environmental  engineering firm or environmental  consultant,  acceptable to the
Landlord, which acceptance will not be unreasonably withheld, to conduct a Phase
II  Environmental  Assessment of the  Environment,  excluding any location where
waste from the Leased Premises has been disposed,

                                      -24-
<PAGE>

to  determine  whether  there has been any  release or  discharge  of  Hazardous
Substances  to the  Environment  during  the Term (the  "Study"),  the scope and
commencement  date  of  such  Study  to be  acceptable  to the  Landlord,  which
acceptance  will not be unreasonably  withheld,  and to summarise the results of
the Study in a report to the  Tenant  (the  "Report"),  which  report the Tenant
shall  disclose to the Landlord at least thirty (30) days prior to the expiry of
the Term. The Tenant shall  undertake at its expense such remedial work, if any,
in respect of releases or discharges of Hazardous  Substances to the Environment
identified  in  the  Report  as are  required  to  bring  the  Environment  into
compliance  with  Environmental  Law so as not to give rise to  liability on the
part of the Landlord for the removal or remediation of such Hazardous Substances
or generally  for  Environmental  Losses (the  "Remedial  Work")  provided it is
established that the Hazardous  Substance has been released or discharged by the
Tenant.

To the extent that the Remedial Work, or any portion thereof,  is required to be
undertaken or completed  after the expiry of the Term, the Landlord shall ensure
the Tenant is granted a free,  unlimited and unrestricted right of access to the
Complex for the  purpose of  allowing  the  Tenant,  its  employees,  agents and
subcontractors to undertake and complete the Remedial Work. The Tenant shall use
reasonable efforts to minimize any disruption to the business of the Landlord or
any  other  occupant  of  the  Complex  likely  to be  caused  by  the  Tenant's
undertaking the Remedial Work after the expiry of the Tenn.

Notwithstanding  anything to the  contrary in this  Lease,  Tenant  shall not be
liable for or  responsible  for nor liable to pay any costs with respect to: (i)
Environmental  Losses  arising from the  migration  during the Term of Hazardous
Substances  from  another  property  to the Lands or from the  Lands to  another
property  (in each case  except to the  extent  the  release  of such  Hazardous
Substances  was caused by Tenant);  and the Landlord  shall  indemnify  and hold
harmless the Tenant, its officers and directors, and those for whom it is at law
responsible, from any claim, liability or damage arising therefrom.

                                   ARTICLE 12
                           ASSIGNMENT AND SUB-LETTING

12.1  Assignment by Landlord

To the extent that the Landlord's covenants and obligations under this Lease are
assumed by a  purchaser  or lessee of the Complex or a portion  thereof,  or are
assumed by an assignee of this Lease or any interest therein, the Landlord shall
without  further  written  agreement be freed and relieved of such covenants and
obligations.

12.2  Assignment and Subletting by Tenant

The  Tenant  shall not assign  this Lease or part with or share the  occupation,
control or  possession  of the Leased  Premises or any part thereof  without the
prior  written  consent of the Landlord,  which consent may not be  unreasonably
withheld. The Tenant may, however,  without the consent of the Landlord,  assign
this Lease to any corporation which is an affiliate of the Tenant (such transfer
being  called an "Excepted  Transfer")  provided  that as soon as is  reasonably
practicable  (and in any  event  prior  to the  effective  date of the  Excepted
Transfer),  the Tenant shall give the Landlord Notice of such Excepted  Transfer
and deliver to the Landlord an

                                      -25-
<PAGE>

agreement  wherein such assignee  covenants to the Landlord to perform,  observe
and keep each and every  covenant,  condition and agreement in this Lease on the
part of the Tenant to be performed,  observed or kept, and further  provided the
Tenant shall,  notwithstanding such Excepted Transfer, remain responsible to the
Landlord for the performance of all terms, covenants,  conditions and agreements
imposed upon the Tenant by this Lease.  If subsequent  to an Excepted  Transfer,
such  affiliate is no longer  affiliated  with the Tenant  (unless the shares of
such company are listed and traded on any  recognized  public stock  exchange or
the Tenant remains its largest single common  shareholder),  such event shall be
deemed to be an  assignment  of this Lease to which the  provisions  of sections
12.2  and  12.3  shall  apply.  For the  purposes  of  this  Section,  the  term
"affiliate"  or  "affiliated"  shall have the meanings  ascribed  thereto in the
Canada Business Corporations Act, as amended from time to time.

Provided that the Tenant may, without the consent of the Landlord,  enter into a
short term  licence of a portion of the Leased  Premises  to a third party whose
presence in the Leased  Premises is required to assist in the Tenant's  business
operations ( as for example for system design or consulting  purposes).  In such
event,  the Tenant shall give the Landlord Notice of such short term licence and
ensure that such third party observes all requirements of this Lease relating to
the use and occupation of the Complex,  and  notwithstanding  such licence,  the
Tenant shall  continue to be responsible  for the due and timely  performance in
full of all of its obligations under this Lease.

Provided further,  that the Tenant may sublease the Leased Premises, in whole or
in part,  without the  Landlord's  prior  consent but on Notice to the Landlord,
provided the Tenant first delivers to the Landlord an agreement by the subtenant
in the  form  attached  as  Schedule  "F" to this  Lease.  Notwithstanding  such
sublease,  the Tenant shall  continue to be  responsible  for the due and timely
performance in full of all of its obligations under this Lease.

12.3  Request to Assign

If the Tenant  requests the  Landlord's  consent to an assignment of this Lease,
the Tenant  shall  submit to the  Landlord  the name and address of the proposed
assignee  together  with a copy of an offer or agreement to assign or assignment
and  such  additional  information  as to the  nature  of its  business  and its
financial  responsibility and standing (including  financial  statements) as the
Landlord may reasonably require.

12.4  Assignment Agreement

The Landlord's  consent to any assignment shall be conditional upon the assignee
entering into an assignment  agreement in form and content  satisfactory  to the
Landlord,  to perform,  observe and keep each and every covenant,  condition and
agreement in this Lease on the part of the Tenant to be performed,  observed and
kept including the payment of Rent and all other sums and payments  agreed to be
paid or  payable  under  this  Lease  on the days and  times  and in the  manner
specified.  In no event  shall any  assignment  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 to be performed.

                                      -26-
<PAGE>

12.5  Changes in Corporate Control

If the  Tenant is a private  corporation  whose  shares  and those of its parent
company are not listed on a recognized  public securities  exchange,  and if for
any reason the effective  voting control of such corporation is transferred from
the person or  persons  having  effective  control  of such  corporation  at the
Commencement  Date (unless such transfer of control is to an affiliated  company
of the Tenant),  such transfer shall be deemed to be an assignment of this Lease
to which the  provisions  of sections 12.2 and 12.3 shall apply (it being agreed
and understood that if subsequent to such transfer,  the transferee is no longer
affiliated  with the Tenant,  (unless the shares of such company are listed on a
recognized public  securities  exchange or the Tenant remains its largest single
common  shareholder),  such event  shall be deemed to be an  assignment  of this
Lease to which the provisions of sections 12.2 and 12.3 shall apply.  The Tenant
shall advise the  Landlord in writing  forthwith of any such change in effective
voting control and shall make available to the Landlord for inspection,  copying
or both, all books and records of the Tenant and affiliated  company which alone
or with other data show the person,  persons or entity having  effective  voting
control of the Tenant and  affiliated  company.  The Landlord may terminate this
Lease upon  thirty  (30) days'  Notice if such  books and  records  are not made
available as requested by the Landlord.  For the purposes of this  section,  the
term "affiliate" or "affiliated" shall have the meanings ascribed thereto in the
Canada Business Corporations Act, as amended from time to time.

                                   ARTICLE 13
                                DEFAULT OF TENANT

13.1  Landlord's Right of Re-Entry

If the  Tenant  shall  be in  default  of any of its  covenants  hereunder,  the
Landlord  shall  give to the  Tenant  Notice in  writing  stating  that the said
default is to be remedied and that if such default is not remedied by the Tenant
within fifteen (15) days after the receipt of such Notice, or such longer period
as may be  reasonably  necessary  in  view of the  nature  of the  default,  the
Landlord may, at its option, either enter into and upon the said Leased Premises
or any  part  thereof  in the  name  of the  whole,  and  this  Lease  shall  be
terminated;  or the  Landlord  itself  may take such steps and do or cause to be
done such things as may be necessary to remedy and correct such defaults and may
thereupon charge its total reasonable costs and expenses,  including legal fees,
incurred in respect  thereof to the Tenant,  who hereby  covenants and agrees to
pay the same  forthwith  and further  covenants  that any and all such costs and
expenses  incurred by the Landlord and unpaid by the Tenant shall be recoverable
by the Landlord as Additional Rent as if the same were and in the same manner as
Rent reserved and in arrears under the terms of this Lease.

13.2  Bankruptcy of Tenant and Other Events of Default

All arrears of Basic Rent,  together with the Basic Rent and Additional Rent for
the next ensuing  three (3) months shall  immediately  become due and be paid as
accelerated  rent in the same manner as if it were Basic Rent in arrears in each
of the following  cases:  if any of the Tenant's goods and moveable  effects and
chattels on the Leased  Premises are seized or taken in execution or  attachment
by any creditor of the Tenant,  or if the Tenant shall make any  assignment  for
the

                                      -27-
<PAGE>

benefit of  creditors,  or if the  Tenant  makes any bulk sale other than a bulk
sale to an assignee or sublessee pursuant to an assignment or sublease consented
to under Article 12, or if the Tenant becomes bankrupt or insolvent or takes the
benefit of any  statute now or  hereafter  in force for  bankrupt  or  insolvent
debtors,  or if any order is made or proceedings taken for the winding-up of the
Tenant or for the  termination of its existence,  or if the Leased  Premises are
used by any other  persons  than those  entitled  to use them under the terms of
this Lease,  or if a trustee or receiver or any person,  firm or  corporation in
any capacity  whatsoever takes or obtains possession or effective control of the
assets of the Tenant, or a substantial portion thereof, or of the conduct of the
Tenant's business, or a substantial portion thereof, pursuant to any security or
other  agreement other than pursuant to a permitted  assignment.  In each of the
above cases the  Landlord may  terminate  this Lease by Notice to the Tenant and
may re-enter and take  possession of the Leased Premises as though the Tenant or
any other occupant of the Leased Premises were holding over after the expiration
of the Term, and any Notices  required to be given in such  circumstances  being
deemed to have been given and the notice period prescribed therein expired.

13.3  Excuse of Performance

Notwithstanding  anything contained in this Lease,  neither the Landlord nor the
Tenant shall be deemed to be in default with respect to the  performance  of any
of the terms,  covenants  and  conditions  of this  Lease,  except the  Tenant's
obligations  to pay Basic Rent and  Additional  Rent,  if such default is due to
Unavoidable Delay.

13.4  Cross - Default

A default by the Tenant of its  obligations  under any other  lease  between the
Tenant and the  Landlord  shall  constitute  a default  under this Lease and any
default under this Lease by the Tenant shall  constitute a default by the Tenant
under such other lease.

                                   ARTICLE 14
                           LANDLORD'S RIGHT OF ACCESS

14.1  Right of Access and Method of Re-Entry

The Landlord and its representatives, employees, contractors and agents who have
received prior security  clearances and have been issued contractor badges shall
have the right to enter the Leased  Premises during the Tenant's normal business
hours upon  reasonable  prior  Notice,  or at any time without  notice during an
emergency,  as determined  by the  Landlord,  to examine the state of the Leased
Premises and of the Leasehold  Improvements,  equipment and fixtures therein, to
make  such   changes,   repairs,   alterations,   improvements,   additions   or
installations  in and to the Complex as the  Landlord is  otherwise  entitled or
required  to carry  out  pursuant  to this  Lease  and to take  into the  Leased
Premises all material and equipment  required in connection  with the foregoing.
The  Landlord or its  employees,  contractors  or agents shall have the right to
enter the Leased  Premises  in the  company of a  representative  of the Tenant,
during normal  business  hours upon  reasonable  prior Notice to show the Leased
Premises to any prospective assignee of the Head Lease or Mortgagee. In the case
of emergency,  if the Leased  Premises are locked the Landlord or its employees,
contractors  or agents  may  enter the  Leased  Premises  using a master

                                      -28-
<PAGE>

key or passcode,  if available,  and, in the case of an  emergency,  by force if
necessary without liability of any type of the Landlord to the Tenant.

14.2  Building Systems

Where any part of the building  systems  adjacent to the Leased Premises require
maintenance  or repair,  the Tenant shall on reasonable  prior Notice permit the
Landlord to enter upon the Leased Premises in the company of a representative of
the Tenant to do such work as the Landlord deems  necessary.  The Landlord shall
undertake its reasonable efforts to co-operate with the "Risk Work Plan" process
of the Tenant where such repairs and/or  maintenance  may impact on the Tenant's
operations.  For the purposes of this Section, "Risk Work Plan" shall mean those
policies and  procedures  which the Tenant itself has in place  ensuring that no
detrimental  impact  is made on and  protection  is given  to the  manufacturing
process or other work being carried out in the Leased Premises.

14.3  Obligations of Tenant and Landlord

No entry under Article 14 shall constitute an eviction of the Tenant in whole or
in part, and the Basic Rent and  Additional  Rent shall not abate while changes,
repairs,  alterations,  improvements,  additions or  installations in and to the
Complex  are being made.  Nor shall any such entry  affect the  obligations  and
covenants of the Tenant under this Lease,  and the Tenant shall have no claim by
reason of loss or interruption of business.  Nothing in this Article 14 shall be
deemed or construed to impose upon the Landlord any  obligation,  responsibility
or liability for the care,  maintenance or repair of the Leased Premises, or any
part thereof save as otherwise expressly set out in this Lease.

                                   ARTICLE 15
                           SHARED AREAS AND FACILITIES

15.1  Non-Exclusive Right to Use Shared Areas and Facilities

Subject to section 17.2 and the other terms and  conditions  of this Lease,  the
Tenant,  its officers,  employees and customers  shall have the right, in common
with others designated by the Landlord or otherwise entitled,  to use the Shared
Areas and Facilities for their proper and intended purpose provided, however, no
access  shall  be  permitted  to  service,   janitorial  and  mechanical  rooms,
transformer  vaults,  electrical  distribution  rooms or water meter rooms.  The
Tenant acknowledges that the Shared Areas and Facilities are under the exclusive
control and  management  of the Landlord and that the Tenant is permitted to use
the Shared Areas and  Facilities  under an irrevocable  licence.  If changes are
made to the Shared Areas and Facilities by the Landlord,  the Landlord shall not
be subject to any liability nor shall the Tenant be entitled to any compensation
or any  diminution  or abatement of Rent and such changes shall not be deemed to
be a constructive or actual eviction or a breach of the Landlord's  covenant for
quiet enjoyment,  unless such changes represent a material interference with the
normal business operations of the Tenant at the Leased Premises.

                                      -29-
<PAGE>

15.2  Alterations to Shared Areas and Facilities

The Landlord  shall have the right at any time from time to time during the Term
to change,  add to,  subtract  from,  rearrange  or alter the  Shared  Areas and
Facilities and other parts of the Complex  including the Lands and all buildings
thereon,  to dedicate portions of the Lands for municipal and other governmental
purposes  and to  convey  portions  of the  Lands  to  others  for any  purposes
whatsoever.  The Landlord shall use its best efforts not to materially interfere
with the normal business operations of the Tenant, but the Landlord shall not be
liable to the Tenant for any interference or inconvenience  caused by any action
of the Landlord  under the  provisions  of this Section 15.2 unless such actions
represent a material  interference  with the normal  business  operations of the
Tenant at the Leased Premises.

                                   ARTICLE 16
                        INTERPRETATION AND MISCELLANEOUS

16.1  No Partnership

Nothing  contained  in this Lease or in any acts of the parties  hereto shall be
construed  to create any  relationship  between the  parties  other than that of
Landlord,  Tenant  and  Covenantor,  if any,  or to  create  a  relationship  of
partnership  or of joint venture  between the parties  hereto,  or to constitute
this Lease as an emphyteutic  lease,  or to create any right of ownership in the
Tenant.

16.2  Agency

The  Tenant  acknowledges  that  the  Landlord  may  perform  any  or all of the
Landlord's  obligations  or  exercise  any of the  Landlord's  rights  hereunder
through or by means of such manager, or other agency or agencies as the Landlord
may from time to time determine.

16.3  Lease is Entire Agreement

With the  exception  of the  Acquisition  Agreement,  this  Lease sets forth the
entire agreement  between the Tenant and the Landlord with respect to the Leased
Premises.  Any offer to lease or agreement to lease entered into by the Landlord
and Tenant  prior to the  execution  of this Lease  shall be deemed to have been
merged and  extinguished  in this Lease.  No amendment or addition to this Lease
will bind the  Landlord or the Tenant  unless such  amendment  or addition is in
writing and signed by all parties to this Lease.

16.4  Joint and Several Liability

The liability to pay Rent and perform all other  obligations under this Lease of
each individual,  corporation,  partnership or business association signing this
Lease and of each member of any such  partnership or business  association,  the
members of which are by law subject to personal liability, shall be deemed to be
joint and several.

                                      -30-
<PAGE>

16.5  Governing Law

This Lease  shall be  construed  and  governed  by the laws of the  Province  of
Ontario and the laws of Canada  applicable  therein,  and for this  purpose each
party  attorns to the  exclusive  jurisdiction  of the courts of the Province of
Ontario in respect of any dispute under this Lease.

16.6  Interpretation

Words importing the singular number shall include the plural and words importing
firms and corporations  shall include persons.  Each obligation of the Tenant in
this Lease, although not expressed as a covenant, is considered to be a covenant
for all purposes.  The article and section headings and index of this Lease form
no part hereof and are inserted for convenience  only. If any section,  article,
paragraph,  sub-paragraph, clause or sub-clause in this Lease is held invalid or
unenforceable  by any  court of  competent  jurisdiction,  this  Lease  shall be
interpreted as if such section,  article,  paragraph,  sub-paragraph,  clause or
sub-clause had not been a part of this Lease.

16.7  Successors and Assigns

This Lease  shall be  binding  upon,  extend to and enure to the  benefit of the
Landlord,  Tenant  and  Covenantor,  if any,  and to each of  their  respective,
successors and permitted assignees.

16.8  Reasonableness

Except where specifically provided to the contrary in this Lease:

      (a)   whenever this Lease requires an approval,  consent or  authorization
            by the Landlord or an agent of the Landlord,  the approval,  consent
            or authorization shall not be unreasonably withheld or delayed;

      (b)   whenever this Lease  requires a  determination,  estimation or other
            action or exercise of  discretion by the Landlord or an agent of the
            Landlord,  the  determination,  estimation,  action or  exercise  of
            discretion shall be reasonable and in accordance with any applicable
            professional practice and standards; and

      (c)   whenever this Lease provides for costs, expenses and fees to be paid
            by the Tenant, the costs, expenses and fees shall be reasonable.

16.9  Counterparts and Facsimile

This  Lease  may be  executed  in any  number  of  counterparts.  Each  executed
counterpart  shall be deemed to be an  original  and all  executed  counterparts
taken  together shall  constitute one agreement.  Each of the parties hereto may
execute this Lease by signing any such  counterpart.  Each party  hereto  agrees
that a copy of any  signature  page of this Lease with a  facsimile  form of the
signature  of the person or persons  signing  this Lease on behalf of such party
shall  constitute  all required  evidence of the  execution and delivery of this
Lease by such party.

                                      -31-
<PAGE>

                                   ARTICLE 17
                               SPECIAL PROVISIONS

17.1  Exercise of Rights by Landlord

Landlord  shall act  reasonably  and as a prudent owner in exercising all rights
and  so as not  to  interfere  more  than  is  reasonably  necessary  under  the
circumstances with Tenant's use and enjoyment of the Premises.

17.2  Parking

The Tenant  shall have access and use of, in common with other  occupants of the
Complex,  and at no additional cost,  three (3) unreserved  parking spots on the
designated parking areas on the Lands for every 1,000 square feet of the Area of
the Leased Premises for the use of its employees and visitors.

17.3  Security

The Tenant shall  comply with  security  measures in place for the Complex.  The
Landlord shall consult with the Tenant in the  establishment  or changes to such
requirements for the Leased Premises,  provided that any special requirements of
the Landlord or the Tenant shall be at such party's costs.

17.4  Cleaning/Janitorial Services/Garbage Removal

The Tenant shall at its sole cost and expense,  provide  janitorial  and garbage
removal  services to the Leased  Premises as would a prudent  owner.  The Tenant
shall ensure that  materials  subject to hazardous  waste  regulations  or other
Environmental  Laws are disposed of by Tenant at Tenant's expense as required by
such  Environmental  Laws, and where so  prohibited,  not as part of the regular
garbage.  The Landlord may from time to time monitor the disposal and removal of
all general waste and Hazardous  Substances.  The Landlord's  costs and expenses
associated with such activities  shall be charged to the Tenant as an additional
service pursuant to section 4.3.

17.5  Emergency Response Team

The Landlord and Tenant shall cooperate in the  establishment and operation of a
joint   emergency   response   team  with  the  purpose  of  responding  to  all
environmental, health and safety emergencies at the Leased Premises.

                                   ARTICLE 18
                                  CONSTRUCTION

18.1  Construction Obligations of the Tenant

      (a)   The Tenant  covenants  and agrees that it shall at its sole cost and
            expense Complete the construction of the Leased Premises (which have
            been designed to comprise approximately 103,000 square feet, more or
            less, of rentable  area) on the

                                      -32-
<PAGE>

            Phase V Lands  in the  location  shown  on the  Site  Plan,  and the
            attendant exterior  amenities  (including  without  limitation,  all
            parking areas,  driveways and  landscaping)  in accordance  with the
            Site  Plan  (including  without  limitation,  making  the  necessary
            financial   deposits  to  the   municipality)   and  the  Plans  and
            Specifications (collectively,  the "Phase V Work"). The Tenant shall
            not vary or amend  the Site  Plan or the  Plans  and  Specifications
            without  having  first  obtained  the prior  written  consent of the
            Landlord.  The  Landlord  need not consent to any change or revision
            which in its  opinion,  acting  reasonably,  adversely  affects  the
            structure of the building,  reduces building  functionality,  or the
            aesthetics of the interior or exterior of the  building,  or reduces
            the useful life of the building,  or generally  degrades the quality
            of the building.  The Landlord  confirms that if it has not provided
            its acceptance or rejection of a proposed  change or revision within
            ten (10) business days of Notice from the Tenant, it shall be deemed
            to have accepted such change or revision.  All agreed  amendments to
            the Plans and  Specifications  shall be dated and  initialled by the
            parties for identification purposes.

      (b)   The  Phase V Work  shall be  carried  out in a good and  workmanlike
            manner and with quality  materials in accordance  with the Site Plan
            and  Plans  and  Specifications,  and in  compliance  with  building
            permits  and site  plan  approvals  therefor  and  Applicable  Laws.
            Services  required  for  the  Leased  Premises  as of  the  Date  of
            Substantial Completion shall be installed and paid for by the Tenant
            and the  Tenant  shall  not  arrange  for the  installation  of such
            services by the regional,  metropolitan  or municipal  government in
            such a way that  the  cost  thereof  shall  be  assessed  as a local
            improvement,  impost,  levy or charge to be included in Taxes levied
            against the  Complex or the Leased  Premises.  The Tenant  agrees to
            initially retain Doran Contractors  Limited as general contractor to
            perform the Phase V Work.  Tenant agrees that it will not change the
            general   contractor  without  the  prior  written  consent  of  the
            Landlord,  which  consent  shall  not be  unreasonably  withheld  or
            delayed.  The  Landlord  confirms  that if it has not  provided  its
            acceptance or rejection of a proposed replacement general contractor
            within ten (10) business days of Notice from the Tenant, it shall be
            deemed to have accepted such replacement general contractor.

      (c)   The Tenant  shall  ensure  that its general  contractor  replacement
            general contractor, as the case may be, takes out and keeps in force
            contractor's  general  liability   insurance,   all  risks  property
            insurance  insuring  physical  loss or  damage  to the  Phase V Work
            during the course of  construction,  including  without  limitation,
            damage due to flood or earthquakes,  for the full replacement  value
            of the Phase V Work, and boiler and pressure vessel insurance issued
            on a broad form basis in an amount not less than  replacement  value
            (collectively,  the  "Contractor's  Insurance").  The  term  of each
            policy of insurance  comprising the Contractor's  Insurance shall be
            from the date of the commencement of the Phase V Work until ten (10)
            days after the Phase V Work has been  completed.  The  Tenant  shall
            during the term of the Contractor's  Insurance  monitor the limit of
            both the all risks  property  insurance  and the boiler and pressure
            insurance included in the Contractor's Insurance to include the cost
            of changes in the Phase V Work.  The

                                      -33-
<PAGE>

            Tenant  shall  also  ensure  that the  Landlord  is added as a named
            insured,  as "Owner" both to the all risk property insurance and the
            boiler and pressure vessel  insurance  included in the  Contractor's
            Insurance,  and as an additional insured to the Contractor's general
            liability policy.  Prior to the Commencement  Date, the Tenant shall
            require its general contractor or replacement general contractor, as
            the case  may be,  to  provide  the  Landlord  with  proof  that the
            Contractor's  Insurance  is in  place  and in good  standing  and to
            promptly provide the Landlord,  on request, a certified true copy of
            each insurance policy comprising the Contractor's  Insurance. If the
            general contractor or replacement  general  contractor,  as the case
            may be, fails to provide or maintain the  Contractor's  Insurance as
            required by this  subsection  18.1(c),  the Landlord  shall have the
            right to provide and maintain such insurance, in which case the cost
            thereof shall be payable by the Tenant to the Landlord on demand. In
            the case of an insured loss, any deductible amount payable under the
            Contractor's Insurance and paid or absorbed by the Landlord shall be
            reimbursed by the Tenant forthwith on demand.

      (d)   The Tenant shall diligently  proceed to obtain all necessary permits
            and  approvals  and as soon as possible and  following the obtaining
            thereof shall proceed with the  construction and completion of Phase
            V Work.

      (e)   During the course of  construction,  the Landlord and its  employees
            and consultants  shall have reasonable access to the Leased Premises
            to inspect and examine all work being  carried  out,  provided  that
            such right of inspection and examination shall not be exercised in a
            manner which would interfere with the construction and completion of
            the Phase V Work.  If the Landlord  gives the Tenant Notice that the
            Phase V Work being  carried out is deficient or is otherwise  not in
            compliance with the Plans and Specifications or the Site Plan, which
            Notice  shall  contain  particulars  of the  alleged  deficiency  or
            non-compliance,  the Tenant shall immediately provide a copy of such
            Notice to the Tenant's  Architect and shall  immediately  attempt to
            cure such deficiency or  non-compliance by enforcing its remedies as
            appropriate in accordance  with the  provisions of the  construction
            contract with its general contractor or otherwise with the intention
            that such alleged  deficiency or  non-compliance be rectified in the
            shortest possible time. The Tenant's Architect shall promptly notify
            the  Landlord  whether  or to the  extent  he/she  concurs  with the
            provisions of the Landlord's  notice.  Either the Landlord or Tenant
            may refer the decision of the Tenant's Architect to arbitration.

      (f)   Within thirty (30) days of the Date of Substantial  Completion,  the
            Tenant shall  deliver to the  Landlord (i) copies of all  guarantees
            and  warranties  provided  by any  contractors,  subcontractors,  or
            material  suppliers  with  respect  to the Phase V Work,  and (ii) a
            certificate  issued by the Tenant's  Architect  certifying  that the
            Phase V Work has been  Completed in accordance  with all  Applicable
            Laws  and in  accordance  with  the  Site  Plan  and the  Plans  and
            Specifications.  The  Tenant  agrees  to use  its  best  efforts  to
            complete any  incomplete  work as noted in the Tenant's  Architect's
            certificate (or as determined by arbitration) promptly and in a good
            and  workmanlike  manner and agrees to use its best efforts to cause
            any

                                      -34-
<PAGE>

            noted  deficiencies  or  incomplete  work to be  remedied  within  a
            reasonable period given the nature of the deficiency.

      (g)   Any dispute between Landlord and Tenant arising under any provisions
            of this Article which cannot be resolved by good faith  negotiations
            shall  be  determined  by   arbitration   in  accordance   with  the
            Arbitration  Act, 1991 of Ontario,  as amended or replaced from time
            to time.

                                   ARTICLE 19
                              IMPROVEMENT ALLOWANCE

19.1  Improvement Allowance

Provided  the  Tenant  is not then in  default,  the  Landlord  shall pay to the
Tenant,  once only as a  contribution  toward the cost of the Phase V Work to be
carried out by the Tenant  pursuant to Article 18, an  improvement  allowance in
the amount of One Hundred and Twenty Dollars ($120)  multiplied by the number of
square feet comprising the Area of the Leased Premises.

Such improvement allowance shall be paid to the Tenant upon the later of:

      (a)   the Completion of the Phase V Work;

      (b)   the expiration of all applicable statutory construction lien periods
            with respect to the Phase V Work;

      (c)   receipt by the Landlord from the Tenant of each of the following:

            (i)   a statutory  declaration  of an officer of the Tenant that the
                  Phase V Work has been  Completed,  the statutory  construction
                  lien periods with respect to the Phase V Work have expired and
                  no liens are outstanding,  all accounts for work, services and
                  material  have been paid and that the  Tenant  has met all its
                  obligations to its contractors,  subcontractors  and suppliers
                  with respect to the Phase V Work;

            (ii)  evidence of compliance  with the  requirements of the Province
                  of Ontario  with  regard to  worker's  compensation  insurance
                  including all payments due thereunder;

            (iii) evidence  in a  form  satisfactory  to  the  Landlord,  acting
                  reasonably,  that the Phase V Lands comply with all applicable
                  zoning  provisions  as a  stand-alone  parcel of land so as to
                  permit  the  financing  and re- sale of the Phase V Lands as a
                  separate  parcel of land,  including  without  limitation,  if
                  required, an access and parking arrangement in accordance with
                  the  subdivision   control  provisions  of  the  Planning  Act
                  (Ontario) with the Landlord as owner of the adjoining  parcels
                  of lands (it being agreed and  understood  by the parties that
                  such  parking  and  access  may  have  to be  located  on such
                  adjoining lands notwithstanding  anything in this Lease to

                                      -35-
<PAGE>

                  the contrary),  a minor variance of the setback requirement of
                  the  municipality,  and a  minor  variance  to the  applicable
                  zoning  bylaw  or a zoning  bylaw  amendment,  as  applicable,
                  permitting  the whole of the  Leased  Premises  to be used for
                  office purposes,  in each case at the sole cost and expense of
                  the Tenant and on terms  satisfactory to the Landlord,  acting
                  reasonably; and

            (iv)  if  requested  by  the  Landlord,  copies  of  all  contracts,
                  subcontracts,  invoices  and  any  other  documentation  which
                  evidences the cost of the Phase V Work; and

      (d)   the Tenant shall have commenced carrying on business from the Leased
            Premises.

Concurrent  with the  payment of the  improvement  allowance,  the Tenant  shall
deliver to the Landlord a waiver in writing of the  Tenant's  Option (as defined
in  section  19.2 of this  Lease)  confirming  that the Option is void and of no
further force or effect.

19.2    Option to Purchase

If the Landlord fails to pay to the Tenant the improvement  allowance  described
in section  19.1 of this  Lease as and when  required  by  section  19.1 of this
Lease,  assuming any  arbitration  commenced with respect to any dispute between
the Landlord and the Tenant  regarding  the  provisions of Article 19 shall have
been either completed and a decision  rendered by the arbitrator or arbitrators,
as the case  may be,  in  respect  of the  same,  or such  arbitration  has been
abandoned  by the consent of the parties,  the Landlord  grants to the Tenant an
option  (the  "Option")  to  purchase  the  Phase  V  Lands  together  with  all
improvements thereon,  including without limitation,  the Leased Premises,  from
the Landlord at the price and upon the terms and  conditions  more  particularly
set out in this section 19.2.

19.2.1. The Option  shall be  exercised  by Notice by the Tenant to the Landlord
        that unless the Landlord pays the improvement  allowance,  or the amount
        then remaining outstanding,  as the case may be, within ten (10) days of
        the Landlord's  receipt of the Tenant's Notice (the "Cure Period"),  the
        Tenant shall be deemed to have exercised its Option. The Tenant's Notice
        exercising  the Option shall specify the date for the  completion of the
        purchase (the "Closing Date"), which date shall be not later than thirty
        (30) days following the  expiration of the Cure Period.  In the event of
        and upon:  (a) the  exercise of the Option in the manner set out in this
        subsection 19.2.1 and (b) the Landlord's  failure to pay the improvement
        allowance, or the amount then remaining outstanding, as the case may be,
        within  the Cure  Period;  this  section  19.2 and the  Tenant's  Notice
        exercising the Option shall then become a binding  agreement of purchase
        and sale between the parties to be  completed  upon the terms set out in
        this section  19.2. If the Landlord  pays the  improvement  allowance in
        full within the Cure Period, the Option shall be null and void and of no
        further force or effect.

19.2.2. The  purchase  price  payable for the Phase V Lands shall be One Hundred
        and Seventy-Five Thousand Dollars ($175,000) per acre of land comprising
        the Phase V Lands plus the amount,  if any,  paid by the Landlord to the
        Tenant on account of the  improvement

                                      -36-
<PAGE>

        allowance prior to the expiration of the Cure Period.  The exact area of
        the Phase V Lands shall be as set forth in a surveyor's  certificate  to
        be  delivered  by the  Landlord  to the Tenant  within  twenty (20) days
        following the expiration of the Cure Period. The purchase price shall be
        paid and  satisfied  in full by  certified  cheque or bank  draft on the
        Closing  Date.  The purchase  price shall be subject to  adjustment  for
        pre-paid Rents but shall not otherwise be subject to adjustment.

19.2.3. The Landlord represents and warrants to the Tenant that:

            (a)   it is not and will not at the Closing  Date be a  non-resident
                  of Canada within the meaning of the Income Act of Canada;

            (b)   it is a  corporation  dully  incorporated  and  organized  and
                  validly existing under the laws of the Province of Ontario;

            (c)   it has all necessary  corporate  authority to grant the Option
                  and, in the event of the exercise of the Option by the Tenant,
                  the completion of the  transaction  contemplated in the Option
                  will be duly authorized by all necessary  corporate  action on
                  the part of the Landlord;

            (d)   the  granting  of  the  Option  and  the   completion  of  the
                  transaction   contemplated  hereby  will  not  result  in  the
                  violation  of any  indenture  or other  agreement,  written or
                  oral,  to which  the  Landlord  may be a party or by which the
                  Landlord is bound; and

            (e)   on the Closing Date, the Phase V Lands shall be free and clear
                  of all encumbrances,  except (i) encumbrances to be discharged
                  from the  purchase  price  payable to the  Landlord  where the
                  Landlord has delivered to the Tenant a signed statement of the
                  encumbrancer  as to the amount  required to obtain a discharge
                  of  the  encumbrance  on  the  Closing  Date  together  with a
                  direction executed by the Landlord authorizing payment of that
                  amount from the purchase  price  directly to the  encumbrancer
                  and the  Landlord's  solicitor's  undertaking  to  obtain  and
                  register a discharge  of the  encumbrance  within a reasonable
                  time after the Closing Date, (ii) those encumbrances  existing
                  when the Landlord obtained title to the Phase V Lands from the
                  Tenant,  and  (iii)  any other  encumbrances  which  have been
                  agreed to by the Tenant in writing or incurred by or on behalf
                  of the  Tenant,  or as a result of any act or  omission of the
                  Tenant  or those for whom the  Tenant  is in law  responsible,
                  including  without  limitation,  any  municipal  agreements or
                  easements required by or entered into as a result of the Phase
                  V Work.

                 The representations and warranties contained in this subsection
                 19.2.3 shall be true and correct as of the  Closing  Date and a
                 certificate to this effect will be delivered by the Landlord to
                 the Tenant on closing.

                 The  Tenant  acknowledges  that except  as set  forth  in  this
                 subsection  19.2.3,  the  Option  granted  hereunder   and  any
                 purchase by the Tenant of the Phase  V  Lands are  made without
                 representations and  warranties by the Landlord and are made on
                 the completely "as is, where is" basis without  recourse to the
                 Landlord.

                                      -37-
<PAGE>

19.2.4. The deed or  transfer  conveying  the Phase V Lands shall be prepared at
        the expense of the Tenant.  The Tenant may direct that the Phase V Lands
        be conveyed by the  Landlord to a transferee  other than the Tenant.  If
        requested  by either the  Landlord or the  Tenant,  the other party will
        deliver on closing the statements  contemplated by subsection  50(22) of
        the Planning Act of Ontario.

        The Option and any  agreement  of  purchase  and sale  arising  from its
        exercise  shall be subject to compliance  with the  subdivision  control
        provisions of the Planning Act of Ontario, as amended from time to time,
        which compliance shall be at the sole expense of the Tenant.

                                                   IN WITNESS WHEREOF...

                                      -38-
<PAGE>

         IN WITNESS WHEREOF the parties hereto have executed this Lease.

DATED this 27th day of March, 2001

                                  MITEL RESEARCH PARK CORPORATION

                                  Per:     /s/
                                           --------------------------------
                                  Name:    Jose Medeiros
                                  Title:   Treasurer

                                  Per:
                                           --------------------------------
                                  Name:
                                  Title:

                                           I/We have the authority to bind the
                                           corporation

DATED this 27th day of March, 2001

                                  MITEL CORPORATION

                                  Per:     /s/
                                           ---------------------------------
                                  Name:    Shirley Mears
                                  Title:   Vice President, Treasurer

                                           I/We have the authority to bind the
                                           corporation

                                      -39-
<PAGE>

                                 SCHEDULE "A-1"

                          LEGAL DESCRIPTION OF THE LAND

PIN 04517-0533 (LT)

Parcel 8-1, in the  Register for Section  4M-280,  being Block 8 on Plan 4M-280,
save  and  except  Parts  19 and 20 on Plan  4R-11340,  in the  City of  Ottawa,
formerly City of Kanata.

PIN 04517-0535 (LT)

Parcel 10-1, in the Register for Section 4M-280,  being Block 10 on Plan 4M-280,
Subject to Instrument  Numbers  LT237263,  LT476569 and NS62066,  in the City of
Ottawa, formerly City of Kanata.

PIN 04517-0537 (LT)

Parcel 12-1, in the Register for Section 4M-280,  being Block 12 on Plan 4M-280,
Subject to  Instrument  Numbers  LT237263 and  LT476569,  in the City of Ottawa,
formerly City of Kanata.

PIN 04517-0560 (LT)

Parcel 26-1, in the Register for Section 4M-280,  being Block 26 on Plan 4M-280,
Subject  to  Instrument  Numbers  LT405509,  LT646448,  in the  City of  Ottawa,
formerly City of Kanata.

PIN 04517-0561 (LT)

Parcel 27-1, in the Register for Section 4M-280,  being Block 27 on Plan 4M-280,
Subject  to  Instrument  Numbers  LT405509,  LT646448,  in the  City of  Ottawa,
formerly City of Kanata.

PIN 04517-0562 (LT)

Parcel 28-1, in the Register for Section 4M-280,  being Block 28 on Plan 4M-280,
Subject  to  Instrument  Numbers  LT405509,  LT646448,  in the  City of  Ottawa,
formerly City of Kanata.

PIN 04517-0569 (LT)

Parcel 33-3, in the Register for Section 4M-280,  being Part of Block 33 on Plan
4M-280,  being Parts 2 and 17 on Plan  4R-4098,  Subject to  Instrument  Numbers
LT323584 and LT236161, in the City of Ottawa, formerly City of Kanata.

PIN 045717-0574(LT)

Parcel 34-3,  in the Register for Section  4M-280,  being Part of Block 34, Plan
4M-280,  being  Parts 1 and 18 on Plan  4R-4098,  Subject to  Instrument  Number
LT323584, in the City of Ottawa, formerly City of Kanata.

                                      -40-
<PAGE>

PIN 04517-0577 (LT)

Parcel 35-1, in the Register for Section 4M-280,  being Block 35 on Plan 4M-280,
Subject to Instrument Number LT323584,  in the City of Ottawa,  formerly City of
Kanata.

PIN 04517-0578 (LT)

Parcel 36-1, in the Register for Section 4M-280,  being Block 36 on Plan 4M-280,
Subject to  Instrument  Number  LT323584  and  LT236161,  in the City of Ottawa,
formerly City of Kanata.

PIN 04517-0644 (LT)

Block 9 on Plan 4M-280,  Save and Except Parts 1, 2 and 3 on Plan  4R-11713,  in
the City of Ottawa, formerly City of Kanata.

PIN 04517-0646 (LT)

Block 11 on Plan 4M-280, Save and Except Part 4 on Plan 4R-11713, in the City of
Ottawa, formerly City of Kanata. Subject to an Easement in favour of Bell Canada
over Part 2 on Plan 5R-4290,  as in  Instrument  Number  NS62066,  subject to an
Easement in favour of The  Corporation  of the City of Nepean,  as in Instrument
No. LT237263, in the City of Ottawa, formerly City of Kanata.

PIN 04517-0648 (LT)

Block  13 on Plan  4M-280,  save and  Except  Part 5 on Plan  4R-11713,  Kanata.
Subject to an Easement in favour of the Corporation of the City of Kanata, as in
Instrument Number LT237263, subject to an Easement in favour of Bell Canada over
Part 6 on Plan 4R-11713,  as in Instrument No. LT966819,  in the City of Ottawa,
formerly City of Kanata.

PIN 04517-0650 (LT)

Block  14 on Plan  4M-280,  Save and  Except  Part 7 on Plan  4R-11713,  Kanata,
subject to an Easement in favour of Bell Canada over Part 9 on Plan 4R-11713, as
in LT966819, in the City of Ottawa, formerly City of Kanata.

PIN 04517-0652 (LT)

Part of Block 15 on Plan 4M-280, being Part 10 on Plan 4R-11713, Kanata, subject
to an  Easement  in  favour  of the  Corporation  of the City of  Kanata,  as in
Instrument No. LT476569, in the City of Ottawa, formerly City of Kanata.

PIN 04517-0660 (LT)

Block 22 on Plan  4M-280,  Save  and  Except  Parts 11 and 12 on Plan  4R-11340,
subject to an Easement in favour of the Corporation of the City of Kanata, as in
LT236160, in the City of Ottawa, formerly City of Kanata.

                                      -41-
<PAGE>

PIN 04517-0662 (LT)

Block 23 on Plan 4M-280,  Save and Except Parts 13 and 14 on Plan  4R-11340,  in
the City of Ottawa, formerly City of Kanata.

PIN 04517-0664 (LT)

Block 24 on Plan 4M-280,  Save and Except Parts 15 and 16 on Plan  4R-11340,  in
the City of Ottawa, formerly City of Kanata.

PIN 04517-0666 (LT)

Block 25 on Plan  4M-280,  Save  and  Except  Parts 17 and 18 on Plan  4R-11340,
Subject to an Easement in favour of Bell Canada over Part 6 on Plan 4R-4626,  as
in Instrument Number LT405509, in the City of Ottawa, formerly City of Kanata.

                                      -42-
<PAGE>

                                 SCHEDULE "A-2"

                     LEGAL DESCRIPTION OF THE PHASE V LANDS

PIN 04517-0664 (LT)

Block 24 on Plan 4M-280,  Save and Except Parts 15 and 16 on Plan  4R-11340,  in
the City of Ottawa, formerly City of Kanata.

                                      -43-
<PAGE>

                                 SCHEDULE "B-1"

                           SITE PLAN SHOWING THE LANDS

                                 [SITE PLAN MAP]

                                      -44-
<PAGE>

                                 SCHEDULE "B-2"

                       SITE PLAN SHOWING THE PHASE V LANDS

                                 [SITE PLAN MAP]

                                      -45-
<PAGE>

                                  SCHEDULE "C"

                  LEASED PREMISES SHOWN IN HEAVY BLACK OUTLINE

                              [LEASED PREMISES MAP]

                                      -46-
<PAGE>

                                  SCHEDULE "D"

                              RULES AND REGULATIONS

1.    Animals and Birds

      No animals  (except  seeing eye dogs) or birds shall be kept in the Leased
      Premises.

2.    Care of Interior of Leased Premises

      The Tenant shall keep the interior of the Leased Premises  clean,  orderly
      and tidy. The Tenant shall keep  perishable  items properly  refrigerated.
      The Tenant shall deposit all debris,  trash and recyclables in appropriate
      areas,  at times  and in such  manner  as the  Landlord  shall  reasonably
      designate.

3.    Doors, Windows and Window Coverings

      The  skylights  and windows  that reflect or admit light into any place in
      the Complex  shall not be covered or   obstructed  by the  Tenant,  and no
      awnings,  curtains or blinds shall be installed  without the prior written
      consent of the Landlord. Windows and doors shall not be left open so as to
      admit  rain or snow or to  interfere  with the  heating  or cooling of the
      Complex.  The  Tenant  shall  not and  shall  not  permit  its  employees,
      contractors,  agents or invitees to throw  anything  out of the windows or
      doors of the Complex or into any passageways,  stairways,  lightwells,  or
      elevator shafts of the Complex.

4.    Loading, Unloading, Delivery of Merchandise

      Deliveries,  shipments  and all loading and  unloading of all items to and
      from the Leased  Premises  shall be made at and from the Tenant's  loading
      bays in such manner as the Landlord shall reasonably designate.

5.    Obstruction of Plumbing and Washroom Facilities

      The  Tenant  agrees  that  it  will  not  use  or  permit  its  employees,
      contractors, agents or invitees to use the plumbing or washroom facilities
      of the Leased  Premises or the Complex for any purpose other than that for
      which they were constructed.

6.    Overloading of Floors

      The  Tenant  shall not  permit  any  floor of the  Leased  Premises  to be
      overloaded.  All  equipment  and other heavy  objects  liable to injure or
      destroy any part of the Leased  Premises or the Complex  shall be moved at
      such  times,  by such  means and by such  persons  as the  Landlord  shall
      reasonably  direct.  Upon the  termination  of this Lease the Tenant shall
      forthwith inform the Landlord in writing of the combinations of all locks,
      safes and vaults in or on the Leased Premises.

                                      -47-
<PAGE>

7.    Parking

      The Tenant and all persons  employed by or doing  business with the Tenant
      shall park not more than the number of motor  vehicles  which the Landlord
      has expressly permitted,  provided that no person or tenant shall have the
      exclusive use of any  particular  parking space and no motor vehicle shall
      be parked on any portion of the Complex  which is a loading zone or is not
      designated  by the  Landlord  for  parking  or  where  signs  are in place
      indicating  that parking is prohibited and the Tenant shall  reimburse the
      Landlord on demand for the cost of removal of any motor  vehicle  which is
      parked in excess of the number expressly  allowed by the Landlord,  parked
      for a period of time deemed by the  Landlord to be  excessive or parked in
      breach  of this  clause  and which  belong  to or is parked by any  person
      employed by or doing business with the Tenant.

8.    Radio and Television

      The Tenant shall remove any radio,  television or other similar  device in
      the Leased  Premises if in the  judgement of the Landlord and in agreement
      with the Tenant such radio, television or other similar device is creating
      a nuisance.  The Tenant shall not in any case erect or cause to be erected
      any aerial  anywhere in the Complex without the express written consent of
      the Landlord.

9.    Signs, Advertising and Displays

      The Tenant shall not, in or about the Leased Premises  without the written
      consent of the Landlord,  erect  exterior  signs,  install  window or door
      signs,  affix  window or door  lettering,  erect  awnings or  canopies  or
      display  advertising  media or devices  which may be seen or heard outside
      the  Leased  Premises.  The  Tenant  shall  remove  forthwith  all  signs,
      lettering,  awnings, canopies and displays which are found by the Landlord
      to be  objectionable.  The Tenant shall  indemnify  and save  harmless the
      Landlord  from all  claims,  demands,  loss or  damage  to any  person  or
      property arising out of or in any way caused by the erection, maintenance,
      or removal of any sign or other  installation  erected or  installed on or
      about the  exterior of the Leased  Premises.  The Tenant  shall at its own
      expense,  maintain in good condition and repair all such signs, lettering,
      awnings,  canopies  and  displays,  shall keep all  displays and signs lit
      during  reasonable  business  hours and shall  observe and comply with all
      requirements  of  any  competent  authority  regarding  the  erection  and
      maintenance of signs including the payment of licence or other fees.

10.   Temperature and Humidity of Leased Premises

      To the extent that the Tenant may exercise control,  the Tenant shall keep
      the Leased Premises at a temperature sufficient to prevent the freezing of
      pipes in the Leased Premises and the Tenant shall keep the temperature and
      humidity of the Leased  Premises at a reasonable  level.  The Tenant shall
      not vent the Leased  Premises into other enclosed parts of the Complex nor
      appropriate warm or cool air from other enclosed parts of the Complex.

                                      -48-
<PAGE>

11.   Use of Entrances, Etc.

      The sidewalks,  entrances, lobbies, elevators, stairways and corridors (if
      applicable)  of the Complex  shall not be obstructed by the Tenant or used
      by it f or any other  purpose  than for ingress and egress to and from the
      Leased  Premises  and the Tenant  shall not place or allow to be placed in
      any such areas any waste paper, dust, garbage, refuse or anything whatever
      that shall tend to make such areas appear unclean or untidy.

12.   Wheeled Vehicles

      All wheeled  vehicles  used within the Leased  Premises  shall be equipped
      with  rubber  wheels and rubber  guards so as not to damage the floors and
      walls of the Complex. No motorized vehicles shall be permitted for loading
      or unloading or parking  purposes  within the Leased  Premises  other than
      electrically or propane operated material handling equipment,  except with
      the prior  written  consent of the  Landlord,  and the Tenant shall comply
      with  the  rules  and   regulations  of  any   regulatory   agency  having
      jurisdiction in that regard, in the use, operation and storage of all such
      equipment.

                                      -49-
<PAGE>

                                  SCHEDULE "E"

           METHODOLOGY TO DETERMINE ADJUSTMENTS TO THE BASIC RENT RATE

If any  adjustment  to the amount of the Basic Rent  payable by the Tenant under
section 3.1 of this Lease is required by the  provisions  of section 3.1 of this
Lease,  the amount of that adjustment shall be calculated in accordance with the
methodology set out in this Schedule "E". If adjustments are required because of
cost  increments  or decrements  pursuant to more than one of the  provisions of
section  2  below,  then  only the net  effect  of  those  adjustments  shall be
considered for computing the effect of those  adjustments on the amount of Basic
Rent payable by the Tenant.

1.    Assumptions:  The Basic Rent  payable by the Tenant  under  section 3.1 is
      based in part on the following assumptions:

      (a)   that the interest rate payable under the Phase V Mortgage  Financing
            is 8.5%, compounded semi-annually and payable monthly in arrears;

      (b)   that the  amortization  period with  respect to the Phase V Mortgage
            Financing is a period of twenty-five (25) years; and

      (c)   that the term of the Phase V Mortgage  Financing  is a period of ten
            (10) years.

2.    Changes to Assumptions:

      (a)   if the interest rate payable under the Phase V Mortgage Financing is
            more than  8.5%,  then the Basic Rent  payable  by the Tenant  under
            section 3.1 shall be  increased by $0.05 per square foot of the Area
            of the Leased Premises for each five (5) basis point increase in the
            amount of the  interest  rate  payable  under  the Phase V  Mortgage
            Financing  (and  increments of less than five (5) basis points shall
            be prorated accordingly);

      (b)   if the interest rate payable under the Phase V Mortgage Financing is
            less than  8.5%,  then the Basic Rent  payable  by the Tenant  under
            section 3.1 shall be  decreased by $0.05 per square foot of the Area
            of the Leased Premises for each five (5) basis point decrease in the
            amount of the  interest  rate  payable  under  the Phase V  Mortgage
            Financing  (and  decrements of less than five (5) basis points shall
            be prorated accordingly); and

      (c)   if the  amortization  period  with  respect  to the Phase V Mortgage
            Financing is less than twenty-five  (25) years,  then the Basic Rent
            payable by the Tenant under  section 3.1 shall be increased by $0.24
            per square foot of the Area of the Leased  Premises for each one (1)
            year decrease in the amortization period with respect to the Phase V
            Mortgage Financing.

                                      -50-
<PAGE>

                                  SCHEDULE "F"

                         CONSENT BY LANDLORD TO SUBLEASE

1.    [_] is the landlord (the "Landlord") of those certain "Leased Premises" as
      defined in section [_] of that  certain  lease  agreement  dated as of [_]
      (the  "Lease"),  made and entered  into by and between the  Landlord and 0
      (the "Tenant") which Lease is incorporated  herein by this reference.  The
      Lease  contains a  restriction  against  assignment  or  subletting by the
      Tenant without the Landlord's prior written consent thereto.  The Landlord
      does hereby consent, subject to the following terms and conditions, to the
      proposed offer to sublease  agreement (the  "Sublease") by and between the
      Tenant,  as sublandlord,  to [_] (the  "Subtenant") of that part of Leased
      Premises   comprising   approximately   [_]  ([_])  square  feet  as  more
      particularly  described  in such  Sublease  as the "[_] " (such part being
      hereinafter  called the "Sublet  Premises"),  a copy of which  Sublease is
      attached  hereto  as  Schedule  "A"  and is  incorporated  herein  by this
      reference.

2.    The Landlord's  consent is expressly  conditional upon the performance and
      observance by the Tenant of the  covenants,  conditions  and agreements in
      the Lease,  and this consent  shall in no way affect or release the Tenant
      from its  liabilities and  responsibilities  under the terms of the Lease.
      The Tenant  acknowledges that,  notwithstanding the terms of the Sublease,
      it shall remain principally liable and responsible for all liabilities and
      responsibilities of "Tenant" under the Lease.

3.    This consent is given without prejudice to the Landlord's rights under the
      Lease,  this consent being limited to the Sublease to the  Subtenant,  and
      shall not be deemed to be an  authorization  for or consent to any further
      or other assignment or subletting or parting with or sharing possession of
      all or any part of the Leased Premises or the Sublet Premises.

4.    The  Landlord  joins in this  consent  solely to grant its consent and, by
      doing so, the Landlord does not thereby:

      (a)   make any representations or warranties; or

      (b)   acknowledge  or  approve  of any of the  terms  of the  Sublease  as
            between the Tenant, as sublandlord, and the Subtenant.

      Further,  nothing  contained  in the  Sublease  or this  consent  shall be
      construed  as  modifying,  waiving  or  affecting  any of the  provisions,
      covenants and conditions or any of the Landlord's rights or remedies under
      the Lease.

5.    In consideration of the Landlord's consent to the Sublease, the Tenant and
      Subtenant agree as follows:

      (a)   The Subtenant  covenants  that the Sublease  shall be subject to and
            subordinate  to the Lease and further  covenants and agrees that the
            Subtenant   will  observe,   comply  with  and  perform  all  terms,
            conditions and covenants in the Lease and to perform all obligations
            of any kind  whatsoever of the "Tenant"  under the Lease

                                      -51-
<PAGE>

            as and when the same are due to be performed by the Tenant  pursuant
            to the terms of the Lease and to be subject to all of the Landlord's
            rights thereunder during the entire term of the Sublease,  as though
            the Subtenant was named "Tenant" under the Lease, to the extent that
            such  covenants,  obligations,  terms and conditions  relate to that
            portion of the Leased  Premises  sublet to the  Subtenant  under the
            Sublease. The Subtenant further expressly acknowledges and agrees to
            be  subject  to the  prohibition  in the Lease  against  subletting,
            assigning, mortgaging or encumbering or permitting the occupation or
            use of all or part of the Leased Premises by others.

      (b)   The Tenant and Subtenant  each  represent and warrant that they have
            dealt with no broker,  finder,  agent or other person in  connection
            with the Sublease other than [_] (the  "Broker"),  and they agree to
            indemnify and hold the Landlord harmless from and against any claims
            or causes of action for a commission  or other form of  compensation
            arising  from the  Sublease  or the Lease,  whether  advanced by the
            Broker  or any  other  person  or  entity.  The  provisions  of this
            paragraph shall survive the  termination of the Lease,  the Sublease
            and any renewal or extension of either or both of them.

      (c)   The Subtenant  waives any rights it may have as  under-lessee  under
            section 21 of the Commercial  Tenancies Act, R.S.O.  1990 c. L.7, as
            amended  or  replaced  from  time to time (the  "Act"),  or any like
            rights under common law. For the purpose of clarity,  the  Subtenant
            agrees  that  notwithstanding  the  Landlord  has  consented  to the
            Sublease,  the  Subtenant  shall  not  claim or  apply  for an order
            vesting the term of the Sublease,  the Leased Premises,  or any part
            thereof, in the Subtenant,  upon the Landlord re-entering the Leased
            Premises or forfeiting the Lease.

      (d)   The Subtenant  waives any rights it may have as  under-tenant  under
            subsection 32(2) of the Act or any like rights under common law. For
            the purpose of clarity,  the Subtenant  agrees that  notwithstanding
            the  Landlord  has  consented  to  the  Sublease,  if  the  Landlord
            distrains or threatens to distrain any goods or chattels  situate on
            the Sublet  Premises,  the Subtenant  shall not seek to protect such
            chattels from the Landlord's  distress as contemplated by subsection
            32 (2) of the Act.

      (e)   The Subtenant  waives any rights it may have under  subsection 39(2)
            of the Act, or any like rights  under common law. For the purpose of
            clarity,  the Subtenant agrees that notwithstanding the Landlord has
            consented to the Sublease, if a receiving order in bankruptcy,  or a
            winding-up  order has been made  against the Tenant,  the  Subtenant
            hereby agrees not to exercise its election as  under-lessee to stand
            in the same position with the Landlord as though the Subtenant  were
            a direct lessee of the Landlord.

6.    The Tenant and Subtenant jointly and severally  acknowledge that there are
      no  covenants,  representations,   warranties,  agreements  or  conditions
      expressed or implied,  collateral  or otherwise  forming part of or in any
      way affecting or relating to the  Landlord's  consent to the Sublease save
      as expressly  set out herein and that this consent  agreement  constitutes

                                      -52-
<PAGE>

      the entire agreement between the Landlord and the Subtenant and may not be
      modified  except by  subsequent  agreement  in writing and executed by the
      Landlord, the Tenant and the Subtenant.

      IN WITNESS WHEREOF the undersigned have executed this consent as of [_] .

SIGNED, SEALED AND DELIVERED)     )
   In the presence of             )       [_] [Landlord]
                                  )       Per:                               c/s
                                  )           -------------------------------
                                  )       Name:
                                  )            ------------------------------
                                  )       Title:
                                  )             -----------------------------
                                  )
                                  )       [_] [Tenant]
                                  )       Per:                               c/s
                                  )           -------------------------------
                                  )       Name:
                                  )            ------------------------------
                                  )       Title:
                                  )             -----------------------------
SIGNED, SEALED AND DELIVERED)     )
   In the presence of             )       [_] [Subtenant]
                                  )       Per:                               c/s
                                  )           -------------------------------
                                  )       Name:
                                  )            ------------------------------
                                  )       Title:
                                  )             -----------------------------

                                      -53-
<PAGE>

                                  SCHEDULE "G"

                                 TENANT SIGNAGE

The Tenant shall be entitled to two signs on the  exterior  facade of the Leased
Premises,  each of which  signs  shall be not  larger in area than the  existing
Mitel signs on what is known as Phase IV of the Complex.  Such signage  shall be
installed on the exterior  facade of the Leased  Premises  below the parapet and
shall be  illuminated.  One such sign shall face March Road and the other  shall
face Leggett Drive. The Tenant shall have exclusive signage rights on the Leased
Premises.

Additionally, the Tenant shall have curb signage rights on all monuments leading
to the Leased Premises, lawn signage at each lobby entrance (quantity 2), within
20 feet of the main doors indicating the building address and Tenant's corporate
name. The Tenant shall also be entitled to a directional  sign over the shipping
and  receiving  area of the  Leased  Premises.  Finally,  the  Tenant  shall  be
entitled,  with the  Landlord's  prior written  consent,  to hang banners on the
Leased  Premises  and  illuminate  the  Leased  Premises  or parts  thereof  for
promotional purposes.

                                      -54-
<PAGE>

                                     Form 6

                              Construction Lien Act

                     CERTIFICATE OF SUBSTANTIAL PERFORMANCE
                   OF THE CONTRACT UNDER SECTION 32 OF THE ACT

                                 City of Ottawa
--------------------------------------------------------------------------------
(County/District or Regional Municipality/City in which premises are situate)

                    400 March Road, (Kanata) Ottawa, Ontario.
--------------------------------------------------------------------------------
(Street  address  and city,  town etc.  or, if there is no street  address,  the
location of the premises)

This is to certify that the contract for the following improvement:

          Base Building Construction of a New 5 Storey Offfice Building
--------------------------------------------------------------------------------
                     (short description of the improvement)

to the above premises was substantially
  performed on                                      October 11, 2001
                                         ---------------------------------------
                                              (date substantially performed)

Date certificate signed:   11/10/01           /s/
                                              Murray & Murray Associates Inc.
                                         ---------------------------------------
                                          (payment certifier where there is one)

                                         ---------------------------------------
                                           owner and contractor, where there
                                                is no payment certifier)

Name of owner:             Zarlink Semiconductor
                           -----------------------------------------------------
Address for service;       360 Legget Drive, (at sta.), Ottawa, Ontario. K2K 3H4
                           -----------------------------------------------------
Name of contractor:        Doran Contractors Limited
                           -----------------------------------------------------
Address for service:       3187 Albion Road, South, Ottawa, Ontario. K1V 8Y3
                           -----------------------------------------------------
Name of payment certifier: Murray & Murray Associates Inc.
                           -----------------------------------------------------
Address:                   12 York Street, 4th Floor, Ottawa, Ontario, KIN 5S6
                           -----------------------------------------------------

(Use A or B whichever is appropriate)

A.    Identification  of premises for preservation of liens:

      Concession 4, Plan M-280, Blocks 23 & 24
      --------------------------------------------------------------------------
      (where liens attach to premises, reference to lot and plan or registration
      number)

B.    Office to which  claim for lien and  affidavit  must be given to  preserve
      lien:

      --------------------------------------------------------------------------
      (where liens do not attach to premises)

                                                     R.O. 1990, Reg. 175, Form 6

                                      -55-
<PAGE>

        ACKNOWLEDGEMENT OF RENT COMMENCEMENT DATE AND BASIC RENT PAYABLE

      The  undersigned   acknowledge  that  pursuant  to  a  lease  between  the
undersigned  dated March 27, 2001 for a building  municipally known as 400 March
Road, Ottawa, Ontario (the "Lease"):

      (a)   the Rent  Commencement Date (as defined in the Lease) is October 11,
            2001;

      (b)   the Rental Rate as defined by the Lease is as follows:

            (i)   for the period from October 11, 2001 to and including  January
                  13, 2002,  Fifteen Dollars  ($15.00) per square foot per year,
                  and  as  such  the  monthly  Basic  Rent  payable  by  Zarlink
                  Semiconductor  Inc.  during  such  period is One  Hundred  and
                  Twenty-Two Thousand,  Eight Hundred and Ten Dollars ($122,810)
                  per month;

            (ii)  for the period  from  January  14, 2002 (being the date of the
                  Phase V  Mortgage  Financing  as  defined in the Lease) to and
                  including  February 1, 2007, Fifteen Dollars and Seventy Seven
                  Cents ($15.77) per square foot per year, and as such the Basic
                  Rent payable by Zarlink  Semiconductor Inc. during such period
                  is One Million, Five Hundred and Forty-Nine.  Thousand,  Three
                  Hundred   and   Seventy    Dollars   and   Ninety-Six    Cents
                  ($1,549,370.96) per annum; and

            (iii) for the period  commencing  February 2, 2007 to and  including
                  October 10, 2011 (being the Termination Date as defined in the
                  Lease),  Fifteen  Dollars  ($15.00)  per square  foot per year
                  subject to  adjustment  in  accordance  with  section  3.1 and
                  Schedule "E" to the Lease.

      IN WITNESS OF WHICH Mitel  Research  Park  Corporation  has executed  this
Acknowledgement this 10th day of January, 2002.

SIGNED, SEALED AND DELIVERED) In     )      MITEL RESEARCH PARK CORPORATION
   the presence of                   )
                                     )      Per:/S/
                                     )          -----------------------------
                                     )
                                     )      Name: Jose Medeiros
                                     )           ----------------------------
                                     )
                                     )      Title: Treasurer
                                     )            ---------------------------

      IN  WITNESS  OF  WHICH  Zarlink   Semiconductor  Inc.  has  executed  this
Acknowledgement this 10th day of January, 2002.

SIGNED, SEALED AND DELIVERED) In
   the presence of                   )      ZARLINK SEMICONDUCTOR INC.
                                     )
                                     )      Per:/S/
                                     )          -----------------------------
                                     )
                                     )      Name: Shirley Mears
                                     )           ----------------------------
                                     )
                                     )      Title: Vice-President, Treasurer
                                     )            ---------------------------

                                      -56-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00086-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00086-of-00352.parquet"}]]