<PAGE>

                                MODIFICATION OF
                          ADDENDUM TO MASTER EQUIPMENT
                         LEASE AGREEMENT NO. 8607TXG245
                   BETWEEN SHELL OIL COMPANY, AS LESSEE, AND
                    AMERICAN FINANCE GROUP, INC., AS LESSOR



     Reference is made to the above-referenced Master Equipment Lease Agreement
(the "Lease") between Shell Oil Company as lessee ("Lessee") and American
Finance Group, successor-in-interest to American Finance Group, Inc., as lessor
("Lessor") and to the Addendum to the Lease entered into as of June 28, 1989,
between Lessee and Lessor. Capitalized terms used herein and not otherwise
defined shall have the meanings ascribed to them in the Lease and Addendum.

     This  modification ("Modification") to the Addendum is needed to include
additional Subsidiaries to the list given in the Addendum.

     Lessee and Lessor hereby agree to add each of the following companies as a
Subsidiary under the terms of the Addendum:

                 Bellaire Trucking Company
                 Encoal Corporation
                 Evergreen Mining Company
                 Kermit Coal Company

    EXECUTED as of the 16th day of December, 1991.


AMERICAN FINANCE GROUP                 SHELL OIL COMPANY


By: /s/                                By: /s/
   -----------------------------          -----------------------------
Title: Executive Vice President        Title: Purchasing Manager - E&P M&FS
<PAGE>

                         ADDENDUM TO MASTER EQUIPMENT
                        LEASE AGREEMENT NO. 8607TXG245
                   BETWEEN SHELL OIL COMPANY, AS LESSEE, AND
                    AMERICAN FINANCE GROUP, INC. AS LESSOR


     Reference is made to the above-referenced Master Equipment Lease Agreement
(the "Lease") between Shell Oil Company as lessee ("Lessee") and American
Finance Group, successor-in-interest to American Finance Group, Inc., as
lessor ("Lessor").  This addendum ("Addendum") is a supplement and addendum
to the Lease and is entered into as of June 28, 1989 between Lessee and Lessor.
Capitalized terms used herein and not otherwise defined shall have the meanings
ascribed to them in the lease.

     WHEREAS, for purposes of Lessee's administrative convenience and in order
to facilitate asset management among Lessee and Lessee's affiliated and
subsidiary companies, Lessee has requested that the Lease be amended to provide
that such affiliated and subsidiary companies enter directly into Rental
Schedules under the lease with Lessor, all without relieving Lessor of any of
its payment or performance obligations thereunder; and

     WHEREAS, Lessor has agreed to amend the Lease as requested by Lessee in
accordance with the following terms and conditions:

     NOW, THEREFORE, Lessee and Lessor hereby agree as follows:

     1.  For purposes of this Addendum and the Lease, "Subsidiary" means any of
         the following companies:

             Shell Coal and Terminal Company
             Marrowbone Development Company
             Shipyard River Terminal Company
             Triton Coal Company
             Shell Mining Company
             Turris Coal Company
             R. & F. Coal Company

     2.  For all purposes under the Lease, "Lessee" shall mean Shell Oil
         Company jointly and severally with any Subsidiary which shall from time
         to time furnish a Rental Schedule under the Lease.

     3.  Lessee consents to the execution and delivery by any Subsidiary of one
         or more Rental Schedules under the Lease and consents and agrees to be
         bound jointly and severally by the terms thereof without any further
         action on Lessee's part.
<PAGE>

     4.  Nothing contained herein shall in any respect limit the liability of
         Shell Oil Company for the full payment and performance of Lessee's
         obligations under the Lease.

     This Addendum amends the Lease effective as to Rental Schedules under the
Lease dated on or after the date hereof and, as amended hereby, the Lease is
affirmed and ratified in all respects, is in full force and effect and is legal,
valid and enforceable in accordance with its terms.

     EXECUTED as an instrument under seal as of this 28th day of June, 1989.

AMERICAN FINANCE GROUP                 SHELL OIL COMPANY


By: /S/                                By: /S/
   -------------------------              -------------------------
Title: Vice President                  Title: Purch MGR - E&P M&FS
<PAGE>

                          BLANKET ORDER: PS-06196-CEB


                        MASTER EQUIPMENT LEASE AGREEMENT


                                 NO. 8607TXG245


                           DATED AS OF JULY 14, 1986



                                    between



                         AMERICAN FINANCE GROUP, INC.
                                    LESSOR



                                      AND



                              SHELL OIL COMPANY
                                    LESSEE
<PAGE>

                               TABLE OF CONTENTS
                               -----------------
<TABLE>
<CAPTION>

SECTION                                                                    PAGE
-----------                                                                ----
<S>                                                                        <C>

    1.   Agreement for Lease of Equipment .............................      1

    2.   Delivery and Acceptance of Equipment .........................      1

    3.   No Warranties by Lessor ......................................      1

    4.   Lease Term ...................................................      1

    5.   Rent .........................................................      1

    6.   Lessee's Representations and Warranties ......................      2

    7.   Titling and Registration; Identification Marks ...............      2

    8.   Fees and Taxes ...............................................      3

    9.   Indemnification by Lessee ....................................      4

    10.  Use of Equipment; Liens ......................................      4

    11.  Equipment Maintenance, Repair, and Additions .................      5

    12.  Loss, Damage or Destruction of Equipment .....................      6

    13.  Reports ......................................................      6

    14.  Insurance ....................................................      6

    15.  Return of Equipment ..........................................      7

    16.  Lessor's Ownership:  Equipment to be and
           Remain Personal Property ...................................      7

    17.  Events of Default ............................................      8

    18.  Assignment and Transfer By Lessor ............................      10

    19.  Option to Renew ..............................................      10

    20.  Additional Rights of Lessor ..................................      11

    21.  Net Lease; Non-Terminability .................................      11

    22.  Lessee's Right to Sublease ...................................      12

    23.  Quiet Enjoyment ..............................................      12
</TABLE>
<PAGE>

<TABLE>

<S>                                                                        <C>

    24.  Notices ......................................................      12

    25.  Entire Agreement: Severability: Effect and
               Modification of Lease ..................................      12

    26.  Governing Law ................................................      12

    27.  Consent to Jurisdiction and Service ..........................      12

    28.  Lessor's Right to Perform for Lessee .........................      13

    29.  Agreement for Lease Only .....................................      13

    30.  Financial Statements .........................................      13

    31.  Miscellaneous ................................................      13

    32.  Definitions ..................................................      13
</TABLE>

EXHIBIT I -- Rental Schedule and Certificate of Inspection and Acceptance with
               Stipulated Loss Values

<PAGE>

     MASTER EQUIPMENT LEASE AGREEMENT NO. 8607TXG245 , dated as of July 14,
1986, between American Finance Group, Inc. (hereinafter called "Lessor"), a
Massachusetts corporation having its principal place of business at Exchange
Place, Boston, Massachusetts 02109, and Shell Oil Company (hereinafter called
"Lessee"), a Delaware corporation with its principal place of business at One
Shell Plaza, Houston, TX.

     In consideration of the mutual covenants hereafter contained, Lessor and
Lessee agree as follows:

     1.    AGREEMENT FOR LEASE OF EQUIPMENT - Lessor shall lease to Lessee and
           --------------------------------
Lessee shall lease from Lessor such Equipment upon the terms and conditions
specified in this Master Equipment Lease Agreement (this "Master Lease") and the
applicable Rental Schedule. Each Rental Schedule shall Incorporate the terms of
this Master Lease and shall constitute a separate lease (the term "this Lease"
shall refer collectively to the applicable Rental Schedule and this Master
Lease).

     2.    DELIVERY AND ACCEPTANCE OF EQUIPMENT - Lessor and Lessee understand
           ------------------------------------
that the vendor of the Equipment will deliver the Equipment to the location
specified in the Rental Schedule. As between Lessor and Lessee, Lessee's
acceptance for lease hereunder of any Equipment (as evidenced by its execution
and delivery to Lessor of a Certificate of Inspection and Acceptance with
respect to such Equipment) constitutes Lessee's acknowledgement that such
Equipment in all respects conforms to the requirements of this Lease and is
subject to all of the terms and conditions of this Lease. Lessor hereby
authorizes Lessee as its agent to accept for Lessor, and in Lessor's name, the
Equipment from the Manufacturer or vendor thereof upon delivery.

     3.    NO WARRANTIES BY LESSOR - LESSOR, EXCEPT AS PROVIDED IN PARAGRAPH 23
           -----------------------
HEREOF, HEREBY MAKES NO EXPRESS OR IMPLIED WARRANTIES OR REPRESENTATIONS AS TO
ANY MATTER WHATSOEVER, INCLUDING WITHOUT LIMITATION THE CONDITION, SELECTION,
QUALITY, SUITABILITY OR OPERATION OF ANY EQUIPMENT, THE MERCHANTABILITY, OR
FITNESS FOR ANY PARTICULAR PURPOSE, AND THE LESSEE LEASES THE EQUIPMENT "AS IS"
AND "WHERE IS." Lessor shall not be liable to Lessee for any (a) defects in any
of the Equipment or for any direct or consequential damage therefrom; (b) loss
of use of any of the Equipment or for any Interruption in Lessee's business
occasioned by Lessee's inability to use any of the Equipment for any reason
whatsoever; and (c) damages in the event that the Manufacturer delays delivery
of the Equipment. Lessor hereby transfers and assigns to Lessee during the Lease
Term all its rights and interest in the Manufacturer's warranty with respect to
any and all of the Equipment, and agrees to execute all documents reasonably
necessary to effect such transfer and assignment. To the extent that any rights
of Lessor with respect to the Manufacturer's warranty applicable to the
Equipment may not be assigned to Lessee, Lessor will use reasonable efforts to
enforce such rights to the benefit of Lessee against the Manufacturer.

     4.    LEASE TERM - The Lease Term shall commence and expire on the dates
           ----------
set forth in the Rental Schedule applicable to the item of Equipment in
question.
<PAGE>

     5.  RENT - (a) This Lease is a net lease and Lessee shall pay to Lessor
         ----
by wire transfer in immediately available funds, as rent for the Equipment
during the Lease Term, the amount set forth in the Rental Schedule ("Basic
Rent") on the dates set forth therein ("Payment Dates"), at the location of
Lessor set forth on the applicable Rental Schedule.

     (b) Lessee shall also pay to Lessor on demand, by wire transfer
in immediately available funds, all amounts which Lessee is required to pay
Lessor pursuant to this Lease (other than Basic Rent) together with every fine,
interest and cost which may be added for non-payment or late payment thereof.
Such amounts shall constitute additional rent ("Additional Rent"). If Lessee
shall fail to pay any additional Rent, Lessor shall have all rights, powers and
remedies with respect thereto as are provided herein or by law in the case of
nonpayment of Basic Rent. With respect to any amount of Basic Rent or Additional
Rent not paid when due hereunder, Lessee shall pay to Lessor interest on such
amount from the due date thereof until payment is received by Lessor at the
lower of: (i) two percent (2%) above the Prime Rate but in no event less than
two percent (2%) per annum above the permanent debt rate of the Rental
Schedule(s) applicable to such overdue amount, or (ii) the highest rate of
interest permitted by law ("Default Interest Rate"). Lessee shall perform all
its obligations under this Lease at its sole cost and expense, and shall pay all
Basic Rent and Additional Rent when due, without further notice or demand.

     6.  LESSEE'S REPRESENTATIONS AND WARRANTIES  -  Lessee represents and
         ---------------------------------------
warrants (and if requested by Lessor, will provide other supporting documents to
the effect) that as of the date any Equipment is accepted for lease
hereunder:  (a) all items of Equipment are new and unused unless otherwise
specified in the applicable Rental Schedule; (b) Lessee is an entity validly
existing, in good standing under the laws of the jurisdiction of its
organization, with full power to enter into this Lease and to pay and perform
its obligations under this Lease, and is qualified to do business in the
location(s) where the Equipment is installed; (c) this Lease has been duly
authorized, executed and delivered by Lessee, and assuming the due
authorization, execution and delivery by Lessor is enforceable in accordance
with its terms; (d) Lessee's execution and delivery of this Lease does not and
will not result in a breach or default under any material indenture, mortgage,
deed of trust or other material agreement or instrument to which Lessee is a
party which breach or default would have a material adverse affect on the
ability of Lessee to perform the obligations under this Lease, or require the
approval of any governmental authority or agency except such as have been
obtained and are valid and sufficient for their purpose and are in full force
and effect; (e) there are no suits or proceedings pending, or to the knowledge
of Lessee threatened, in any court or any governmental agency against or
affecting Lessee, which, if decided against Lessee, would impair Lessee's
ability to perform any of its obligations under this Lease; and (f) there has
been no material adverse change to Lessee's financial condition since the date
of Lessee's most recent audited financial statement furnished Lessor.

     7.  TITLING AND REGISTRATION; IDENTIFICATION MARKS - (a) The Lessee will,
         ----------------------------------------------
on behalf of the Lessor and at the Lessee's expense, promptly obtain an
application for the Lessor's title for each item of Equipment, reflecting the
Lessor or its assignee as owner and whomever the Lessor shall designate as
first lienholder, the Manufacturer's certificate of title and a certificate of

                                      -2-
<PAGE>

registration issued in the name of the Lessor or its assignee. Certificates of
ownership shall be delivered to the Lessor or to whomever the Lessor shall
designate. The Lessee shall, at Lessee's expense, take such action as shall be
necessary from time to time to avoid suspension or revocation of any
certificates of ownership and to renew and maintain all certificates of
registration. If the Lessee is required to obtain any new certificate of
ownership or of registration, the Lessee shall, at Lessee's sole expense and
after prior written notice to the Lessor, obtain such new certificate of
ownership or of registration in the manner provided herein. The Lessor appoints
the Lessee its attorney-in-fact for the purpose of carrying out the Lessee's
obligations pursuant to this Section 8. The Lessee shall notify the Lessor of
the state in which each item of Equipment is titled and registered, the license
plate number of each item of Equipment, and any changes of such state of license
plate number.

(b)  If requested by Lessor or required by federal, state or local law, Lessor
shall furnish to Lessee and Lessee shall, at Lessee's expense, affix to
the Equipment a sign, tag or other form of notice to disclose Lessor's
ownership of the Equipment or that the Equipment is leased, and Lessee
shall keep and maintain such sign, tag or other form of notice affixed or
attached to the Equipment throughout the Lease Term.  Lessee will not
allow the name of any persons other than Lessor or its assignee to be
placed on any Equipment as a claim of ownership other than that of Lessor;
provided, however, that Lessee may cause such Equipment to be lettered with
the names or initials or other insignia customarily affixed by the
manufacturer thereof or used by Lessee on equipment used by it of the
same or a similar type for convenience of identification of its
rights to use such Equipment as permitted under this Lease or normal
advertising displays.

     8.  FEES AND TAXES - Lessee agrees to pay promptly when due, and to
         --------------
indemnify and hold Lessor harmless from, all license, title and registration
fees whatsoever, all excise and property taxes (including without limitation
all sales, use, personal property and stamp taxes) and all other
charges associated with the aforementioned excise and property taxes such as
penalties or interest, which are assessed, levied or imposed by any
governmental or taxing authority against Lessor, (unless such assessment is due
to Lessor's error, neglect, or oversight) with respect to any Equipment or the
purchase, acquisition, ownership, delivery, leasing, possession, use, operation,
control or return thereof, which accrue during the term of this Lease,
excluding, however, any taxes on, or measured by, Lessor's net income.

     This obligation to indemnify and hold Lessor harmless is contingent upon
notification to Lessee, in writing, within 10 days of receipt by Lessor of any
claim for such charges by a governmental or taxing authority, and prior to any
payment of such charges to such authority.

     If requested by Lessee in writing, Lessor may, at Lessee's expense, take
such action as Lessee may reasonably direct with respect to such asserted
liability, including payment under protest and granting of permission
to Lessor to file any claim or commence any action to prevent such payment or
permit Lessee to do so in Lessors' name, provided that under no circumstances
shall Lessor be requested to delay payment of such liability beyond the date for
payment of a final assessment

                                      -3-
<PAGE>

     (a)  The Lessee shall not have responsibility for the following, which
are not imposts:  any franchise, estate, inheritance, transfer, or taxes based
solely on or measured by the net income of Lessor. Except as stated in any
Schedule,  all tax benefits arising out of ownership of the Equipment are and
shall remain vested in Lessor.

     (b) Lessee shall prepare and submit all necessary filings to the
applicable taxing authorities where the incidence of such impost and/or its
related filing obligation shall be the legal responsibility of Lessee.

     (c) The Lessee shall not be required to pay or discharge any claim or
demand referred to in this Section so long as the validity or the amount thereof
shall be contested in good faith and be appropriate legal proceedings in any
reasonable manner which will not result in the forfeiture, seizure, confiscation
or sale of the Equipment.

     (d) Lessee shall comply with and cause the Equipment to comply with all
legal requirements applicable thereto or to the use thereof and with all
contracts (including insurance policies), agreements and restrictions applicable
therefore to the ownership or use thereof.

     9.  INDEMNIFICATION BY LESSEE - (a) Lessee shall indemnify Lessor and its
         -------------------------
Assignees against, and agrees to defend, protect, save and keep them harmless
from any and all liabilities, obligations, losses, damages, penalties, claims,
actions, suits, costs, expenses and disbursements, including attorneys' fees and
expenses, of whatsoever kind and nature asserted against Lessor (including,
without limitation, by way of strict or absolute liability), in any way relating
to or arising out of the construction, installation, possession, use,
maintenance, operation, control, condition, return, or other use of the
Equipment during the Lease Term and until such time the Equipment is returned to
Lessor pursuant to the provisions hereof. In case any action, suit or proceeding
is brought against Lessor or any of its Assignees by reason of any of the
foregoing, Lessee, at Lessee's expense, shall cause the claim upon which such
action, suit or proceeding is based to be discharged, or shall cause such
action, suit or proceeding to be resisted or defended by counsel designated by
Lessee and approved by Lessor (which approval shall not be unreasonably
withheld).

     (b) If as a result of changes  in the federal tax laws, the regulations
issued thereunder or the administrative or judicial interpretations thereof, the
reasonable after-tax benefit resulting from the ownership and lease of the
Equipment hereunder is reduced, then the amount of Basic Rent due under the
Rental Schedule in question shall be increased, not to exceed a 10% increase in
the lease rate factor, to provide Lessor the same after-tax benefit that would
have resulted from the ownership and lease of the Equipment if such changes had
not occurred.

     The indemnification by Lessee under this Section 9 shall survive the
payment of all obligations under, and the termination of, this Lease.

                                      -4-
<PAGE>

     10. USE OF EQUIPMENT; LIENS - During the Lease Term, Lessee warrants and
         -----------------------
agrees that the Equipment will be operated and otherwise be in compliance with
all statutes, regulations and orders of any governmental body having power to
regulate the Equipment. Lessee shall not permit the Equipment to be used for any
purpose for which, in the published opinion of the Manufacturer, the Equipment
is not designed or suited.

     During the Lease Term, Lessee will not directly or indirectly create,
incur, assume or suffer to exist any mortgage, security interest, lien, or
encumbrance on the Equipment, Lessor's or any Assignee's title thereto, or
interest therein, except:

     (a) the respective rights of Lessor (and its Assignees, as hereinafter
         defined, if any) and Lessee as herein provided;

     (b) liens or encumbrances granted or placed thereon by Lessor (or its
         assigns, if any);

     (c) liens or encumbrances resulting from claims against Lessor but not
         against Lessee and unrelated to this Lease, and not resulting from any
         default, act or omission of Lessee;

     (d) liens for taxes either not yet due or being contested in good faith and
         by appropriate proceedings;

     (e) inchoate materialmen's, mechanics', workmen's, repairmen's, employees'
         or other like liens arising in the ordinary course of business and not
         delinquent; and

     (f) liens arising out of judgments against Lessee with respect to which an
         appeal or proceeding for review is being prosecuted in good faith and
         with respect to which there has been secured a stay of execution
         pending such appeal or proceeding for review; provided, however, that
                                                       -----------------
         the liens referred to in clauses (d) and (f) of this Section 10 may
         remain only so long as the existence thereof does not subject the
         Equipment in question to forfeiture, seizure or otherwise adversely
         affect the rights of Lessor or any Assignee.

Lessee, at its own expense, will promptly take such action as may be necessary
to keep the Equipment free and clear of, and to duly discharge, any such
mortgage, security interest, lien, or encumbrance not excepted above. Lessee
agrees to procure and maintain in effect all licenses, permits and other
approvals and consents required by laws in connection with Lessee's possession,
use, operation and maintenance of the Equipment. Lessee agrees that during the
Lease Term, 100% of the use of the Equipment shall be "qualified business use"
as that term is defined in Section 280F of the Code, which use shall be
calculated in accordance with Regulations promulgated thereunder and shall be
supported by records maintained in accordance with Section 280F and the
Regulations thereunder. Lessee agrees that the Equipment shall not be garaged at
any location outside the 48 contiguous states of the United States without the
prior written consent of Lessor.

                                      -5-
<PAGE>

     11. EQUIPMENT MAINTENANCE, REPAIR, AND ADDITIONS  (a)  During the Lease
         --------------------------------------------
Term with respect thereto, Lessee, at Lessee's sole expense, will maintain the
Equipment in good and efficient operating repair, appearance and condition
except for ordinary wear and tear, and will make all necessary adjustments,
replacements and repairs. All maintenance and repairs to the Equipment shall be
made by the Manufacturer thereof or those of substantially equal skill or
knowledge in maintaining and repairing the Equipment.

     (b) Provided that the value of the Equipment or any item thereof shall
not be reduced thereby, Lessee shall have the right at any time to connect
additional compatible equipment to the Equipment whether such compatible
equipment is owned by Lessee or leased from a third party. In each case, Lessee
shall disconnect or detach such equipment upon the termination of this Lease, or
such equipment shall become the property of the Lessor. Lessee agrees to
indemnify and hold Lessor harmless from any loss or damage caused to the
Equipment by the connection to, or disconnection from, any compatible equipment.

     12. LOSS, DAMAGE OR DESTRUCTION OF EQUIPMENT - Lessee shall bear all
         ----------------------------------------
risks of damage to, taking of, or loss or destruction of, any item of Equipment
during the Lease Term thereof and until such Equipment has been returned to
Lessor.

     In the event that any item of Equipment shall become lost, stolen,
destroyed or irreparably damaged from any cause whatsoever, or if any item of
Equipment or Lessor's title thereto shall be requisitioned or seized by any
governmental authority (each such occurrence being hereafter called a "Casualty
Occurrence") during its Lease Term and until it has been returned to Lessor,
Lessee shall promptly notify Lessor in writing of such fact, fully informing
Lessor of all details of the Casualty Occurrence in question, and shall pay
Lessor in cash the greater of (i) the Fair Market Value of the item of Equipment
in question as of the date of the Casualty Occurrence or (ii) the "Stipulated
Loss Value" as set forth in the Exhibit to the Rental Schedule pursuant to which
such item of Equipment is leased hereunder calculated as of the Payment Date
immediately preceding the date of the Casualty Occurrence or, if the Casualty
Occurrence occurs on a Payment Date, calculated as of the date of the Casualty
Occurrence. This payment shall be made on the next succeeding Payment Date
following the Casualty Occurrence or, if the Casualty Occurrence occurs on a
Payment Date, on the date of the Casualty Occurrence.

     Upon the payment of the greater of the Stipulated Loss Value or Fair
Market Value of the Equipment in question in accordance with the terms of this
Section 12, and the payment of all Basic Rent and all other sums then due
hereunder, this Lease shall terminate with respect to the Equipment or part
thereof suffering the Casualty Occurrence and all Lessor's rights and title to
the Equipment shall pass to Lessee, "as is" and "where is" and, except for a
warranty that the Equipment is free of all liens or encumbrances granted by
Lessor or arising out of matters not within the scope of Lessee's indemnities
hereunder, without warranty or recourse, as evidenced by a duly executed bill of
sale naming Lessor as the seller and Lessee as the buyer.

                                      -6-
<PAGE>

     13. REPORTS - Lessee will cause to be furnished to Lessor, if requested,
         -------
a statement showing the location, condition and such other information regarding
the Equipment as Lessor may reasonably request.

     Lessor shall have the right, upon reasonable notice to Lessee, to inspect
the Equipment and Lessee's records with respect thereto.

     14. INSURANCE - Lessee will procure and maintain at its expense all risk
         ---------
insurance on all Equipment for the related full Lease Term at the higher of the
Equipment's Stipulated Loss Value or Fair Market Value and public liability
insurance in the amount of at least $5,000,000 insuring Lessor, the Secured
Party and any Assignee, as their interests may appear, against liability for
death, bodily injury and property damage resulting from ownership, maintenance
use or operation of the Equipment. All such insurance shall name Lessor and any
Assignee as additional insureds and loss payees, shall be in such amounts and
with such insurers as are reasonably satisfactory to Lessor, and shall provide
that the same may not be altered or cancelled except after thirty (30) days
prior written notice to Lessor. Lessee shall deliver to Lessor, prior to the
beginning of the Lease Term with respect to any Equipment, or prior to the
effective date of any cancellation or expiration of such insurance, as the case
may be, a certificate or other evidence satisfactory to Lessor of the
maintenance of such insurance. Lessor shall be under no duty to examine such
policies, certificates or other evidences of insurance, or to advise Lessee in
the event that its insurance is not in compliance with this Lease. In the event
of failure on the part of the Lessee to provide such insurance, Lessor may, at
its option, provide such insurance and add the amount of the premiums to the
rents due hereunder, and Lessee shall, upon Lessor's demand pay the same as
Additional Rent. Lessee may self assume some or all of its obligations hereunder
provided it delivers to Lessor a certificate certifying that Lessee has in
effect a program of self insurance and that the coverage required above is
provided by such program.

     15. RETURN OF EQUIPMENT - (a) Upon the expiration or earlier termination
         -------------------
of this Lease with respect to an item of Equipment, the Lessee, at its own risk
and expense, shall return such item of Equipment to the Lessor, together with
all license plates and all registration certificates, certificates of ownership
maintenance and repair records and similar documents in the Lessee's possession,
at the place originally delivered hereunder, or such other places as the Lessor
may reasonably designate, in the condition in which such item of Equipment is
required to be maintained pursuant to Section 11 hereof and, with respect to any
items of Equipment which are tractor or trailer units, at least meeting the
following condition:
     (i)   All items of Equipment originally furnished with such item of
Equipment, or the substantial equivalent thereof, shall be installed, intact,
and in the condition required by Section 11 hereof at the time of return;
     (ii)  The cost of necessary glass, wood, fiberglass or sheet metal repairs
shall not exceed $250;
     (iii) Brake linings shall have a minimum of 35%. remaining wear;
     (iv)  All tires shall be the ones last used by Shell on that item of
Equipment, tractor front wheels shall not be recapped casings, and shall have a
minimum of 35% remaining tread;

                                      -7-
<PAGE>

     (v) The power train including engine, transmission and driveline shall be
in standard operating condition, the engine shall be capable of generating its
originally rated output and tractor units shall be capable of pulling the load
for which they were originally designed; and
     (vi)  Each item of Equipment shall be free of any advertising and
identification of Lessee.

     (b) Notwithstanding any provisions of this Lease to the contrary,  Lessee
shall give Lessor at least 120 days prior written notice of its intention to
return the Equipment to Lessor on the Termination Date. In the event Lessee
shall fail to give Lessor 120 days' notice in writing, this Lease, at the sole
discretion of the Lessor, shall be extended and continue at the same rental as
the rental in effect on the last Payment Date immediately preceding the
Termination Date until 120 days after Lessor receives such notice in writing
from Lessee.

     (c) In the event that Lessee fails to return the Equipment at the end of
the Primary Term or a Renewal Term (as the case may be) to Lessor as provided in
this Section 15, this Lease, at the sole discretion of the Lessor, shall be
extended and continue at the same rental rate as the rental rate in effect on
the last Payment Date of the Primary Term or Renewal Term (as the case may be)
until such time as the Equipment has been returned.

     16. LESSOR'S OWNERSHIP: EQUIPMENT TO BE AND REMAIN PERSONAL PROPERTY -
         ----------------------------------------------------------------
Lessee acknowledges and agrees it does not have or obtain any title to the
Equipment, nor any property right or interest therein, except its rights as
Lessee hereunder and subject to the terms hereof. All of the Equipment shall be
and remain personal property notwithstanding the manner in which the Equipment
may be attached or affixed to realty, and that upon the expiration or other
termination of the Lease Term of Equipment, Lessee shall have the obligation,
and Lessor shall have the right, to remove, or cause the removal of, such
Equipment, from the premises whereon the same is then located.

     If  Lessee  is  unable  to  return,  or  is  prevented  from  returning,
any Equipment to Lessor upon the termination of the Lease Term, for any reason
whatsoever, including, but not limited to, the assertion by any third party of
any claim (except for claims arising out of liens granted by Lessor or asserted
against Lessor and unrelated to the Equipment or this Lease) against such
Equipment, or of any right with respect thereto (but excluding failure by Lessor
or its Assignee to accept the returned Equipment as provided herein), such
Equipment shall, for all purposes of this Lease, be deemed to have been the
subject of a Casualty Occurrence, and Lessee shall pay to Lessor the amounts
provided in Section 12 hereof, with respect to such Equipment, at the time, in
the manner, and with the consequences provided in such Section.

     17. EVENTS OF DEFAULT - (a) If, during the continuance of this Lease, one
         -----------------
or more of the following events (hereinafter called "Events of Default") shall
occur:

     (1) default shall be made in the payment of any Basic or Additional Rent
due hereunder, and any such default shall continue for more than ten (10) days
after the due date of such Basic or Additional Rent;

                                      -8-
<PAGE>

     (2) Lessee shall default in the observance and/or performance of any other
covenant, condition and agreement on the part of Lessee to be observed and/or
performed under this Lease and such default shall continue for thirty (30) days
after written notice from Lessor to Lessee specifying the default and demanding
the same to be remedied.

     (3) any representation or warranty made by Lessee herein or in any
document or certificate furnished to Lessor in connection herewith shall at any
time prove to be incorrect when made in any material respect;

     (4) Lessee shall make or permit any unauthorized assignment or transfer of
this Lease or of Lessee's rights and obligations hereunder, or Lessee shall make
or permit any unauthorized sublease or transfer of any Equipment, or the
possession of same;

     (5) Lessee shall make an assignment for the benefit of creditors, or cease
doing business as a going concern, or generally fail to pay its debts as they
become due, or become insolvent or bankrupt or admit in writing its inability to
pay its debts as they mature, or consent to the appointment of a trustee or
receiver, or a trustee or a receiver shall be appointed on decree or order of a
court of competent jurisdiction, for Lessee or for a substantial part of
Lessee's property without Lessee's consent and such decree or order shall
continue undischarged and unstayed for a period of sixty (60) days;

     (6) if pursuant to the merger of Lessee into another corporation where
Lessee is not the surviving corporation, or the consolidation of Lessee with one
or more other corporations and the sale or other disposition of all or
substantially all the assets of Lessee to one or more other entities, the
surviving entity or transferee of assets, as the case may be, shall not deliver
to Lessor and to any Assignee an acknowledged instrument in recordable form,
assuming all obligations, covenants and responsibilities of Lessee hereunder and
under any instrument executed by Lessee, and acknowledging the assignment of
Lessor's interest in this Lease as security for indebtedness; or
     (b) then, in any such case, Lessor, at its option, may do any one or more
of the following;

     (1) declare this Lease, with respect to the Rental Schedule in question,
in default upon written notice to Lessee, and proceed by appropriate court
action to enforce performance by Lessee of the covenants and terms of this Lease
and/or to recover damages for the breach thereof;

     (2) terminate this Lease upon written notice to Lessee; whereupon all
right of Lessee to use the Equipment shall immediately terminate;

     (3) whether or not this Lease be terminated, repossess the Equipment,
wherever found, with legal process, and for this purpose Lessor and/or its
agents may enter upon any premises of or under the control or jurisdiction of
Lessee or any agent of Lessee, and remove the Equipment therefrom;

                                      -9-
<PAGE>

     (4) with respect to any Equipment returned to or repossessed by Lessor,
hold or use such Equipment for any purpose whatsoever, including selling the
same at a private or public, cash or credit sale, or Lessor may re-lease such
Equipment in all the foregoing events free and clear of any rights of the Lessee
and without any duty to account to the Lessee with respect to such action or
inaction;

     (5) whether or not Lessor shall have exercised, or shall thereafter at
any time exercise, any of its rights set forth above in this Section 17(b) with
respect to any item of Equipment, and upon written notice to the Lessee
specifying a payment date demand that the Lessee pay to the Lessor, and the
Lessee shall pay to the Lessor on the payment date specified in such notice, as
liquidated damages for loss of a bargain and not as a penalty (in lieu of the
Basic Rent for such Equipment due after the payment date specified in such
notice), an amount equal to the excess of the "Termination By Sale" value set
forth on the Exhibit to the Rental Schedule in question for such item of
Equipment computed as of the Payment Date next preceding the payment date
specified in such notice or if such payment date occurs on a Payment Date, then
computed as of such Payment Date over whichever of the following three amounts
the Lessor, in its sole discretion, shall specify in such notice:

        (i)   the present value of the fair market rental value (determined as
        hereafter provided in this Section 17(b)) of such item of Equipment for
        the remainder of the Lease Term as of the date of such notice, such
        present value to be computed on the basis of a 7% per annum rate of
        discount from the respective dates upon which such rent would be paid;

        (ii)  the fair market sales value (determined as hereafter provided in
        this Section 17(b)) of such item of Equipment as of the date of such
        notice; or

        (iii) if the Lessor shall have sold any item of Equipment pursuant to
        paragraph (4) above, the net proceeds of such sale; and

     (6) whether or not any Equipment is returned to, or repossessed by Lessor,
as aforesaid, Lessee shall also be liable for, and Lessor may forthwith recover
from Lessee, all Basic Rent and Additional Rent that accrued prior to the date
of Lessee's default.

     In addition to the foregoing, Lessor may also recover from Lessee all
costs and expenses arising out of Lessee's default, including without limitation
expenses of repossession of the Equipment and the storage, repairs,
reconditioning, sale and releasing thereof, and reasonable attorneys' fees
incurred by Lessor in exercising any of its rights or remedies hereunder. For
the purposes of this Section 17, "fair market rental value" and "fair market
sales value" shall be determined by an appraisal of an independent appraiser
chosen by the Lessor, and the cost of any such appraisal shall be borne by
Lessee.

                                     -10-
<PAGE>

     18. ASSIGNMENT AND TRANSFER BY LESSOR. - (a) Lessor may assign this Lease,
         ---------------------------------
any item of Equipment, and all sums at any time due and to become due, by the
Lessee to Lessor under this Lease without notice to or consent of Lessee to a
security assignee (the "Secured Party") for the purpose of securing a loan to
the Lessor for the purchase of the Equipment. The Secured Party shall not be
obligated to perform any duty, covenant or condition required to be performed by
Lessor under this Lease. Lessor, at its sole discretion, may also sell or
transfer the Equipment and/or this Lease to a partnership, trust or other person
or entity (the "Transferee" and collectively with the Secured Party an
("Assignee") subject to the rights of the Lessee under this Lease.

     (b) Lessee agrees that notwithstanding any assignment to a Secured Party,
each and every covenant, agreement, representation and warranty of Lessor under
this lease shall be and remain the sole liability of the Lessor and of every
successor in interest of Lessor or, in the case of assignment to a Transferee,
shall become and remain the sole liability of the Transferee. Lessee further
acknowledges and agrees that from and after the receipt by Lessee of written
notice of such an assignment from Lessor, Lessee shall comply with the
directions or demands given in writing by the Secured Party consistent with
Lessee's obligations under the Lease and the Secured Party shall have the right
to exercise (either in its own name or in the name of the Lessor) such rights,
privileges and remedies of Lessor provided for herein. Lessee shall not assert
against the Secured Party any defense, counterclaim, set-off, abatement,
reduction or recoupment that Lessee may have against Lessor or any Transferee.
After any assignment to the Secured Party, this Lease may not be amended or
modified without the prior written consent of any such Secured Party.

     19. OPTION TO RENEW - (a)  Upon the expiration of the Primary Term of
         ---------------
this Lease, and provided that no Event of Default, and no event which with the
giving of notice or lapse of time, or both, would constitute an Event of
Default, has occurred and then remains unremedied to Lessor's satisfaction,
Lessee shall have the option, exercisable on at least 180 days prior written
notice to Lessor to renew the Lease Term with respect to all, but not less than
all items of Equipment whose Primary Term or Renewal Term, as the case may be,
have the same Lease Expiration Date, either:

     (1) on a month-to-month renewal basis, terminable by either Lessor or
         Lessee upon thirty days written notice, at the same rate, terms and
         conditions as described herein; or
     (2) up to three (3) successive additional terms (each of which being herein
         called a "Renewal Term") for one year each at a rental for each such
         Renewal Term at a rate that would be obtained in an arms-length
         transaction between an Informed and willing prospective lessee and an
         informed and willing lessor under no compulsion to lease (said rate
         being herein called the "Fair Rental Rate").

                                     -11-
<PAGE>

     (b) If, on or before a date 60 days prior to the expiration of the Lease
Term with respect to each Rental Schedule for which notice of Renewal has been
given, Lessor and Lessee are unable to agree upon a determination of the Fair
Rental Rate for the Equipment, Lessee shall have no obligation to renew this
Lease. However, if Lessee wishes to proceed with its option, Lessee shall give
written notice to Lessor to that effect and the Equipment shall be leased during
the Renewal Term at the Fair Rental Rate determined in accordance with the
procedure for Appraisal below provided that the total term of the Lease,
including any Renewal Term(s) entered into pursuant to this Section 19 hereof,
shall not exceed 75%. of the useful life of the item of Equipment in question.

     (c) "Appraisal" shall mean a procedure whereby two recognized independent
equipment appraisers, one chosen by Lessee and one by Lessor shall mutually
agree upon the amount in question. Lessor or Lessee, as the case may be, shall
deliver a written notice to the other party appointing its appraiser within 15
days after receipt from the other party of a notice appointing that party's
appraiser. If within 15 days after appointment of the two appraisers as
described above, the two appraisers are unable to agree upon the amount in
question, a third recognized independent appraiser shall be chosen within five
days thereafter by the mutual agreement of such first two appraisers, or if such
first two appraisers fail to agree upon the appointment of a third appraiser,
such appointment shall be made by an authorized representative of the American
Arbitration Association, and the appraisal of the third appraiser so appointed
and chosen shall be given within a period of ten (10) days after the selection
of such third appraiser. The average of the three appraisals arrived at by said
three appraisers shall be binding and conclusive on Lessor and Lessee. Lessor
and Lessee shall pay the fees of the respective appraisers appointed by them and
shall share equally the fees and expenses of the third-appraiser, if any, and
those of the American Arbitration Association, if applicable.

     (d) After a determination of the Fair Rental Rate of the Equipment has
been made in accordance with the procedure described above, Lessee's exercise of
its option shall be effective upon the expiration of the Primary Term or
Renewal Term as the case may be.

     20. ADDITIONAL RIGHTS OF LESSOR. - Receipt by Lessor of any Basic Rent or
         ---------------------------
Additional Rent with knowledge of the breach of any provision hereof shall not
constitute a waiver of such breach and no waiver by Lessor of any provision
hereof shall be deemed to have been made unless made in writing. Lessor shall be
entitled to injunctive relief in case of the violation, or attempted or
threatened violation, of any of the provisions hereof, or to a decree compelling
performance of any of the provisions hereof or to any other remedy allowed to
Lessor by law.

     21. NET LEASE; NON-TERMINABILITY. - This Lease is an absolutely net lease
         ----------------------------
and, except as otherwise expressly provided herein (including any right of early
termination set forth in any Rental Schedule), shall not terminate, nor shall
Lessee be entitled to any abatement, reduction, set-off, counterclaim, defense
or deduction with respect to any Basic Rent or Additional Rent nor shall the
obligations of Lessee hereunder be affected, other than as expressly set forth
in this Lease, by reason of any damage to or destruction of any item

                                     -12-
<PAGE>

of the Equipment or any taking of any item of the Equipment by condemnation or
otherwise. Nothing contained in this Lease shall prevent Lessee from bringing a
separate action for damages suffered by Lessee as a result of the breach by
Lessor of any obligation owed by it to Lessee or for equitable relief to obtain
compliance with such obligation.

     22. LESSEE'S  RIGHT TO SUBLEASE - Provided that no Event of Default has
         ---------------------------
occurred and is continuing, Lessee shall have the right to sublease the
Equipment for a term or terms expiring no later than the day prior to the
Termination Date of this Lease subject to the prior written approval of the
Lessor, which approval shall not be unreasonably withheld. No sublease of the
Equipment by Lessee shall relieve Lessee of any of its obligations hereunder.

     23. QUIET ENJOYMENT - So long as no Event of Default has occurred and is
         ---------------
continuing hereunder, Lessee shall have peaceful and quiet use and enjoyment of
the Equipment against acts of Lessor or anyone claiming solely by, through, or
under Lessor.

     24. NOTICES - Any notice required or permitted to be given under this
         -------
Lease shall be deemed to have been given upon its receipt, in writing, by the
receiving party at its address set forth below, or to such other address as
either party shall hereafter furnish to the other in writing.

     1.  If to Lessee:  Bruce Frazier
                        Manager Light Oil
                        Shell Land Transportation
                        Shell Oil Company
                        One Shell Plaza
                        P.O. Box 2463
                        Houston, TX 77001
                        (713) 241-4184 (4159)

     2.  If to Lessor:  American Finance Group, Inc.
                        ATT:  Treasurer
                        Exchange Place
                        Boston, MA 02109

     25. ENTIRE AGREEMENT, SEVERABILITY, EFFECT AND MODIFICATION OF LEASE - This
         ----------------------------------------------------------------
Lease constitutes the entire agreement between the parties with respect to the
leasing of the Equipment. Any provision of this Lease which is unenforceable in
any jurisdiction, shall be, as to such jurisdiction, ineffective to the extent
of such unenforceability without invalidating the remaining provisions hereof.
No variation or modification of this Lease and no waiver of any of its
provisions or conditions shall be valid unless in writing and signed by a duly
authorized representative of the party against whom enforcement is sought.

     26. GOVERNING  LAW -  Lessor and Lessee agree that this Lease shall be
         --------------
governed by and construed in accordance with the laws of the Commonwealth of
Massachusetts.

                                     -13-
<PAGE>

     27. CONSENT  TO  JURISDICTION  AND  SERVICE  -  The  Lessee  agrees  that
         ---------------------------------------
any legal action or proceeding against it arising out of this Lease may be
brought in any state or federal court sitting in the city of Boston in the
Commonwealth of Massachusetts and it hereby irrevocably consents and submits to
the nonexclusive in personam jurisdiction of the said courts and irrevocably
agrees that all claims in any such action or proceeding may be heard, determined
in and enforced by any such court. Lessee irrevocably consents to the service of
summons, notice, or other process relating to any such action or proceeding by
delivery thereof to it by hand or by mail in the manner set forth in Section 25
hereof.

     28. LESSOR'S RIGHT TO PERFORM FOR LESSEE - If Lessee fails to duly and
         ------------------------------------
promptly perform any of its obligations under this Lease or fails to comply with
any of the covenants or agreements contained herein, Lessor may itself perform
such obligations or comply with such covenants or agreements, for the account of
Lessee without thereby waiving any default, and any amount paid or expense
(including reasonable attorneys' fees) reasonably incurred by Lessor in
connection with such performance or compliance shall, together with interest
thereon at the Default Interest Rate be, payable by Lessee to Lessor on demand.

     29. AGREEMENT FOR LEASE ONLY - Lessor and Lessee agree that this Lease is
         ------------------------
and is intended to be a true lease (and not a lease in the nature of a security
interest) and further agree to treat this Lease as a true lease for all
purposes, including without limitation, tax purposes.

     30. FINANCIAL STATEMENTS  - Lessee agrees to furnish, upon Lessor's
         --------------------
request such financial information available thru public record concerning
Lessee as Lessor or any Assignee may reasonably require during the term of this
Lease.

     31. MISCELLANEOUS.  The captions in this Master Lease and this Lease are
         -------------
for convenience of reference only. This Lease may be executed in separate
counterparts, all of which together shall constitute one instrument. Lessor and
Lessee agree that to the extent that this Lease constitutes chattel paper under
the Uniform Commercial Code, no security interest on this Lease may be created
through the transfer or possession of any counterpart of this Lease but only
through transfer and possession of that counterpart of the Rental Schedule to
this Lease marked "Lender's Original".

     32. DEFINITIONS - The following terms shall have the following meanings
         -----------
for all purposes of this Lease:

     "ACQUISITION COST" of any item of Equipment means an amount equal to the
sum of (i) the purchase price of such item of Equipment paid by Lessor, plus,
(ii) any excise, sales or use tax paid by Lessor on or with respect to such
item of Equipment, plus (iii) any reasonable costs, expenses and fees paid or
incurred by Lessor in obtaining, delivering and installing such item of
Equipment.

     "ADDITIONAL  RENT" shall have the meaning specified in Section 5(b)
hereof.

                                     -14-
<PAGE>

     "APPRAISAL" shall have the meaning specified in Section 19(c) hereof.

     "ASSIGNEE" shall have the meaning specified in Section 18(a) hereof.

     "BASIC RENT" shall have the meaning specified in Section 5(a) hereof.

     "CASUALTY OCCURRENCE" shall have the meaning specified in Section  12
hereof.

     "CERTIFICATE OF INSPECTION AND ACCEPTANCE" means the certification
contained in or which is an Exhibit to each Rental Schedule to be executed by
Lessee, substantially in the form of "Exhibit 1" attached hereto whereby Lessee
evidences its acceptance of an item of Equipment for lease hereunder.

     "DEFAULT INTEREST RATE" shall mean the rate of interest set forth in
Section 5(b) hereof.

     "EQUIPMENT" means the equipment described on each Rental Schedule
executed pursuant to this Master Lease, and owned by Lessor and leased by Lessor
to Lessee or ordered by Lessor for lease to Lessee as provided herein and any
attachments, accessories, or additions thereto or substitutions therefor.

     "EVENTS OF DEFAULT" shall have the meaning specified in Section 17(a)
hereof.

     "FAIR MARKET VALUE" means the appraised value of the Equipment in
question determined by the procedure for Appraisal.

     "FAIR RENTAL RATE" shall have the meaning specified in Section 19(a)(2)
hereof.

     "INTERIM TERM" for this Lease shall commence upon the commencement date
set forth in the applicable Rental Schedule and shall end on the commencement
date of the Primary Term.

     "INVESTMENT TAX CREDIT" shall mean any investment tax credit provided for
in Section 38 et seq. of the Internal Revenue Code of 1954, as amended.

     "LEASE" shall have the meaning specified in Section 1 hereof.

     "LEASE COMMENCEMENT DATE" with respect to an item of Equipment means the
date of the commencement of the Lease Term of such item and shall be the date
such item is accepted by Lessee for lease hereunder.

     "LEASE EXPIRATION DATE" with respect to an item of Equipment means the date
of the expiration of the Lease Term of such item as provided in the Rental
Schedule.

     "LEASE TERM" with respect to an item of Equipment shall mean the
"Interim Term" plus the "Primary Term", including any period of renewal provided
for herein.

     "MANUFACTURER(S)" shall mean the manufacturer(s) of each item of Equipment.

                                     -15-
<PAGE>

     "MASTER LEASE" shall have the meaning specified in Section 1 hereof.

     "PAYMENT  DATES" shall have the meaning specified in Section 5(a) hereof.

     "PRIMARY TERM" for this Lease shall commence and shall end on the
respective dates set forth in the Rental Schedule.

     "PRIME RATE" shall mean the rate of interest per annum announced from time
to time as its "Prime Rate" by the lending institution providing the permanent
debt financing with respect to the Rental Schedule in question; if there is no
permanent debt financing or if the lending institution in question has no PRIME
RATE, then Lessor and Lessee agree that the Prime Rate announced from time to
time by Morgan Guaranty Trust Company of New York, in New York City shall apply
hereunder.

     "RENEWAL TERM" shall have the meaning specified in Section 19(a)(2)
hereof.

     "RENTAL SCHEDULE" means each schedule, substantially in the form of
"Exhibit 1" attached hereto, executed by Lessor and Lessee pursuant to this
Master Lease, setting forth a description of Equipment to be leased hereunder,
its location, its Acquisition Cost, the amount of Basic Rent payable by Lessee
with respect thereto, the lease term thereof, the Lease Commencement Date with
respect thereto, and such other matters as Lessor and Lessee may agree upon.

     "SECURED PARTY" shall have the meaning specified in Section 18(a) hereof.

     "STIPULATED LOSS VALUE" shall have the meaning specified in Section 12(a)
hereof.

     "TERMINATION DATE" means the expiration or termination of the Primary Term
or Renewal Term of any item of Equipment, whether by the passage of time or
otherwise.

     "TRANSFEREE" shall have the meaning specified in Section 18(a) hereof.

     IN WITNESS WHEREOF, the duly authorized representatives of Lessor and
Lessee have executed this Master Lease as of the date first above written.

LESSOR:  AMERICAN FINANCE GROUP, INC.    LESSEE: SHELL OIL CORPORATION

By:  /S/                                 By:  /S/
   ---------------------------------        ---------------------------------
Title: Vice President                    Title: Purchasing Manager

                                     -16-