LEASE

THIS LEASE  AGREEMENT,  dated 15 July 97 by and between  Koger  Equity,  Inc., a
Florida  Corporation  ("Landlord")  with its principal  office at 3986 Boulevard
Center Dr., Jacksonville,  FL 32207, and Conversion Technologies  International,
Inc., a Corporation  organized  and existing  under the laws of the State of DE,
("Tenant") with its principal  office at 82 Bethany Road,  Suite 6, Hazlet,  New
Jersey 07730.

1. BASIC LEASE PROVISIONS

A. DESCRIPTION OF PREMISES:         D. ADDRESS  FOR  PAYMENT OF RENT AND
                                       SECURITY DEPOSITS:
   Suite Number:     280            Payee: Koger Equity, Inc.
   Building Name:    Cragg          Address:  Post Office Box 860502
   Address: 3452 Lake Lynda Drive   City/State/Zip:Orlando, FL 32886-0502
   County:     Orange               Tenant Account#  390121 (note on remittance)
   City: Orlando                    E. ADDRESSES FOR NOTICES
   Center: Koger Center University  Tenant: Conversion Technologies Int'l
                                            82 Bethany Road, Suite 6
B. PRINCIPAL LEASE TERMS:                   Hazlet, New Jersey 07730
   Lease Term (Months)36 months
   Commencement Date: 01 August 97   Tenant Fed I.D./SSN: 13-3754366
   Expiration Date: 31 July 00
                                     Landlord:   Koger Equity, Inc.
   Monthly Base Rent: $6689.50                   930 Woodcock Road
   Sales or Use Taxes:$401.37                    Suite 127
   Total: $7,090.87                              Orlando, FL 32803
                                     Landlord Fed I.D.: 59-289805-45
   Security Deposit: $7090.87
                                     With a copy to:   Koger Equity, Inc.
C. LEASED AREA                                         Attn: President
   Approximately 4722 rentable square feet.            3986   Blvd. Center Drive
   (Includes Tenant's share of common area.)           Jacksonville, FL 32207

The provisions contained in Sections 2 through 36, inclusive, which appear after
the signature lines below, are a part of this Lease and are incorporated in this
Lease by  reference.  The Tenant and the Landlord  have executed or caused to be
executed this Lease on the dates shown below their  signatures,  to be effective
as of the date set forth above.

Tenant:Conversion Technologies International, Inc,   Landlord:Koger Equity, Inc.

By:                                                  By:
   -----------------------------(SEAL)                  ------------------(SEAL)
Print Name:                                          Print Name:J. Velma Keen II
Title                                                Title:     Vice President

Attest:                                              Attest:
       --------------------------                           --------------------
Print Name:                                          Print Name:
Title:                                               Title:

(Corporate Seal)                                     (Corporate Seal)

Date:                                                Date:
     ----------------------------                         ----------------------


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Signed an, sealed in the presence of:  Signed   and  sealed  in the presence of:

(1)                                    (1)
   ---------------------------------       -------------------------------------
Print Name:                            Print Name:
(2)                                    (2)
   ---------------------------------       -------------------------------------
Print Name:                            Print Name:
As to Tenant                           As to Landlord


                   LEASE PROVISIONS INCORPORATED BY REFERENCE

2. LEASE OF PREMISES:  The Landlord  hereby  leases to the Tenant and the Tenant
hereby takes from the Landlord the premises (the  "Premises")  which include the
Suite(s)  shown and  described on Exhibit "A".  together with any other parts of
the Building used exclusively by Tenant, which Premises are or will be contained
in the office building (the "Building"  located at the address stated in Section
1A, under the terms and conditions  contained in this lease. For the purposes of
this lease, "Property" shall mean the Property referred to at the street address
in  Section 1A which is more  specifically  described  in the legal  description
maintained in the Landlord's records.  For the purposes of this lease,  "Center"
shall mean The Koger Center referred to in Section 1A.

3. TERM:  The term of this Lease (the  "Term")  shall  commence on the date (the
"Commencement Date") which is the earlier to occur of the date stated in Section
lB, or the date the Tenant first occupies all or part of the Premises.  The Term
shall  expire on the date (the  "Expiration  Date")  stated in Section 1B unless
sooner  terminated  as  otherwise  provided  in this  Lease or  unless  extended
pursuant to Section 27 or other extension provisions contained herein.

4. USE AND POSSESSION:  The Tenant covenants and agrees that the Premises are to
be used by the Tenant for  general  office  purposes  and for no other  purposes
without the prior written  consent of the Landlord.  The Tenant shall not occupy
or use the  Premises  or permit the use or  occupancy  of the  Premises  for any
purpose  or in any manner  which:  (a) is  unlawful  or is in  violation  of any
applicable legal,  governmental or  quasi-governmental  requirement,  ordinance,
rule or code:  (b) may be dangerous to persons or property:  (c) may  invalidate
any insurance policy held by the Landlord or increase the amount of premiums for
any insurance  policy  affecting the Building or the Property (if any additional
amounts of insurance premiums are so incurred, the Tenant shall pay the Landlord
the additional amounts on demand as Additional Rent,  provided that such payment
shall not  authorize  such use);  (d) may create a nuisance or disturb any other
tenant of the Building or the  occupants of  neighboring  Property or injure the
reputation  of the  Building  or the  Center:  and (e)  violates  the "Rules and
Regulations" of the Building as may from time to time be adopted by Landlord, or
any  restriction  of record.  The Tenant agrees that Tenant shall be responsible
for any costs incurred by Landlord by reason of Tenant's  misuse of the Premises
or the Building  and common  areas,  including  without  limitation  any damages
incurred  by Tenant in moving into or out of the  Premises.  If any costs are so
incurred by Landlord,  the Tenant shall pay the Landlord such costs on demand as
Additional Rent.

     The Landlord agrees to have the Premises substantially  completed and ready
for possession on or before the Commencement  Date,  subject to delays caused or
occasioned by strikes,  insurrections,  Acts of God,  labor unrest,  shortage of
materials,  civil  disturbances  and other  casualties or  unforeseen  causes or
events  beyond the control of the  Landlord  ("Unforeseen  Causes").  The Tenant
agrees to accept  possession  of the  Premises  within  ten (10) days  after the
receipt of notice from the Landlord of substantial completion (if after the date
specified in Section 1B).

5. RENT:  Tenant  agrees to pay to Landlord at the address  specified in Section
1E, or at such other place designated in writing by Landlord,  the Monthly Rent,
and any  Additional  Rent,  plus any  sales or use  taxes  (collectively  called
"Rent").  "Monthly  Rent"  shall mean the  initial  monthly  base rent stated in
Section 1B for the first twelve months  following the  Commencement  Date of the
Term of this Lease  ("First  Lease  Year"),  and the Adjusted  Monthly  Rent, as
adjusted  under Section 7. Rent shall be paid without any prior notice or demand
and without any  deduction  whatsoever.  Monthly Rent shall be due in advance on
the first day of each month of the


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Term. The first  installment of Monthly Rent shall be paid by Tenant to Landlord
upon  execution  of this  Lease.  Rent  for any  partial  lease  month  shall be
prorated.  Monthly  Rent will be  adjusted in the manner set forth in Section 7.
Tenant's  obligation to pay Rent to Landlord shall be independent of every other
covenant or obligation of Landlord under this Lease.  All delinquent  Rent shall
bear interest at the maximum rate  permitted by applicable law or 18% per annum,
whichever  is less,  from the date due  until  paid.  Rent  shall be  considered
delinquent  after the 10th day  following the date it is due. If Tenant fails to
pay Rent or any other  charge when due under this Lease,  then Tenant  shall pay
and Landlord  shall be entitled to receive a late  payment  service  charge,  in
addition to any  interest  charge due  hereunder,  covering  administrative  and
overhead  expenses  incurred by Landlord caused by such late payment,  which the
parties  stipulate  and agree are hereby  liquidated  and shall be equal to five
percent of the overdue  amount.  Tenant  shall pay a charge  equal to $25.00 per
returned  check or the amount to which  Landlord  is  entitled  under State law,
whichever is greater,  for any checks written to Landlord which are returned for
insufficient funds.

6.     REAL ESTATE TAX INCREASES:  See Attached Rider

7.     RENT ADJUSTMENT:  See Attached Rider

8. SALES AND USE TAX:  In  addition  to the Tenant and other  amounts due to the
Landlord under this Lease, the Tenant shall pay to the Landlord and the Landlord
shall remit to the appropriate governmental authorities any sales, use, or other
tax,  excluding  Federal or State income  taxes,  now or hereafter  imposed upon
rents and other  amounts due to the Landlord  under this Lease,  notwithstanding
the fact that any statute, ordinance,  enactment or regulation may impose any of
those types of taxes on the Landlord.

9.  NOTICES:  For the  purpose of any notice or demand  under  this  Lease,  the
respective parties shall be served by overnight  delivery,  personal delivery or
certified or registered mail, return receipt requested,  addressed to the Tenant
at the address as set forth in Section 1E and to the  Landlord at the  addresses
set forth in  Section  1E or other  such  addresses  designated  in  writing  by
landlord. Any notice shall be effective when delivered.

10.  ORDINANCES  AND  REGULATIONS:  The Tenant  shall  comply  promptly,  at the
Tenant's  sole cost and  expense,  with all  present  and  future  laws,  codes,
ordinances,  rules or regulations of any municipal,  county,  state,  federal or
other governmental  authority,  including  environmental laws, and any bureau or
department  thereof,  and of the Board of Fire  Underwriters  or any other  body
exercising  similar  functions,  which may be  applicable  to the  Premises  and
Tenant's  use  or  occupancy  of  the  Premises,   and  shall  comply  with  the
requirements  of all of  Landlord's  policies of  insurance at any time in force
with  respect to the  Building in which the  Premises  are  located.  The Tenant
agrees for itself and for its  subtenants,  employees,  agents,  and invitees to
comply  with the  Rules  and  Regulations,  promulgated  from  time to time with
respect to the  Premises,  Building,  Property  and  Center,  a copy of which is
available in the management office in the Center.

      Notwithstanding any other provision of this lease to the contrary,  Tenant
shall comply with the Americans with Disabilities Act ("ADA"),  as it now exists
and as it may hereafter be amended, with regard to the Premises and the Tenant's
use of the Premises,  including without  limitation,  the obligation to make the
Premises  accessible  and shall hold  Landlord  harmless  with respect  thereto.
Landlord  shall not be responsible  for compliance  with the ADA with respect to
the Premises,  including the design or construction thereof.  Tenants waives any
right, claim, defense or set off which Tenant may have, nor or hereafter,  based
upon any  responsibility  landlord  may have  under the ADA with  respect to the
Premises,  the Building,  the Property or otherwise.  Tenant agrees that any and
all steps  taken or to be taken by  Landlord,  in  Landlord's  judgment,  now or
hereafter  to comply with the ADA  concerning  the  Building or the Property are
authorized  and permitted  under the Lease and shall  constitute an admission by
Landlord that the ADA breach of Tenant's rights under this Lease. Nothing herein
shall  constitute  an admission by Landlord that the ADA governs any part of the
Premises,  Building or  Property or any  activities  of  Landlord  with  respect
thereto.

      Tenant covenants and agrees that Tenant shall not at any time maintain on,
or dispose or  discharge  from,  the  Property or the  Premises  any  "Hazardous
Materials",  as defined below,  except Tenant may use and store minor quantities
of Hazardous  Materials for cleaning purposes only or in connection with the use
of office equipment so


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long  as  the  quantities  and  use  are  exempt  from  applicable  governmental
regulation and such Hazardous  materials are disposed of in accordance  with all
applicable  laws.  The  failure to comply  with all  applicable  laws  regarding
Hazardous  Materials and this covenant  shall  constitute an Event of Default by
the Tenant  under this Lease and shall  entitle  the  Landlord to all rights and
remedies  provided  in this  Lease,  at law or in  equity.  The term  "Hazardous
Materials"  as used herein shall mean  collectively,  any hazardous  waste,  any
hazardous  substances,  any  pollutant  contaminant,  all as  defined  by 42 USC
ss.9601,  and  any  toxic  substances,   petroleum  products,   other  hazardous
materials,  or other chemicals or substances regulated by any environmental laws
of any county,  state or federal  government or any other  governmental  entity.
Tenant's   obligations  as  set  forth  in  this  paragraph  shall  survive  the
termination of this Lease.

11. SIGNS: The Tenant shall not place any signs or other  advertising  matter or
materials  on the  exterior or on the  interior of the  Building or at any other
location on the Property or Center,  without the prior written  consent from the
Landlord. Any lettering or signs placed on the interior of the Building shall be
for directional  purposes only, and such signs and lettering shall be of a type,
kind,  character,  location  and  description  which have been  approved  by the
Landlord in writing.  Directional  and  identification  signage  provided by the
Landlord shall be limited to the tenant directory of the Building.

12. SERVICES:  The Landlord shall provide the following:  heating and cooling of
the Premises,  during normal  business hours defined as Monday  through  Friday,
8:00 a.m. to 5:00 p.m., excluding national holidays, to the extent necessary for
the  comfortable  occupancy of the Premises,  according to Landlord's  standard,
under  normal  business  operations  and in the absence of the use of  machines,
equipment,  or devices which affect the temperature  otherwise maintained in the
Premises:  water from the regular Building  fixtures for drinking,  lavatory and
toilet purposes: customary cleaning and janitorial services in the Premises five
times per week, excluding national holidays:  customary cleaning, mowing grounds
keeping and trash removal in the Common  Areas:  Landlord's  customary  security
services for the Property;  and  electricity for normal business usage according
to Landlord's  standard.  Additional  capacity or usage shall be provided at the
option of the Landlord  (reasonably  exercised) and at the sole cost and expense
of the Tenant as Additional Rent. The Landlord shall provide Landlord's standard
amount of free  non-exclusive  parking  for the  employees  and  visitors of the
Tenant on the parking areas adjacent to the Building.

      The  services  to be  provided  by Landlord at its cost under the terms of
this Lease shall not include any  maintenance  or  replacement  of  non-standard
building items such as kitchen or breakroom  fixtures and  appliances  including
but not limited to sinks, disposals,  dishwashers, water heaters, refrigerators,
icemakers, special air conditioning or heating units, and card access systems or
special facilities such as showers.  All cost for the maintenance or replacement
of such items shall be the obligation of the Tenant.

      The Tenant  agrees that the  Landlord  shall not be liable for damages for
failure to furnish or delay in furnishing any service if  attributable to any of
the causes described in Sections 16 and 17 or as a result of unforeseen  causes.
No failure or delay resulting from the foregoing  reasons shall be considered to
be an  eviction  or  disturbance  of  the  Tenant's  quiet  enjoyment,  use,  or
possession of the Premises.  If the Tenant shall require  electrical  current to
operate equipment or machines,  including heating,  refrigeration,  computer(s),
data  processing,  or other machines or equipment  using  electrical  current or
maintain office hours that will increase the amount of the  electricity  usually
furnished  by the  Landlord  for use in general  office  space,  the Tenant will
obtain the prior  written  approval of the  Landlord and pay to the Landlord the
additional  direct expense  incurred,  including any installation or maintenance
cost, as Additional Rent.  Landlord reserves the right to install a submeter for
such service.

13.  ALTERATIONS:  The Tenant, by occupancy  hereunder,  accepts the Premises as
being in good repair and condition and suitable for Tenant's intended use of the
Premises.  The Tenant shall maintain the Premises and every part thereof in good
repair and condition,  reasonable use, wear and tear excepted.  The Tenant shall
not make or suffer to be made any  alterations,  additions or improvements to or
of the Premises or any part thereof without  Landlord's  prior written  consent.
The Tenant  shall not permit any lien or claim for lien of a mechanic,  laborer,
or supplier  or any other lien to be filed  against  the  Center,  the  Property
containing the Building, the Premises, or any part of such property, arising out
of work performed, or alleged to have been performed by, or at the direction of,
or on behalf of the Tenant.


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      The interest of Landlord in the Property or any part thereof  shall not be
subject  to liens for  improvements  made by Tenant or by persons  claiming  by.
through or under  Tenant,  and Tenant agrees that Tenant shall notify any person
making any  improvements on behalf of Tenant of this provision.  Upon request of
Landlord,  Tenant will  execute a short form of this Lease which states that the
terms of this  Lease  expressly  prohibits  any  liability  to  Landlord  or the
Landlord's  property for any improvements made by, through or under Tenant which
may be recorded by Landlord.

14. QUIET  ENJOYMENT:  Subject to the provisions of this Lease, the Tenant shall
be entitled to peaceful  and quiet  enjoyment  of the  Premises,  so long as the
Tenant is not in default under this Lease.

15. LANDLORD'S  RIGHTS: The Landlord and its agents shall have the right. at all
reasonable  times  during the Term of this Lease to enter the  Premises  for the
purpose of inspecting the Premises and of making any repairs and  alterations as
the Landlord shall deem  necessary.  The Landlord and its agents shall also have
the right to enter the  Premises  at all  reasonable  hours for the  purpose  of
displaying the Premises to prospective tenants during the ninety (90) day period
prior to the Expiration  Date of this Lease.  Landlord and its agents shall have
the right at all times to alter,  renovate,  and repair portions of the Building
which do not include the Premises,  notwithstanding any temporary  inconvenience
or disturbance to Tenant caused by such repairs. renovations, or alterations.

16. DESTRUCTION OF PREMISES:  If the Premises,  the Building. or the Property is
rendered substantially  untenantable by fire or other casualty, the Landlord may
elect,  by giving the Tenant  written  notice  within ninety (90) days after the
date of the fire or casualty, either to: (a) terminate this Lease as of the date
of the fire or other casualty: or (b) proceed to repair or restore the Premises.
the  Building.  or the  Property  (other  than the  leasehold  improvements  and
personal property installed by the Tenant).  to substantially the same condition
as existed immediately prior to fire or other casualty.

     If the Landlord elects to proceed  pursuant to 16(b) above, the Landlord's
notice shall contain the Landlord's  reasonable estimate of the time required to
substantially complete the repair or restoration. If the estimate indicates that
the time so required will exceed one hundred  eighty (180) days from the date of
the casualty and the Landlord does not make  available to the Tenant for its use
and  occupancy  other office  space,  substantially  similar to the Premises and
located in the Property or in the Center,  if any,  pursuant to Section 23. then
the Tenant shall have the right to  terminate  this Lease as of the date of such
casualty by giving  written  notice to the  Landlord  not later than twenty (20)
days  after  the  date of the  Landlord's  notice.  If the  Landlord's  estimate
indicates that the repair or restoration can be  substantially  completed within
one hundred  eighty (180) days,  or if the Tenant fails to exercise its right to
terminate this Lease, this Lease shall remain in force and effect.

     If the Premises are damaged by fire or other casualty but the Premises are
not rendered  substantially  untenantable,  then the Landlord  shall  diligently
proceed to repair and  restore  the  damaged  portions  thereof  (other than the
leasehold  improvements  and personal  property  installed  by the  Tenant),  to
substantially  the same condition as existed  immediately  prior to such fire or
other casualty,  unless such damage occurs during the last twelve (12) months of
the Term,  in which event the Landlord  shall have the right to  terminate  this
Lease as of the date of such fire or other  casualty by giving written notice to
the  Tenant  within  thirty  (30) days  after  the date of such  notice or other
casualty.

     If all or any part of the Premises  are damaged by fire or other  casualty
and this  Lease is not  terminated.  the Rent  shall  abate for that part of the
Premises which are untenantable on a per diem and proportionate  area basis from
three (3) days after the date of the fire or other  casualty  until the Landlord
has  substantially  completed  the repair and  restoration  work in the Premises
which it is  required  to  perform,  provided,  that as a result of such fire or
other casualty, the Tenant does not occupy the portion of the Premises which are
untenantable during such period.


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17. CONDEMNATION:  If all or part of the Premises, Building or Property is taken
or condemned by any  authority  for any public use or purpose  (including a deed
given  in  lieu of  condemnation).  which  renders  the  Premises  substantially
untenantable,  this Lease  shall  terminate  as of the date title  vests in such
authority, and the Rent shall be apportioned as of such date.

     If any part of the  Premises,  Building,  or Property is taken or condemned
but the Premises are not rendered substantially  untenantable  (including a deed
given in lieu of  condemnation),  this Lease shall not terminate.  If the taking
reduces  the  rentable  square  feet in the  Premises,  Rent shall be  equitably
reduced for the period of such taking by an amount which bears the same ratio to
the Rent then in effect as the number of square feet so taken or condemned bears
to the Leased Area set forth in Section 1C. The  Landlord.  upon  receipt and to
the  extent  of the  award in  condemnation  or  proceeds  of sale,  shall  make
necessary  repairs and  restorations  (exclusive of leasehold  improvements  and
personal property  installed by the Tenant) to restore the Premises remaining to
as near its former condition as circumstances  will permit,  and to the Building
and the Property to the extent  necessary to constitute  the portion of same not
so taken or condemned as complete.

     The  Landlord  shall be entitled to receive the entire  price or award from
any sale,  taking or  condemnation  without  any  payment  to the Tenant and the
Tenant  hereby  assigns to the Landlord the Tenant's  interest,  if any. in such
award. However, the Tenant shall have the right separately to pursue against the
condemning  authority  an award with  respect to the loss,  if any, to leasehold
improvements paid by the Tenant without any credit or allowance for the Landlord
and for any loss for injury,  damage,  or destruction  of the Tenant's  business
resulting from such taking.  Under no circumstances  shall the Tenant seek or be
entitled to any  compensation for the value of its leasehold estate which Tenant
hereby assigns to Landlord.

18.  ASSIGNMENT AND SUBLEASE:  Without the prior written consent of the Landlord
which will not be  unreasonably  withheld.  the Tenant  shall not  sublease  the
Premises,  or assign,  mortgage,  pledge,  hypothecate or otherwise  transfer or
permit the  transfer of this Lease or the  interest of the Tenant in this Lease,
in whole or in part, by operation of law,  court decree or  otherwise.  Landlord
may grant,  deny or withhold  consent or impose  conditions  on the  granting of
consent.  in Landlord's  sole  discretion.  If the Tenant desires to assign this
Lease or to enter into any sublease of the  Premises:  the Tenant shall  deliver
written  notice of such  intent  to the  Landlord.  together  with a copy of the
proposed assignment or sublease at least thirty (30) days prior to the effective
date of the proposed assignment or commencement date of the term of the proposed
sublease.  Any approved  sublease  shall be  expressly  subject to the terms and
conditions of this Lease.  In the event of any approved  sublease or assignment.
the Tenant shall not be released or discharged from any liability, whether past,
present or future,  under this Lease,  including any renewal term of this Lease,
and if the  sublease  or  assignment  provides  for rent in  excess  of the Rent
payable  to  Landlord  under  the  terms of this  Lease,  one-half  (1/2) of the
difference  between the rent payable by the  assignee or subtenant  and the Rent
payable to  Landlord  under the terms of this Lease shall be paid to Landlord in
consideration of its consent to the assignment or sublease. For purposes of this
Section  18,  an  assignment  shall be  considered  to  include  a change in the
majority  ownership or control of Tenant if Tenant is a corporation whose shares
of stock are not traded publicly,  or, if the Tenant is a partnership,  a change
in the general  partner of the  partnership  or a change in the persons  holding
more than 50% interest in the partnership,  or a change in majority ownership or
control of any general partner of the partnership.

19.  HOLDING  OVER:  If the Tenant,  or any assignee or sublessee of the Tenant,
shall  continue to occupy the Premises  after the  termination  or expiration of
this Lease  (including a termination by notice under Section 24 or a termination
or  expiration  under  Section  27),  without the prior  written  consent of the
Landlord,  such tenancy shall be a Tenancy at  Sufferance.  During the period of
any hold over tenancy by the Tenant, or any assignee or sublessee, the Landlord,
by notice to the Tenant,  may adjust the Rent to an amount  equal to one hundred
and fifty  percent  of the Rent of the last  month of the Term in which Rent was
payable.  Acceptance  by the  Landlord of any Rent after  termination  shall not
constitute a renewal of this Lease or a consent to such hold over  occupancy nor
shall it waive the Landlord's  right of re-entry or any other right contained in
this Lease or provided by law.

20.  SUBORDINATION  AND  ATTORNMENT:  This  Lease  and the  right of the  Tenant
hereunder are expressly  subject and  subordinate  to the lien and provisions of
any mortgage,  deed of trust. deed to secure debt.  ground lease,  assignment of
leases,  or other security  instrument or operating  agreement  (collectively  a
"Security


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Instrument")  now or hereafter  encumbering  the  Premises,  the  Building,  the
Property, or any part thereof, and all amendments,  renewals,  modifications and
extensions  of and to any such Security  Instrument  and to all advances made or
hereafter to be made upon such Security Instrument. The Tenant agrees to execute
and  deliver  such  further  instruments,  in such  form as may be  required  by
Landlord  or  any  holder  of  a  proposed  or  existing  Security   Instrument,
subordinating  this Lease to the lien of any such Security  Instrument as may be
requested in writing by the Landlord or holder from time to time.

      In the  event  of the  foreclosure  of any  such  Security  Instrument  by
voluntary  agreement or otherwise,  or the  commencement  of any judicial action
seeking such  foreclosure,  the Tenant at the request of the then Landlord shall
attorn to and  recognize  such  mortgage  or  purchaser  in  foreclosure  as the
Tenant's  landlord under this Lease. The Tenant agrees to execute and deliver at
any time upon  request of such  mortgagee,  purchaser or their  successors,  any
instrument to further evidence such attornment.

      The  Tenant  shall  from time to time.  upon not less than seven (7) days'
prior  written  request by the  Landlord  deliver to the Landlord a statement in
writing  certifying  that this Lease is unmodified and in full force and effect,
or, if there have been modifications,  that this Lease, as modified,  is an full
force and effect;  providing a true,  correct and complete copy of the Lease and
any and all modifications of the Lease; the amount of each item of the Rent then
payable under this Lease and the date to which the Rent has been paid:  that the
Landlord  is not in  default  under  this  Lease or, if in  default,  a detailed
description  of such default;  that the Tenant is or is not in possession of the
Premises.  as the  case  may be;  and  containing  such  other  information  and
agreements as may be reasonably requested.

21. WAIVER AND INDEMNIFICATION:  To the full extent permitted by law, the Tenant
hereby  releases  and waives all claims  against  the  Landlord  and its agents,
employees,  officers,  directors,  and  independent  contractors,  for injury or
damage to person,  property or business sustained in or about the Property,  the
Building,  or the  Premises by the Tenant,  its agents or  employees  other than
damage  proximately and solely caused by the gross negligence of the Landlord or
its agents or employees.

      The Tenant  agrees to  indemnify  and hold  harmless  the Landlord and its
agents and employees, from and against any and all liabilities, claims, demands,
costs,  and expenses of every kind and nature,  including those arising from any
injury or damage to any person  (including  death) or property  sustained in the
Premises, or resulting from the failure of the Tenant to perform its obligations
under this Lease; provided, however, the Tenant's obligations under this section
shall not apply to injury or damage resulting from the negligence or willful act
of the Landlord or its agents or employees.

      The Landlord  agrees to indemnify  and hold  harmless the Tenant,  and its
respective  agents and  employees,  from and  against  any and all  liabilities,
claims,  demands,  costs and expenses of every kind and nature, arising from any
injury or damage to any person  (including  death) or property  sustained  in or
about the Building  proximately caused by the gross negligence or willful act or
omission of the Landlord:  provided,  however, the Landlord's  obligations under
this section shall not apply to injury or damage  resulting  from the negligence
or willful act or omission of the Tenant, or its agents or employees.

     The  Landlord  shall not be  responsible  or liable to the  Tenant  for any
event,  act or omission to  the:-extent  covered by insurance and  maintained or
required to be maintained by the Tenant with respect to the Premises and its use
and occupancy  thereof  (whether or not such  insurance is actually  obtained or
maintained).  At the request of the Landlord, the Tenant shall from time to time
cause its insurers to provide  effective  waivers of subrogation for the benefit
of  the  Landlord,  and  its  agents  or  employees  and  insurers,  in  a  form
satisfactory to the Landlord.

22.  SURRENDER OF PREMISES:  Upon the expiration or termination of this Lease or
the termination of the Tenant's right of possession of the Premises,  the Tenant
shall  surrender  and vacate the  Premises  immediately  and deliver  possession
thereof to the Landlord in a clean, good, and tenantable  condition,  except for
a) damages beyond the control of the Tenant; b) reasonable use; c) ordinary wear
and tear. Any movable trade  fixtures and personal  property that may be removed
from the Premises by the Tenant at the end of the Lease term,  but which are not
so removed,  shall be conclusively presumed to have been abandoned by the Tenant
and title to such  property  shall pass


                                    7 of 12
<PAGE>

to the  Landlord  without any payment or credit;  or, the  Landlord  may, at its
option,  either store or dispose of such trade fixtures and personal property at
the Tenant's expense. Tenant agrees that it shall not remove any of the personal
property  from the Premises  without  Landlord's  consent so long as any Rent or
Additional Rent, or other sums owed to Landlord, remain unpaid.

23. RELOCATION OF TENANT: At any time after the date of this Lease, the Landlord
may  substitute for the Premises,  other premises in the Center,  in which event
the New Premises  shall be deemed to be the Premises for all purposes under this
Lease,  provided:  (1) the New Premises shall be similar to the Premises in area
and  configuration;  (2) if the  Tenant  is then  occupying  the  Premises,  the
Landlord  shall give the  Tenant  not less than  sixty  (60) days prior  written
notice of such  substitution;  (3) if the Tenant is then occupying the Premises,
the Landlord shall pay the actual and reasonable  expenses of physically  moving
the Tenant,  its then existing  property and its then existing  equipment to the
new Premises and the Landlord  shall pay the actual and  reasonable  expenses of
replacing  the  then  unusable  printed  materials  of the  Tenant;  and (4) the
Landlord,  at  its  expense,   shall  improve  the  New  Premises  in  a  manner
substantially  similar to that of the Premises at the time of such  substitution
or as otherwise mutually agreed between the Tenant and the Landlord in writing.

24.  EVENTS OF  DEFAULT:  Each of the  following  shall  constitute  an event of
default  by the  Tenant  under  this  Lease:  (1) the  Tenant  fails  to pay any
installment  of Rent or  Additional  Rent within ten (10) days after the date on
which the  installment  of Rent or  Additional  Rent first  becomes due; (2) the
Tenant  fails to observe or perform its  obligations  under  sub-section  (d) of
Section 4 above and such  violation  continues for more than 24 hours after such
notice  or Tenant  fails to  observe  or  perform  any of the  other  covenants.
conditions or provisions of this Lease other than the payment of any installment
of Rent or Additional  Rent,  and fails to cure such default within fifteen (15)
days after written notice from the Landlord to the Tenant;  (3) the Tenant fails
a second time to observe or perform any of the other  covenants.  conditions  or
provisions  of this Lease other than the payment of any  installment  of Rent or
Additional  Rent after prior  written  notice of the failure;  (4) a petition is
filed by or against  the Tenant or any  Guarantor  to declare  the Tenant or the
Guarantor,  as the case may be  bankrupt  or to seek  relief from such tenant or
Guarantor under any chapter of the Bankruptcy  Code, as amended,  or under other
law imposing a moratorium  on, or granting  debtor's  relief with respect to the
rights of  creditors;  (5) the Tenant or any  Guarantor  becomes or is  declared
insolvent by law or Tenant or any Guarantor  makes an assignment for the benefit
of  creditors;  (6) a  receiver  is  appointed  for the  Tenant or the  Tenant's
property or for any  Guarantor or any of  Guarantor's  property;  (7) the Tenant
abandons  or vacates  the  Premises;  or (8) the  interest of the Tenant in this
Lease is levied upon under execution or other legal process.

      Upon the occurrence of an event of default by the Tenant under this Lease,
the Landlord at its option,  without further notice or demand to the Tenant. may
in addition to all other rights and remedies  provided in this Lease,  at law or
in equity:

      A.  Terminate  this  Lease and the  Tenant's  right of  possession  of the
Premises,  and recover all damages to which the Landlord is entitled  under this
Lease, at law and in equity, specifically including, without limitation, all the
Landlord's expenses of relenting (including repairs, alterations,  improvements,
additions, decorations, legal fees and brokerage commissions).

      B.  Terminate the Tenant's  right of  possession  of the Premises  without
terminating  this  Lease,  in which  event the  Landlord  may,  but shall not be
obligated  to,  relet the  Premises,  or any part thereof for the account of the
Tenant,  for such rent and such term and upon such terms and  conditions  as are
acceptable to the Landlord For purposes of any  reletting of the  Premises,  the
Landlord is authorized to redecorate,  repair, alter and improve the Premises to
the extent  necessary or desirable in the  Landlord's  judgment.  For any period
during which the Premises have not been relet, Tenant shall pay Landlord monthly
on the  first  day of each  month  during  the  period  that  Tenant's  right of
possession is terminated, a sum equal to the amount of Rent due under this Lease
for such month.  If and when the Premises are relet and a sufficient  sum is not
realized from such  reletting  after payment of all the  Landlord's  expenses of
reletting (including repairs, alterations, improvements, additions, decorations,
legal fees and brokerage  commissions)  to satisfy the payment of Rent due under
this  Lease  for any  month,  the  Tenant  shall  pay to the  Landlord  any such
deficiency  monthly  upon demand.  The Tenant  agrees that the Landlord may file
suit to recover any sums due to the  Landlord  under this  section and that such
suit or recovery of any amount due the


                                    8 of 12
<PAGE>

Landlord  shall not be any  defense to any  subsequent  action  brought  for any
amount not  previously  reduced by  judgment  in favor of the  Landlord.  If the
Landlord  elects to terminate  the  Tenant's  right to  possession  only without
terminating this Lease, the Landlord may at its option, enter into the Premises,
removing the Tenant's  signs and other  evidences of tenancy,  and take and hold
possession thereof: provided,  however, that such entry and possession shall not
terminate  this  Lease or  release  the  Tenant,  in whole or in part,  from the
Tenant's obligation to pay the Rent reserved hereunder for the full Term or from
any other obligation of the Tenant under this Lease.

      Tenant shall pay on demand or reimburse Landlord for payment of Landlord's
reasonable  attorney's fees, expenses and court costs in negotiation,  at trial,
and on appeal  incurred by Landlord to enforce any  obligation  of Tenant  under
this Lease or to defend any claim brought by Tenant  against  Landlord or by any
person claiming by, through or under Tenant, or in curing any default by Tenant,
or in connection  with any action or proceeding  arising out of or occasioned by
any lien or claim of lien on the Premises,  the Building,  or the Center,  or in
defending or otherwise participating in any legal proceeding initiated by Tenant
or against Tenant,  or in connection with the investigation of a response to any
request for consent or other amendments to the Lease by Tenant.

25. SUCCESSOR AND ASSIGNS: This Lease shall bind and inure to the benefit of the
successors, assigns, heirs, executors, administrators, and legal representatives
of the parties hereto.  In the event of the sale assignment,  or transfer by the
Landlord  of its  interest  in the  Building  or in  this  Lease  (other  than a
collateral  assignment to secure a debt of the Landlord prior to enforcement) to
a successor in interest who expressly  assumes the  obligations  of the Landlord
hereunder,  the Landlord shall  thereupon be released or discharged  from all of
its covenants and obligations hereunder, except such obligations as the Landlord
shall have  accrued  prior to any such sale,  assignment  or  transfer:  and the
Tenant agrees to look solely to such  successor of the Landlord for  performance
of such obligations. Any securities or funds given by the Tenant to the Landlord
to secure performance by the Tenant of its obligations hereunder may be assigned
by the Landlord to such  successor of the Landlord and, upon  acknowledgment  by
such  successor or receipt of such security and its assumption of the obligation
to account for such  security  in  accordance  with the terms of the Lease,  the
Landlord shall be discharged of any further  obligation  relating  thereto.  The
Landlord's  assignment  of the Lease or of any or all of its rights herein shall
in no manner affect the Tenant's obligations hereunder.  The Landlord shall have
the right to freely  sell,  assign or  otherwise  transfer  its  interest in the
Building and/or this Lease.

26.  NON-WAIVER:  No waiver of any covenant or condition of this Lease by either
party  shall be deemed  to imply or  constitute  a  further  waiver of any other
covenant or condition of this Lease.

27.  AUTOMATIC RENEWAL. See Attached Rider.

28. SECURITY  DEPOSIT.  As security for the performance of its obligations under
this Lease, the Tenant upon its execution of this lease has paid to the Landlord
a security deposit (the "Security  Deposit") in the amount stated in Section 1B.
The Security  Deposit may be applied by the  Landlord to cure or partially  cure
any default of the Tenant  under this Lease,  and upon notice by the Landlord or
such  application,  the Tenant shall  replenish the Security  Deposit in full by
promptly  paying to the Landlord the amount so applied.  The Landlord  shall not
pay any interest on the Security  Deposit.  The  Security  Deposit  shall not be
deemed an advance payment of rent or a measure of damages for any default by the
Tenant  under this Lease,  nor shall it be a bar or defense to any action  which
the Landlord may at any time commence against the Tenant.

29.  LIMITATION OF THE  LANDLORD'S  LIABILITY:  As used in this Lease,  the term
"Landlord"  shall mean the entity herein named as such,  and its  successors and
assigns.  No person holding the Landlord's  interest under the Lease (whether or
not such person is named as the "Landlord")  shall have any liability  hereunder
after  such  person  ceases  to hold such  interest,  except  for any  liability
accruing hereunder while such person held such interest. No principal,  officer,
employee,  or  partner  (general  or  limited)  of the  Landlord  shall have any
personal  liability under any provision of this Lease. If the Landlord  defaults
in the performance of any of its obligations under this Lease or otherwise,  the
Tenant shall look solely to the  Landlord's  interest in the Building and not to
the  other  assets  of  Landlord  or the  assets,  interest,  or  rights  of any
principal,  officer,  employee, or partner (general or limited) for satisfaction
of the Tenant's remedies on account thereof.


                                    9 of 12
<PAGE>

30.  COMMON  AREAS:  For  purposes of this Lease  "Common  Areas" shall mean all
areas, improvements,  space, and equipment (owned or controlled by the Landlord)
in or at the Property,  provided by the Landlord for the common or joint use and
benefit of tenants, customers and other invitees.

31. MISCELLANEOUS:  This Lease, the Exhibits, the Riders and Addendums contained
herein or attached hereto contain the entire agreement  between the Landlord and
the Tenant and there are no other agreements, either oral or written. This Lease
shall not be  modified  or amended  except by a written  document  signed by the
Landlord and the Tenant which specifically refers to this Lease. The captions in
this Lease are for  convenience  only and in no way define,  limit,  construe or
describe the scope or intent of the  provisions of this Lease.  This Lease shall
be construed in  accordance  with the laws of the state in which the Building is
located.  If any provision of this Lease or any  amendment  hereof is invalid or
unenforceable  in any instance,  such invalidity or  unenforceability  shall not
affect the validity or enforceability of any other provision,  or such provision
in any circumstance not controlled by such determination.

32. TENANT'S INSURANCE: Tenant shall obtain and keep in force during the Term of
this Lease, including any extension and renewal, comprehensive general liability
insurance,  including contractual  liability coverage,  insuring Landlord (as an
additional  insured)  and  Tenant  against  any  liability  arising  out  of the
ownership,  use,  occupancy  or  maintenance  of the  Premises,  and  all  areas
appurtenant thereto.  Such policy shall provide minimum limits of $1,000,000 for
damage to property or for death or injury to any one person in any one accident.
Tenant  shall  deliver  to  Landlord,  prior to  occupancy  of the  Premises,  a
certificate  of  insurance  and evidence of payment of one year's  premium,  and
shall deliver a new  certificate  as and when the policy is renewed or replaced.
Said policy  shall  contain a waiver of  subrogation  clause in form and content
satisfactory   to  Landlord   and  provide  that  it  will  not  be  subject  to
cancellation,  non-renewal,  reduction  or other  change  except  after at least
thirty (30) days prior  written  notice to  Landlord.  If Tenant fails to comply
with such requirements,  Landlord may obtain such insurance and keep the same in
effect and Tenant shall pay Landlord,  as  Additional  Rent due  hereunder,  the
premium cost thereof upon demand.

33. NO  RECORDING:  NEITHER THIS LEASE NOR ANY  MEMORANDUM  OF THIS LEASE MAY BE
RECORDED OR FILED FOR RECORD IN ANY PUBLIC RECORDS WITHOUT THE SEPARATE  EXPRESS
WRITTEN CONSENT, IN RECORDABLE FORM, OF THE LANDLORD.

34.  ENCUMBRANCES  ON LANDLORD'S  TITLE:  Upon request of Landlord,  Tenant will
promptly release or modify,  or cause to be released or modified,  any financing
statement given by Tenant to a third party, any notice of commencement  filed by
Tenant with  respect to work on the  Premises,  or any other  recorded  document
filed by or on account of Tenant ("Document"),  which adversely affects, clouds,
or otherwise  encumbers  Landlord's title to the Center or any part thereof,  so
that the Occupant  shall not encumber  any portion of the Center,  Building,  or
Property  other than the Tenants  leasehold  interest in the Premises.  Tenant's
obligations  as set forth in this Section 34 shall survive  termination  of this
Lease.

35.  RADON  DISCLOSURE  FOR  FLORIDA  LEASES:  Radon  is a  naturally  occurring
radioactive  gas which,  when it has  accumulated  in a building  in  sufficient
quantities, may present health risks to persons who are exposed to it over time.
Levels of radon that  exceed  federal  and state  guidelines  have been found in
buildings in Florida.  Additional  information regarding radon and radon testing
may be obtained from your county public health unit.  Tenant  acknowledges  this
disclosure by signing this Lease.

36. RIDERS & ADDENDA: All riders and addenda contained herein or attached hereto
shall be deemed to be a part  hereof  and hereby  incorporated  in this Lease by
reference.






                                    10 of 12
<PAGE>


                                   LEASE RIDER


This Rider is attached to and made a part of the Lease dated July 15,1997 by and
between  Koger  Equity,  Inc,,  a  Florida  Corporation  ("Landlord")  with  its
principal office at 3986 Boulevard Center Drive,  Jacksonville,  Florida, 32207,
and Conversion  Technologies  International,  Inc., a corporation  organized and
existing under the laws of the State of Delaware,  ("Tenant") with its principal
office at 82 Bethany Road, Suite 6, Hazlet, New Jersey 07730

36A:  EARLY   OCCUPANCY:   If  the  Tenant  takes  occupancy  prior  to  the
      commencement  date of this Lease Agreement,  all terms and conditions will
      be in effect as of the date of occupancy.

36B:  RENT  ADJUSTMENT:  The monthly  rental as stated in Paragraph 1B,  Monthly
      Base Rent, will be adjusted on the respective anniversary dates by a fixed
      increase of five percent (5%) per year.

36C:  TENANT  IMPROVEMENTS:  Thorough   cleaning  of  existing  carpets,  entire
      suite to be detailed  cleaned.  All painted walls to be repainted and door
      and jambs to be finished as needed.

36D:  OPTION  TO  RENEW:  Tenant  shall  have the  option to renew the Lease
      Agreement  effective  August 1, 2000,  by providing  the  Landlord  with a
      minimum of 120 days prior written notice of its intent to renew.



                   [Illustrative -- Floor Plan of Building]