SMTC CORP
DEFERRED SHARE UNITS AGREEMENT
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<DESCRIPTION>DEFERRED SHARE UNITS AGREEMENT
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 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="right"><FONT FACE="Times New Roman" SIZE="2"><B>EXHIBIT 10.2 </B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:-6px"><FONT
SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT FACE="Times New Roman" SIZE="2"><B>SMTC MANUFACTURING CORPORATION OF CANADA </B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT
FACE="Times New Roman" SIZE="2"><B>DEFERRED SHARE UNITS </B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT FACE="Times New Roman" SIZE="2"><B>AGREEMENT </B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT
SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">In recognition of the important contributions that John Caldwell (the &#147;Executive&#148;) can make to the success of SMTC
Corporation and its Affiliates, SMTC Manufacturing Corporation of Canada (the &#147;Corporation&#148;) hereby grants to the Executive the deferred share units award described below. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT
SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">1. <U>The Deferred Share Unit Award</U>. The Corporation hereby grants to the Executive Sixty-six Thousand (66,000) Units
(the &#147;Award&#148;). A &#147;Unit&#148; is an amount equal to the Fair Market Value (as defined below) of a single share of Common Stock (as defined below) on the Grant Date (as defined below). </FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:8%"><FONT FACE="Times New Roman" SIZE="2">a. The Executive is not entitled to any dividends payable on the Common
Stock. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:8%"><FONT FACE="Times New Roman" SIZE="2">b. The Award shall not be interpreted to bestow upon
the Executive any equity interest or ownership in the Corporation or any Affiliate. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:8%"><FONT
FACE="Times New Roman" SIZE="2">c. The Executive acknowledges that the Board of Directors of SMTC Corporation shall continue to manage SMTC Corporation as such Board of Directors deems appropriate, and that such Board of Directors is under no
obligation to manage SMTC Corporation or take any action so as to maximize the value of the Award or avoid any diminution in value of the Award. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px; text-indent:8%"><FONT FACE="Times New Roman" SIZE="2">d. The Board of Directors, in its sole discretion, may make additional grants of Units to the Executive from time to time. </FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">2. <U>Definitions</U>. The following definitions will apply for purposes of
this Agreement. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:-6px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:8%"><FONT FACE="Times New Roman" SIZE="2">a. &#147;Affiliate&#148; of any person means
(a) any other person directly or indirectly owning, controlling, or holding with power to vote, five percent or more of the outstanding voting securities of such person, (b) any person five percent or more of whose outstanding voting securities are
directly or indirectly owned, controlled or held with power to vote, by such person and (c) any other person directly or indirectly controlling, controlled by, or under common control with, such person. </FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:8%"><FONT FACE="Times New Roman" SIZE="2">b. &#147;Board of Directors&#148; means the board of directors of SMTC
Corporation. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:8%"><FONT FACE="Times New Roman" SIZE="2">c. &#147;Cause&#148; shall have the meaning as
set forth in section 4.8 of the Employment Agreement. </FONT></P>

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 <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:8%"><FONT FACE="Times New Roman" SIZE="2">d. &#147;Common Stock&#148; means a share of common stock, $0.01 par value per share, of SMTC
Corporation. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:8%"><FONT FACE="Times New Roman" SIZE="2">e. &#147;Employment Agreement&#148; means the
employment agreement between the Corporation and the Executive, dated February 7, 2005. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:8%"><FONT
FACE="Times New Roman" SIZE="2">f. &#147;Fair Market Value&#148; means the closing price of the Common Stock for the day immediately preceding the Payment Date; <I>provided</I>, that if such day is not a trading day, fair market value shall mean the
closing price of the Common Stock for the next preceding day which is a trading day. For this purpose, the &#147;closing price&#148; of the Common Stock on any trading day will be the last sale price with respect to such Common Stock, or, in case no
such sale takes place on such day, the average of the high bid and low asked prices in the over-the-counter market with respect to such Common Stock, as reported by the National Association of Securities Dealers, Inc. Automated Quotation System or
such other similar system then in use; or, if on any such date such Common Stock is not quoted by any such organization, the average of the closing bid and asked prices with respect to such Common Stock, as furnished by a professional market maker
making a market in such Common Stock selected by the Board of Directors of SMTC Corporation in good faith; or, if no such market maker is available, the fair market value of such Common Stock as of such day as determined in good faith by the Board
of Directors of SMTC Corporation. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:8%"><FONT FACE="Times New Roman" SIZE="2">g. &#147;Grant Date&#148;
means the date on which this Agreement was executed as indicated on the signature page hereof. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:8%"><FONT
FACE="Times New Roman" SIZE="2">h. &#147;Payment Date&#148; means a date determined by the Board of Directors in its sole discretion that is within sixty (60) days of the occurrence of a Termination Event, subject to adjustment pursuant to Sections
5b and 6 hereof. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:8%"><FONT FACE="Times New Roman" SIZE="2">i. &#147;Termination Event&#148; means the
Executive&#146;s termination of employment by reason of death, disability, voluntary resignation with the Corporation and its Affiliates or termination of employment by the Corporation or its Affiliates other than for Cause. </FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">3. <U>Vesting</U>. Subject to Section 5b, the entire Award shall be fully
vested on the Grant Date. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">4. <U>Adjustments Based on Certain
Changes in the Common Stock</U><I>. </I>In the event of any stock split, reverse stock split, stock dividend, recapitalization or similar change affecting the Common Stock, the Award shall be equitably adjusted. </FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">5. <U>Termination of Employment</U>. On the Payment Date, the Corporation
shall pay to the Executive the Fair Market Value of the Award in a single cash lump sum payment. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">6. <U>Change of Control</U>. In the event that of a Change of Control (as defined in Section 4.4 of the Employment Agreement), a Termination Event will be
deemed to have </FONT></P>

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 <P STYLE="margin-top:0px;margin-bottom:0px"><FONT FACE="Times New Roman" SIZE="2">occurred on the date of the closing of the Change of Control (or series of transactions constituting the Change of
Control), and the Payment Date shall be adjusted to be ten (10) days after such closing date. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT
FACE="Times New Roman" SIZE="2">7. <U>Determination by the Board of Directors.</U> Any determination by the Board of Directors in its reasonable discretion concerning any provision hereto shall be binding upon the Corporation, SMTC Corporation, and
the Executive. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">8. <U>Designation of Beneficiary</U>. The
Executive may designate or change the designation of a beneficiary or beneficiaries to receive any payment due hereunder upon his death by filing a written designation with the Corporation. The Corporation shall be bound by the last designation
filed with it by the Executive. In the absence of such designation of a beneficiary by the Executive, or if no beneficiary so designated shall survive him, the Executive&#146;s beneficiary shall be his or her estate. Any amounts due hereunder
payable to the beneficiary or beneficiaries shall be made on the same terms and shall be subject to the same conditions as if such amounts were paid to the Executive. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT
SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">9. <U>Employment Rights</U>. This Deferred Share Units Agreement shall not create any right of the Executive to continued
employment with the Corporation or its Affiliates or limit the right of Corporation or its Affiliates to terminate the Executive&#146;s employment at any time and shall not create any right of the Executive to employment with the Corporation or any
of its Affiliates. Except to the extent required by applicable law that cannot be waived, the loss of the Award shall not constitute an element of damages in the event of termination of the Executive&#146;s employment even if the termination is
determined to be in violation of an obligation of the Corporation or its Affiliates to the Executive by contract or otherwise. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">10. <U>Unfunded Status</U>. The obligations of the Corporation and its Affiliates hereunder shall be contractual only and all such payments shall be made
from the general assets of the Corporation or its Affiliates. The Executive shall rely solely on the unsecured promise of the Corporation and nothing herein shall be construed to give the Executive or any other person or persons any right, title,
interest or claim in or to any specific asset, fund, reserve, account or property of any kind whatsoever owned by the Corporation or any Affiliate. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">11. <U>No Assignment</U>. No right or benefit or payment under the Plan shall be subject to assignment or other transfer nor shall it be liable or subject
in any manner to attachment, garnishment or execution. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">12.
<U>Withholding</U>. The Corporation and its Affiliates shall have the right to withhold from any payment made under this Deferred Share Units Agreement any U.S., Canadian, state, provincial, local or other taxes required by law to be withheld with
respect to the payment. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">13. <U>Amendment or Termination</U>.
This Deferred Share Units Agreement may be amended by mutual written agreement of the parties; provided, however, that the Corporation may in its sole discretion deem a Termination Event to have occurred, terminate this Deferred Share Units
Agreement and accelerate the payment of benefits hereunder. </FONT></P>

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 <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">IN WITNESS WHEREOF, SMTC Manufacturing Corporation of Canada has executed this Deferred Share Units
Agreement as of the 7</FONT><FONT FACE="Times New Roman" SIZE="1" COLOR="#000000"><SUP>th</SUP></FONT><FONT FACE="Times New Roman" SIZE="2" COLOR="#000000"> day of February, 2005. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT
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<TD VALIGN="top" COLSPAN="3"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT FACE="Times New Roman" SIZE="2">SMTC MANUFACTURING CORPORATION OF CANADA</FONT></P></TD></TR>
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<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT FACE="Times New Roman" SIZE="2">By:</FONT></P></TD>
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<TD VALIGN="bottom"> <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:1.00em; text-indent:-1.00em"><FONT FACE="Times New Roman" SIZE="2">/s/ William Brock</FONT></P><HR SIZE="1" NOSHADE COLOR="#000000"></TD></TR>
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<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT FACE="Times New Roman" SIZE="2">Director</FONT></P></TD></TR>
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<TD VALIGN="top"><FONT FACE="Times New Roman" SIZE="2">Acknowledged and agreed:</FONT></TD></TR>
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<TD VALIGN="top"> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT FACE="Times New Roman" SIZE="2">/s/ John Caldwell</FONT></P><HR SIZE="1" NOSHADE COLOR="#000000"></TD></TR>
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<TD VALIGN="top"><FONT FACE="Times New Roman" SIZE="2">John Caldwell</FONT></TD></TR>
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<TD VALIGN="top" COLSPAN="3"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT FACE="Times New Roman" SIZE="2">SMTC CORPORATION</FONT></P></TD></TR>
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<TD VALIGN="bottom"> <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:1.00em; text-indent:-1.00em"><FONT FACE="Times New Roman" SIZE="2">/s/ William Brock</FONT></P><HR SIZE="1" NOSHADE COLOR="#000000"></TD></TR>
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<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT FACE="Times New Roman" SIZE="2">Title:</FONT></P></TD>
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<TD VALIGN="bottom"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT FACE="Times New Roman" SIZE="2">Director</FONT></P></TD></TR>
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