<PAGE>   1
                                                                    Exhibit 10.1

                                                                     NUMBER 5 OF
                                                                      5 EXECUTED
                                                                    COUNTERPARTS


                         SAGE REALTY CORPORATION, AGENT
                                    LANDLORD

                                       and

                              ATLANTIC REALTY TRUST
                                     TENANT

                               INDENTURE OF LEASE



                                             PREMISES: Part of the 10th Floor
                                                       747 Third Avenue
                                                       New York, New York 10017
<PAGE>   2
                             TABLE OF CONTENTS
Article                                                                    Page
-------                                                                    ----

 1  DEFINITIONS, TERM . . . . . . . . . . . . . . . . . . . .. ..........   1

 2  COMMENCEMENT OF TERM ................................................   2

 3  FIXED RENT, ADDITIONAL RENTS AND RENT ADJUSTMENTS . . . .............   3
     A. Operating Expense Adjustment . . . . . . . . . . . ..............   5
     B. Real Estate Tax Adjustment . . . . . . . . . . . . ..............   5

 4  ELECTRICITY .........................................................   7
 5  USE .................................................................  10

 6  REPAIRS, ALTERATIONS AND LIENS . . . . . . . . . . . . . ............  11
 7  FLOOR LOAD, NOISE, WINDOW CLEANING . . . . . . . . . . . ............  16
 8  LAWS, ORDINANCES, REQUIREMENTS OF PUBLIC AUTHORITIES . . ............  16
 9  INSURANCE, PROPERTY LOSS, REIMBURSEMENT . . . . . . . . .............  17
 10 DAMAGE OR DESTRUCTION BY FIRE OR OTHER CAUSE . . . . . . ............  20
 11 ASSIGNMENT, SUBLETTING, MORTGAGING . . . . . . . . . . . ............  22

 12 NO LIABILITY ON LANDLORD ............................................  26

 13 MOVING OF HEAVY EQUIPMENT . . . . . . . . . . . . . . . .............  26

 14 CONDEMNATION ......................................................... 27
 15 ENTRY, RIGHT TO CHANGE PUBLIC PORTIONS OF THE
    BUILDING ............................................................  28
 16 BANKRUPTCY ..........................................................  29

 17 DEFAULTS AND REMEDIES AND WAIVER OF REDEMPTION . . . . . ............  30
 18 LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS . . . . ............  33
 19 COVENANT OF QUIET ENJOYMENT . . . . . . . . . . . . . . .............  33

 20 EXCAVATION ..........................................................  34
 21 SERVICES AND EQUIPMENT ..............................................  34
 22 DEFINITION OF LANDLORD ..............................................  38

                                       i
<PAGE>   3
 23 INVALIDITY OF ANY PROVISION . . . . . . . . . . . . . . .............  38

 24 BROKER ..............................................................  39
 25 SUBORDINATION .......................................................  39
 26 ESTOPPEL CERTIFICATE ................................................  40

 27 LEGAL PROCEEDINGS, WAIVER OF JURY TRIAL . . . . . . . . .............  41
 28 SURRENDER OF PREMISES/HOLDOVER . . . . . . . . . . . . . ............  42

 29 RULES AND REGULATIONS ...............................................  42
 30 NOTICES .............................................................  43

 31 NO WAIVER: ENTIRE AGREEMENT . . . . . . . . . . . . . . .............  43

 32 CAPTIONS ............................................................  44

 33 INABILITY TO PERFORM . . . . . . . . . . . . . . . . . . ............  44
 34 NO REPRESENTATION BY LANDLORD . . . . . . . . . . . . . .............  45

 35 NAME OF BUILDING ....................................................  45
 36 SUCCESSORS AND ASSIGNS ..............................................  45
 37 DEFERRED COLLECTIONS ................................................  45

 38 FEES/INTEREST/LATE CHARGES . . . . . . . . . . . . . . . ............  46

 39 INTENTIONALLY OMITTED ...............................................  46

 40 MUTUAL TERMINATION OPTION . . . . . . . . . . . . . . . .............  46

Schedule A Floor Plan
Schedule B Intentionally Omitted
Schedule C Rules and Regulations

                                       ii
<PAGE>   4
       INDENTURE OF LEASE made as of this 16th day of January 1996, between
SAGE REALTY CORPORATION, a New York Corporation having its principal office at
777 Third Avenue, N`} York, Newt York 10017, Agent for the owner of the Building
hereinafter mentioned (herein "Landlord"), and ATLANTIC REALTY TRUST, a
______________________ having its office at 747 Third Avenue, New York,
New York 10017 (herein "Tenant").

                              W I T N E S S E T H:

                                    ARTICLE 1
                                DEFINITIONS. TERM
                                -----------------

       Section 1.01. The terms defined in this Article shall, for all purposes
of this Lease and all agreements supplemental thereto, have the meanings herein
specified unless the context otherwise requires.

             (a) "Building" shall mean the office building known as 747 Third
Avenue, in the Borough of Manhattan, City and State of New York. The plot of
land on which the Building is erected is hereinafter called the "Land".

             (b) "Business Days" shall mean all days excluding Saturdays,
Sundays and days observed by the State of New York or Federal Government as
legal holidays, and further excluding holidays established by any union contract
applicable to employees at the Building.

             (c) "Commencement Date" shall have the meaning set forth in Section
2.02.

             (d) "Demised Premises" shall mean a portion of the tenth (lath)
floor of the Building, as shown on the Floor Plan annexed hereto as Schedule A
and made a part of this Lease, including all fixtures and equipment which at the
Commencement Date or during the Term of this Lease are attached thereto and
which become a part thereof.

             (e) "Expiration Date" shall mean April 30, 1998 or any sooner date
of termination pursuant to the provisions hereof.

             (f) "Fixed Rent" shall mean the annual rental payable by Tenant for
the Demised Premises in equal monthly installments as provided for in Article 3
of this Lease.

             (g) "Interest Rate" shall mean the lesser of (i) 2% above the prime
commercial lending rate of Marine Midland Bank, N.A. in effect from time to time
or (ii) the maximum applicable legal rate, if any.

             (h) "Lease" shall mean this Indenture of Lease and any and all
Schedules annexed hereto.
<PAGE>   5
                                      - 2 -

             (i) "Lease" shall mean this Indenture of Lease and any and all
Schedules annexed hereto.

             (I) "Term of this Lease" and "Term" shall mean the term of years
commencing on the Commencement Date and expiring on the Expiration Date, subject
to the terms and conditions hereinafter set forth.

       Section 1.02. Landlord hereby leases to Tenant, and Tenant hereby rents
from Landlord, the Demised Premises, subject to the provisions hereinafter set
forth, together with appurtenances, including the right to use in common with
others the lobbies, elevators and other public portions of the Building.

       TO HAVE AND TO HOLD unto Tenant, its successors and permitted assigns,
for the Term of this Lease or until the Term of this Lease sooner terminates as
hereinafter provided.

                                    ARTICLE 2
                              COMMENCEMENT OF TERM
                              --------------------

       Section 2.01. Tenant acknowledges that it has examined the Demised
Premises and is taking same "as is" as of the Commencement Date. Tenant
acknowledges that Landlord is not required to do any work with respect thereto.

       Section 2.02. The Term of this Lease and the payment of rent shall
commence on May 1, 1997 (herein the "Commencement Date" ) .

       The taking of possession by Tenant of the Demised Premises shall be
deemed an acceptance of same by Tenant. Such taking of possession shall also be
conclusive evidence, as against Tenant, that the Demised Premises and the
Building of which the same form a part were in good and satisfactory condition
at the time of such occupancy and that the Demised Premises were substantially
as shown on Schedule A.

       Section 2.03. If Landlord shall be unable to give possession of the
Demised Premises on the date anticipated for the commencement of the Term hereof
for any reason whatsoever, Landlord shall not be subject to any liability, nor
shall the validity of this Lease nor the obligations of Tenant hereunder be
thereby affected. Without limiting the foregoing, the parties hereto expressly
negate the provisions of Section 223-a of the Real Property Law and agree that
such Section shall be inapplicable hereto. Tenant agrees that the provisions of
this Article are intended to constitute "an express provision to the contrary"
within the meaning of Section 223-a. If by reason of such delay, the Term of
this Lease shall commence subsequent to such anticipated date, the Term of this
Lease shall be deemed extended for the same period.
<PAGE>   6
                                      - 3 -

                                    ARTICLE 3
                FIXED RENT. ADDITIONAL RENTS AND RENT ADJUSTMENTS
                -------------------------------------------------

       Section 3.01. During the Term of this Lease, Tenant shall pay, at
Landlord's address as herein set forth, or at such other address that Landlord
may from time to time designate, a Fixed Rent payable in lawful money of the
United States of America (by check of Tenant drawn on a bank that is a member of
the New York Clearinghouse Association) in equal monthly installments in advance
on the first day of each calendar month, without notice or demand, and without
setoff or deduction whatsoever at the annual rate (subject to adjustment
pursuant to Article 4 hereof) of $172,150.70 during the period beginning on the
Commencement Date and continuing through the balance of the Term.

       If Tenant's obligation to pay Fixed Rent shall commence on a date other
than the first day of a calendar month, the first installment of Fixed Rent
shall be in an amount equal to that required to cover the period up to and
including the last day of the month wherein the obligation to pay Fixed Rent
occurs, computed on a per diem basis.

       Section 3.02. The Fixed Rent does not take into account increases of real
estate taxes and/or expenses during the Term of this Lease or other adjustments
in rent, or other payments to be made by Tenant, during the Term of this Lease.
Provision therefor is hereinafter made.

       Section 3.03. All costs, expenses, adjustments and payments which Tenant
is obligated to pay to Landlord pursuant to this Lease and/or its Schedules
shall be deemed additional rent whether or not denominated as such and, in the
event of nonpayment thereof, Landlord shall have all rights and remedies with
respect thereto as herein provided for in case of nonpayment of Fixed Rent.

       Tenant covenants and agrees to pay the Fixed Rent and additional rent as
in this Lease provided, when due.

       Section 3.04. For the purposes of this Section 3.04, the following
definitions shall apply:

             (a) The term "Base Tax Year" as hereinafter set forth for the
determination of real estate tax escalation shall mean the period commencing on
July 1, 1996 and ending on June 30, 1997.

             (b) The term "the Percentage" shall mean 1.35%.

             (c) The term "Real Estate Taxes" shall mean all real estate taxes,
assessments, water and sewer rents, governmental levies, county taxes or any
other governmental charges, general
<PAGE>   7
                                      - 4 -

or special, ordinary or extraordinary, unforeseen as well as foreseen, of any
kind or nature whatsoever, which are or may be assessed or imposed upon the
Land, the Building and the sidewalks, plazas or streets in front of or adjacent
thereto, including any tax, excise or fee measured by or payable with respect to
any rent, and levied against Landlord and/or the Land and/or Building, under the
laws of the United States, the State of New York, or any political subdivision
thereof, or by the City of New York, or any political subdivision thereof. If,
due to a future change in the method of taxation or in the taxing authority, a
franchise, income, transit, profit or other tax or governmental imposition,
however designated, shall be levied against Landlord, and/or the Land and/or the
Building, in substitution in whole or in part for said Real Estate Taxes, or in
lieu of additional real estate taxes, then such franchise, income, transit,
profit or other tax or governmental imposition shall be deemed to be included
within the definition of "Real Estate Taxes" for the purposes hereof.

             (d) The term "Tax Year" shall mean every twelve-month consecutive
period commencing each July 1st during the Term of this Lease.

             (e) The term "Wage Rate" shall mean the minimum regular hourly wage
rate plus all other sums, including, but not limited to, sums paid for pensions,
welfare funds, vacations, bonuses, social security unemployment, disability
benefits, health, life, accident and other type of insurance required to be paid
to or for the benefit of employees engaged in the general maintenance and
operation of office buildings of the type in the vicinity of the Building
pursuant to a c0110ctiv0 bargaining agreement (designated as "Others" in said
agreement) between Realty Advisory Board on Labor Relations, Inc. (or any
successor thereto) and Local 32B/32J of the Building Service Employees
International Union AFL-CIO (or any successor thereto). The Wage Rate is
intended to be an index in the nature of a cost of living index, and is not
intended to reflect the actual costs of wages or expenses for the Building. If
any such agreement is not entered into, or such parties or their successors
shall cease to bargain collectively, then the Wage Rate shall be the minimum
regular hourly wage rate and other suns as aforesaid payable to or for the
benefit of employees engaged in the maintenance and operation of first class
office buildings of the same general type as the Building in the Manhattan area.

             (f) The term "Base Wage Rate" shall mean the Wage Rate in effect on
January 1, 1997.

             (g) The term "Wage Rate Factor" shall mean 4,863.
<PAGE>   8
                                      - 5 -

       A. Operating Expense Adjustment

       It is agreed that if at any time the Wage Rate shall be greater than the
Base Wage Rate, Tenant shall be required to pay to Landlord as additional rent
an "Operating Expense Adjustment" in an annual sum equal to the product obtained
by multiplying (i) the number of cents (including any fraction of a cent) by
which the Wage Rate exceeds the Base Wage Rate by (ii) the Wage Rate Factor by
(iii) 80%. Such Operating Expense Adjustment shall be payable to Landlord
together with Fixed Rent in equal monthly installments on the first day of each
calendar month commencing with the first month during the Term of this Lease in
which the Wage Rate shall be greater than the Base Wage Rate and, as billed by
Landlord, continuing thereafter until a new adjustment in the additional rent
shall be established and become effective in accordance with the provisions of
this paragraph. Notwithstanding any change in Wage Rate downwards, the Fixed
Rent shall not be reduced. In the event any change in the Wage Rate shall be
made retroactive, Tenant shall pay Landlord the amount of any resulting
retroactive adjustment in such additional rent within fifteen (15) days after
being billed therefor.

       B. Real Estate Tax Adjustment

       In the event that the Real Estate Taxes payable for any Tax Year shall
exceed the amount of such Real Estate Taxes, as finally determined, payable with
respect to the Base Tax Year, Tenant shall pay to Landlord, as additional rent
("Tenant's Tax Payment") for such Tax Year, an amount equal to the Percentage of
the excess. By or after the start of the Tax Year following the Base Tax Year,
and by or after the start of each Tax Year thereafter, Landlord shall furnish to
Tenant a statement of the Real Estate Taxes payable with respect to such Tax
Year, and a statement of the Real Estate Taxes payable during the Base Tax Year.

       Within thirty (30) days after the issuance by the governmental authority
having jurisdiction thereafter of tax bills for Real Estate Taxes assessed,
levied and/or imposed upon the Land and Building for any Tax Year, Landlord
shall submit to Tenant a photostated copy of such bill and/or bills and
thereafter on or about each respective anniversary date shall submit a copy of
the tax bill and/or bills for the Real Estate Taxes assessed, levied or imposed
upon the Land and Building for such Tax Year, together with a statement which
shall indicate the amount, if any, of Tenant's Tax Payment. Landlord's failure
to submit copies of bills as aforesaid shall not be considered a default by
Landlord or a defense by Tenant to such tax payment.

       Within thirty (30) days after the issuance of the statement, Tenant shall
pay Tenant's Tax Payment in the amount set forth on such statement. Such
statement shall be conclusively deemed binding upon Tenant unless Tenant shall
have objected thereto in
<PAGE>   9
                                      - 6 -

writing within thirty (30) days of receipt thereof. Notwithstanding the
foregoing provisions of this paragraph, Tenant's Tax Payment shall be payable in
the same number of installments as Real Estate Taxes are payable to the taxing
authority and shall be payable not less than thirty (30) days in advance of the
date on which the corresponding installment is due such taxing authority without
incurring any penalty, interest or late charge.

       In the event Landlord shall receive a final reduction or refund of Real
Estate Taxes for any Tax Year for which Tenant is obligated to pay any
additional rent under the provisions of this subsection B of Section 3.04, the
amount or the proceeds of such reduction or refund, less legal fees and other
expenses incurred in collecting the same or achieving such reduction, shall be
applied and allocated to the periods for which such final reduction or refund
was obtained, and proper adjustment shall be made between Landlord and Tenant.
Tenant has been advised that proceedings to protest the Real Estate Tax
Assessment for the Base Tax Year may have been filed and may result in a
reduction of Real Estate Taxes for the Base Tax Year.

       Any payments or refunds due hereunder for any period of less than a full
Tax Year at the commencement or end of the Term of this Lease shall be equitably
prorated to reflect such event.

       In addition to Tenant's obligation to pay Tenant's Tax Payment as
aforesaid, Tenant shall pay to Landlord as additional rent payable upon demand,
any occupancy tax or rent tax now in effect or hereafter enacted, iii payable by
Landlord in the first instance or hereafter required to be paid by Landlord.

       Section 3.05. Upon the date of the expiration or any sooner termination
of this Lease, whether the same be the date hereinabove set forth as the
expiration of the Term of this Lease or any prior or subsequent date, a
proportionate share of the Fixed Rent, adjustments and additional rents for the
year (calendar or fiscal) in which such expiration or termination occurs, shall
immediately become due and payable by Tenant to Landlord as hereinafter
provided, if not theretofore already billed and paid. Such proportionate share
shall be based upon the length of time that this Lease shall have been in
existence during such year. Promptly after any such expiration or termination,
Landlord shall compute the amounts due from Tenant, as aforesaid, which
computations shall either be based on that year's actual figures or be an
estimate based on the most recent statements theretofore prepared by Landlord
and furnished to Tenant pursuant to this Lease. If an estimate is used, then
Landlord shall promptly cause statements to be prepared on the basis of the
comparative year's actual figures as soon as they are available, and within ten
(10) days after such statement or statements are prepared by Landlord and
furnished to Tenant,
<PAGE>   10
                                      - 7 -

Landlord and Tenant shall make appropriate adjustments of any estimated payments
theretofore made.

       Tenant's obligation to pay any and all rents, adjustments and additional
rents under this Lease shall continue and shall cover all periods up to the
Expiration Date. Landlord's and Tenant's obligations to make the adjustments
hereinabove referred to shall survive any expiration or termination of this
Lease. Any delay or failure of Landlord in billing any Fixed Rent or additional
rent herein provided for shall not constitute a waiver of or in any way impair
the continuing obligation of Tenant to pay such rent adjustments hereunder.

                                    ARTICLE 4
                                   ELECTRICITY
                                   -----------

       Section 4.01. The Fixed Rent reserved in this Lease includes the agreed
sum of 514,102.70 per annum in consideration of which Landlord, as an additional
service, will supply Tenant with electricity for normal use in the Demised
Premises between the hours 9:00 A.H. and 5:30 P.h. on Business Days. If
Landlord's electric rates (i.e., the public utility rate schedule at the time in
question, including all surcharges, taxes, fuel adjustments, taxes regularly
passed on to consumers by the public utility, and other sums payable in respect
thereof for the supply of electric energy to Landlord for the Building) are
increased, the Fixed Rent reserved in this Lease shall be adjusted by applying
to the sum specified above, the same percentage as such rate increase, and such
adjusted Fixed Rent shall be billed by Landlord to Tenant, with effect as of the
date of the increase of Landlord's electric rats. Landlord shall not be liable
in any way to Tenant for any failure or defect in the supply or character of
electric energy furnished to the Demised Premises by reason of any requirement,
act or omission of the public utility serving the Building with electricity or
for any other reason not attributable to the Landlord. At Landlord's option,
Tenant shall purchase fro" the Landlord or Landlord's agent all lighting tubas,
lamps, bulbs and ballasts used in the Demised Premises and Tenant shall pay
Landlord's reasonable charges for providing and installing same on demand, as
additional rent.

       Section 4.02. Tenant's use of electric energy in the Demised Premises
shall not at any time exceed the capacity of any of the electrical conductors,
machinery and equipment in or otherwise serving the Demised Premises. In order
to insure that such capacity is not exceeded and to avert possible adverse
effect upon the Building electric service, Tenant shall not, without Landlord's
prior written consent in each instance, connect any additional fixtures,
machinery, appliances or equipment to the Building electric distribution system
or make any alteration or addition to Tenant's machinery, appliances or
equipment, or the electric system of the Demised Premises
<PAGE>   11
                                      - 8 -

existing on the CommenC0ment Date other than lamps, typewriters, copiers,
computer terminals, copying machines, communications equipment such as
telephones, fax machines, appliances, and other small office machines that
consume comparable or less amounts of electricity. Should Landlord grant such
consent, all additional risers or other equipment required therefor shall be
provided by Landlord, and the cost thereof shall be paid by Tenant upon
Landlord's demand. As a condition to granting such consent, Landlord may require
Tenant to agree to an increase in the Fixed Rent by an amount which will reflect
the value to Tenant of the additional service to be furnished by Landlord, that
is, the potential additional electrical energy to be mad. available to Tenant
based upon the estimated additional capacity of such additional risers or other
equipment. If Landlord and Tenant cannot agree on the amount of such increase,
Tenant shall nevertheless pay the same as billed until such amount shall be
determined by an independent utility consultant to be selected by Landlord and
paid by Tenant. The determination of the consultant shall be binding upon the
parties. When the amount of such increase is so determined, the parties shall
execute an agreement supplementary hereto to reflect such increase in the amount
of the Fixed Rent stated in this Lease and in the amount set forth in Section
4.01, effective from the date such additional service is made available to
Tenant, but such increase shall be effective from such date even if such
supplementary agreement is not executed.

       Section 4.03. If there shall be an increase in the space constituting the
Demised Premises, or if Tenant's failure to maintain its machinery and equipment
in good order and repair causes greater consumption of electrical current, or if
Tenant uses electricity on days or hours other than those specified in Section
4.01, or if Tenant adds any machinery, appliances or equipment requiring
additional 010ctrical current, the Fixed Rent herein reserved shall be increased
accordingly. The amount of such increase shall be billed by Landlord to Tenant,
effective as of the date of the increased usage. Such sum shall be due, and
shall be paid by Tenant, as additional rent hereunder at the time billed. If
Tenant disputes the amount of such increase, Tenant shall nevertheless pay the
same as billed, and the amount shall be determined by an independent utility
consultant to be selected by Landlord and paid by Tenant. The determination of
the consultant shall be binding upon the parties.

       Section 4.04. Landlord reserves the right to discontinue furnishing
electric energy to Tenant in the Demised Premises at any time upon not less than
one hundred twenty (120) days prior written notice to Tenant provided that
Landlord shall have made such election as to the majority of all tenants
occupying the Building and further provided that electric service is available
directly from the public utility servicing the Building (Landlord hereby
agreeing, unless otherwise required by law, not to discontinue furnishing
electricity to Tenant until such time as
<PAGE>   12
                                      - 9 -

Tenant is able to obtain same directly from the public utility). If Landlord
exercises such right of termination, this Lease shall continue in full force and
effect and shall be unaffected thereby, except only that, from and after the
effective date of such termination, Landlord shall not be obligated to furnish
electric energy to Tenant and the Fixed Rent under this Lease shall be reduced
by the amount set forth in Section 4.01, plus or minus the amount of any change
pursuant to Sections 4.01, 4.02, 4.03 and 4.05. If Landlord so discontinues
furnishing electric energy to Tenant, Tenant shall arrange to obtain electric
energy directly from the public utility company furnishing electric service to
the Building. Such electric energy may be furnished to Tenant by means of the
then existing building system feeders, risers and wiring to the extent that the
same are available, suitable and safe for such purposes. All meters and
additional panel boards, feeders, risers, wiring and other conductors and
equipment which may be required to obtain electric energy directly from such
public utility company shall be installed and maintained by Tenant at its
expense.

       Section 4.05. Tenant covenants and agrees that at no time will the
connected electrical load serving the Demised Premises exceed 5 watts per square
foot. Should Landlord consent to an increase in the connected electrical load,
as a condition to granting such consent, Landlord may require Tenant to agree to
an increase in the Pied Rent by an amount which will reflect the value to
Tenant of the additional connected electrical load. If Tenant disputes the
amount, Tenant shall nevertheless pay the same as billed, and the amount shall
be determined by an independent utility consultant to be selected by Landlord
and paid by Tenant. The determination of the consultant shall be binding upon
the parties.

       Section 4.06. If any tax is imposed upon Landlord with respect to
electrical energy furnished as a service to Tenant by any Federal, State or
Municipal Authority, Tenant covenants and agrees that where permitted by law or
applicable regulations, Tenant's pro rata share of such taxes shall be
reimbursed by Tenant to Landlord.

       Section 4.07. Landlord shall have the right to procure periodic surveys
made by an independent utility consultant selected by Landlord and if such
utility consultant determines that there has been (i) an increase in Tenant's
use of electrical current or (ii) the amount set forth in section 4.01 is
insufficient, then, the amount set forth in Section 4.01 shall be adjusted and
in addition to the other requirements and obligations imposed on Tenant in this
Article, Tenant shall pay the fees of the utility consultant making such survey.
The findings of such utility consultant shall be binding and conclusive upon the
parties.
<PAGE>   13
                                     - 10 -

       Section 4.08. Notwithstanding the aforesaid provisions of this Article,
if, pursuant to an action of the Public Service Commission of the State of New
York, or otherwise, submerging of electricity is permitted at the Building,
then Landlord shall have the option, at Landlord's sole cost and expense, of
installing submitters to measure Tenant's electricity consumption Upon
installation of the submitters, Tenant's electricity consumption and demand 
shall be measured by said submitters, and Tenant agrees to purchase such
electricity from Landlord or Landlord's designated agent at Landlord's electric
rates, plus twelve (12%) percent thereof to reimburse Landlord for
administrative services in connection with supplying and billing such
electricity and two and one-half (2-1/2%) percent for line loss All such sums
shall be paid by Tenant to Landlord as additional rent hereunder If more than
one meter measures the electricity consumption and demand of Tenant in the
Building, the service rendered through each meter shall be aggregated and billed
in accordance with the above rate classification, unless Landlord shall elect
separate billing on a per-meter basis Landlord may at any time render bills for
Tenant's consumption and demand and Tenant shall pay the same within thirty (30)
days following the date the same are rendered If Landlord exercises such right
of suturing, this Lease shall continue in full force and effect and shall be
unaffected thereby, except only that, from and after the effective date of such
submerging, Landlord shall not be obligated to furnish electric energy to Tenant
and the Fixed Rent under this Lease shall be reduced by the amount set forth in
Section 4.01, plus or minus the amount of any change pursuant to Sections 4.01,
4.02, 4.03 and 4.05.

                                    ARTICLE 5
                                       USE
                                       ---

       Section 5.01. Tenant shall use and occupy the Demised Premises for
administrative, executive and general business office purposes only and for no
other purposes.

       Section 5 02 Tenant shall not suffer or permit the Demised Premises or
any part thereof to be used in any manner, or suffer or permit anything to be
done therein, or suffer or permit anything to be brought into or kept in the
Demised Premises which would in any way (i) violate any law or requirement of
public authorities, (ii) cause structural injury to the Building or any part
thereof, (iii) interfere with the normal operation of the heating,
air-conditioning, ventilating, plumbing or other mechanical or electrical
systems of the Building or the elevators installed therein, (iv) constitute a
public or private nuisance, or (v) alter the appearance of the exterior of the
Building or of any portion of the interior thereof other than the Demised
Premises.
<PAGE>   14
                                     - 11 -

       Section 5.03. Tenant shall not, without the prior written consent of
Landlord (which shall not be unreasonably withheld or delayed), allow a
"Servicing Company" (defined below) to install any telephone, data, information
or other communications equipment in the Demised Premises to service premises
occupied by persons other than Tenant and/or its affiliates. For example, the
Demised Premises may not be used as a so-called "switching" or "relay" station
serving third parties (that is, parties other than Tenant and its affiliates)
without such consent by Landlord. In granting such consent, Landlord may require
that the Servicing Company enter into a license agreement with Landlord
confirming that the Servicing Company shall have no independent rights in the
Demised Premises and that upon termination of this Lease, for whatever reason,
the Servicing Company will have no right to leave its equipment in the Demised
Premises. Landlord may make a reasonable charge to the Servicing Company for
allowing it to install its equipment in the Demised Premises. A "Servicing
Company" shall mean a person, firm, corporation or other entity other than
Tenant whose equipment services not only the Demised Premises, but other
premises or parties as well.

                                    ARTICLE 6
                         REPAIRS. ALTERATIONS AND LIENS
                         ------------------------------

             Section 6.01. Tenant shall take good care of the Demised Premises
and the fixtures and appurtenances and equipment therein and, at its sole cost
and expense, make all repairs thereto as and when needed to preserve the
aforesaid in good working order and condition. All damage or injury to the
Demised Premises and to its fixtures, appurtenances and equipment or to the
Building of which the same form a part, or to its fixtures, appurtenances and
equipment caused by Tenant moving property, or resulting from any
air-conditioning unit or system, any short circuit, flow or leakage of water,
steam, illuminating gas, sewer gas, sewerage or odors, or by frost or by
bursting or leaking of pipes or plumbing works or gas, or from any other cause
of any other kind or nature whatsoever due to carelessness, omission, neglect,
improper conduct or other cause of Tenant, its servants, employees, agents,
visitors or licensees, shall be repaired, restored or replaced promptly by
Tenant, at its sole cost and expense, to the satisfaction of Landlord. If Tenant
fails to make such repairs, restorations or replacements, same may be made by
Landlord at the expense of Tenant and any costs therefor shall be collectible as
additional rent or otherwise, and shall be paid by Tenant within five (5) days
after rendition of a bill or statement therefor.

       Section 6.02. Landlord shall, at its expense, make all repairs and
replacements, structural and otherwise, necessary in order to keep in good order
and repair the exterior of the Building and the public portions of the Building,
the need for which Landlord shall have knowledge (including the public halls
<PAGE>   15
                                     - 12 -

and stairways, plumbing, wiring and other Building equipment for the general
supply of water, heat, air-conditioning, gas and electricity) except repairs
hereinabove provided to be made by Tenant and repairs, the need for which Tenant
has not reported to Landlord.

       Section 6.03. All repairs, restorations or replacements by either party
shall be of first-class quality and done in good and workmanlike manner. Tenant
shall, and shall include in all contracts, subcontracts and purchase orders, a
requirement that such contractors, subcontractors or materialism, as the case
may be, shall, cause all workers at the Demised Premises to work harmoniously
with each other and with Building personnel and in a manner which will not
disrupt access to or use of the common areas of the Building, cause
inconvenience to the other tenants in the Building or interfere with the conduct
of other tenants' business. Tenant agrees that should Tenant, its agents and/or
contractors, enter upon the Demised Premises for the purpose of performing any
work, the labor employed by Tenant or anyone performing such work, for or on
behalf of Tenant, shall always be harmonious and compatible with the labor
employed by Landlord or any contractors or subcontractors of Landlord. Should
such labor be unharmonious or incompatible, Landlord may require Tenant to
withdraw such labor fro" the Demised Premises. In the event Tenant or Tenant's
contractor shall enter upon the Demised Premises or any other part of the
Building, Tenant agrees to indemnify and save Landlord free and harmless, fro"
and against any and all claims whatsoever arising out of said entry or such
work. Tenant's agents and contractors and their employees shall comply with the
special rules, regulations and requirements of Building management with respect
to the performance and coordination of said agents, contractors and their
employees so as to avoid intrusion into the operation of the Building and to
avoid disturbing the quiet enjoyment of other tenants.

       Section 6.04. Tenant shall not store or place any materials or other
obstructions in the lobby or other public portions of the Building, or on the
sidewalk adjacent to the Building.

       Section 6.05. Tenant shall do no work and shall make no alterations,
decorations, installations, additions or improvements in or to the Demised
Premises, including, but not limited to, installation of a water cooler, an
air-conditioning or cooling system unit or part thereof, or other apparatus of
like or other nature without Landlord's prior written consent which consent
shall not be unreasonably withheld or delayed in the case of alterations,
decorations, installations, additions or improvements in the Demised Premises
which are non-structural in nature and do not materially, adversely affect the
structure, exterior or common areas of the Building or materially, adversely
affect the functioning of the heating, ventilating or airworthiness,
electrical, mechanical, plumbing or elevator systems of the Building or other
tenants' use thereof, and then
<PAGE>   16
                                     - 13 -
only by contractors or mechanics approved by Landlord. Such approval must be
obtained prior to any bidding for said work. All such work, alterations,
decorations, installations, additions or improvements shall be done at Tenant's
sole expense and at such times and in such manner as Landlord may from time to
time designate and in full compliance with all governmental bodies having
jurisdiction thereafter.Tenant's work, alterations, decorations, installations,
additions or improvements shall be completed free of all liens and encumbrances
and, as a condition precedent to Landlord's consent to the making by Tenant of
alterations, decorations, installations, additions or improvements to the
Demised Premises, Tenant shall obtain, and deliver to Landlord, at the earliest
opportunity permitted by applicable law, written and unconditional waivers of
mechanics' liens upon the real property in which the Demised Premises are
located, for all work, labor and services to be performed and materials to be
furnished by them in connection with such work, signed by all contractors,
subcontractors, materialism and laborers to become involved in such work. As a
condition to Landlord's permission to Tenant to make any of Tenant's
installations in the Demised Premises, Landlord may require that Tenant agree
with Landlord to fixing the Commencement Date of this Lease.

       Landlord shall not be liable for any failure of the airconditioning and
ventilating equipment in the Demised Premises installed by Landlord caused by
any work, alterations, decorations, installations, additions or improvements by
Tenant, and Tenant shall correct any such condition causing such failure
promptly upon notice from Landlord of the need therefor. If Tenant shall fail to
correct same, Landlord may make such correction and charge Tenant for the cost
thereof. Such sum due Landlord shall be deemed additional rent and shall be paid
by Tenant promptly upon being billed therefor.

       Section 6.06. Prior to co fencing any work pursuant to the provisions of
Section 6.05, Tenant shall furnish to Landlord:

             (i)   Copies of all governmental permits and authorizations which
may be required in connection with such work.

             (ii)  A certificate evidencing that Tenant (or Tenant's
contractors) has (have) procured workers' compensation insurance covering all
persons employed in connection with the work who might assert claims for death
or bodily injury against Landlord, "Overlapped" (as hereinafter defined),
Tenant or the Building.

             (iii) Such additional personal injury and property damage insurance
(over and above the insurance required to be carried by Tenant pursuant to the
provisions of Article 9) as Landlord may reasonably require because of the
nature of the work to be performed by Tenant.
<PAGE>   17
                                     - 14 -

       Section 6.07. All work, alterations, decorations, installations,
additions or improvements upon the Demised Premises made by either party,
including all paneling, decorations, partitions, railings, mezzanine floors,
galleries and the like, affixed to the realty or for which Tenant shall have
received a credit or contribution shall, unless Landlord elects otherwise (which
election shall be made by giving a notice pursuant to the provisions of Article
30 not less than thirty (30) days prior to the expiration or other termination
of this Lease or any renewal or extension thereof) become the property of
Landlord and shall remain upon, and be surrendered with the Demised Premises as
a part thereof at the end of the Term or renewal or extension term, as the case
may be In the event that Landlord shall elect otherwise, then such alterations,
decorations, installations, additions or improvements made by Tenant upon the
Demised Premises as Landlord shall select shall be removed by Tenant, and Tenant
shall restore the Demised Premises to its original condition, at its own cost
and expense, at or prior to the expiration of the Term.

             Where furnished by or at the expense of Tenant (except where same
is a replacement of an item theretofore furnished and paid for by Landlord or
against which Tenant has received a credit or contribution from Landlord), all
movable property, furniture, furnishings and trade fixtures other than those
affixed to the realty so that they cannot be removed without material damage
shall remain the property of Tenant and shall be removed from the Demised
Premises on or before the Expiration Date In the event of damage to the Demised
Premises or the Building by reason of such removal, Tenant shall restore the
same to good order and condition (normal wear and tsar excepted) If Tenant
should desire to leave any part of such property in the Demised Premises upon
the expiration of the Term, it shall so notify Landlord in writing not less than
sixty (60) days prior to the expiration of the Term, specifying the items of
property which it desires to so leave If within thirty (30) days after the
service of such notice Landlord shall request Tenant to remove any of the said
property, Tenant shall, at its expense, at or before the expiration of the Term,
remove said property and, in case of damage to the Demised Premises or the
Building by reason of such removal, restore the Demised Premises to good order
and condition (normal wear and tear excepted).

       Section 6.08. Landlord shall not be responsible for supervision and/or
coordination in respect to Tenant's activities pursuant to this Lease Landlord's
managing agent shall perform such supervision and coordination and, with respect
to any work, alteration, decoration, addition or improvement costing more than
$15,000, Tenant agrees to pay such managing agent, promptly upon being billed
therefor, a sun equal to ten (10%) percent of the cost of such work for indirect
costs, field supervision and coordination in connection therewith Tenant agrees
to keep records of Tenant's work, alterations, decorations, additions and
<PAGE>   18
                                     - 15 -

improvements costing in excess of 515,000 and of the cost thereof. Tenant agrees
to furnish to Landlord's managing agent copies of such records certified as
correct by Tenant within forty-five (45) days after Landlord's managing agent's
request therefor.

      Section 6.09. Tenant will not do any act or suffer any act to be done
which will in any way encumber the title of Landlord or Tenant in and to the
Demised Premises or the Building or the Land, nor will the interest or estate of
Landlord or Tenant in the Demised Premises or the Building or the Land be in any
way subject to any claim by way of lien or encumbrance, whether by operation of
law or by virtue of any express or implied contract by Tenant.

      Section 6.10. Tenant will not suffer or permit any liens to stand against
the Demised Premises, the Building or the Land or any part thereof, by reason of
any work, labor, services or materials done for, or supplied to, or claimed to
have been done for, or supplied to, Tenant, or anyone holding the Demised
Premises or any part thereof through or under Tenant. If any such lien is at any
time filed against the Demised Premises or the Building or the Land, Tenant will
cause the saw to be discharged of record within thirty (30) days after the date
of filing of the Sara, by either payment, deposit or bonding (and the failure of
Tenant to do so shall be a material default hereunder entitling Landlord to give
a notice to Tenant pursuant to the provisions of Section 17.01(1) hereof). In
addition to any other right or remedy of Landlord, Landlord may, but will not be
obligated to, procure the discharge of such lien either by paying the amount
claimed to be due by deposit in court or bonding, and/or Landlord will be
entitled, if Landlord so elects, to compel the prosecution of an action for the
foreclosure of such lien by the listener and to pay the amount of the judgment, 
if any, in favor of the listener with interest computed at the Interest Rate,
costs and allowances. Any amount paid or deposited by Landlord for any of the
aforesaid purposes, and all legal and other expenses of Landlord, including,
without limitation, attorneys' fees incurred in defending such action or in
procuring the discharge of such lien, with all necessary disbursements in
connection therewith, will become due and payable on the date of payment or
deposit, as additional rent.

      Section 6.11. Nothing in this Lease will be deemed to be, or construed in
any way as constituting, the consent or request of Landlord, express or implied
by inference or otherwise, to any person, firm or corporation for the
performance of any labor or the furnishing of any materials for any
construction, rebuilding, alteration or repair of or to the Demised Premises,
the Building or the Land or any part thereof, nor as giving Tenant any right,
power or authority to contract for or permit the rendering of any services or
the furnishing of any materials which might in any
<PAGE>   19
                                     - 16 -

way give rise to the right to file any lien against Landlord's interest in the
Demised Premises, the Building or the Land.

                                    ARTICLE 7
                       FLOOR LOAD. NOISE. WINDOW CLEANING
                       ----------------------------------

       Section 7.01. Tenant shall not place a load upon any floor of the Demised
Premises which exceeds the load per square foot which such floor was designed to
carry and which is allowed by law.

       Section 7.02. Business machines and mechanical equipment belonging to
Tenant which cause noise or vibration that may be transmitted to the structure
of the Building or the Demised Premises to such a degree as to be objectionable
to Landlord shall be placed and maintained by the party owning the machines or
equipment, at such party's expense, in settings of cork, rubber or spring type
vibration eliminators sufficient to eliminate noise or vibration.

       Section 7.03. Tenant will not clean, nor require, permit, suffer or allow
any window in the Demised Premises to be cleaned from the outside in violation
of Section 202 of the Labor Law or of the rules of the Board of Standards and
Appeals or of any other board or body having or assenting jurisdiction.

                                    ARTICLE 8
              LAWS. ORDINANCES. REQUIREMENTS OF PUBLIC AUTHORITIES
              ----------------------------------------------------

       Section 8.01. Tenant shall, at its expense, comply with all laws, orders,
ordinances and regulations or any direction made pursuant to any law, ordinance,
rule, regulation or order of any public of rice or officer which or who shall,
with respect to the particular use or manner of use of the Demised Premises (as
opposed to office us- in general) or to any abatement of nuisance, impose any
violation, order or duty upon Landlord or Tenant arising from Tenant's
particular use or manner of use of the Demised Premises (as opposed to office
use in general), or as a result of any installations made therein (whether or
not in compliance with the work article hereof) by Tenant or at Tenant's
request, or required by reason of a breach of any of Tenant's covenants or
agreements hereunder.

       Section 8.02. If Tenant should desire to contest the validity of any such
law, ordinance, rule, regulation or order with which Tenant is obligated to
comply, it may, at its expense, carry on such contest and non-compliance by it
during such contest (so long as Tenant proceeds with due diligence) shall not
constitute a breach of this Lease provided that it shall, to the satisfaction of
Landlord, indemnify and hold Landlord harmless from and against all liability
for any loss, damages and expenses
<PAGE>   20
                                     - 17 -

(including, without limitation, attorneys' fees) which might result from or be
incurred in connection with such contest or non-compliance. Notwithstanding the
foregoing, non-compliance as aforesaid shall not commence or continue if it
might subject Landlord to any fine or penalty or to prosecution for a crime, or
if it would constitute a default by Landlord under any mortgage or lease
affecting the Building and/or the Land.

        Section 8.03.  If Tenant receives written notice of any violation of
law, ordinance, rule, regulation or order applicable to the Demised Premises,
it shall give prompt notice thereof to Landlord.

        Section 8.04.  Except as aforesaid, Landlord shall, at its expense,
comply with or cause to be complied with, all laws, ordinances, rules,
regulations and orders of federal, state, county and municipal authorities and
any direction made pursuant to law of any public officer or officers which
shall, with respect to the public portions of the Building, impose any
violation, order or duty upon Landlord or Tenant and with respect to which
Tenant is not obligated by Section 8.01 to comply. Except as aforesaid,
Landlord shall further, at its expense, comply with or cause to be complied
with, all laws, ordinances, rules, regulations and orders of federal, state,
county and municipal authorities and any direction made pursuant to law of any
public officer or officers which affect Tenant's use or enjoyment of, or access
to, the Demised Premises and with respect to which Tenant is not obligated by
Section 8.01 to comply. Landlord may, at its expense, contest the validity of
any such law, ordinance, rule, order or regulation.

                                   ARTICLE 9
                    INSURANCE, PROPERTY LOSS, REIMBURSEMENT

        Section 9.01.  Tenant shall not do or permit to be done any act or
thing upon the Demised Premises which will invalidate or be in conflict with
the Certificate of Occupancy or the terms of the New York State standard form
of fire, boiler, sprinkler, water damage or other insurance policies covering
the Building and the fixtures and property therein and Tenant shall, at its own
expense, comply with all rules, orders, regulations or requirements of the New
York Board of Fire Underwriters or any other similar body having jurisdiction
and shall not knowingly do or permit anything to be done in or upon the Demised
Premises in a manner which increases the rate of fire insurance upon the
Building or on any property or equipment located therein over the rate in
effect at the commencement of the Term of this Lease.

        Section 9.02.  If, by reason of any failure of Tenant to comply with
the provisions of this Lease, the rate of fire, boiler, sprinkler, water damage
or other insurance (with extended coverage) on the Building or on the property
and equipment of 
<PAGE>   21
                                     - 18 -

Landlord or any other tenant or subtenant in the Building shall be higher than
it otherwise would be, Tenant shall reimburse Landlord and the other tenants in
the Building for that part of the fire, boiler, sprinkler, water damage or other
insurance premiums thereafter paid by Landlord or by the other tenants in the
Building which shall have been charged because of such failure by Tenant, and
Tenant shall make the reimbursement on the first day of the month following such
payment by Landlord or such other tenants. In any action or proceeding wherein
Landlord and remnant are parties, a schedule or Make up" of any insurance rate
for the Building or Demised Premises issued by the New York Fire Insurance
Exchange, or other body establishing fire insurance rates for the Building,
shall be conclusive evidence of the facts therein stated and of the several
items and charges in the insurance rates then applicable to the Building or
Demised Premises.

       Section 9.03. Tenant, at Tenant's own cost and expense, shall maintain
insurance protecting and indemnifying Landlord and Tenant (and at Landlord's
request, the landlord under any ground or underlying lease [herein
"Overlandlord"], as well as the holder of any mortgage affecting the Land, the
Building or both) against any and all claims for injury or damage to persons or
property for the loss of life or of property occurring upon, in or about the
Demised Premises and the public portions of The Building used by Tenant, its
employees, agents, contractors, customers and invitees arising out of the
negligent act or omission of any of the foregoing, such insurance to afford
minimum protection during the Term of this Lease of not less than a single
combined limit of S3,000,000 in respect of property damage and bodily injury or
death to any one person or in respect of any one occurrence or accident.
Landlord may from time to time require that the amount of liability insurance to
be maintained by Tenant under this Article be increased so that Landlord shall
be adequately protected giving due consideration to all relevant circumstances
and conditions.

       All such insurance shall be effected under valid and enforceable policies
(which may cover the Demised Premises and other locations), shall be issued by
insurers of recognized responsibility and shall contain a provision whereby the
insurer agrees not to cancel the insurance without ten (10) days' prior written
notice to Landlord.

       On or before the Commencement Date of this Lease, Tenant shall furnish
Landlord with a certificate evidencing the aforesaid insurance coverage and
renewal certificates shall be furnished to Landlord at least thirty (30) days
prior to the expiration date of each policy for which a certificate was
theretofore required to be furnished.

       Section 9.04. Tenant shall give Landlord immediate notice in case of a
fire or accident in the Demised Premises or the
<PAGE>   22
                                     - 19 -

Building, or of defects therein or in any fixtures or equipment promptly after
Tenant becomes aware of the same.

       Section 9.05. Tenant shall indemnify and hold Landlord harmless from and
against all liabilities, suits, claims, demands and actions, and costs and
expenses of any kind or nature, due to or arising out Of any injury to person or
property, including death resulting at any time therefrom, occurring in or about
the Demised Premises. To the extent of any valid and collectible insurance
furnished by Tenant for the protection of Landlord, Tenant's obligation to
indemnify and hold Landlord harmless against liability which is covered by such
insurance shall be deemed, to the extent thereof, to be satisfied.

       Section 9.06. Landlord and Tenant shall each endeavor to secure an
appropriate clause in, or an endorsement upon, each fire or extended coverage or
rent insurance policy obtained by it and covering the Building, the Demised
Premises or the personal property, fixtures and equipment located therein or
thereon, pursuant to which the respective insurance companies waive -subrogation
or permit the insured, prior to any loss, to agree with a third party to waive
any claim it might have against said third party. The parties hereto shall give
prompt notice to the other in the event such clause is or becomes unavailable.
The waiver of subrogation or permission for waiver of any claim shall extend to
the agents of each party and the employees of each party and its respective
agents and, in the case of Tenant, shall also extend to all other persons and
entities occupying or using the Demised Premises. If and to the extent that such
waiver or permission can be obtained only upon payment of an additional charge,
then the party benefiting from the waiver or permission shall pay such charge
upon written demand, or shall be deemed to have agreed that the party obtaining
the insurance coverage in question shall be free of any further obligations
under the provisions hereof relating to such waiver or permission.

       Subject to the foregoing provisions of this Section 9.06, each party
hereby releases the other with respect to any claim (including a claim for
negligence) which it might otherwise have against the other party for loss,
damages or destruction with respect to its property by fire or other casualty
(including rental value or business interest, as the case may be) occurring
during the Term of this Lease.

       Section 9.07. Tenant agrees to look solely to Landlord's estate and
interest in the Land and Building, or the lease of the Building, or of the Land
and Building, and the Demised Premises (or the unencumbered proceeds from a sale
thereof), for the satisfaction of any right or remedy of Tenant for the
collection of a judgment (or other judicial process) requiring the payment of
money by Landlord, in the event of any liability by Landlord, and no other
property or assets of Landlord shall be subject to levy, execution, attachment,
or other enforcement procedure for
<PAGE>   23
                                     - 20 -

the satisfaction of Tenant's remedies under or with respect to this Lease, the
relationship Of Landlord and Tenant hereunder, or Tenant's use and occupancy of
the Demised Premises, or any other liability of Landlord to Tenant.

                                   ARTICLE 10
                  DAMAGE OR DESTRUCTION BY FIRE OR OTHER CAUSE
                  --------------------------------------------

       Section 10.01. If the Building or the Do teed Premises shall be partially
or totally damaged or destroyed by fire or other cause, then whether or not the
damage or destruction shall have resulted from the fault or neglect of Tenant,
or its employees, agents or visitors (and if this Lease shall not have been
terminated as in this Article 10 hereinafter provided), Landlord shall to the
extent permitted by available insurance proceeds, repair the damage and restore
and rebuild the Building and/or the Demised Premises (without limiting the
rights of any insurance company, subrogated to Landlord's rights hereunder
pursuant to the terms of any insurance policy as to which Landlord shall have
been unable to obtain a waiver of subrogation in accordance with Section 9.06
hereof to seek recovery from Tenant, and any rights of Landlord under any other
provisions of this Lease or at law or in equity), with reasonable dispatch after
notice to it of the damage or destruction; provided, however, that Landlord
shall not be required to repair or replace any of Tenant's property.
Notwithstanding anything contained herein to the contrary, in no event shall
Tenant be relieved of liability or responsibility for damage or destruction
resulting from the fault or neglect of Tenant if the insurance policies carried
by Landlord on the Building do not contain a waiver of the right of subrogation.

       Section 10.02. If the Building or the Demised Premises shall be partially
destroyed by fire or other cause, the rents payable hereunder shall be abated to
the extent that the Demised Premises shall have been rendered untenantabl0 and
for the period from the date of such damage or destruction to the date the
damage shall be repaired or restored. If the Demised Premises or a major part
thereof shall be totally (which shall be deemed to include substantially
completely) untenable on account of fire or other cause, the rent shall abate
as of the date of the damage or destruction and until Landlord shall repair,
restore and rebuild the Building and the Demised Premises, provided, however,
that should Tenant occupy or reoccurs a portion of the Demised Premises during
the period the Demised Premises are made completely untenantable, rents
allocable to such portion shall be payable by Tenant from the date of such
occupancy.

       Section 10.03. If the Building or Demised Premises shall be totally
damaged or destroyed by fire or other cause, or if the Building shall be so
damaged or destroyed by fire or other cause that Landlord shall decide not to
restore or rebuild it, then in either such case Landlord may terminate this
Lease by giving
<PAGE>   24
                                     - 21 -

Tenant notice to such effect within sixty (60) days after the date of the
casualty. In case of any substantial damage or destruction mentioned in this
Article 10 which prevents Tenant from operating its business in the Demised
Premises for more than fifteen (15) Business Days, Tenant may terminate this
Lease by notice to Landlord given within thirty (30) days of the occurrence of
such damage. 

       Section 10.04. No damages, compensation or claim shall be payable by
Landlord for inconvenience, loss of business or annoyance arising from any
repair or restoration of any portion of the Demised Premises or of the Building
pursuant to this Article 10. Landlord shall endeavor to effect such repair or
restoration promptly and in such manner as not unreasonably to interfere with
Tenant's business, provided no additional costs, for labor at overtime or
premium rates, or otherwise, are incurred thereby.

       Section 10.05. Notwithstanding any of the foregoing provisions of this
Article 10, if Landlord or Overlapped or the holder of any superior mortgage
shall be unable to collect all of the insurance proceeds (including rent
insurance proceeds) applicable to damage or destruction of the Demised Premises
or the Building by fire or other cause by reason of some action or inaction on
the part of Tenant or any of its employees, agents or contractors, then, without
prejudice to any other remedies which may be available against Tenant, there
shall be no abatement of Tenant's rent until the total amount of such rent not
abated which would otherwise have been abated equals the amount of uncollected
insurance proceeds.

       Section 10.06. Landlord will not carry separate insurance of any kind on
Tenant's property and Landlord shall not be obligated to repair any damage
thereto or replace the same.

       Section 10.07. In the event of the termination of this Lease pursuant to
any of the provisions of this Article 10, this Lease and the Term and estate
hereby granted shall expire as of the date of such termination with the same
effect as if that were the Expiration Date, and the Fixed Rent and additional
rent payable hereunder shall be apportioned as of such date.

       section 10.08. The provisions of this Article 10 shall be considered an
express agreement governing any case of damage or destruction of the Demised
Premises by fire or other casualty, and Section 227 of the Real Property Law of
the state of New York providing for a contingency in the absence of an express
agreement, and any other law of like import, now or hereafter in force, shall
have no application to the Demised Premises and this Lease.
<PAGE>   25
                                     - 22 -
                                   ARTICLE 11
                       ASSIGNMENT. SUBLETTING. MORTGAGING
                       ----------------------------------

       Section 11.01. (a) Tenant will not by operation of law or otherwise,
assign, mortgage or otherwise encumber this Lease, nor the estate and Term
hereby granted, nor sublet or permit the Demised Premises or any part thereof to
be used by others, without Landlord's prior written consent in each instance.
The consent by Landlord to any assignment or subletting shall not in any manner
be construed to relieve Tenant from obtaining Landlord's express written consent
to any other or further assignment or subletting.

       If Tenant desires to assign or sublet all or any portion of the Demised
Premises, Tenant agrees to use as its exclusive rental agent for such purpose
the then designated leasing agent of the Building and to notify such leasing
agent of its desire to assign this Lease or sublet the Demised Premises. Upon
obtaining a proposed assignee or subleases, upon terms satisfactory to Tenant,
Tenant shall submit to Landlord in writing (1) the name of the proposed assignee
or subtenant; (2) the terms and conditions of the proposed assignment or
subletting; (3) the nature and character of the business of the proposed
assignee or subtenant and any other information reasonably requested by
Landlord.

       Upon receipt of the foregoing submission from Tenant Landlord shall have
the following options to be exercised within thirty (30) business days from the
date of such receipt:

             1. If an assignment shall be proposed or if a proposed subletting
shall be for all or substantially all of the Demised Premises, Landlord shall
have the option to terminate this Lease effective as of the date proposed by
Tenant for such assignment or subletting.

             2. If a proposed sublease shall be for less than all or
substantially all of the Demised Premises or if it shall be for less than the
balance of the Term of this Lease, Landlord shall have the option to terminate
this Lease as to the portion of the Demised Premises proposed to be sublet for
such portion of the Term as is included in such proposed sublease, effective as
of the effective date of such proposed sublease. In the event of the exercise of
such option under this subparagraph 2, the rent and all other charges payable
hereunder shall be equitably apportioned, and Tenant shall be responsible for
the cost of constructing any necessary demising walls.

             3. Landlord shall have the option to require Tenant to execute an
assignment or sublease to Landlord, or to any party designated by Landlord, upon
the same terms and conditions as contemplated with the proposed assignee or
subtenant, except that (A) Landlord (or Landlord's designee) as assignee or
sublease
<PAGE>   26
                                     - 23 -

shall have an express unlimited right to further assign or sublease to others
and to make any alterations required in connection therewith, and (B) the rent
or consideration payable under such assignment or sublease to Landlord (or
Landlord's designee) shall be the lower of (i) the rental payable by Tenant to
Landlord under this Lease, or (ii) the rental payable by the proposed assignee
or subtenant pursuant to the assignment or sublease originally proposed by
Tenant.

       (b) If Landlord shall not exercise any of its foregoing options within
the time set forth above, provided Tenant shall not then be in default
hereunder, Landlord's consent to any such proposed assignment or subletting
shall not be "unreasonably" withheld or delayed, as described in paragraph (c)
of this Section 11. 01.

       If Landlord shall not exercise any of the options described in paragraph
(a) above and Tenant shall thereupon assign this Lease or sublet all or any
portion of the Demised Premises, then and in that event Tenant shall pay to
Landlord as additional rent the difference, if any, between the Fixed Rent plus
additional rent allocable to that part of the Demised Premises affected by such
assignment or sublease pursuant to the provisions of this Lease, and the Fixed
Rent and additional rent payable by the assignee or subleases to Tenant. Such
additional rent payments shall be made monthly within five (5) days after
receipt of the same by Tenant. Any other cash or other consideration payable to
Tenant in connection with such assignment or sublease or the sale of Tenant's
property in connection therewith shall be similarly paid over to Landlord when
and as received by Tenant.

       If Tenant fails to consummate any proposed assignment or subletting to
which Landlord shall have consented within sixty (60) days after granting such
consent, paragraph (a) shall again apply to said proposed assignment or
subletting.

       No option exercised by Landlord pursuant to the above provisions of
paragraph (a), and no assignment or sublease made to Landlord under the above
provisions of paragraph (a), shall be binding upon any purchaser of any ground
or underlying lease who acquires such ground or underlying lease by reason of
the foreclosure of any mortgage to which this Lease is subordinate, nor upon any
assignee of any ground or underlying lease who takes such assignment in lieu of
such foreclosure, it being understood, however, that such purchaser or assignee
may, at its option, elect to enforce such option, assignment or sublease.

       (c) In determining reasonableness with respect to its consent to a
proposed assignment or sublease by Tenant, Landlord may take into consideration
all relevant factors surrounding the proposed assignment or sublease, including,
without limitation, the following:
<PAGE>   27
                                     - 24 -

             (i)   the financial stability and business reputation of the
proposed assignee or subtenant;

             (ii)  the nature of the business and the proposed use of the
Demised Premises by the proposed assignee or subtenant in relation to the
majority of other tenants in the Building;

             (iii) that the proposed assignee or subtenant shall not be a tenant
of other space in the Building or a party which has dealt with Landlord or
Landlord's agent (directly or through a broker) with respect to space in the
Building during the six (6) months immediately preceding Tenant's request for
Landlord's consent, provided Landlord has space in the Building for such
proposed assignee or subtenant;

             (iv)  restrictions contained in leases of other tenants of the
Building;

             (v)   the effect that the proposed assignee's or subtenant's
occupancy or use of the Demised Premises would have upon the operation and
maintenance of the Building and Landlord's investment therein;

             (vi)  that not more than one entity shall occupy the Demised
Premises at any time.

       Section 11.02. If this Lease shall be assigned, or if the Demised
Premises or any part thereof be sublet or occupied by any person or persons
other than Tenant, Landlord may after default by Tenant, c0110ct rent from the
assignee, subtenant or occupant and apply the net amount collected to the rent
herein reserved, but no such assignment, subletting, occupancy or collection of
rent shall be deemed a waiver of the covenants in this Article, nor shall it be
deemed acceptance of the assignee, subtenant or occupant as a tenant, or a
release of Tenant from the full performance by Tenant of all the terms,
conditions and covenants of this Lease.

       Section 11.03. Each assignee or transferee shall assume and be deemed to
have assumed this Lease and shall be and remain liable jointly and severally
with Tenant for the payment of the rent, additional rent and adjustments of
rent, and for the due performance of all the terms, covenants, conditions and
agreements herein contained on Tenant's part to be performed for the Term of
this Lease. No assignment shall be binding on Landlord unless such assignee or
Tenant shall deliver to Landlord a duplicate original of the instrument of
assignment which contains a covenant of assumption by the assignee of all of the
obligations aforesaid and shall obtain from Landlord the aforesaid written
consent prior thereto.

       Section 11.04. For the purposes of this Lease, any sale, transfer or
assignment of any of the stock of a corporate Tenant
<PAGE>   28
                                     - 25 -

or any transfer in the control of Tenant by operation of law or otherwise
shall be deemed an assignment.

       Section 11.05. The listing of any name other than that of Tenant, whether
on the doors of the Demised Premises, on the Building directory or otherwise,
shall not operate to vest any right or interest in this Lease or the Demised
Premises. It is expressly understood that any such listing is a privilege
extended by Landlord that is revocable at will by written notice to Tenant.

       Section 11.06. Tenant shall reimburse Landlord for any costs incurred by
Landlord to review the requested consent provided in Article 11, including
attorneys' fees.

       Section 11.07. If Landlord shall recover or come into possession of the
Demised Premises before the Expiration Date, Landlord shall have the right to
take over any sublease made by Tenant and to succeed to all rights of Tenant
thereunder, Tenant hereby assigning (effective as of the date of Landlord's
succession of Tenant's estate in the Demised Premises) such subleases as
Landlord may elect to take over. Every subletting hereunder shall be subject to
the condition that, from and after the termination of this Lease or re-entry by
Landlord hereunder or other succession by Landlord to Tenant's estate in the
Demised Premises, the subtenant under such sublease shall waive any right to
surrender possession or to terminate the sublease and, at Landlord's election,
shall be bound to Landlord for the balance of the term thereof and shall 
attorney to and recognize Landlord, as its landlord, under all of the then
executory terms of such sublease, except that Landlord shall not be (a) liable
for any previous act, omission or negligence of Tenant under such sublease, (b)
subject to any counterclaim, defense or offset theretofore accruing to such
subtenant against Tenant, (c) bound by any previous modification or amendment of
such sublease made without Landlord's consent or by any previous prepayment of
more than one month's rent and additional rent unless paid as provided in the
sublease, or (d) obligated to perform any repairs or other work in the subleased
space or the Building beyond Landlord's obligations under this Lease, and each
subtenant shall execute and deliver such instruments as Landlord may reasonably
request to evidence and confirm such attainment.

       Section 11.08. Notwithstanding anything to the contrary elsewhere
contained herein (including Section ll.01 (a) hereof), provided that Tenant 
shall not be in default in any of the terms of this Lease beyond notice and the
expiration of any applicable grace period, Tenant may, without Landlord's
consent but upon not less than ten (10) days' prior written notice to Landlord,
sublet to any corporations or other business entities which control, are
controlled by, or are under common control with Tenant or any principal officer
and/or director or trustee of Tenant (herein referred to as a "Related Entity")
all or part of the Demised
<PAGE>   29
                                     - 26 -

Premises or permit any Related Entity to occupy the same for any of the purposes
permitted to Tenant, subject however to compliance with Tenant's obligations
under this Lease. Such subletting or occupancy shall not be deemed to vest in
any such Related Entity any right or interest in this Lease nor shall such
subletting or occupancy relieve, release, impair or discharge any of Tenant's
obligations hereunder. Tenant shall deliver to Landlord a copy of any such
sublease or occupancy agreement for all or any portion of the Demised Premises.

                                   ARTICLE 12
                            NO LIABILITY ON LANDLORD
                            ------------------------

       Section 12.01. Landlord or its agents shall not be liable for any damage
to property of Tenant or of others entrusted to employees of the Building, nor
for the loss of or damage to any property of Tenant by theft or otherwise.
Landlord or its agents shall not be liable for any injury or damage to persons
or property resulting from fire, explosion, falling plaster, steam, gas,
electricity, water, rain or snow, leaks from any part of the Building or from
the pipes, appliances or plumbing works or from the roof, street or sub-surface
or from any other place or by dampness or by any other cause of whatsoever
nature, unless caused by or due to the negligence of Landlord, its agents,
servants or employees; nor shall Landlord or its agents be liable for any such
damage caused by other tenants or persons in the Building or caused by
operations in construction of any private, public or quasi-public work; nor
shall Landlord be liable for any latent defect in the Demised Premises or in the
Building of which they form a part. If at any time any windows of the Demised
Premises are temporarily or permanently closed, darkened or bricked up for any
reason whatsoever including but not limited to Landlord's own acts, Landlord
shall not be liable for any damage Tenant may sustain thereby, and Tenant shall
not be entitled to any compensation therefor nor abatement of rent, nor shall
the same release Tenant from its obligations hereunder nor constitute an
eviction.

                                   ARTICLE 13
                           MOVING OF HEAVY EQUIPMENT
                           -------------------------

       Section 13.01. Tenant shall not move any safe, heavy equipment or bulky
matter in or out of the Building without Landlord's written consent, which
consent Landlord agrees not to unreasonably withhold or delay. If the movement
of such items requires special handling, Tenant agrees to employ only persons
holding a Master Rigger's License to do said work and all such work shall be
done in full compliance with the Administrative Code of the City of New York and
other municipal requirements. All such movements shall be made during hours
which will least interfere with the normal operations of the Building, and all
<PAGE>   30
                                     - 27 -

damage caused by such movement shall be promptly repaired by Tenant at Tenant's
expense.

                                   ARTICLE 14
                                  CONDEMNATION
                                  ------------

       Section 14.01. In the event that the whole of the Demised Premises or
access thereto shall be lawfully condemned or taken in any manner for any public
or quasi-public use, this Lease and the Term and estate hereby granted shall
forthwith cease and terminate as of the date of vesting of title. In the event
that only a part of the Demised Premises shall be so condemned or taken, then,
effective as of the date of vesting of title, the rent hereunder for such part
shall be abated. In the event that only a part of the Building shall be so
condemned or taken, then (a) if substantial structural alteration or
reconstruction of the Building shall in the reasonable opinion of Landlord be
necessary or appropriate as a result of such condemnation or taking (whether or
not the Demised Premises be affected), Landlord may, at its option, terminate
this Lease and the Term and estate hereby granted as of the date of such vesting
of title by notifying Tenant in writing of such termination within sixty (60)
days following the date on which Landlord shall have received notice of vesting
of title, or (b) if Landlord does not elect to terminate this Lease, as
aforesaid, this Lease shall be and remain unaffected by such condemnation or
taking, except that the Fixed Rent and additional rent shall be abated to the
extent, if any, heretofore provided in this Article 14. In the event that only
a part of the Demised Premises shall be so condemned or taken and this Lease and
the Term and estate hereby granted are not terminated as heretofore provided,
Landlord will, at its expense, restore with reasonable diligence the remaining
structural portions of the Demised Premises as nearly as practicable to the same
condition as it was prior to such condemnation or taking.

       In the event of termination in any of the cases hereinabove provided in
this Article 14, this Lease and the Tern and estate hereby granted shall expire
as of the date of such termination with the same effect as if that were the date
heretofore set for the expiration of the Term of this Lease, and the rent
hereunder shall be apportioned as of such date.

       In the event of any condemnation or taking hereinabove mentioned of all
or a part of the Building, Landlord shall be entitled to receive the entire
award in the condemnation proceeding, including any award made for the value of
the estate vested by this Lease in Tenant, and Tenant hereby expressly assigns
to Landlord any and all right, title and interest of Tenant now or hereafter
arising in or to any such award or any part thereof, and Tenant shall be
entitled to receive no part of such award.
<PAGE>   31
                                     - 28 -

                                   ARTICLE 15
             ENTRY. RIGHT TO CHANGE PUBLIC PORTIONS OF THE BUILDING
             ------------------------------------------------------

       Section 15.01. Tenant shall permit Landlord to erect, use and maintain
pipes and conduits in and through the Demised Premises. All such pipes and
conduits shall either be concealed above the suspended ceiling area, or within
the demising walls or installed in the service columns, or shall be installed
along the walls of the Demised Premises and appropriately enclosed, where
feasible. In the event the construction deprives the Tenant of the use of a
material or substantial portion of the usable area of the Demised Premises
(other than on a temporary basis), the Tenant shall be entitled to an pro rata
abatement of rent for the space so permanently taken. Landlord or its agents or
designees shall have the right, but only upon reasonable notice (except in
emergencies, in which event no notice shall be required) given to Tenant or any
authorized employee of Tenant at the Demised Premises, to enter the Demised
Premises at reasonable times during business hours, for the purpose of making
such repairs of alterations as shall be required or as Landlord shall have the
right to make by the provisions of this Lease. Landlord shall be allowed to take
all material into and upon the Demised Premises that may be required for the
repairs and alterations above mentioned without the same constituting an
eviction of Tenant in whole or in part, and the rent reserved hereunder shall in
no wise abate, except as otherwise provided in this Lease, while said repairs or
alterations are being made, by reason of loss or interruption of the business of
Tenant because of the prosecution of any such work, or otherwise. Landlord
agrees to do any work pursuant to this Article in such a manner so as not to
unreasonably interfere with Tenant's business, provided no additional costs, for
labor at overtime or premium rates, or otherwise, are incurred thereby.

       Section 15.02. During the twelve (12) months prior to the expiration of
the Term of this Lease, Landlord may exhibit the Demised Premises to prospective
tenants. Landlord shall also have the right to enter the Demised Premises for
the purpose of inspecting the same or exhibiting the same to prospective
purchasers or lessees of the entire Building or to prospective mortgagees of the
property of which the Demised Premises forms a part. The holders of any mortgage
of Landlord's interest in the property, or such holders' agents or designees,
shall also have such right of inspection for itself and for any prospective
assignees of any such mortgagees.

       Section 15.03. Landlord shall have the right at any time without thereby
creating an actual or constructive eviction or incurring liability to Tenant
therefor, to change the arrangement or location of such of the following as are
not contained within the Demised Premises or any part thereof: entrances,
<PAGE>   32
                                     - 29 -

passageways, elevators, doors and doorways, corridors, stairs, toilets and other
like public service portions of the Building.

                                   ARTICLE 16
                                   BANKRUPTCY
                                   ----------

       Section 16.01. (a) Anything elsewhere in this Lease to the contrary
notwithstanding, this Lease may be cancelled by Landlord by the sending of a
written notice to Tenant within a reasonable time after the happening of any one
or more of the following events: (i) Tenant shall (A) have applied for or
consented to the appointment of a receiver, trustee, liquidator, or other
custodian of Tenant or any of its properties or assets, (B) be unable to pay its
debts generally as they become due or shall have taken any other action which
could result in it becoming the subject of an insolvency or bankruptcy
proceeding, (C) have made a general assignment for the benefit of creditors, (D)
have commenced a voluntary case for relief as a debtor under the United States
Bankruptcy Code or filed a petition to take -advantage of any bankruptcy,
reorganization, insolvency, readjustment of debts, dissolution or liquidation
law or statute or an answer admitting the material allegations of a petition
filed against it in any proceeding under any such law, or (E) be adjudicated a
bankrupt or insolvent; or (ii) Without the acquiescence or consent of Tenant an
order, judgment or decree shall have been entered by any court of competent
jurisdiction approving as properly filed a petition seeking relief under the
United States Bankruptcy Code or any bankruptcy, reorganization, insolvency,
readjustment of debts, dissolution or liquidation law or statute with respect to
Tenant or appointing a receiver, trustee, liquidator or other custodian of all
or a substantial part of its properties or assets, and such order, judgment or
decree shall have continued unstayed and in effect for any period of not less
than sixty (60) days. Neither Tenant, nor any person claiming through or under
Tenant or by reason of any statute or order of court, shall thereafter be
entitled to possession of the Demised Premises, but shall forthwith quit and
surrender the Demised Premises. If this Lease shall be assigned in accordance
with its terms, the provisions of this Article shall be applicable only to the
party then owning Tenant's interest in this Lease.

             (b) It is stipulated and agreed that in the event of the
termination of this Lease pursuant to paragraph (a) hereof, Landlord shall
forthwith, notwithstanding any other provisions of this Lease to the contrary,
be entitled to recover from Tenant as and for liquidated damages an amount equal
to the difference between the rent reserved hereunder for the unexpired portion
of the Term demised and the then fair and reasonable rental value of the Demised
Premises for the same period. In the computation of such damages the difference
between any installment of rent becoming due hereunder after the date of
termination and the fair
<PAGE>   33
                                     - 30 -

and reasonable rental value of the Demised Premises for the period for which
such installment was payable shall be discounted to the date of termination at
the rate of four percent (4%) per annum. If the Demised Premises or any part
thereof be re-let by Landlord for the unexpired Term of this Lease, or any part
thereof, before the presentation of proof of such liquidated damages to any
court, commission or tribunal, the amount of rent reserved upon such re-letting
shall be prima facie evidence as to the fair and reasonable rental value for the
part or the whole of the Demised Premises so re-let during the term of the
re-letting. Nothing herein contained shall limit or prejudice the right of
Landlord to prove for and obtain as liquidated damages by reason of such
termination, an amount equal to the maximum allowed by any statute or rule in
effect at the time when, and governing the proceedings in which, such damages
are to be approved, whether or not such amount be greater, equal to, or less
than the amount of the difference referred to above.

                                   ARTICLE 17
                 DEFAULTS AND REMEDIES AND WAIVER OF REDEMPTION
                 ----------------------------------------------

       Section 17.01. (1) If (A) Tenant defaults in fulfilling any of the
covenants of this Lease, with respect to the covenants for the payment of Fixed
Rent or additional rent, and if such default shall continue for seven (7) days
after Landlord shall have given to Tenant a written notice specifying such
default or (B) the Demised Premises are abandoned by Tenant or if the Demised
Premises are damaged by reason of negligence or carelessness of Tenant, its
agents, employees or invitees, or (C) in the case of the happening of a default
or omission (other than in the payment of Fixed Rent, additional rent or other
charges hereunder, and other than the failure to cause a lien against the
Demised Premises, the Building or the Land to be discharged of record within the
time period provided for elsewhere in this Lease) which default shall continue
for twenty (20) days after notice thereof to Tenant (or in the case of the
happening of a default or omission which cannot with due diligence be completely
cured or remedied within such twenty (20) day period, if Tenant shall not have
diligently commenced curing such default within such twenty (20) day period, and
shall not thereafter with reasonable diligence and in good faith be proceeding
to remedy or cure such default), then, in any such case, Landlord may give to
Tenant a notice of intention to terminate this Lease upon the expiration of
three (3) days from the service of such notice of intention, and upon the
expiration of said three (3) days, this Lease and the Term hereof shall
terminate, and Tenant shall then quit and surrender the Demised Premises to
Landlord, but Tenant shall remain liable as hereinafter provided.

       (2) If (A) the notice provided for in (1) hereof shall have been given,
and the Term shall expire as aforesaid; or (B) if Tenant shall make any default
in the payment of Fixed Rent or
<PAGE>   34
                                     - 31 -

additional rent herein reserved, or any part of either, or in making any other
payment herein provided; or (C) if any execution or attachment shall be issued
against Tenant or any of Tenant's property whereupon the Demised Premises shall
be taken or occupied or attempted to be taken or occupied by someone other than
Tenant; or (D) if Tenant shall make default with respect to any other lease
between Landlord and Tenant; then in any of such events Landlord may, without
notice, re-enter the Demised Premises either by force or otherwise, and
dispossess Tenant and the legal representatives of Tenant or any other occupants
of the Demised Premises by summary proceedings or otherwise and remove their
effects and hold the Demised Premises as if this Lease had not been made. Tenant
hereby waives the service of notice of intention to re-enter or to institute
legal proceedings to the aforesaid end. If Tenant shall make default hereunder
prior to the date fixed as the commencement of any renewal or extension of this
Lease, Landlord may cancel and terminate such renewal or extension agreement by
written notice, but Tenant shall remain liable as hereinafter provided.

       Section 17.02. In case of any such default, re-entry, expiration and/or
dispossess by summary proceedings or otherwise, (i) the rent shall become due
thereupon and be paid up to the time of such re-entry, dispossess and/or
expiration together with such costs as Landlord may incur for legal expenses,
attorneys' fees, brokerage and/or putting the Demised Premises in good order, or
for preparing the same for re-rental; (ii) Landlord may re-let the Demised
Premises or any part or parts thereof, either in the name of Landlord or
otherwise, for a term or terms, which may at Landlord's option be less than or
exceed the period which would otherwise have constituted the balance of the Term
of this Lease and may grant concessions or free rent; and/or (iii) Tenant or the
legal representatives of Tenant shall also pay Landlord as liquidated damages
for the failure of Tenant to observe and perform Tenant's covenants herein
contained, at the election of Landlord, either:

             (a) a sum which at the time of such termination of this Lease or at
the time of any such re-entry by Landlord, as the case may be, represents the
then value of the excess, if any, of (1) the aggregate of the installments of
Fixed Rent and the additional rent (if any) which would have been payable
hereunder by Tenant, had this Lease not so terminated, for the period commencing
with such earlier termination of this Lease or the date of any such re-entry, as
the case may be, and ending with the date heretofore set for the expiration of
the full term hereby granted pursuant to Articles 1 and 2 hereof, over (2) the
aggregate rental value of the Demised Premises for the same period, said lump
sum to be discounted to the Expiration Date of this Lease at the then prevailing
prime rate of interest; or

             (b) sums equal to the aggregate of the installments of Fixed Rent
and additional rent (if any) which would have been
<PAGE>   35
                                     - 32 -

payable by Tenant had this Lease not so terminated, or had Landlord not so
re-entered the Demised Premises, payable upon the due dates therefor specified
herein following such termination or such re-entry and until the date
heretofore set for the expiration of the full Term hereby granted; provided,
however, that if Landlord shall re-let the Demised Premises during said period,
Landlord shall credit Tenant with the net rents received by Landlord for such
re-letting, such net rents to be determined by first deducting from the gross
rents as and when received by Landlord from such re-letting the expenses
incurred or paid by Landlord terminating this Lease or of re-entering the
Demised Premises and of securing possession thereof, including, without
limitation, attorneys' fees and costs of removal and storage of Tenant's
property, as well as the expenses of re-letting, including repairing, restoring,
altering, decorating and preparing the Demised Premises for new tenants,
brokers' commissions, advertising costs, attorneys' fees, and all other similar
or dissimilar expenses chargeable against the Demised Premises and the rental
therefrom in connection with such relenting, it being understood that any such
re-letting may be for a period equal to or shorter or longer than the remaining
Term of this Leas0; provided, further, that (1) in no event shall Tenant be
entitled to receive any excess of such net rents over the sums payable by Tenant
to Landlord hereunder, (2) in no event shall Tenant be entitled in any suit for
the collection of damages pursuant to this paragraph (b) to a credit in respect
of any net rents from a re-letting except to the extent that such net rents are
actually received by Landlord prior to the commencement of such suit, and (3) if
the Demised Premises or any part thereof should be re-let in combination with
other space, then proper apportionment on a square foot area basis shall be made
of the rent received from such re-letting and of the expenses of reletting.

      For the purpose of paragraph (a) of this Section 17.02, the amount of
additional rent which would have been payable by Tenant under Article 3 hereof
for each year, as therein provided, ending after such termination of this Lease
or such re-entry, shall be deemed to be an amount equal to the amount of such
additional rent payable by Tenant for the calendar year and Tax Year ending
immediately preceding such termination of this Lease or such reentry. suit or
suits for the recovery of such damages, or any installments thereof, may be
brought by Landlord from time to time at its election, and nothing contained
herein shall be deemed to require Landlord to postpone suit until the date when
the Term of this Lease would have expired if it had not been terminated under
the provisions of Articles 16 or 17 hereof, or under any provision of law, or
had Landlord not recentered the Demised Premises.

      Landlord, at Landlord's option, may make such alterations, repairs,
replacements and/or decorations in the Demised Premises as Landlord in
Landlord's sole judgment considers advisable and
<PAGE>   36
                                     - 33 -

necessary for the purpose of re-letting the Demised Premises; and the making of
such alterations and/or decorations shall not operate or be construed to release
Tenant from any liability hereunder as aforesaid. Landlord shall in no event be
liable in any way whatsoever for failure to re-let the Demised Premises, or in
the event that the Demised Premises are re-let, for failure to collect the rent
thereof under such re-letting. In the event of a breach or threatened breach by
Tenant of any of the covenants or provisions hereof, Landlord shall have the
right of injunction and the right to invoke any remedy allowed at law or in
equity as if re-entry, summary proceedings and other remedies were not herein
provided for. Mention in this Lease of any particular remedy shall not preclude
Landlord from any other remedy, in law or in equity. Tenant hereby expressly
waives any and all rights of redemption granted by or under any present or
future laws in the event of Tenant being evicted or dispossessed for any cause,
or in the event of Landlord obtaining possession of the Demised Premises, by
reason of the violation by Tenant of any of the covenants and conditions of this
Lease, or otherwise.

                                   ARTICLE 18
                LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS
                ------------------------------------------------

       Section 18.01. If Tenant shall default in the observance or performance
of any term or covenant on its part to be observed or performed under or by
virtue of any of the terms or provisions in any Article of this Lease which
default shall continue after notice and the expiration of any applicable cure
period (except in the event of an emergency in which event no notice shall be
necessary), Landlord, without being under any obligation to do so and without
thereby waiving such default, may remedy such default for the account and at the
expense of Tenant. If Landlord makes any expenditures or incurs any obligations
for the payment of money in connection therewith, including, but not limited to,
attorneys' fees in instituting, prosecuting or defending any action or
proceedings, such sums paid or obligations incurred with interest computed at
the Interest Rate and costs shall be deemed to be additional rent hereunder and
shall be paid to it by Tenant on demand.

                                   ARTICLE 19
                          COVENANT OF QUIET ENJOYMENT
                          ---------------------------

       Section 19.01. Landlord covenants that upon Tenant paying the rent and
additional rents and observing and performing all the terms, covenants and
provisions of this Lease on Tenant's part to be observed and performed, Tenant
may peaceably and quietly enjoy the Demised Premises, subject nevertheless to
the terms and conditions of this Lease and provided, however, that no eviction
of Tenant by reason of paramount title, the foreclosure of any mortgage now or
hereafter affecting the Demised Premises
<PAGE>   37
                                     - 34 -

or by reason of any termination of any ground or underlying lease to which this
Lease is subject and subordinate, whether such termination is by operation of
law, by agreement or otherwise, shall be construed as a breach of this covenant
nor shall any action by reason thereof be brought against Landlord, and provided
further that this covenant shall bind and be enforceable against Landlord,
subject to the terms hereof, only so long as Landlord is in possession and is
collecting rent from Tenant but not thereafter.

                                   ARTICLE 20
                                   EXCAVATION
                                   ----------

       Section 20.01. In the event that an excavation should be made for
building or other purposes upon land adjacent to the Building, or should be
authorized to be made, Tenant shall, if necessary, afford to the person or
persons causing or authorized to cause such excavation, license to enter upon
the Demised Premises for the purpose of doing such work as shall reasonably be
necessary to protect or preserve the wall or walls of the Building, or the
Building, from injury or damage and to support them by proper foundations,
pinning and/or underpinning.

                                   ARTICLE 21
                             SERVICES AND EQUIPMENT
                             ----------------------

       Section 21.01. So long as this Lease is in full force and effect,
Landlord shall, at its cost and expense:

             (a) Provide necessary elevator facilities on Business Days from
8:00 A.N. to 6:00 P.M. and shall have sufficient elevators available at all
other times. At Landlord's option, the elevators shall be operated by
automatic control or by manual control, or by a combination of both of such
methods.

             (b) (i) Maintain and keep in good order and repair the
air-conditioning, heating and ventilating system installed by Landlord, which
system is further described hereinabove. The "interior" portion of said system
will be operated by Landlord as seasonably required on Business Days from 8:00
A.M. to 6:00 P.M. and the "perimeter" portion of said system shall be under
Tenant's control. Landlord shall have no responsibility or liability for the
ventilating conditions and/or temperature of the Demised Premises during the
hours or days Landlord is not required to furnish heat, ventilation or
air-conditioning pursuant to this paragraph. Landlord has informed Tenant that
the windows of the Demised Premises and the Building may be sealed and that
accordingly, the Demised Premises may become uninhabitable and the air therein
unbreathable during the hours or days when Landlord is not required pursuant to
this paragraph to furnish heat, ventilation or air-conditioning. Such

<PAGE>   38
                                     - 35 -

condition of the Demised Premises shall not constitute nor be deemed to
constitute a breach or a violation of this Lease or of any provision thereof,
nor shall such condition of the Demised Premises constitute or be deemed to
constitute an eviction and Tenant shall not claim nor be entitled to claim any
abatement of rent or make any claim for any damages or compensation by reason of
such condition of the Demised Premises. Any use. or occupancy of the Demised
Premises during the hours or days Landlord is not required to furnish heat,
ventilation or air-conditioning to the Demised Premises pursuant to this
paragraph shall be at the sole risk, responsibility and hazard of Tenant. Tenant
shall in any event cause all of the windows in the Demised Premises to be kept
closed at all times and shall cause all of the vents, intakes, outlets and
grilles in the Demised Premises to be kept entirely unobstructed at all times.
Additionally, Tenant shall comply with and observe any and all rules,
regulations and requirements hereafter prescribed by Landlord for the proper
functioning of the heating, ventilating and air-conditioning system.

                   (ii)  The heating, ventilating and air-conditioning system
servicing the Demised Premises consists, as of the date hereof, of an interior
duct air distribution system and perimeter units. The perimeter units serve that
portion of the Demised Premises which is within 15 feet from the glass line of
the Building and operate automatically, co lancing operation at 8:00 A.M. and
ceasing operation at 6:00 P.M. The perimeter units may be activated by Tenant at
any other time and upon activation will operate for a prep-programmed period of
time and may be reactivated by Tenant thereafter on a continuing basis. A11
electricity used in connection with the operation of the perimeter units shall
be supplied by Landlord upon and subject to all of the terms and conditions
contained in Article 4 hereof.

                   (iii) In the event that Tenant shall require operation of the
"interior" portion of the air-conditioning, heating or ventilation system at
times other than as described above, Tenant shall give Landlord at least
twenty-four (24) hours advance notice of such requirement and, if reasonably
practicable, Landlord will arrange for such operation and Tenant shall pay
Landlord's established charges therefor as additional rent, including with
respect to minimum number of hours and/or minimum floor area for such operation.

             (c) Provide cleaning and janitorial services on Business Days.

             (d) Furnish hot and cold water for lavatory, pantry and drinking
and office cleaning purposes. If Tenant requires, uses or consumes water for any
other purposes, Tenant agrees to Landlord installing a meter or meters or other
means to measure Tenant's water consumption, and Tenant further agrees to
reimburse Landlord for the cost of the meter or meters and the installation
thereof, And to pay for the maintenance of said
<PAGE>   39
                                     - 36 -

meter equipment and/or to pay Landlord's cost of other means of measuring such
water consumption by Tenant. Tenant shall reimburse Landlord the cost of all
water consumed, as measured by said meter or meters or as otherwise measured,
including sewer rents.

       Section 21.02. Landlord reserves the right to interrupt, curtail or
suspend the services required to be furnished by Landlord under this Article 21
when the necessity therefor arises by reason of accident, emergency, mechanical
breakdown, or when required by any law, order or regulation of any federal,
state, county or municipal authority, or for any other cause beyond the
reasonable control of Landlord. Landlord shall do any work pursuant to this
Article in such a manner so as to minimize interference with Tenant's business,
provided no additional costs, for labor at overtime or premium rates, or
otherwise, are incurred thereby. No diminution or abatement of rent or other
compensation shall or will be claimed by Tenant as a result of any interruption,
curtailment or suspension of services, nor shall this Lease or any of the
obligations of Tenant be affected or reduced by reason of such interruption,
curtailment or suspension.

       Section 21.03. Tenant shall reimburse Landlord for the cost to Landlord
of removal from the Demised Premises and the Building of so much of any refuse
and rubbish of Tenant as shall exceed that ordinarily accumulated daily in the
routine of business office occupancy or by any use of the Demised Premises after
customary business hours.

       Section 21.04. It is expressly agreed that only Landlord or any one or
more persons, firms or corporations authorized in writing by Landlord will be
permitted to furnish laundry, linen, towels, drinking water, ice and other
similar supplies and services to tenants and licensees in the Building. Landlord
may fix, in its sole and absolute discretion, at any time and from time to time,
the hours during which and the regulations under which such supplies and
services are to be furnished. Landlord expressly reserves the right to act as or
to designate, at any time and from time to time, an exclusive supplier of all or
any one or more of the said supplies and services, provided that the quality
thereof and the charges therefor are reasonably comparable to that of other
suppliers and Landlord furthermore expressly reserves the right to exclude from
the Building any person, firm or corporation attempting to furnish any of said
supplies or services but not so designated by Landlord.

       Section 21.05. It is expressly agreed that only Landlord or any one or
more persons, firms or corporations authorized in writing by Landlord will be
permitted to sell, deliver or furnish any food or beverages, either personally
or through the use of vending machines, for consumption within the Demised
Premises or elsewhere in the Building. Landlord expressly reserves the right
<PAGE>   40
                                     - 37 -

to act as or to designate at any time, or from time to time, an exclusive
supplier or suppliers of such food and beverages sold in the Building and
Landlord further expressly reserves the right to exclude from the Building any
person, firm or corporation attempting to purvey any such food or beverages but
not so designated by Landlord. It is understood, however, that Tenant or regular
office employees of Tenant who are not employed by any supplier of such food or
beverages or by any person, firm or corporation engaged in the business of
purveying such food or beverages, may personally bring or have delivered into
the Building food or beverages for consumption within the Demised Premises by
employees of Tenant, but not for resale to or for consumption by any other
tenant. Landlord may fix in its absolute discretion, at any time and from time
to time, the hours during which and the regulations under which foods and
beverages may be brought or delivered into the Building by or for regular
employees of Tenant. Notwithstanding the foregoing, it is understood that Tenant
or regular office employees of Tenant who are not employed by any supplier of
such food or beverages or by any person, firm or corporation engaged in the
business of purveying such food or beverages, may personally bring food or
beverages into the Building for consumption within the Demised Premises by
employees of Tenant, but not for resale to or for consumption by any other
tenant. It is further understood that Tenant may order food and beverages for
delivery to Tenant in the Demised Premises for consumption by Tenant's employees
and invitees from contractors, restaurants and caterers selected by Tenant,
without obtaining Landlord's prior consent, provided however that if Landlord
determines that the delivery by any such contractor, restaurant or caterer poses
a security risk to the Building personnel or to other tenants in the Building or
otherwise causes a nuisance or disruption in the Building, Landlord may exclude
same from the Building.

       Section 21.06. Tenant agrees to employ such office maintenance contractor
as Landlord may from time to time designate, for all waxing, polishing, lamp
replacement, cleaning (other than those cleaning services Landlord is obligated
to furnish) and the maintenance work in the Demised Premises, provided that the
quality thereof and the charges therefor are reasonably comparable to that of
other contractors. Tenant shall not employ any other contractor without
Landlord's prior written consent, which shall not be unreasonably withheld.

       Section 21.07. Landlord will not be required to furnish any other
services, except as otherwise provided in this Lease.

       Section 21.08. (a) Tenant, at its sole cost and expense, shall cause the
Demised Premises to be exterminated on a monthly basis to the satisfaction of
Landlord and shall for such purposes employ exterminators designated by
Landlord.
<PAGE>   41
                                     - 38 -

             (b) If Tenant shall have facilities on the Demised Premises for
cooking, drinking, eating, washing and/or storage of food, or similar items,
Tenant shall, on a weekly basis, cause the portion of the Demised Premises on
which such facilities are located to be exterminated to the satisfaction of
Landlord by exterminators designated by Landlord. The foregoing shall not,
however, constitute any approval or consent to the use of the Demised Premises
for such purposes.

             (c) If Tenant fails to comply with the provisions of this Section
21.08, Landlord, in addition to any other remedies available to it under this
Lease or pursuant to law, may perform such service, and the cost therefor shall
be paid by Tenant on demand as additional rent hereunder.

                                   ARTICLE 22
                             DEFINITION OF LANDLORD
                             ----------------------

       Section 22.01. The term "Landlord" wherever used in this Lease shall be
limited to mean and include only the owner or owners at the time in question of
the Land and the Building or the Building or the tenant under a ground or
underlying lease affecting the Land and the Building or the Building, or both,
to whom this Lease may be assigned, or a mortgagee in possession, so that in the
event of any sale, assignment or transfer of the Land and the Building or the
Building, or of such ground or underlying lease, such owner, tenant under a
ground lease or mortgagee in possession shall thereupon be released and
discharged from all covenants, conditions and agreements of Landlord thereafter
accruing hereunder; but such covenants, conditions and agreements shall be
binding upon each new owner, tenant under a ground or underlying lease, or
mortgagee in possession for the time being of the Land and the Building, until
sold, assigned or transferred.

                                   ARTICLE 23
                          INVALIDITY OF ANY PROVISION
                          ---------------------------

       Section 23.01. If any term, covenant, condition or provision of this
Lease or the application thereof to any circumstance or to any person, firm or
corporation shall be invalid or unenforceable to any extent, the remaining
terms, covenants, conditions and provisions of this Lease, or the application
thereof to any circumstances or to any person, firm or corporation other than
those as to which any term, covenant, condition or provision is held invalid or
unenforceable, shall not be affected thereby and each remaining tern, covenant,
condition and provision of this Lease shall be valid and shall be enforceable to
the fullest extent permitted by law.
<PAGE>   42
                                     - 39 -

                                   ARTICLE 24
                                     BROKER
                                     ------

       Section 24.01. The parties hereto agree that Daniel N. Davis and
SageGroupAssociates Inc. (collectively, the "Brokers") were the only brokers who
negotiated and brought about this transaction, and Landlord agrees to pay the
Brokers a commission therefor as per separate agreements. Tenant represents and
warrants that it has not dealt with any broker in connection with this
transaction other than the Brokers, and Tenant agrees to indemnify and save
Landlord harmless from any claims made by other brokers claiming to have dealt
with Tenant. Landlord represents that it has not dealt with any broker in
connection with this transaction other than the Brokers, and Landlord agrees to
indemnify and save Tenant harmless from any claims made by other brokers
claiming to have dealt with Landlord in connection with this transaction.

                                   ARTICLE 25
                                  SUBORDINATION
                                  -------------

       Section 25.01. This Lease is subject and subordinate to all ground or
underlying leases and to all mortgages which may now or hereafter affect such
leases or the Building of which the Demised Premises forms a part, and to all
renewals, modifications, consolidations, replacements and extensions thereof.
This clause shall be self-operative, and no further instrument of subordination
shall be required by any mortgage. In confirmation of such subordination,
Tenant shall execute promptly any certificate that Landlord may request. Tenant
hereby constitutes and appoints Landlord the Tenant's attorney-in-fact to
execute any such certificate or certificates for and on behalf of Tenant.

       Section 25.02. At the option of Landlord or any successor landlord or the
holder of any mortgage affecting the Demised Premises, Tenant agrees that
neither the cancellation nor termination of any ground or underlying lease to
which this Lease is now or may hereafter become subject or subordinate, nor any
foreclosure of a mortgage affecting said premises, nor the institution of any
suit, action, summary or other proceeding against Landlord herein or any
successor landlord, or any foreclosure proceeding brought by the holder of any
such mortgage to recover possession of such property, shall by operation of law
or otherwise result in cancellation or termination of this Lease or the
obligations of Tenant hereunder, and upon the request of any such landlord,
successor landlord, or the holder of such mortgage, Tenant covenants and agrees
to attorn to Landlord or to any successor to Landlord's interest in the 
Demised Premises, or to such holder of such mortgage or to the purchaser of the
mortgaged premises in foreclosure.
<PAGE>   43
                                     - 40 -

       Section 25.03. In the event of any act or omission by Landlord which
would give Tenant the right to terminate this Lease or to claim a partial or
total eviction, pursuant to the terms of this Lease, if any, Tenant will not
exercise any such right until:

       (i)  it has given written notice of such act or omission to the following
(whose names and addresses shall previously have been furnished to Tenant) by
delivering such notice of such act or omission addressed to such holders at the
last address so furnished:

             (a) the holder of any first mortgage, and

             (b) the landlord under any ground or underlying lease to which
this Lease is subject and subordinate; and

       (ii) a reasonable period for remedying such act or omission shall have
elapsed following such giving of notice during which such parties, or any of the
parties, with reasonable diligence, following the giving of such notice, has not
commenced and continued to remedy such act or omission or to cause the same to
be remedied.

       Section 25.04. If, in connection with obtaining financing, a banking,
insurance or other recognized institutional lender shall request reasonable
modifications in this Lease as a condition to such financing, Tenant will not
unreasonably withhold, delay or defer its consent thereto, provided that such
modifications do not, in Tenant's reasonable opinion, increase the obligations
of Tenant hereunder or materially adversely affect the leasehold interest hereby
created or Tenant's use and enjoyment of the Demised Premises.

                                   ARTICLE 26
                              ESTOPPEL CERTIFICATE
                              --------------------

       Section 26.01. Tenant agrees, at any time, and from time to time, upon
not less than seven (7) days prior notice from Landlord, to execute, acknowledge
and deliver to Landlord a statement in writing addressed to Landlord certifying
that this Lease is unmodified and in full force and effect (or, if there have
been modifications, that the same is in full force and effect as modified and
stating the modifications), stating the dates to which the Fixed Rent,
additional rental and other charges have been paid, and stating whether or not
to the best knowledge of the signer of such certificate, there exists any
default in the performance of any covenant, agreement, term, provision or
condition contained in this Lease, and any claim or offset in favor of Tenant,
and, if any, specifying each such default, claim or offset in favor of Tenant,
and, if any, specifying each such default, claim or offset of which signer may
<PAGE>   44
                                     - 41 -

have knowledge, it being intended that any such statement delivered pursuant
hereto may be relied upon by Landlord and by any purchaser or prospective
purchaser of the Building and/or the Land and by any mortgagee or prospective
mortgagee of any mortgage affecting the Building and/or the Land, and by any
landlord under a ground or underlying lease affecting the Land or the Building.

                                   ARTICLE 27
                    LEGAL PROCEEDINGS, WAIVER OF JURY TRIAL
                    ---------------------------------------

       Section 27.01. Landlord and Tenant hereby waive, to the extent such
waiver is not prohibited by law, the right to a jury trial in any action,
summary proceeding or legal proceeding between or among the parties hereto or
their successors arising out of this Lease or Tenant's occupancy of the Demised
Premises or Tenant's right to occupy the Demised Premises.

       Section 27.02. Tenant hereby waives the right to interpose a counterclaim
(other than a compulsory counterclaim) in any summary proceeding instituted by
Landlord against Tenant or in any action instituted by Landlord for unpaid rent
or additional rent under this Lease.

       Section 27.03. Tenant hereby agrees that the existence of any legal
proceeding arising under this Lease, or any judgment resulting therefrom, shall
remain confidential and to that end shall not discuss with, or make public
disclosure of, the same to the press, other tenants of the Building, or
otherwise. The parties hereto understand and agree that the papers filed in the
course of any such legal proceeding may be available to the public but this
Section 27.03 is understood by Tenant as a prohibition against any public
discussion or disclosure of the same, including any response to any query from
the press, other tenants of the Building or otherwise.

       Section 27.04. In the event Tenant claims or asserts that Landlord has
violated or failed to perform a covenant of Landlord not to unreasonably
withhold or delay Landlord's consent or approval, or in any case where
Landlord's reasonableness in exercising its judgment is in issue, Tenant's sole
remedy shall be an action for specific performance, declaratory judgment or
injunction, and in no event shall Tenant be entitled to any money damages for a
breach of such covenant, and in no event shall Tenant claim or assert any claims
in any money damages in any action or by way of set-off, defense or
counterclaim, and Tenant hereby specifically waives the right to any money
damages or other remedies.
<PAGE>   45
                                     - 42 -



                                   ARTICLE 28
                         SURRENDER OF PREMISES/HOLDOVER
                         ------------------------------

       Section 28.01. Upon the expiration or other termination of the Term of
this Lease, Tenant shall quit and surrender the Demised Premises in good order
and condition, ordinary wear and tear and damage by fire or other casualty, the
elements and any cause beyond Tenant's reasonable control excepted, and shall
remove all its property therefrom, except as otherwise provided in this Lease.
Tenant's obligation to observe or perform this covenant shall survive the
expiration or other termination of the Term of this Lease.

       Section 28.02. If at any time during the last month of the Term of this
Lease, Tenant shall have removed all or substantially all of Tenant's property
from the Demised Premises, Landlord may, and Tenant irrevocably grants to
Landlord a license to, immediately enter and alter, renovate and redecorate the
Demised Premises, without diminution or abatement of rent, or incurring
liability to Tenant for any compensation, and such acts shall have no effect on
this Lease.

       Section 28.03. Tenant agrees it shall indemnify and save Landlord
harmless against all costs, claims, loss or liability resulting from delay by
Tenant in surrendering the Demised Premises upon expiration or sooner
termination of the term of this Lease, including, without limitation, any claims
made by any succeeding tenant founded on such delay. The parties recognize and
agree that the damage to Landlord resulting from any failure by Tenant timely to
surrender the Demised Premises will be substantial, will exceed the amount of
monthly rent theretofore payable hereunder, and will be impossible of accurate
measurement. Tenant therefore agrees that if possession of the Demised Premises
is not surrendered to Landlord within two (2) days after the date of the
expiration or sooner termination of the Term of this Lease, then Tenant will pay
Landlord as liquidated damages for each month and for each portion of any month
during which Tenant holds over in the Demised Premises after expiration or
sooner termination of the Term of this Lease, a sum equal to two and one-half
(2 1/2) times the average rent and additional rent which was payable per month
under this Lease during the six (6) month period preceding such expiration or
termination of the Term of this Lease. The aforesaid obligations shall survive
the expiration of sooner termination of the Term of this Lease.

                                   ARTICLE 29
                             RULES AND REGULATIONS
                             ---------------------

       Section 29.01. Tenant, its servants, employees, agents, visitors, and
licensees shall observe faithfully and comply strictly with the rules and
regulations set forth in Schedule C
<PAGE>   46
                                     - 43 -

attached hereto and made a part hereof. Landlord shall have the right from time
to time during the Term of this Lease to make reasonable changes in and
additions to the rules thus set forth.

       Section 29.02. Any failure by Landlord to enforce any rules and
regulations now or hereafter in effect, either against Tenant or any other
tenant in the Building, shall not constitute a waiver of any such rules and
regulations.

                                   ARTICLE 30
                                    NOTICES
                                    -------

       Section 30.01. Any notice, request or demand permitted or required to be
given by the terms and provisions of this Lease, or by any law or governmental
regulation, either by Landlord to Tenant or by Tenant to Landlord, shall be in
writing. Unless otherwise required by such law or regulation, such notice,
request or demand shall be given, and shall be deemed to have been served and
given by Landlord and received by Tenant, three (3) days after Landlord (1)
shall have deposited such notice, request or demand by registered or certified
mail return receipt requested enclosed in a securely closed postpaid wrapper, in
a United States Government general or branch post office, addressed to Tenant at
the Demised Premises, and until Tenant has moved its offices to the Demised
Premises, (2) shall have deposited such notice, request or demand by registered
or certified mail return receipt requested enclosed in a securely closed
postpaid wrapper in such a post office addressed to Tenant at its address as
stated on the first page of this Lease. Such notice, request or demand shall be
given, and shall be deemed to have been served and given by Tenant and received
by Landlord, three (3) days after Tenant shall have deposited such notice,
request or demand by registered or certified mail return receipt requested
enclosed in a securely closed postpaid wrapper in such a post office addressed
to Landlord at 777 Third Avenue, New York, New York 10017. Notices may also be
sent by Federal Express or other similar nationally recognized overnight courier
and shall be deemed to have been served and given the next Business Day after
deposit with such overnight courier. Either party may, by notice as aforesaid,
designate a different address or addresses for notices, requests or demands to
it.

                                   ARTICLE 31
                          NO WAIVER: ENTIRE AGREEMENT
                          ---------------------------

       Section 31.01. The failure of Landlord to seek redress for violation of,
or to insist upon the strict performance of, any covenant or condition of this
Lease, or any of the Rules and Regulations set forth or hereafter adopted by
Landlord shall not prevent a subsequent act which would have originally
constituted a violation from having all the force and effect of an original
<PAGE>   47
                                     - 44 -

violation. The receipt by Landlord of rent with knowledge of the breach of any
covenant of this Lease shall not be deemed a waiver of such breach. The failure
of Landlord to enforce any of the Rules and Regulations set forth, or hereafter
adopted, against Tenant and/or any other tenant in the Building shall not be
deemed a waiver of any such Rules and Regulations. No provision of this Lease
shall be deemed to have been waived by Landlord, unless such waiver be in
writing signed by Landlord. No payment by Tenant or receipt by Landlord of a
lesser amount than the monthly rent herein stipulated shall be deemed to be
other than on account of the earliest stipulated rent, nor shall any endorsement
or statement on any check or any letter accompanying any check or payment as
rent be deemed an accord and satisfaction, and Landlord may accept such check or
payment without prejudice to Landlord's right to recover the balance of such
rent or pursue any other remedy in this Lease provided.

       Section 31.02. This Lease with the Schedules annexed hereto, if any,
contains the entire agreement between Landlord and Tenant, and any executory
agreement hereafter made between Landlord and Tenant shall be ineffective to
change, modify, waive, release, discharge, terminate, or effect an abandonment
of this Lease, in whole or in part, unless such executory agreement is in
writing and signed by the party against which enforcement of the change,
modification, waiver, release, discharge, termination or the effecting of the
abandonment is sought.

                                   ARTICLE 32
                                    CAPTIONS
                                    --------

       Section 32.01. The captions of Articles in this Lease are inserted only
as a matter of convenience and for reference, and they in no way define, limit
or describe the scope of this Lease or the intent of any provision thereof.

                                   ARTICLE 33
                              INABILITY TO PERFORM
                              --------------------

       Section 33.01. This Lease and the obligation of Tenant to pay rent
hereunder and perform all of the other covenants and agreements hereunder on the
part of Tenant to be performed shall in no way be affected, impaired or excused
because Landlord is unable to fulfill any of its obligations under this Lease or
to supply or is delayed in supplying any service expressly or implied to be
supplied or is unable to make, or is delayed in making any repair, additions,
alterations or decorations or is unable to supply or is delayed in supplying any
equipment or fixtures if Landlord is prevented or delayed from so doing by
reason of strike or labor troubles or any outside cause whatsoever including but
not limited to, governmental preemption in connection with a National Emergency
or by reason of any rule,
<PAGE>   48
                                     - 45 -

order or regulation of any department or subdivision thereof of any government
agency or by reason of the conditions of supply and demand which have been or
are affected by war or other emergency.

                                   ARTICLE 34
                         NO REPRESENTATION BY LANDLORD
                         -----------------------------

       Section 34.01. Landlord or Landlord's agents have made no representations
or promises with respect to the Building, the Land or the Demised Premises
except as herein expressly set forth, and no rights, easements or licenses are
acquired by Tenant by implication or otherwise except as expressly set forth in
the provisions of this Lease. The taking of possession of the Demised Premises
by Tenant shall be conclusive evidence, as against Tenant, that Tenant accepts
said premises and that the Demised Premises and the Building of which the sane
form a part were in good and satisfactory condition at the time such possession
was so taken.

                                   ARTICLE 35
                                NAME OF BUILDING
                                ----------------

       Section 35.01. The Building may be known as or by such name as Landlord,
in its sole discretion, may elect, and Landlord shall have the right from time
to time to change such designation or name without Tenant's consent.

                                   ARTICLE 36
                             SUCCESSORS AND ASSIGNS
                             ----------------------

       Section 36.01. The covenants, conditions and agreements contained in this
Lease shall bind and inure to the benefit of the parties hereto and their
respective heirs, legal representatives, successors and, except as otherwise
provided herein, their assigns.

                                   ARTICLE 37
                              DEFERRED COLLECTIONS
                              --------------------

       Section 37.01. If all or any part of the Fixed Rent or additional rents,
as above defined, shall at any time become uncollectible, reduced or required to
be refunded by virtue of any rules, regulations, orders, laws and ordinances
(including, without limitation, rent control or stabilization laws), or
governmental or quasi-governmental authorities having jurisdiction ("Laws and
Ordinances"), then for the period prescribed by said Laws and Ordinances, Tenant
shall pay to Landlord the maximum amounts permitted pursuant to said Laws and
<PAGE>   49
                                     - 46 -

Ordinances. Upon the expiration of the applicable period of time during which
such amounts shall be uncollectible, reduced or refunded, Tenant shall pay to
Landlord as additional rent, within fifteen (15) days after demand, all such
uncollected, reduced or refunded amounts that would have been payable for the
period absent such Laws and Ordinances; provided, however, that the retroactive
collection thereof shall then be lawful.

                                   ARTICLE 38
                           FEES/INTEREST/LATE CHARGES
                           --------------------------

       Section 38.01. Whenever any default by Tenant causes Landlord to incur
attorneys' fees and/or any other costs or expenses, Tenant agrees that it shall
pay and/or reimburse Landlord for such fees, costs or expenses promptly upon
being billed therefor.

       Section 38.02. If any monies owing by Tenant under this Lease are paid
more than five (5) days after the date such monies are payable pursuant to the
provisions of this Lease, Tenant shall pay Landlord interest thereon, at the
Interest Rate, for the period from the date such monies were originally payable
to the date such monies are paid. In the event that twice in any twelve (12)
month period Tenant shall have defaulted beyond any applicable notice and curs
period in the payment of Fixed Rent or additional rent, or any part of either,
then any further default by Tenant within such twelve (12) month period shall
permit Landlord to collect from Tenant, upon demand, in addition to any interest
payable pursuant to this Article 38, or elsewhere in this Lease, a late charge
equal to ten percent (10%) of the amount of Fixed Rent and additional rent so
due as compensation to Landlord for the costs incurred by it as a result of such
defaults, Landlord and Tenant acknowledging that the actual amount of such costs
would be impossible to ascertain.

                                   ARTICLE 39
                              INTENTIONALLY OMITTED
                              ---------------------

                                   ARTICLE 40
                           MUTUAL TERMINATION OPTION
                           -------------------------

       Section 40.01. Landlord and Tenant shall each have the option to cancel
and terminate this Lease, effective as of (i) November 30, 1997 and (ii)
February 28, 1998 (either date is herein referred to as the "Early Termination
Date") by written notice (the "Termination Notice") delivered to the other no
later than ninety (90) days prior to such Early Termination Date. Upon timely
delivery of the Termination Notice, this Lease will expire on the Early
Termination Date as if such date were the Expiration
<PAGE>   50
                                     - 47 -

Date set forth herein and Tenant shall vacate the Demised Premises on or before
the Early Termination Date leaving the same in the condition otherwise required
upon the expiration or sooner termination of this Lease.

       Section 40.02 The effectiveness of Tenant's exercise of the foregoing
option is expressly conditioned upon there not being any uncured default by
Tenant hereunder, beyond notice and the expiration of any applicable cure
period, at the time of the exercise of said option and at the time of
termination (unless Landlord, in its sole discretion, elects to waive such
condition).

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

                                          SAGE REALTY CORPORATION, AGENT

                                          By: _______________________________
                                                 Landlord

                                          ATLANTIC REALTY TRUST

                                          By: _______________________________
                                                 Tenant

<PAGE>   51
                                     - 48 -

                                ACKNOWLEDGMENTS

State of New York )
               ss.:
County of Queens  )

        On the 16th day of January 1997, before me personally came Robert
Kaufman to me known, who being by me duly sworn, did depose and say that he
resides at 18 Marlin Court, Great Neck, NY, that he is the Executive V.P. of
SAGE REALTY CORPORATION, the corporation described in and which executed the
foregoing instrument; that he knows the seal of said corporation; that the seal
affixed to said instrument is such corporate seal; that it was so affixed by
order of the Board of Directors of said corporation, and that he signed his
name thereto by like order.

/s/   Claudia J. Whitfield
--------------------------------
          Notary Public

      CLAUDIA J. WHITFIELD
NOTARY PUBLIC, State of New York
         No. 41-5004514
   Qualified in Queens County
   Commission Expires 11/16/98



CORPORATE TENANT

State of New York  )
               ss.:
County of New York )

        On the 13th day of January, 199__, before me personally came Joel M.
Pashcow to me known, who, being by me duly sworn did depose and say that (s)he
resides at 21 Fir Dr., Great Neck, NY 11024, that (s)he is the Chairman &
President of ATLANTIC REALTY TRUST, the corporation described in and which
executed the above instrument; and that (s)he signed (her) his name by order of
the board of directors of such corporation.

/s/      Maureen G. Dudley
----------------------------------
           Notary Public

         MAUREEN G. DUDLEY
 NOTARY PUBLIC, State of New York
          No. 01DU5088584
    Qualified in Richmond County
Commission Expires November 4, 1998
<PAGE>   52
                                  SCHEDULE "C"

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

             1. The rights of tenants in the entrances, corridors, elevators and
escalators of the Building are limited to ingress to and egress from the
tenants' premises for the tenants and their employees, licensees and invitees,
and no tenant shall use, or permit the use of, the entrances, corridors,
escalators or elevators for any other purpose. No bicycles, dogs or other
animals may be brought into the Building by Tenant, or its employees, licensees
or invitees. No tenant shall invite to the tenant's premises, or permit the
visit of, persons in such numbers or under such conditions as to interfere with
the use and enjoyment of any of the plazas, entrances, corridors, escalators,
elevators and other facilities of the Building by other tenants. Tenant shall
not use or permit its employees to use the elevators before 10:00 A.M. in a
"Down" direction for purposes of taking a coffee break or similar activities.
Fire exits and stairways are for emergency use only, and they shall not be used
for any other purposes by the tenants, their employees, licensees or invitees.
No tenant shall encumber or obstruct, or permit the encumbrance or obstruction
of, any of the sidewalks, plazas, entrances, corridors, escalators, elevators,
fire exits or stairways of the Building. Landlord reserves the right to control
and operate the public portions of the Building and the public facilities, as
well as facilities furnished for the common use of the tenants, in such manner
as it deems best for the benefit of the tenants generally.

             2. The cost of repairing any damage to the public portions of the
Building or the public facilities or to any facilities used in common with other
tenants, caused by a tenant or the employees, licensees or invitees of the
tenant, shall be paid by such tenant.

             3. Landlord may refuse admission to the Building outside of
ordinary business hours to any person not known to the watchman in charge or not
having a pass issued by Landlord or not properly identified, and may require all
persons admitted to or leaving the Building outside of ordinary business hours
to register. Tenant's employees, agents and visitors shall be permitted to enter
and leave the Building whenever appropriate arrangements have been previously
made between Landlord and Tenant with respect thereto. Each tenant shall be
responsible for all persons for whom he requests such permission and shall be
liable to Landlord for all acts of such persons. Any person whose presence in
the Building at any time shall, in the judgment of Landlord, be prejudicial to
the safety, character, reputation and interests of the Building or its tenants
may be denied access to the Building or may be ejected therefrom. In case of
invasion, riot, public excitement or other commotion, Landlord may prevent all
access to the Building during the continuance of the same, by closing the doors
or otherwise, for the safety of the tenants and protection of property in the
Building. Landlord may require any
<PAGE>   53
                                      - 2 -

person leaving the Building with any package or other object to exhibit a pass
from the tenant from whose premises the package or object is being removed, but
the establishment and enforcement, or failure to enforce, of such requirements
shall not impose any responsibility on Landlord for the protection of any tenant
against the removal of property from the premises of the tenant. Landlord shall,
in no way, be liable to any tenant for damages or loss arising from the
admission, exclusion or ejection of any person to or from the tenant's premises
or the Building under the provisions of this rule.

             4. No tenant shall obtain or accept or use in its premises ice,
drinking water, food, beverage, towel, barbering, boot blacking, floor
polishing, lighting maintenance, cleaning or other similar services from any
persons not authorized by Landlord in writing to furnish such services, provided
always that the charges for such services by persons authorized by Landlord are
not excessive. Such services shall be furnished only at such hours, in such
places within the tenant's premises and under such regulations as may be fixed
by Landlord.

             5. No awnings or other projections over or around the windows shall
be installed by any tenant and only such window blinds as are supplied, or
permitted by Landlord shall be used in a tenant's premises.

             6. There shall not be used in any space, or in the public halls of
the Building, either by Tenant or by jobbers or others, in the delivery or
receipt of merchandise or mail, any hand trucks, except those equipped with
rubber tires and side guards.

             7. All entrance doors in each tenant's premises shall be left
locked when the tenant's premises are not in use. Entrance doors shall not be
left open at any time. All windows in each tenant's premises shall be kept
closed at all times, and all blinds or drapes therein above the ground floor
shall be lowered or closed when and as reasonably required because of the
position of the sun, during the operation of the Building air conditioning
system to cool or ventilate the tenant's premises.

             8. No noise, including the playing of any musical instruments,
radio or television, which, in the judgment of Landlord, might disturb other
tenants in the Building shall be made or permitted by any tenant and no cooking
shall be done in Tenant's premises except as expressly approved by Landlord.
Nothing shall be done or permitted in any tenant's premises and nothing shall be
brought into or kept in any tenant's premises which would impair or interfere
with any of the Building services or the proper and economic heating, cleaning
or other servicing of the Building or the premises, or the use or enjoyment by
any other tenant of any other premises, nor shall there be installed by any
tenant any ventilating, air conditioning, electrical or
<PAGE>   54
                                      - 3 -

other equipment of any kind which, in the judgment of Landlord, might cause any
such impairment or interference. No dangerous, inflammable, combustible or
explosive object or material shall be brought into the Building by any tenant or
with the permission of any tenant.

             9.  Tenant shall not permit any cooking or food odors emanating
from the Demised Premises to seep into other portions of the Building.

             10. No acids, vapors or other materials shall be discharged or
permitted to be discharged into the waste lines, vents or flues of the Building
which may damage them. The water and wash closets and other plumbing fixtures in
or serving any tenant's premises shall not be used for any purpose other than
the purpose for which they were designed or constructed, and no sweepings,
rubbish, rags, acids or other foreign substances shall be deposited therein. All
damages resulting from any misuse of the fixtures shall be borne by the tenant
who, or whose servants, employees, agents, visitors or licensees, shall have
caused the same.

             11. No signs, advertisement, notice or other lettering shall be
exhibited, inscribed, painted or affixed by any tenant on any part of the
outside or inside the premises or the Building without the prior written consent
of Landlord. In the event of the violation of the foregoing by any tenant,
Landlord may remove the same without any liability, and may charge the expense
incurred by such removal to the tenant or tenants violating this rule. Interior
signs and lettering on doors and elevators shall be inscribed, painted, or
affixed for each tenant by Landlord at the expense of such tenant, and shall be
of a size, color and style acceptable to Landlord.

             Landlord shall have the right to prohibit any advertising by any
tenant which impairs the reputation of the Building or its desirability as a
building for offices, and upon written notice from Landlord, Tenant shall
refrain from or discontinue such advertising.

             12. No additional locks or bolts of any kind shall be placed upon
any of the doors or windows in any tenant's premises, and no lock on any door
therein shall be changed or altered in any respect. Duplicate keys for a
tenant's premises and toilet rooms shall be procured only from Landlord, which
may make a reasonable charge therefor. Upon the termination of a tenant's lease,
all keys to the tenant's premises and toilet rooms shall be delivered to
Landlord.

             13. No tenant shall mark, paint, drill into, or in any way deface
any part of the Building or the premises demised to such tenant. Not boring,
cutting or stringing of wires shall be permitted, except with the prior written
consent of Landlord, and
<PAGE>   55
                                      - 4 -

as Landlord may direct. Not tenant shall install any resilient tile or similar
floor covering in the premises demised to such tenant except in a manner
approved by Landlord.

             14. No tenant shall use or occupy, or permit any portion of the
premises demised to such tenant to be used or occupied, as an office for a
public stenographer or typist, or as a barber or manicure shop, or as an
employment bureau. No tenant or occupant shall engage or pay any employees in
the Building, except those actually working for such tenant or occupant in the
Building or advertise for laborers giving an address at the Building.

             15. No premises shall be used, or permitted to be used, at any
time, as a store for the sale or display of goods or merchandise or any king, or
as a restaurant, shop, booth, bootblack or other stand, or for the conduct of
any business or occupation which involves direct patronage of the general public
on the premises demised to such tenant, or for manufacturing or for other
similar purposes.

             16. The requirements of tenants will be attended to only upon
application at the office of the Building. Employees of Landlord shall not
perform any work or do anything outside for the regular duties, unless under
special instructions from the office of the Landlord.

             17. Each tenant shall, at its expense, provide artificial light in
the premised demised to such tenant for Landlord's agents, contractors and
employees while performing janitorial or other cleaning services and making
repairs or alterations in said premises.

             18. Employees of Tenant shall not loiter around the hallways,
stairways, elevators, front, roof or any other part of the Building used in
common by the occupants thereof.

             19. Any cuspid or similar containers or receptacles used in the
Demised Premises shall be cared for and cleaned by and at the expense of Tenant.

             20. Any and all wet and/or food garbage, including coffee grinds,
is to be deposited in a plastic liner bag in a waste basket or other receptacle.

             21. Tenant shall separate all refuse and rubbish of Tenant in
accordance with the methods and procedures set forth, from time to time, by
Landlord.