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                                     EXHIBIT
                                      10.53


    Lease Agreement, dated January 12, 1998, by and between Danat Investment
      Company and the Company (Re: property at 20000 South Western Avenue,
                             Torrance , California).


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             STANDARD INDUSTRIAL/COMMERCIAL SINGLE-TENANT LEASE-NET
                (DO NOT USE THIS FORM FOR MULTI-TENANT BUILDINGS)

1.1      BASIC PROVISIONS ("BASIC PROVISIONS")

         1.1   PARTIES: This Lease ("Lease"), dated for reference purposes only,
is made by and between DANAT INVESTMENT COMPANY, a California general
partnership ("Danat") ("LESSOR") and CONSOLIDATED CAPITAL OF NORTH AMERICA,
INC., a Colorado corporation ("LESSEE"), (collectively the "PARTIES," or
individually a "PARTY").

         1.2   PREMISES: That certain real property, including all improvements
therein or to be provided by Lessor under the terms of this Lease, and commonly
known as 20000 South Western Avenue, Torrance, California 90501, located in the
County of Los Angeles, State of California, and generally described as (describe
briefly the nature of the property and, if applicable, the "PROJECT", if the
property is located within a Project) a two-story office building containing
approximately 19,140 square feet and a steel frame industrial building
containing approximately 310,000 square feet (collectively, the "Building") and
situated on approximately 609,840 square feet of land. Rail spur abandoned and
not part of premises. EXHIBIT "B" ("PREMISES"). (See also Paragraph 2)

         1.3   TERM: 3 (three) years and months ("ORIGINAL TERM") commencing
("COMMENCEMENT DATE") and ending December 31, 2000 ("EXPIRATION DATE"). (See
also Paragraph 3)

         1.4   EARLY POSSESSION: N/A ("EARLY POSSESSION DATE"). (See also
Paragraphs 3.2 and 3.3)

         1.5   BASE RENT: $ 75,000.00 per month ("BASE RENT"), payable on the
first day of each month commencing January 1, 1998 (See also Paragraph 4)

[ ] If this box is checked, there are provisions in this Lease for the Base
    Rent to be adjusted. SEE ADDENDUM

         1.6   BASE RENT PAID UPON EXECUTION: $ 75,000.00 as Base Rent for the
period January 1998 .

         1.7   SECURITY DEPOSIT: $ 75,000.00 within 60 days of closing of Sale
("SECURITY DEPOSIT"). (See also Paragraph 5)

         1.8   AGREED USE: manufacturing, processing and distribution of steel
products . (See also Paragraph 6)

         1.9   INSURING PARTY. Lessor is the "INSURING PARTY" unless otherwise
stated herein. (See also Paragraph 8)

         1.10  REAL ESTATE BROKERS: (See also Paragraph 15)

               (a) REPRESENTATION: The following real estate brokers
(collectively, the "BROKERS") and brokerage relationships exist in this
transaction (check applicable boxes):

[ ] N/A represents Lessor exclusively ("LESSOR'S BROKER"); 

[ ] N/A represents Lessee exclusively ("LESSEE'S BROKER"); or 

[ ] N/A represents both Lessor and Lessee ("DUAL AGENCY").

               (b) PAYMENT TO BROKERS: Upon execution and delivery of this Lease
by both Parties, Lessor shall pay to the Broker the fee agreed to in their
separate written agreement (or if there is no such agreement, the sum of% of the
total Base Rent for the brokerage services rendered by said Broker).

         1.11  GUARANTOR. The obligations of the Lessee under this Lease are to
be guaranteed by ("GUARANTOR"). (See also Paragraph 37)

         1.12  ADDENDA AND EXHIBITS. Attached hereto is an Addendum or Addenda
consisting of Paragraphs 1 through 11 and Option to Extend, Addendum to Standard
Lease and Option to Purchase Lease Rider and agreement regarding equipment
purchase and offset rights, all of which constitute a part of this Lease.

2.  PREMISES.

         2.1   LETTING. Lessor hereby leases to Lessee, and Lessee hereby leases
from Lessor, the Premises, for the term, at the rental, and upon all of the
terms, covenants and conditions set forth in this Lease. Unless otherwise
provided herein, any statement of size set forth in this Lease, or that may have
been used in calculating rental, is an approximation which the Parties agree is
reasonable and the rental based thereon is not subject to revision whether or
not the actual size is more or less. SEE ADDENDUM

         2.3   COMPLIANCE. Lessor warrants that the improvements on the Premises
and the use made of the Premises as of the Start Date comply with all applicable
laws, covenants or restrictions of record, building codes, regulations and
ordinances ("APPLICABLE REQUIREMENTS") in effect on the Start Date. SEE ADDENDUM
Said warranty does not apply to the use to which Lessee will put the Premises or
the any Alterations or Utility Installations (as defined in Paragraph 7.3(a))
made or to be made by Lessee. If the Applicable Requirements are here after
changed (as opposed to being in existence at the Start Date, which is addressed
in Paragraph 6.2(e) below) so as to require during the term of this Lease the
construction of an addition to or an alteration of the Building, the remediation
of any Hazardous Substance, or the reinforcement or other physical modification
of the Building ("CAPITAL EXPENDITURE"), Lessor and Lessee shall allocate the
cost of such work as follows:

               (a) Subject to Paragraph 2.3(c) below, if such Capital
Expenditures are required as a result of the specific and unique use of the
Premises by Lessee as compared with uses by tenants in general, Lessee shall be
fully responsible for the cost thereof, provided, however that if such Capital
Expenditure is required during the last two (2) years of this Lease and the cost
thereof exceeds six (6) months' Base Rent, Lessee may instead terminate this
Lease unless Lessor notifies Lessee, in writing, within ten (10) days after
receipt of Lessee's termination notice that Lessor has elected to pay the
difference between the actual cost thereof and the amount equal to six (6)
months' Base Rent. If Lessee elects termination, Lessee shall immediately cease
the use of the Premises which requires such Capital Expenditure and deliver to
Lessor written notice specifying a termination date at least ninety (90) days
thereafter. Such termination date shall, however, in no event be earlier than
the last day that Lessee could legally utilize the Premises without commencing
such Capital Expenditure. 

               (b) If such Capital Expenditure is not the result of the specific
and unique use of the Premises by Lessee (such as , governmentally mandated
seismic modifications), then Lessor and Lessee shall allocate the obligation to
pay for such cost pursuant to the provisions of Paragraph 7.1(c) which
paragraph, for purposes of this Paragraph 2.3(b), shall be deemed to have not
been stricken from this Lease, provided, however, that if such Capital
Expenditure is required during the last two years of this Lease or if Lessor
reasonably determines that it is not economically feasible to pay its share
thereof, Lessor shall have the option to terminate this Lease upon ninety (90)
days prior written notice to Lessee unless Lessee notifies Lessor, in writing,
within in ten (10) days after receipt of Lessor's termination notice that Lessee
will pay for such Capital Expenditure. If Lessor does not elect to terminate,
and fails to tender its share of any such Capital Expenditure, Lessee may
advance such funds and deduct same, with Interest, from Rent until Lessor's
share of such cost have been fully paid. If Lessee is unable to finance Lessor's
share, or if the balance of the Rent due and payable for the remainder of this
Lease is not sufficient to fully reimburse Lessee on an offset basis, Lessee
shall have the right to terminate this Lease upon thirty (30) days written
notice to Lessor. 



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               (c) Notwithstanding the above, the provisions concerning Capital
Expenditures are intended to apply only to non-voluntary, unexpected, and new
Applicable Requirements. If the Capital Expenditures are instead triggered by
Lessee as a result of an actual or proposed change in use, change in intensity
of use, or modification to the Premises then, and in that event, Lessee shall be
fully responsible for the cost thereof, and Lessee shall not have any right to
terminate this Lease. 

         2.4   ACKNOWLEDGMENTS. Lessee acknowledges that: (a) it has been
advised by Lessor and/or Brokers to satisfy itself with respect to the condition
of the Premises (including but not limited to the electrical, HVAC and fire
sprinkler systems, security, environmental aspects, and compliance with
Applicable Requirements), and their suitability for Lessee's intended use, (b)
Lessee has made such investigation as it deems necessary with reference to such
matters and assumes all responsibility therefor as the same relate to its
occupancy of the Premises, and (c) neither Lessor, Lessor's agents, nor any
Broker has made any oral or written representations or warranties with respect
to said matters other than as set forth in this Lease. SEE ADDENDUM If addition,
Lessor acknowledges that: (a) Broker has made no representations, promises or
warranties concerning Lessee's ability to honor the Lease or suitability to
occupy the Premises, and (b) it is Lessor's sole responsibility to investigate
the financial capability and/or suitability of all proposed tenants. 

         2.5   LESSEE AS PRIOR OWNER/OCCUPANT. The warranties made by Lessor in
Paragraph 2 shall be of no force or effect if immediately prior to the Start
Date Lessee was the owner or occupant of the Premises. In such event, Lessee
shall be responsible for any necessary corrective work. 

3. TERM 

         3.1   TERM. The Commencement Date, Expiration Date and Original Term of
this Lease are as specified in Paragraph 1.3. 

         3.2   EARLY POSSESSION. If Lessee totally or partially occupies the
Premises prior to the Commencement Date, the obligation to pay Base Rent shall
be abated for the period of such early possession. All other terms of this Lease
(including but not limited to the obligations to pay Real Property Taxes and
insurance premiums and to maintain the Premises) shall, however, be in effect
during such period. Any such early possession shall not affect the Expiration
Date. 

         3.3   DELAY IN POSSESSION. Lessor agrees to use its best commercially
reasonable efforts to deliver possession of the Premises to Lessee by the
Commencement Date. If, despite said efforts, Lessor is unable to deliver
possession as agreed, Lessor shall not be subject to any liability therefor, nor
shall such failure affect the validity of this Lease. Lessee shall not, however,
be obligated to pay Rent or perform its other obligations until it receives
possession of the Premises. If possession is not delivered within sixty (60)
days after the Commencement Date, Lessee may, at its option, by notice in
writing within ten (10) days after the end of such sixty (60) day period, cancel
this Lease, in which event the Parties shall be discharged from all obligations
hereunder. If such written notice is not received by Lessor within said ten (10)
day period, Lessee's right to cancel shall terminate. Except as otherwise
provided, if possession is not tendered to Lessee by the Start Date and Lessee
does not terminate this Lease, as aforesaid, any period of rent abatement that
Lessee would otherwise have enjoyed shall run from the date of delivery of
possession and continue for a period equal to what Lessee would otherwise have
enjoyed under the terms hereof, but minus any days of delay caused by the acts
or omissions of Lessee. If possession of the Premises is not delivered within
four (4) months after the Commencement Date, this Lease shall terminate unless
other agreements are reached between Lessor and Lessee, in writing. 

         3.4   LESSEE COMPLIANCE. Lessor shall not be required to tender
possession of the Premises to Lessee until Lessee complies with its obligation
to provide evidence of insurance (Paragraph 8.5). Pending delivery of such
evidence, Lessee shall be required to perform all of its obligations under this
Lease from and after the Start Date, including the payment of Rent,
notwithstanding Lessor's election to withhold possession pending receipt of such
evidence of insurance. Further, if Lessee is required to perform any other
conditions prior to or concurrent with the Start Date, the Start Date shall
occur but Lessor may elect to withhold possession until such conditions are
satisfied. 

4. RENT. 

         4.1. RENT DEFINED. All monetary obligation of Lessee to Lessor under
the terms of this Lease (except for the Security Deposit) are deemed to be rent
("RENT"). 

         4.2   PAYMENT. Lessee shall cause payment of Rent to be received by
Lessor in lawful money of the United States, without offset or deduction (except
as specifically permitted in this Lease, including Paragraph 6.2 (e)), on or
before the day on which it is due. Rent for any period during the term hereof
which is for less than one (1) full calendar month shall be prorated based upon
the actual number of days of said month. Payment of Rent shall be made to Lessor
at its address stated herein on Page 12 or to such other persons or place as
Lessor may from time to time designate in writing. Acceptance of a payment which
is less than the amount then due shall not be a waver of Lessor's rights to the
balance of such Rent, regardless of Lessor's endorsement of any check so
stating.

5. SECURITY DEPOSIT. Lessee shall deposit with Lessor upon execution
hereof the Security Deposit as security for Lessee's faithful performance of its
obligations under this Lease. If Lessee fails to pay Rent, or otherwise Defaults
under this Lease, Lessor may use, apply or retain all or any portion of said
Security Deposit for the payment of any amount due Lessor or to reimburse or
compensate Lessor for any liability, expense, loss or damage which Lessor may
suffer or incur by reason thereof. If Lessor uses or applies all or any portion
of said Security Deposit, Lessee shall within ten (10) days after written
request therefor deposit monies with Lessor sufficient to restore said Security
Deposit to the full amount required by this Lease. If the Base Rent increases
during the term of this Lease, Lessee shall, upon written request from Lessor,
deposit additional moneys with Lessor so that the total amount of the Security
Deposit shall at all times bear the same proportion to the increased Base Rent
as the initial Security Deposit bore to the initial Base Rent. Should the Agreed
Use be amended to accommodate a material change in the business of Lessee or to
accommodate a sublease or assignee, Lessor shall have the right to increase the
Security Deposit to the extent necessary, in Lessor's reasonable judgment, to
account for any increased wear and tear that the Premises may suffer as a result
thereof. If a change in control of Lessee occurs during this Lease and following
such change the financial condition of Lessee is, in Lessor's reasonable
judgment, significantly reduced, Lessee shall deposit such additional monies
with Lessor as shall be sufficient to cause the Security Deposit to be at a
commercially reasonable level based on said change in financial condition.
Lessor shall not be required to keep the Security Deposit separate from its
general accounts. Within fourteen (14) days after the expiration or termination
of this Lease, if Lessor elects to apply the Security Deposit only to unpaid
Rent, and otherwise within thirty (30) days after the Premises have been vacated
pursuant to Paragraph 7.4( c ) below, Lessor shall return that portion of the
Security Deposit not used or applied by Lessor. No part of the Security Deposit
shall be considered to be held in trust, to bear interest or to be prepayment
for any monies to be paid by Lessee under this Lease.


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6. USE.
   
         6.1   USE. Lessee shall use and occupy the Premises only for the Agreed
Use, or any other legal use which is reasonably comparable thereto, and for no
other purpose. Lessee shall not use or permit the use of the Premises in a
manner that is unlawful, creates damage, waste or a nuisance, or that disturbs
owners and/or occupants of, or causes damage to neighboring properties. Lessor
shall not unreasonably withhold or delay its consent to any written request for
a modification of the Agreed Use, so long as the same will not impair the
structural integrity of the improvements on the Premises or the mechanical or
electrical systems therein, is not significantly more burdensome to the
Premises. If Lessor elects to withhold consent, Lessor shall within five (5)
business days after such request give written notification of same, which notice
shall include an explanation of Lessor's objections to the change in use.

         6.2   HAZARDOUS SUBSTANCES.

               (a) REPORTABLE USES REQUIRE CONSENT. The term "HAZARDOUS
SUBSTANCE" as used in this Lease shall mean any product, substance, or waste
whose presence, use, manufacture, disposal, transportation, or release, either
by itself or in combination with other materials expected to be on the Premises,
is either: (i) potentially injurious to the public health, safety or welfare,
the environment or the Premise, (ii) regulated or monitored by any governmental
authority, or (iii) a basis for potential liability of Lessor to any
governmental agency or third party under any applicable statute or common law
theory. Hazardous Substances shall include, but not be limited to ,
hydrocarbons, petroleum, gasoline, and/or crude oil or any products, by-products
or fractions thereof. Lessee shall not engage in any activity in or on the
Premises which constitutes a Reportable Use of Hazardous Substances without the
express prior written consent of Lessor and timely compliance (at Lessee's
expense) with all Applicable Requirements. "REPORTABLE USE" shall mean (i) the
installation or use of any above or below ground storage tank, (ii) the
generation, possession, storage, use , transportation, or disposal of a
Hazardous Substance that requires a permit from, or with respect to which a
report, notice, registration or business plan is required to be filed with, any
governmental authority, and/or (iii) the presence at the Premises of a Hazardous
Substance with respect to which an Applicable Requirements requires that a
notice be given to persons entering or occupying the Premises or neighboring
properties. Notwithstanding the foregoing, Lessee may use any ordinary and
customary materials reasonably required to be used in the normal course of the
Agreed Use, so long as such use is in compliance with all Applicable
Requirements, is not a Reportable Use, and does not expose the Premises or
neighboring property to any meaningful risk of contamination or damage or expose
Lessor to any liability therefor. In addition, Lessor may condition its consent
to any Reportable Use upon receiving such additional assurances as Lessor
reasonably deems necessary to protect itself, the public, the Premises and/or
the environment against damage, contamination, injury and/or liability,
including, but not limited to, the installation (and removal on or before Lease
expiration or termination) of protective modifications (such as concrete
encasements) and/or increasing the Security Deposit. SEE ADDENDUM

               (b) DUTY TO INFORM LESSOR. If Lessee knows, or has reasonable
cause to believe, that a Hazardous Substance has come to be located in, on,
under or about the Premises, other than as previously consented to by Lessor,
Lessee shall immediately give written notice of such fact to Lessor, and provide
Lessor with a copy of any report, notice, claim or other documentation which it
has concerning the presence of such Hazardous Substance. Lessor acknowledges
receipt and review of the ESA.

               (c) LESSEE REMEDIATION. Lessee shall not cause or permit any
Hazardous Substance to be spilled or released in, on, under, or about the
Premises (including through the plumbing or sanitary sewer system) and shall
promptly, at Lessee's expense, take all investigatory and/or remedial action
reasonably recommended, whether or not formally ordered or required, for the
cleanup of any contamination of, and for the maintenance, security and/or
monitoring of the Premises or neighboring properties, that was caused or
materially contributed to by Lessee, or pertaining to or involving any Hazardous
Substance brought onto the Premises during the term of this Lease, by or for
Lessee, or any third party.

               (d) LESSEE INDEMNIFICATION. Lessee shall indemnify, defend,
reimburse and hold Lessor, its agents, employees, lenders and ground lessor, if
any, harmless from and against any and all loss of rents and/or damages,
liabilities, judgments, claims, expenses, penalties, and attorneys' and
consultants' fees arising out of or involving any Hazardous Substance brought
onto the Premises by or for Lessee, or any third party (provided, however, that
Lessee shall have no liability under this Lease with respect to migration of any
Hazardous Substance under the Premises from adjacent properties). Lessee's
obligations shall include, but not be limited to, the effects of any
contamination or injury to person, property or the environment created or
suffered by Lessee, and the cost of investigation, removal, remediation,
restoration and/or abatement, and shall survive the expiration or termination of
this Lease. NO TERMINATION, CANCELLATION OR RELEASE AGREEMENT ENTERED INTO BY
LESSOR AND LESSEE SHALL RELEASE LESSEE FROM ITS OBLIGATIONS UNDER THIS LEASE
WITH RESPECT TO HAZARDOUS SUBSTANCES, UNLESS SPECIFICALLY SO AGREED BY LESSOR IN
WRITING AT THE TIME OF SUCH AGREEMENT.

               (e) LESSOR INDEMNIFICATION. SEE ADDENDUM

               (f) INVESTIGATIONS AND REMEDIATIONS. Lessor shall retain the
responsibility and pay for any investigations or remediation measures required
by governmental entities having jurisdiction with respect to the existence of
Hazardous Substances in, on or about the Premises prior to the Start Date,
unless such remediation measure is required as a result of Lessee's use
(including "Alterations", as defined in paragraph 7.3(a) below) of the Premises,
in which event Lessee shall be responsible for such payment. Lessee shall
cooperate fully in any such activities at the request of Lessor, including
allowing Lessor and Lessor's agents to have reasonable access to the Premises at
reasonable times in order to carry out Lessor's investigative and remedial
responsibilities.

               (g) LESSOR TERMINATION OPTION. If a Hazardous Substance Condition
occurs during the term of this Lease, unless Lessee is legally responsible
therefor (in which case Lessee shall make the investigation and remediation
thereof required by the Applicable Requirements and this Lease shall continue in
full force and effect, but subject to Lessor's rights under Paragraph 6.2(d) and
Paragraph 13), Lessor may, at Lessor's option, either (i) investigate and
remediate such Hazardous Substance Condition, if required, as soon as reasonably
possible at Lessor's expense, in which event this Lease shall continue in full
force and effect, or (ii) if the estimated cost to remediate such condition
exceeds twelve (12) times the then monthly Base Rent or $100,000, whichever is
greater, give written notice to Lessee, within thirty (30) days after receipt by
Lessor of knowledge of the occurrence of such Hazardous Substance Condition, of
Lessor's desire to terminate this Lease as of the date sixty (60) days following
the date of such notice. In the event Lessor elects to give a termination
notice, Lessee may, within ten (10) days thereafter, give written notice to
Lessor of Lessee's commitment to pay the amount by which the cost of the
remediation of such Hazardous Substance Condition exceeds an amount equal to
twelve (12) times the then monthly Base Rent or $100,000 , which ever is
greater. Lessee shall provide Lessor with said funds or satisfactory assurance
thereof within thirty (30) days following such commitment. In such event, this
Lease shall continue in full force and effect, and Lessor shall proceed to make
such remediation as soon as reasonably possible after the required fund are
available. If Lessee does not give such notice and provide the required funds or
assurance thereof within the time provided, this Lease shall terminate as of the
date specified in Lessor's notice of termination.


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         6.3   LESSEE'S COMPLIANCE WITH APPLICABLE REQUIREMENTS. Except as
otherwise provided in this Lease, Lessee shall, at Lessee's sole expense, fully,
diligently and in a timely manner, materially comply with all Applicable
Requirements, the requirements of any applicable fire insurance underwriter or
rating bureau, and the recommendations of Lessor's engineers and/or consultants
which relate in any manner to the Premises, without regard to whether said
requirements are now in effect or become effective after the Start Date. Lessee
shall, within ten (10) days after receipt of Lessor's written request, provide
Lessor with copies of all permits and other documents, and other information
evidencing Lessee's compliance with any Applicable Requirements specified by
Lessor, and shall immediately upon receipt, notify Lessor in writing (with
copies of any documents involved) of any threatened or actual claim, notice,
citation, warning, complaint or report pertaining to or involving the failure of
Lessee or the Premises to comply with any Applicable Requirements.

         6.4   INSPECTION; COMPLIANCE. Lessor and Lessor's "Lender" (as defined
in Paragraph 30 below) and consultants shall have the right to enter into
Premises at any time, in the case of an emergency, and otherwise at reasonable
times, for the purpose of inspecting the condition of the Premises and for
verifying compliance by Lessee with this Lease. The cost of any such inspections
shall be paid by Lessor, unless a violation of Applicable Requirements, or a
contamination is found to exist or be imminent, or the inspection is requested
or ordered by a governmental authority. In such case, Lessee shall upon request
reimburse Lessor for the cost of such inspections, so long as such inspection is
reasonably related to the violation or contamination.

7.       MAINTENANCE; REPAIRS, UTILITY INSTALLATIONS; TRADE FIXTURES AND
ALTERATIONS.

         7.1   LESSEE'S OBLIGATIONS.

               (a) IN GENERAL. Subject to the provisions of Paragraph 2.2
(Condition), 2.3 (Compliance), 6.3 (Lessee's Compliance with Applicable
Requirements), 7.2 (Lessor's Obligations), 9 (Damage or Destruction), and 14
(Condemnation), Lessee shall, at Lessee's sole expense, keep the Premises,
Utility Installations, and Alterations in good order, condition and repair
(whether or not the portion of the Premises requiring repairs, or the means of
repairing the same, are reasonably or readily accessible to Lessee, and whether
or not the need for such repairs occurs as a result of Lessee's use, any prior
use, the elements or the age of such portion of the Premises), including, but
not limited to, all equipment or facilities, such as plumbing, heating,
ventilation, air-conditioning, electrical, lighting facilities, boilers,
pressure vessels, fire protection system, fixtures, walls (interior and
exterior), foundations, ceilings, roofs, floors, windows, doors, plate glass,
skylights, landscaping, driveways, parking lots, fences, retaining walls, signs,
sidewalks and parkways located in, on, or adjacent to the Premises. Lessee, in
keeping the Premises in good order, condition and repair, shall exercise and
perform good maintenance practices, specifically including the procurement and
maintenance of the service contracts required by Paragraph 7.1(b) below.
Lessee's obligations shall include restorations, replacements or renewals when
necessary to keep the Premises and all improvements thereon or a part thereof in
good order, condition and state of repair. Lessee shall, during the term of this
Lease, keep the exterior appearance of the Building in a first-class condition
consistent with the exterior appearance of other similar facilities of
comparable age and size in the vicinity, including, when necessary, the exterior
repainting of the Building.

               (b) SERVICE CONTRACTS. Lessee shall, at Lessee's sole expense,
procure and maintain contracts, with copies to Lessor, in customary form and
substance for, and with contractors specializing and experienced in the
maintenance of the following equipment and improvements ("Basic Elements"), if
any, if and when installed on the Premises: (i) HVAC equipment, (ii) boiler, and
pressure vessels, (iii) fire extinguishing systems, including fire alarm and/or
smoke detection, (iv) landscaping and irrigation systems, (v) roof covering and
drains, (vi) driveways and parking lots, (vii) clarifiers (viii) basic utility
feed to the perimeter of the Building, and (ix) any other equipment, if
reasonably required by Lessor.

         7.2   LESSOR'S OBLIGATIONS. Subject to the provisions of Paragraphs 2.2
(Condition), 2.3 (Compliance), 9 (Damage or Destruction) and 14 (Condemnation),
it is intended by the Parties hereto that Lessor have no obligation, in any
manner whatsoever, to repair and maintain the Premises, or the equipment
therein, all of which obligations are intended to be that of the Lessee. It is
the intention of the Parties that the terms of this Lease govern the respective
obligations of the Parties as to maintenance and repair of the Premises, and
they expressly waive the benefit of any statute now or hereafter in effect to
the extent it is inconsistent with the terms of this Lease.

         7.3   UTILITY INSTALLATIONS; TRADE FIXTURES; ALTERATIONS.

               (a) DEFINITIONS; CONSENT REQUIRED. The term "UTILITY
INSTALLATIONS" refers to all floor and window coverings, air lines, power
panels, electrical distribution, security and fire protection systems,
communications systems, lighting fixtures, HVAC equipment, plumbing, and fencing
in or on the Premises. The Term "TRADE FIXTURES" shall mean Lessee's machinery
and equipment that can be removed without doing material damage to the Premises.
The term "ALTERATIONS" shall mean any modification of the improvements, other
than Utility Installations or Trade Fixtures, whether by addition or deletion.
"LESSEE OWNED ALTERATIONS AND/OR UTILITY INSTALLATIONS" are defined as
Alterations and/or Utility Installations made by Lessee that are not yet owned
by Lessor pursuant to Paragraph 7.4(a). Lessee shall not make any Alterations or
Utility Installations to the Premises without Lessor's prior written consent.
Lessee may, however, make non-structural Utility Installations to the interior
of the Premises (excluding the roof) without such consent but upon notice to
Lessor, as long as they are not visible from the outside, do not involve
puncturing, relocating or removing the roof or any existing walls, and the
cumulative cost thereof during this Lease as extended does not exceed $50,000 in
the aggregate or $10,000 in any one year.

               (b) CONSENT. Any Alterations or Utility Installations that Lessee
shall desire to make and which require the consent of the Lessor shall be
presented to Lessor in written form with detailed plans. Consent shall be deemed
conditioned upon Lessee's: (i) acquiring all applicable governmental permits,
(ii) furnishing Lessor with copies of both the permits and the plans and
specifications prior to commencement of the work, and (iii) compliance with all
conditions of said permits and other Applicable Requirements in a prompt and
expeditious manner. Any Alterations or Utility Installations shall be performed
in a workmanlike manner with good and sufficient materials. Lessee shall
promptly upon completion furnish Lessor with as-built plans and specifications.
For work which cost an amount equal to the greater of one month's Base Rent, or
$10,000, Lessor may condition its consent upon Lessee providing a lien and
completion bond in an amount equal to one and one-half times the estimated cost
of such Alteration or Utility Installation and/or upon Lessee's posting an
additional Security Deposit with Lessor.

               (c) INDEMNIFICATION. Lessee shall pay, when due, all claims for
labor or materials furnished or alleged to have been furnished to or for Lessee
at or for use on the Premises, which claims are or may be secured by any
mechanic's or materialmen's lien against the Premises or any interest therein.
Lessee shall give Lessor not less than ten (10) days' notice prior to the
commencement of any work in, on or about the Premises, and Lessor shall have the
right to post notices of non-responsibility. If Lessee shall contest the
validity of any such lien, claim or demand, then Lessee shall, at its sole
expense defend and protect itself, Lessor and the Premises against the same and
shall pay and satisfy any such adverse judgment that may be rendered thereon
before the enforcement thereof. If Lessor shall require, Lessee shall furnish a
surety bond in an amount equal to one and one-half times the 


<PAGE>   6

amount of such contested lien, claim or demand, indemnifying Lessor against
liability for the same. If Lessor elects to participate in any such action,
Lessee shall pay Lessor's attorneys' fees and costs.

         7.4   OWNERSHIP; REMOVAL; SURRENDER; AND RESTORATION.

               (a) OWNERSHIP. Subject to Lessor's right to require removal or
elect ownership as hereinafter provided, all Alterations and Utility
Installations made by Lessee shall be the property of Lessee, but considered a
part of the Premises. Lessor may, at any time, elect in writing to be the owner
of all or any specified part of the Lessee Owned Alterations and Utility
Installations. Unless otherwise instructed per Paragraph 7.4(b) hereof, all
Lessee Owned Alterations and Utility Installations shall, at the expiration or
termination of this Lease, become the property of Lessor and be surrendered by
Lessee with the Premises.

               (b) REMOVAL. By delivery to Lessee of written notice from Lessor
not earlier than ninety (90) and not later than thirty (30) days prior to the
end of the term of this Lease, Lessor may require that any or all Lessee Owned
Alterations or Utility Installations be removed by the expiration or termination
of this Lease. Lessor may require the removal at anytime of all or any part of
any Lessee Owned Alterations or Utility Installations made without the required
consent.

               (c) SURRENDER/RESTORATION. Lessee shall surrender the Premises by
the Expiration Date or any earlier termination date, with all of the
improvements, parts and surfaces thereof in substantially the same condition and
state of repair as received, ordinary wear and tear excepted. "Ordinary wear and
tear" shall not include any damage or deterioration that would have been
prevented by good maintenance practice. Lessee shall repair any damage
occasioned by the installation, maintenance or removal of Trade Fixtures, Lessee
Owned Alterations and/or Utility Installations, furnishings, and equipment as
well as the removal of any storage tank installed by or for Lessee, and the
removal, replacement, or remediation of any soil, material or groundwater
contaminated by Lessee. Trade Fixtures shall remain the property of Lessee and
shall be removed by Lessee. The failure by Lessee to timely vacate the Premises
pursuant to this Paragraph 7.4( c ) without the express written consent of
Lessor shall constitute a holdover under the provisions of Paragraph 26 below.

8.       INSURANCE; INDEMNITY.

         8.1   PAYMENT FOR INSURANCE. Lessee shall pay for all insurance
required under Paragraph 8 except to the extent of the cost attributable to
liability insurance carried by Lessor under Paragraph 8.2(b) in excess of
$2,000,000 per occurrence. Premiums for policy periods commencing prior to or
extending beyond the Lease term shall be prorated to correspond to the Lease
term. Payment shall be made by Lessee to Lessor within ten (10) days following
receipt of an invoice. SEE ADDENDUM

         8.2   LIABILITY INSURANCE.

               (a) CARRIED BY LESSEE. Lessee shall obtain and keep in force a
Commercial General Liability Policy of Insurance protecting Lessee and Lessor
against claims for bodily injury, person injury and property damage based upon
or arising out of the ownership, use, occupancy or maintenance of the Premises
and all areas appurtenant thereto. Such insurance shall be on an occurrence
basis providing single limit coverage in an amount not less than $2,000,000 per
occurrence with an "ADDITIONAL INSURED-MANAGERS OR LESSORS OF PREMISES
ENDORSEMENT" and contain the "AMENDMENT OF THE POLLUTION EXCLUSION ENDORSEMENT"
for damage caused by heat, smoke or fumes from a hostile fire. The Policy shall
not contain any intra-insured exclusions as between insured persons or
organizations, but shall include coverage for liability assumed under this Lease
as an "insured contract" for the performance of Lessee's indemnity obligations
under this Lease. The limits of said insurance shall not, however, limit the
liability of Lessee nor relieve Lessee of any obligation hereunder. All
insurance carried by Lessee shall be primary to and not contributory with any
similar insurance carried by Lessor, whose insurance shall be considered excess
insurance only.

               (b) CARRIED BY LESSOR. Lessor shall maintain liability insurance
as described in Paragraph 8.2(a), in addition to, and not in lieu of, the
insurance required to be maintained by Lessee. Lessee shall not be named as an
additional insured therein.

         8.3   PROPERTY INSURANCE - BUILDING, IMPROVEMENTS AND RENTAL VALUE.

               (a) BUILDING AND IMPROVEMENTS. The Insuring Party shall obtain
and keep in force a policy or policies in the name of Lessor, with loss payable
to Lessor, any groundlessor, and to any Lender(s) insuring loss or damage to the
Premises. The amount of such insurance shall be equal to the full replacement
cost of the Premises, as the same shall exist from time to time, or the amount
required by any Lenders, but in no event more than the commercially reasonable
and available insurable value thereof. If Lessor is the Insuring Party, however,
Lessee Owned Alterations and Utility Installations, Trade Fixtures, and Lessee's
personal property shall be insured by Lessee under Paragraph 8.4 rather than by
Lessor. If the coverage is available and commercially appropriate, such policy
or policies shall insure against all risk of direct physical loss or damage
(except the perils of flood and/or earthquake unless required by a Lender),
including coverage for debris removal and the enforcement of any Applicable
Requirements requiring the upgrading, demolition, reconstruction or replacement
of any portion of the Premises as the result of a covered loss. Said policy or
policies shall also contain an agreed valuation provision in lieu of any
coinsurance clause, waiver of subrogation, and inflation guard protection
causing an increase in the annual property insurance coverage amount by a factor
of not less than the adjusted U. S. Department of Labor Consumer Price Index for
All Urban Consumers for the city nearest to where the Premises are located. If
such insurance coverage has a deductible clause, the deductible amount shall not
exceed $1,000 per occurrence, and Lessee shall be liable for such deductible
amount in the event of an Insured Loss.
               
               (b) RENTAL VALUE. The insuring Party shall obtain and keep in
force a policy or policies in the name of Lessor with loss payable to Lessor and
any Lender, insuring the loss of the full Rent for one (1) year. Said insurance
shall provide that in the event the Lease is terminated by reason of an insured
loss, the period of indemnity for such coverage shall be extended beyond the
date of the completion of repairs or replacement of the Premises, to provide for
one full year's loss of Rent from the date of any such loss. Said insurance
shall contain an agreed valuation provision in lieu of any coinsurance clause,
and the amount of coverage shall be adjusted annually to reflect the projected
Rent otherwise payable by Lessee, for the next twelve (12) month period. Lessee
shall be liable for any deductible amount in the event of such loss.

               (c) ADJACENT PREMISES. If the Premises are part of a larger
building, or of a group of buildings owned by Lessor which are adjacent to the
Premises, the Lessee shall pay for any increase in the premiums for the property
insurance of such building or buildings if said increase is caused by Lessee's
acts, omissions, use or occupancy of the Premises.

         8.4   LESSEE'S PROPERTY/BUSINESS INTERRUPTION INSURANCE.

               (a) PROPERTY DAMAGE. Lessee shall obtain and maintain insurance
coverage on all of Lessee's personal property, Trade Fixtures, and Lessee Owned
Alterations and Utility Installations. Such insurance shall be full replacement
cost coverage with a deductible of not to exceed $1,000 per occurrence. The
proceeds from any such insurance shall be used by Lessee for the replacement of
personal property, Trade Fixtures and Lessee Owned Alterations and Utility
Installations. Lessee shall provide Lessor with written evidence that such
insurance is in force.



<PAGE>   7

               (b) BUSINESS INTERRUPTION. Lessee shall obtain and maintain loss
of income and extra expense insurance in amounts as will reimburse Lessee for
direct or indirect loss of earnings attributable to all perils commonly insured
against by prudent lessees in the business of Lessee or attributable to
prevention of access to the Premises as a result of such perils.

               (c) NO REPRESENTATION OF ADEQUATE COVERAGE. Lessor makes no
representation that the limits or forms of coverage of insurance specified
herein are adequate to cover Lessee's property, business operations or
obligations under this Lease.

         8.5   INSURANCE POLICIES. Insurance required herein shall be by
companies duly licensed or admitted to transact business in the state where the
Premises are located, and maintaining during the policy term a "General
Policyholders Rating" of at least B+, V, as set forth in the most current issue
of "Best's Insurance Guide", or such other rating as may be required by a
Lender. Lessee shall not do or permit to be done anything which invalidates the
required insurance policies. Lessee shall, prior to the Start Date, deliver to
Lessor certified copies of policies of such insurance or certificates evidencing
the existence and amounts of the required insurance. No such policy shall be
cancelable or subject to modification except after thirty (30) days prior
written notice to Lessor. Lessee shall, at least thirty (30) days prior to the
expiration of such policies, furnish Lessor with evidence of renewals or
"insurance binders" evidencing renewal thereof, or Lessor may order such
insurance and charge the cost thereof to Lessee, which amount shall be payable
by Lessee to Lessor upon demand. Such policies shall be for a term of at least
one year, or the length of the remaining term of this Lease, whichever is less.
If either Party shall fail to procure and maintain the insurance required to be
carried by it, the other Party may, but shall not be required to, procure and
maintain the same.

         8.6   WAIVER OF SUBROGATION. Without affecting any other rights or
remedies, Lessee and Lessor each hereby release and relieve the other, and waive
their entire right to recover damages against the other, for loss of or damage
to its property arising out of or incident to the perils required to be insured
against herein. The effect of such releases and waivers is not limited by the
amount of insurance carried or required, or by any deductibles applicable
hereto. The Parties agree to have their respective property damage insurance
carriers waive any right to subrogation that such companies may have against
Lessor or Lessee, as the case may be, so long as the insurance is not
invalidated thereby.

         8.7   INDEMNITY. Except for Lessor's gross negligence or willful
misconduct, Lessee shall indemnify, protect, defend and hold harmless the
Premises, Lessor and its agents, Lessor's master or ground lessor, partners and
Lenders, from and against any and all claims, loss of rents and/or damages ,
liens, judgments, penalties, attorneys' and consultants' fees, expenses and/or
liabilities arising out of, involving, or in connection with , the use and/or
occupancy of the Premises by Lessee. If any action or proceeding is brought
against Lessor by reason of any of the foregoing matters, Lessee shall upon
notice defend the same at Lessee's expense by counsel reasonably satisfactory to
Lessor and Lessor shall cooperate with Lessee in such defense. Lessor need not
have first paid any such claim in order to be defended or indemnified. 

         8.8   EXEMPTION OF LESSOR FROM LIABILITY. Lessor shall not be liable
for injury or damage to the person or goods, wares, merchandise or other
property of Lessee, Lessee's employees, contractors, invitees, customers, or any
other person in or about the Premises, whether such damage or injury is caused
by or results from fire, steam, electricity, gas, water or rain, or from the
breakage, leakage, obstruction or other defects of pipes, fire sprinklers,
wires, appliances, plumbing, HVAC or lighting fixtures, or from any other cause,
whether the said injury or damage results from conditions arising upon the
Premises or upon other portions of the Building of which the Premises are a
part, or from other sources or places. Lessor shall not be liable for any
damages arising from any act or neglect of any other tenant of Lessor.
Notwithstanding Lessor's negligence or breach of this Lease, Lessor shall under
no circumstances be liable for injury to Lessee's business or for any loss of
income or profit therefrom. 

9.       DAMAGE OR DESTRUCTION. 

         9.1   DEFINITIONS. 

               (a) "PREMISES PARTIAL DAMAGE" shall mean damage or destruction to
the improvements on the Premises, other than Lessee Owned Alterations and
Utility Installations, which can reasonably by repaired in six (6) months or
less from the date of the damage or destruction. Lessor shall notify Lessee in
writing within thirty (30) days from the date of the damage or destruction as to
whether or not the damage is Partial or Total. 

               (b) "PREMISES TOTAL DESTRUCTION" shall mean damage or destruction
to the Premises, other than Lessee Owned Alterations and Utility Installations
and Trade Fixtures, which cannot reasonably be repaired in six (6) months or
less from the date of the damage or destruction. Lessor shall notify Lessee in
writing within thirty (30) days from the date of the damage or destruction as to
whether or not the damage is Partial or Total. 

               (c) "INSURED LOSS" shall mean damage or destruction to
improvements on the Premises, other than Lessee Owned Alterations and Utility
Installations and Trade Fixture, which was caused by an event required to be
covered by the insurance described in Paragraph 8.3(a), irrespective of any
deductible amounts or coverage limits involved. 

               (d) "REPLACEMENT COST" shall mean the cost to repair or rebuild
the improvements owned by Lessor at the time of the occurrence to their
condition existing immediately prior thereto, including demolition, debris
removal and upgrading required by the operation of Applicable Requirements, and
without deduction for depreciation. 

               (e) "HAZARDOUS SUBSTANCE CONDITION" shall mean the occurrence or
discovery of a condition involving the presence of, or a contamination by, a
Hazardous Substance as defined in Paragraph 6.2(a), in, on, or under the
Premises. 

         9.2   PARTIAL DAMAGE - INSURED LOSS. If a Premises Partial Damage that
is an Insured Loss occurs, then Lessor shall, at Lessor's expense, repair such
damage (but not Lessee's Trade Fixtures or Lessee Owned Alterations and Utility
Installations) as soon a reasonably possible and this Lease shall continue in
full force and effect; provided, however, that Lessee shall, at Lessor's
election, make the repair of any damage or destruction the total cost to repair
of which is $10,000 or less, and, in such event, Lessor shall make any
applicable insurance proceeds available to Lessee on a reasonable basis for that
purpose. Not withstanding the foregoing, if the required insurance was not in
force or the insurance proceeds are not sufficient to effect such repair, the
Insuring Party shall promptly contribute the shortage in proceeds (except as to
the deductible which is Lessee's responsibility) as and when required to
complete said repairs. In the event, however, such shortage was due to the fact
that, by reason of the unique nature of the improvements, full replacement cost
insurance coverage was not commercially reasonable and available, Lessor shall
have no obligation to pay for the shortage in insurance proceeds or to fully
restore the unique aspects of the Premises unless Lessee provides Lessor with
the funds to cover same, or adequate assurance thereof, within ten (10) days
following receipt of written notice of such shortage and request therefor. If
Lessor receives said funds or adequate assurance hereof within said ten (10) day
period, the party responsible for making the repairs shall complete them as soon
as reasonably possible and this Lease shall remain in full force and effect. If
such funds or assurance are not received, Lessor may nevertheless elect by
written notice to Lessee within ten (10) days thereafter to: (i) make such
restoration and repair as is commercially reasonable with Lessor paying any
shortage in proceeds, in which case the Lease shall remain in full force and
effect; or (ii) have this Lease terminate thirty (30) days thereafter. Lessee
shall not be entitled to reimbursement of any funds contributed by Lessee to
repair any such damage or destruction. Premises Partial Damage due to flood or



<PAGE>   8

earthquake shall be subject to Paragraph 9.3, notwithstanding that there may be
some insurance coverage, but the net proceeds of any such insurance shall be
made available for the repairs if made by either Party. 

         9.3   PARTIAL DAMAGE - UNINSURED LOSS. If a Premises Partial Damage
that is not an Insured Loss occurs, unless caused by a negligent or willful act
of Lessee (in which event Lessee shall make the repairs at Lessee's expense),
Lessor may either: (i) repair such damage as soon as reasonably possible at
Lessor's expense, in which event this Lease shall continue in full force and
effect, or (ii) terminate this Lease by giving written notice to Lessee within
thirty (30) days after receipt by Lessor of knowledge of the occurrence of such
damage. Such termination shall be effective sixty (60) days following the date
of such notice. In the event Lessor elects to terminate this Lease, Lessee shall
have the right within ten (10) days after receipt of the termination notice to
give written notice to Lessor of Lessee's commitment to pay for the repair of
such damage without reimbursement from Lessor. Lessee shall provide Lessor with
said funds or satisfactory assurance thereof within thirty (30) days after
making such commitment. In such event this Lease shall continue in full force
and effect, and Lessor shall proceed to make such repairs as soon as reasonably
possible after the required funds are available. If Lessee does not make the
required commitment, this Lease shall terminate as of the date specified in the
termination notice. 

         9.4   TOTAL DESTRUCTION. Notwithstanding any other provision hereof, if
a Premises Total Destruction occurs, this Lease shall terminate sixty (60) days
following such Destruction. If the damage or destruction was caused by the gross
negligence or willful misconduct of Lessee, Lessor shall have the right to
recover Lessor's damages from Lessee, except as provided in Paragraph 8.6. 

         9.5   DAMAGE NEAR END OF TERM. If at any time during the last six (6)
months of this Lease there is damage for which the cost to repair exceeds one
(1) month's Base Rent, whether or not an Insured Loss, Lessor may terminate this
Lease effective sixty (60) days following the date of occurrence of such damage
by giving a written termination notice to Lessee within thirty (30) days after
the date of occurrence of such damage. Notwithstanding the foregoing, if Lessee
at that time has an exercisable option to extend this Lease or to purchase the
Premises, then Lessee may preserve this Lease by, (a) exercising such option and
(b) providing Lessor with any shortage in insurance proceeds (or adequate
assurance thereof) needed to make the repairs on or before the earlier of (i)
the date which is ten days after Lessee's receipt of Lessor's written notice
purporting to terminate this Lease, or (ii) the day prior to the date upon which
such option expires. If Lessee duly exercises such option during such period and
provides Lessor with funds (or adequate assurance thereof) to cover any shortage
in insurance proceeds, Lessor shall, at Lessor's commercially reasonable
expense, repair such damage as soon as reasonably possible and this Lease shall
continue in full force and effect. If Lessee fails to exercise such option and
provide such funds or assurance during such period, then this Lease shall
terminate on the date specified in the termination notice and Lessee's option
shall be extinguished. 

         9.6   ABATEMENT OF RENT; LESSEE'S REMEDIES. 

               (a) ABATEMENT. In the event of Premises Partial Damage or
Premises Total Destruction or a Hazardous Substance Condition for which Lessee
is not responsible under this Lease, the Rent payable by Lessee for the period
required for the repair, remediation or restoration of such damage shall be
abated in proportion to the degree to which Lessee's use of the Premises is
impaired, but not to exceed the proceeds received from the Rental Value
insurance. All other obligations of Lessee hereunder shall be performed by
Lessee, and Lessor shall have no liability for any such damage, destruction,
remediation, repair or restoration except as provided herein. 

               (b) REMEDIES. If Lessor shall be obligated to repair or restore
the Premises and does not commence, in a substantial and meaningful way, such
repair or restoration with ninety (90) days after such obligation shall accrue,
Lessee may, at any time prior to the commencement of such repair or restoration,
give written notice to Lessor and to any Lenders of which Lessee has actual
notice, of Lessee's election to terminate this Lease on a date not less than
sixty (60) days following the giving of such notice. If Lessee gives such notice
and such repair or restoration is not commenced within thirty (30) days
thereafter, this Lease shall terminate as of the date specified in said notice.
If the repair or restoration is commenced within said thirty (30) days, this
Lease shall continue in full force and effect. "COMMENCE" shall mean either the
unconditional authorization of the preparation of the required plans, or the
beginning of the actual work on the Premises, whichever first occurs. 

         9.7   TERMINATION - ADVANCE PAYMENTS. Upon termination of this Lease
pursuant to Paragraph 6.2(g) or Paragraph 9, an equitable adjustment shall be
made concerning advance Base Rent and any other advance payments made by Lessee
to Lessor. Lessor shall, in addition, return to Lessee so much of Lessee's
Security Deposit as has not been, or is not then required to be, used by Lessor.

         9.8   WAIVE STATUTES. Lessor and Lessee agree that the terms of this
Lease shall govern the effect of any damage to or destruction of the Premises
with respect to the termination of this Lease and hereby waive the provisions of
any present or future statute to the extent inconsistent herewith. 

10.      REAL PROPERTY TAXES. 

         10.1  DEFINITION OF "REAL PROPERTY TAXES." As used herein, the term
"REAL PROPERTY TAXES" shall include any form of assessment; real estate,
general, special, ordinary or extraordinary, or rental levy or tax (other than
inheritance, personal income or estate taxes); improvement bond; and/or license
fee imposed upon or levied against any legal or equitable interest of Lessor in
the Premises, Lessor's right to other income therefrom, and/or Lessor's business
of leasing, by any authority having the direct or indirect power to tax and
where the funds are generated with reference to the Building address and where
the proceeds so generated are to be applied by the city, county or other local
taxing authority of a jurisdiction within which the Premises are located. The
term "REAL PROPERTY TAXES" shall also include any tax, fee, levy, assessment or
charge, or any increase therein, imposed by reason of events occurring during
the term of this Lease, including but not limited to, a change in the ownership
of the Premises. 

         10.2 

               (a) PAYMENT OF TAXES. Lessee shall pay the Real Property Taxes
applicable to the Premises during the term of this Lease. Subject to Paragraph
10.2(b), all such payments shall be made at least ten (10) days prior to any
delinquency date. Lessee shall promptly furnish Lessor with satisfactory
evidence that such taxes have been paid. If any such taxes shall cover any
period of time prior to or after the expiration or termination of this Lease,
Lessee's share of such taxes shall be prorated to cover only that portion of the
tax bill applicable to the period that this Lease is in effect, and Lessor shall
reimburse Lessee for any overpayment. If Lessee shall fail to pay any required
Real Property Taxes, Lessor shall have the right to pay the same, and Lessee
shall reimburse Lessor therefor upon demand. 

               (b) ADVANCE PAYMENT. In the event Lessee incurs a late charge on
any Rent payment, Lessor may, at Lessor's option, estimate the current Real
Property Taxes, and require that such taxes be paid in advance to Lessor by
Lessee, either: (i) in a lump sum amount equal to the installment due, at least
twenty (20) days prior to the applicable delinquency date, or (ii) monthly in
advance with the payment of the Base Rent. If Lessor elects to require payment
monthly in advance, the monthly payment shall be an amount equal to the amount
of the estimated installment of taxes divided by the number of months remaining
before the month in 



<PAGE>   9

which said installment becomes delinquent. When the actual amount of the
applicable tax bill is known, the amount of such equal monthly advance payments
shall be adjusted as required to provide the funds needed to pay the applicable
taxes. If the amount collected by Lessor is insufficient to pay such Real
Property Taxes when due, Lessee shall pay Lessor, upon demand, such additional
sums as are necessary to pay such obligations. All moneys paid to Lessor under
this Paragraph may be intermingled with other moneys of Lessor and shall not
bear interest. In the event of a Breach by Lessee in the performance of its
obligations under this Lease, than any balance of funds paid to Lessor under the
provisions of this Paragraph may at the option of Lessor, be treated as an
additional Security Deposit. 

         10.3  JOINT ASSESSMENT. If the Premises are not separately assessed,
Lessee's liability shall be an equitable proportion of the Real Property Taxes
for all of the land and improvements included within the tax parcel assessed,
such proportion to be conclusively determined by Lessor from the respective
valuations assigned in the assessor's work sheets or such other information as
may be reasonably available. 

         10.4  PERSONAL PROPERTY TAXES. Lessee shall pay, prior to delinquency,
all taxes assessed against and levied upon Lessee Owned Alterations, Utility
Installations, Trade Fixtures, furnishings, equipment and all personal property
of Lessee. When possible, Lessee shall cause such property to be assessed and
billed separately from the real property of Lessor. If any of Lessee's said
personal property shall be assessed with Lessor's real property, Lessee shall
pay Lessor the taxes attributable to Lessee's property within ten (10) days
after receipt of a written statement. 

11.      UTILITIES. Lessee shall pay for all water, gas, heat, light, power,
telephone, trash disposal and other utilities and services supplied to the
Premises, together with any taxes thereon. If any such services are not
separately metered to Lessee, Lessee shall pay a reasonable proportion, to be
determined by Lessor, of all charges jointly metered. 

12.      ASSIGNMENT AND SUBLETTING. 

         12.1  LESSOR'S CONSENT REQUIRED. 

               (a) Lessee shall not voluntarily or by operation of law assign,
transfer, mortgage or encumber (collectively, "ASSIGN OR ASSIGNMENT") or sublet
all or any part of Lessee's interest in this Lease or in the Premises without
Lessor's prior written consent.

               (b) A change in the control of Lessee shall constitute an
assignment requiring consent. The transfer, on a cumulative basis, of
twenty-five percent (25%) or more of the voting control of Lessee shall
constitute a change in control for this purpose. SEE ADDENDUM

               (c) The involvement of Lessee or its assets in any transaction,
or series of transactions (by way of merger, sale, acquisition, financing,
transfer, leveraged buy-out or otherwise), whether or not a formal assignment or
hypothecation of this Lease or Lessee's assets occurs, which results or will
result in a reduction of the Net Worth of Lessee by an amount greater than
twenty-five percent (25%) of such Net Worth as it was represented at the time of
the execution of this Lease or at the time of the most recent assignment to
which Lessor has consented, or as it exists immediately prior to said
transaction or transactions constituting such reduction, whichever was or is
greater, shall be considered an assignment of this Lease to which Lessor may
withhold its consent. "NET WORTH OF LESSEE" shall mean the net worth of Lessee
(excluding any guarantors) established under generally accepted accounting
principles. 

               (d) An assignment or subletting without consent shall, at
Lessor's option, be a Default curable after notice per Paragraph 13.1(c), or a
noncurable Breach without the necessity of any notice and grace period. If
Lessor elects to treat such unapproved assignment or subletting as a noncurable
Breach, Lessor may either: (i) terminate this Lease, or (ii) upon thirty (30)
days written notice, increase the monthly Base Rent to one hundred ten percent
(110%) of the Base Rent then in effect. Further, in the event of such Breach and
rental adjustment, (i) the purchase price of any option to purchase the Premises
held by Lessee shall be subject to similar adjustment to one hundred ten percent
(110%) of the price previously in effect, and (ii) all fixed and non-fixed
rental adjustments scheduled during the remainder of the Lease term shall be
increased to One Hundred Ten Percent (110%) of the scheduled adjusted rent. 

               (e) Lessee's remedy for any breach of Paragraph 12.1 by Lessor
shall be limited to compensatory damages and/or injunctive relief. SEE ADDENDUM

         12.2  TERMS AND CONDITIONS APPLICABLE TO ASSIGNMENT AND SUBLETTING. 

               (a) Regardless of Lessor's consent, any assignment or subletting
shall not: (i) be effective without the express written assumption by such
assignee or sublessee of the obligations of Lessee under this Lease, (ii)
release Lessee of any obligations hereunder, or (iii) alter the primary
liability of Lessee for the payment of Rent or for the performance of any other
obligations to be performed by Lessee.

               (b) Lessor may accept Rent or performance of Lessee's obligations
from any person other than Lessee pending approval or disapproval of an
assignment. Neither a delay in the approval or disapproval of such assignment
nor the acceptance of Rent or performance shall constitute a waver or estoppel
of Lessor's right to exercise its remedies for Lessee's Default or Breach.

               (c) Lessor's consent to any assignment or subletting shall not
constitute a consent to any subsequent assignment or subletting. 

               (d) In the event of any Default or Breach by Lessee, Lessor may
proceed directly against Lessee, any Guarantors or anyone else responsible for
the performance of Lessee's obligations under this Lease, including any assigee
or sublessee, without first exhausting Lessor's remedies against any other
person or entity responsible therefore to Lessor, or any security held by
Lessor. 

               (e) Each request for consent to an assignment or subletting shall
be in writing, accompanied by information relevant to Lessor's determination as
to the financial and operational responsibility and appropriateness of the
proposed assignee or sublessee, including but not limited to the intended use
and/or required modification of the Premises, if any, together with a fee of
$1000 or ten percent (10%) of the current monthly Base Rent applicable to the
portion of the Premises which is the subject of the proposed assignment or
sublease, whichever is greater, as consideration for Lessor's considering and
processing said request. Lessee agrees to provide Lessor with such other or
additional information and/or documentation as may be reasonably requested. 

               (f) Any assignee of, or sublessee under, this Lease shall, by
reason of accepting such assignment or entering into such sublease, be deemed to
have assumed and agreed to conform and comply with each and every term,
covenant, condition and obligation herein to be observed or performed by Lessee
during the term of said assignment or sublease, other than such obligations as
are contrary to or inconsistent with provisions of an assignment or sublease to
which Lessor has specifically consented to in writing. 

         12.3  ADDITIONAL TERMS AND CONDITIONS APPLICABLE TO SUBLETTING. The
following terms and conditions shall apply to any subletting by Lessee of all or
any part of the Premises and shall be deemed included in all subleases under
this Lease whether or not expressly incorporated therein:

               (a) Lessee hereby assigns and transfers to Lessor all of Lessee's
interest in all Rent payable on any sublease, and Lessor may collect such Rent
and apply same toward Lessee's obligations under this Lease; provided, however,
that until a Breach 


<PAGE>   10

shall occur in the performance of Lessee's obligations, Lessee may collect said
Rent. Lessor shall not, by reason of the foregoing or any assignment of such
sublease, nor by reason of the collection of Rent, be deemed liable to the
sublessee for any failure of Lessee to perform and comply with any of Lessee's
obligations to such sublease. Lessee hereby irrevocably authorizes and directs
any such sublessee, upon receipt of a written notice from Lessor stating that a
Breach exists in the performance of Lessee's obligations under this Lease, to
pay to Lessor all Rent due and to become due under the sublease. Sublessee shall
rely upon any such notice from Lessor and shall pay all Rents to Lessor without
any obligation or right to inquire as to whether such Breach exists,
notwithstanding any claim from Lessee to the contrary.

               (b) In the event of a Breach by Lessee, Lessor may , at its
option, require sublessee to attorn to Lessor, in which event Lessor shall
undertake the obligations of the sublessor under such sublease from the time of
the exercise of said option to the expiration of such sublease; provided,
however, Lessor shall not be liable for any prepaid rents or security deposit
paid by such sublessee to such sublessor or for any prior Defaults or Breaches
of such sublessor.

               (c) Any matter requiring the consent of the sublessor under a
sublease shall also require the consent of Lessor.

               (d) No sublessee shall further assign or sublet all or any part
of the Premises without Lessor's prior written consent.

               (e) Lessor shall deliver a copy of any notice of Default or
Breach by Lessee to the sublessee, who shall have the right to cure the Default
of Lessee within the grace period, if any, specified in such notice. The
sublessee shall have a right of reimbursement and offset from and against Lessee
for any such Defaults cured by the sublessee. 

13.      DEFAULT; BREACH; REMEDIES.

         13.1  DEFAULT; BREACH. A "DEFAULT" is defined as a failure by the
Lessee to comply with or perform any of the terms, covenants, conditions or
rules under this Lease. A "BREACH" is defined as the occurrence of one or more
of the following Defaults, and the failure of Lessee to cure such Default within
any applicable grace period: 

               (a) The abandonment of the Premises; or the vacating of the
Premises without providing a commercially reasonable level of security, or where
the coverage of the property insurance described in Paragraph 8.3 is jeopardized
as a result thereof, or without providing reasonable assurances to minimize
potential vandalism.

               (b) The failure of Lessee to make any payment of Rent or any
Security Deposit required to be made by Lessee hereunder, whether to Lessor or
to a third party, when due, to provide reasonable evidence of insurance or
surety bond, or to fulfill any obligation under this Lease which endangers or
threatens life or property, where such failure continues for a period of three
(3) business days following written notice to Lessee.

               (c) The failure by Lessee to provide (i) reasonable written
evidence of compliance with Applicable Requirements, (ii) the service contracts,
(iii) the rescission of an unauthorized assignment or subletting, (iv) a
Estoppel Certificate, (v) a requested subordination, (vi) evidence concerning
any guaranty and/or Guarantor, (vii) any document requested under Paragraph 42
(easements), or (viii) any other documentation or information which Lessor may
reasonably require of Lessee under the terms of this Lease, where any such
failure continues for a period of ten (10) days following written notice to
Lessee. 

               (d) A Default by Lessee as to the terms, covenants, conditions or
provisions of this Lease, or of the rules adopted under Paragraph 40 hereof,
other than those described in subparagraphs 13.1(a), (b) or (c), above, where
such Default continues for a period of thirty (30) days after written notice;
provided, however, that if the nature of Lessee's Default is such that more than
thirty (30) days are reasonably required for its cure, than it shall not be
deemed to be a Breach if Lessee commences such cure within said thirty (30) day
period and thereafter diligently prosecutes such cure to completion. 

               (e) The occurrence of any of the following events: (i) the making
of any general arrangement or assignment for the benefit of creditors; (ii)
becoming a "DEBTOR" as defined in 11 U.S.C. 101 or any successor statute thereto
(unless, in the case of a petition filed against Lessee, the same is dismissed
within sixty (60) days); (iii) the appointment of a trustee or receiver to take
possession of substantially all of Lessee's assets located at the Premises or of
Lessee's interest in this Lease, where possession is not restored to Lessee
within thirty (30) days; or (iv) the attachment, execution or other judicial
seizure of substantially all of Lessee's assets located at the Premises or of
Lessee's interest in this Lease, where such seizure is not discharged within
thirty (30) days; provided, however, in the event that any provision of this
subparagraph (e) is contrary to any applicable law, such provision shall be of
no force or effect, and not affect the validity of the remaining provisions. 

               (f) The discovery that any financial statement of Lessee or of
any Guarantor given to Lessor was materially false. 

               (g) If the performance of Lessee's obligations under this Lease
is guaranteed: (i) the death of a Guarantor, (ii) the termination of a
Guarantor's liability with respect to this Lease other than in accordance with
the terms of such guaranty, (iii) a Guarantor's becoming insolvent or the
subject of a bankruptcy filing, (iv) a Guarantor's refusal to honor the
guarantee, or (v) a Guarantor's breach of its guaranty obligation on an
anticipatory basis, and Lessee's failure, within sixty (60) days following
written notice of any such event, to provide written alternative assurance or
security, which, when coupled with the then existing resources of Lessee, equals
or exceeds the combined financial resources of lessee and the Guarantors that
existed at the time of execution of this Lease. 

         13.2  REMEDIES. If Lessee fails to perform any of its affirmative
duties or obligations, within ten (10) days after written notice (or in case of
an emergency, without notice), Lessor may, at its option, perform such duty or
obligation on Lessee's behalf, including but not limited to the obtaining of
reasonably required bonds, insurance policies, or governmental licenses, permits
or approvals. The costs and expenses of any such performance by Lessor shall be
due and payable by Lessee upon receipt of invoice therefor. If any check given
to Lessor by Lessee shall not be honored by the bank upon which it is drawn,
Lessor, at its option, may require all future payment to be made by Lessee to be
by cashier's check. In the event of a Breach, Lessor may, with or without
further notice or demand, and without limiting Lessor in the exercise of any
right or remedy which Lessor may have by reason of such Breach:

               (a) Terminate Lessee's right to possession of the Premises by any
lawful means, in which case this Lease shall terminate and Lessee shall
immediately surrender possession to Lessor. In such event Lessor shall be
entitled to recover from Lessee: (i) the unpaid Rent which had been earned at
the time of termination; (ii) the worth at the time of award of the amount by
which the unpaid rent which would have been earned after termination until the
time of award exceeds the amount of such rental loss that the Lessee proves
could have been reasonably avoided; (iii) the worth at the time of award of the
amount by which the unpaid rent for the balance of the term after the time of
award exceeds the amount of such rental loss that the Lessee proves could be
reasonably avoided; and (iv) any other amount necessary to compensate Lessor for
all the detriment proximately caused by the Lessee's failure to perform its
obligations under this Lease or which in the ordinary course of things would be
likely to result therefrom, including but not limited to the cost of recovering
possession of the Premises, expenses of reletting, including necessary
renovation and alteration of the Premises, reasonable attorneys' fees, and that
portion of any leasing commission paid by Lessor in connection with this Lease
applicable to the unexpired term of this Lease. The worth at the time of award
of the amount referred to in provision (iii) of the 



<PAGE>   11

immediately preceding sentence shall be computed by discounting such amount at
the discount rate of the Federal Reserve Bank of the District within which the
Premises are located at the time of award plus one percent (1%). Efforts by
Lessor to mitigate damages caused by Lessee's Breach of this Lease shall not
waive Lessor's right to recover damages under Paragraph 12. If termination of
this Lease is obtained though the provisional remedy of unlawful detainer,
Lessor shall have the right to recover in such proceeding any unpaid Rent and
damages as are recoverable therein, or Lessor may reserve the right to recover
all or any part thereof in a separate suit. If a notice and grace period
required under Paragraph 13.1 was not previously given, a notice to pay rent or
quit, or to perform or quit given to Lessee under the unlawful detainer statue
shall also constitute the notice required by Paragraph 13.1. In such case, the
applicable grace period required by Paragraph 13.1 and the unlawful detainer
statute shall run concurrently, and the failure of Lessee to cure the Default
within the greater of the two such grace periods shall constitute both an
unlawful detainer and a Breach of this Lease entitling Lessor to the remedies
provided for in this Lease and/or by said statute. 

               (b) Continue the Lease and Lessee's right to possession and
recover the Rent as it becomes due, in which event Lessee may sublet or assign,
subject only to reasonable limitations. Acts of maintenance, efforts to relet,
and/or the appointment of a receiver to protect the Lessor's interest, shall not
constitute a termination of the Lessee's right to possession. 

               (c) Pursue any other remedy now or hereafter available under the
laws or judicial decisions of the state wherein the Premises are located. The
expiration or termination of this Lease and/or the termination of Lessee's right
to possession shall not relieve Lessee from liability under any indemnity
provisions of this Lease as to matters occurring or accruing during the term
hereof or by reason of Lessee's occupancy of the Premises. 

         13.3  INDUCEMENT RECAPTURE. Any agreement for free or abated rent or
other charges, or for the giving or paying by Lessor to or for Lessee of any
cash or other bonus, inducement or consideration for Lessee's entering into this
Lease, all of which concessions are hereinafter referred to as "INDUCEMENT
PROVISIONS," shall be deemed conditioned upon Lessee's full and faithful
performance of all of the terms, covenants and conditions of this Lease. Upon
Breach of this Lease by Lessee, any such Inducement Provision shall
automatically be deemed deleted from this Lease and of no further force or
effect, and any rent, other charge, bonus, inducement or consideration
theretofore abated, given or paid by Lessor under such an Inducement Provision
shall be immediately due and payable by Lessee to Lessor, notwithstanding any
subsequent cure of said Breach by Lessee. The acceptance by Lessor of rent or
the cure of the Breach which initiated the operation of this paragraph shall not
be deemed a waiver by Lessor of the provisions of this paragraph unless
specifically so stated in writing by Lessor at the time of such acceptance. 

         13.4  LATE CHARGES. Lessee hereby acknowledges that late payment by
Lessee of Rent will cause Lessor to incur cost not contemplated by this Lease,
the exact amount of which will be extremely difficult to ascertain. Such costs
include, but are not limited to, processing and accounting charges, and late
charges which may be imposed upon Lessor by any Lender. Accordingly, if any Rent
shall not be received by Lessor within five (5) days after such amount shall be
due, then, without any requirement for notice to Lessee, Lessee shall pay to
Lessor a one-time late charge equal to ten percent (10%) of each such over due
amount. The parties hereby agree that such late charge represents a fair and
reasonable estimate of the costs Lessor will incur by reason of such late
payment. Acceptance of such late charge by Lessor shall in no event constitute a
waiver of Lessee's Default or Breach with respect to such overdue amount, nor
prevent the exercise of any of the other rights and remedies granted hereunder.
In the event that a late charge is payable hereunder, whether or not collected,
for three (3) consecutive installments of Base Rent, than notwithstanding any
provision of this Lease to the contrary, Base Rent shall, at Lessor's option,
become due and payable quarterly in advance. 

         13.5  INTEREST. Any monetary payment due Lessor hereunder, other than
late charges, not received by Lessor, when due as to scheduled payments (such as
Base Rent) or within thirty (30) days following the date on which it was due for
non-scheduled payment, shall bear interest from the date when due, as to
scheduled payment, or the thirty-first (31st) day after it was due as to
non-scheduled payments. The interest ("INTEREST") charged shall be equal to the
prime rate reported in the Wall Street Journal as published closest prior to the
date when due plus four percent (4%), but shall not exceed the maximum rate
allowed by law. Interest is payable in addition to the potential late charge
provided for in Paragraph 13.4. 

         13.6  BREACH BY LESSOR. 

               (a) NOTICE OF BREACH. Lessor shall not be deemed in breach of
this Lease unless Lessor fails within a reasonable time to perform an obligation
required to be performed by Lessor. For purposes of this Paragraph, a reasonable
time shall in no event be less than thirty (30) days after receipt by Lessor,
and any Lender whose name and address shall have been furnished Lessee in
writing for such purpose, of written notice specifying wherein such obligation
of Lessor has not been performed; provided, however, that if the nature of
Lessor's obligation is such that more than thirty (30) days are reasonably
required for its performance, than Lessor shall not be in breach if performance
is commenced within such thirty (30) day period and thereafter diligently
pursued to completion.

               (b) PERFORMANCE BY LESSEE ON BEHALF OF LESSOR. In the event that
neither Lessor nor Lender cures said breach within thirty (30) days after
receipt of said notice, or if having commenced said cure they do not diligently
pursue it to completion, then Lessee may elect to cure said breach at Lessee's
expense and offset from Rent an amount equal to the greater of one month's Base
Rent or the Security Deposit, and to pay an excess of such expense under
protest, reserving Lessee's right to reimbursement from Lessor. Lessee shall
document the cost of said cure and supply said documentation to Lessor.

14.      CONDEMNATION. If the Premises or any portion thereof are taken under
the power of eminent domain or sold under the threat of the exercise of said
power (collectively "CONDEMNATION"), this Lease shall terminate as to the part
taken as of the date the condemning authority takes title or possession,
whichever first occurs. If more than ten percent (10%) of any building portion
of the premises, or more than twenty-five percent (25%) of the land area portion
of the premises not occupied by any building, is taken by Condemnation, Lessee
may, at Lessee's option, to be exercised in writing within ten (10) days after
Lessor shall have given Lessee written notice of such taking (or in the absence
of such notice, within ten (10) days after the condemning authority shall have
taken possession) terminate this Lease as of the date the condemning authority
takes such possession. If Lessee does not terminate this Lease in accordance
with the foregoing, this Lease shall remain in full force and effect as to the
portion of the Premises remaining, except that the Base Rent shall be reduced in
proportion to the reduction in utility of the Premises caused by such
Condemnation. Condemnation awards and/or payments shall be the property of
Lessor, whether such award shall be made as compensation for diminution in value
of the leasehold, the value of the part taken, or for severance damages;
provided, however, that Lessee shall be entitled to any compensation for
Lessee's relocation expenses, loss of business goodwill and/or Trade Fixtures,
without regard to whether or not this Lease is terminated pursuant to the
provisions of this Paragraph. All Alterations and Utility Installations made to
the Premises by Lessee, for purposes of Condemnation only, shall be considered
the property of the Lessee and Lessee shall be entitled to any and all
compensation which is payable therefor. In the event that this Lease is not
terminated by reason of the Condemnation, Lessor shall repair any damage to the
Premises caused by such Condemnation.



<PAGE>   12

15.      BROKERS FEE. 

         15.3  REPRESENTATIONS AND INDEMNITIES OF BROKER RELATIONSHIPS. Lessee
and Lessor each represent and warrant to the other that it has had no dealings
with any person, firm, broker or finder (other than the Brokers, if any) in
connection with this Lease, and that no one other than said named Brokers is
entitled to any commission or finder's fee in connection herewith. Lessee and
Lessor do each hereby agree to indemnify, protect, defend and hold the other
harmless from and against liability for compensation or charges which may be
claimed by any such unnamed broker, finder or other similar party by reason of
any dealings or actions of the indemnifying Party, including any costs,
expenses, attorneys' fees reasonably incurred with respect thereto.

16. ESTOPPEL CERTIFICATES.

               (a) Each Party (as "RESPONDING PARTY") shall within ten (10) days
after written notice from the other Party (the "REQUESTING PARTY") execute,
acknowledge and deliver to the Requesting Party a statement in writing in form
similar to the then most current "ESTOPPEL CERTIFICATE" form published by the
American Industrial Real Estate Association, plus such additional information,
confirmation and/or statements as may be reasonably requested by the Requesting
Party.

               (b) If the Responding Party shall fail to execute or deliver the
Estoppel Certificate within such ten day period, the Requesting Party may
execute an Estoppel Certificate stating that: (i) the Lease is in full force and
effect without modification except as may be represented by the Requesting
Party, (ii) there are no uncured defaults in the Requesting Party's performance,
and (iii) if Lessor is the Requesting Party, not more than one month's rent has
been paid in advance. Prospective purchasers and encumbrancers may rely upon the
Requesting Party's Estoppel Certificate, and the Responding Party shall be
estopped from denying the truth of the facts contained in said Certificate. 

               (c) If Lessor desires to finance, refinance, or sell the
Premises, or any part thereof, Lessee and all Guarantors shall deliver to any
potential lender or purchaser designated by Lessor such financial statements as
may be reasonably required by such lender or purchaser, including but not
limited to Lessee's financial statements for the past three (3) years. All such
financial statements shall be received by Lessor and such lender or purchaser in
confidence and shall be used only for the purposes herein set forth.

17.      DEFINITION OF LESSOR. The term "LESSOR" as used herein shall mean the
owner or owners at the time in question of the fee title to the Premises, or, if
this is a sublease, of the Lessee's interest in the prior lease. In the event of
a transfer of Lessor's title or interest in the Premises or this Lease, Lessor
shall deliver to the transferee or assignee (in cash or by credit) any unused
Security Deposit held by Lessor. Except as provided in Paragraph 15, upon such
transfer or assignment and delivery of the Security Deposit, as aforesaid, the
prior Lessor shall be relieved of all liability with respect to the obligations
and/or covenants under this Lease thereafter to be performed by the Lessor.
Subject to the foregoing, the obligations and/or covenants in this Lease to be
performed by the Lessor shall be binding only upon the Lessor as hereinabove
defined. Notwithstanding the above, and subject to the provisions of Paragraph
20 below, Danat and all subsequent holders of Danat's interest in this Lease
shall remain liable and responsible with regard to the potential duties and
liabilities of Lessor pertaining to Hazardous Substances as outlined in
Paragraph 6 above.

18.      SEVERABLILITY. The invalidity of any provision of this Lease, as
determined by a court of competent jurisdiction, shall in no way affect the
validity of any other provision hereof.

19.      DAYS. Unless otherwise specifically indicated to the contrary, the
word "days" as used in this Lease shall mean and refer to calendar days.

         20.  LIMITATION ON LIABILITY. Subject to the provisions of Paragraph 17
above, the obligations of Lessor under this Lease shall not constitute personal
obligations of Lessor, the individual partners of Lessor or its or their
individual partners, directors, officers or shareholders, and Lessee shall look
to the Premises, and to no other assets of Lessor, for the satisfaction of any
liability of Lessor with respect to this Lease, and shall not seek recourse
against the individual partners of Lessor, or its or their individual partners,
directors, officers or shareholders, or any of their personal assets for such
satisfaction.

         21.  TIME OF ESSENCE. Time is of the essence with respect to the
performance of all obligations to be performed or observed by the Parties under
this Lease.

         22.  NO PRIOR OR OTHER AGREEMENTS; BROKER DISCLAIMER. This Lease
contains all agreements between the Parties with respect to any matter mentioned
herein, and no other prior or contemporaneous agreement or understanding shall
be effective. Lessor and Lessee each represents and warrants to the Brokers that
it has made, and is relying solely upon, its own investigation as to the nature,
quality, character and financial responsibility of the other Party to this Lease
and as to the nature, quality and character of the Premises. Brokers have no
responsibility with respect thereto or with respect to any default or breach
hereof by either Party. The liability (including court cost and Attorneys'
fees), of any Broker with respect to negotiation, execution, delivery or
performance by either Lessor or Lessee under this Lease or any amendment or
modification hereto shall be limited to an amount up to the fee received by such
Broker pursuant to this Lease; provided, however, that the forgoing limitation
on each Broker's liability shall not be applicable to any gross negligence or
willful misconduct of such Broker.

23.      NOTICES. 

         23.1  NOTICE REQUIREMENTS. All notices required or permitted by this
Lease shall be in writing and may be delivered in person (by hand or by courier)
or may be sent by regular, certified or registered mail or U.S. Postal Service
Express Mail, with postage prepaid, or by facsimile transmission, and shall be
deemed sufficiently given if serve in a manner specified in this Paragraph 23.
The addresses noted adjacent to a Party's signature on this Lease shall be that
Party's address for delivery or mailing of notices. Either Party may by written
notice to the other specify a different address for notice, except that upon
Lessee's taking possession of the Premises, the Premises shall constitute
Lessee's address for notice. A copy of all notices to Lessor shall be
concurrently transmitted to such party or parties at such addresses as Lessor
may from time to time hereafter designate in writing. 

         23.2  DATE OF NOTICE. Any notice sent by registered or certified
mail, return receipt requested, shall be deemed given on the date of delivery
shown on the receipt card, or if no delivery date is shown, the postmark
thereon. If sent by regular mail the notice shall be deemed given forty-eight
(48) hours after the same is addressed as required herein and mailed with
postage prepaid. Notices delivered by United States Express Mail or overnight
courier that guarantee next day delivery shall be deemed given twenty-four (24)
hours after delivery of the same to the Postal Service or courier. Notices
transmitted by facsimile transmission or similar means shall be deemed delivered
upon telephone confirmation of receipt, provided a copy is also delivered via
delivery or mail. If notice is received on a Saturday, Sunday or legal holiday,
it shall be deemed received on the next business day.

24.      WAIVERS. No waiver by Lessor of the Default or Breach of any term,
covenant or condition hereof by Lessee, shall be deemed a waiver of any other
term, covenant or condition hereof, or of any subsequent Default or Breach by
Lessee of the same or of any other term, covenant or condition hereof. Lessor's
consent to, or approval of, any act shall not be deemed to render unnecessary
the obtaining of Lessor's consent to, or approval of, any subsequent or similar
act by Lessee, or be construed as the basis of an estoppel to enforce the
provision or provisions of this Lease requiring such consent. The acceptance of
Rent by Lessor shall not be a waiver of any Default or Breach by Lessee. Any
payment by Lessee may be accepted by Lessor on account of moneys or damages 


<PAGE>   13

due Lessor, notwithstanding any qualifying statements or conditions made by
Lessee in connection therewith, which such statements and/or conditions shall be
of no force or effect whatsoever unless specifically agreed to in writing by
Lessor at or before the time of deposit of such payment. 

25.      RECORDING. Either Lessor or Lessee shall, upon request of the other,
execute, acknowledge and deliver to the other a short form memorandum of this
Lease for recording proposes in form and content acceptable to both parties. The
Party requesting recordation shall be responsible for payment of any fees
applicable thereto.

26.      NO RIGHT TO HOLDOVER. Lessee has no right to retain possession of the
Premises or any part thereof beyond the expiration or termination of this Lease.
In the event that Lessee holds over, then the Base Rent shall be increased to
one hundred fifty percent (150%) of the Base Rent applicable during the month
immediately preceding the expiration or termination. Nothing contained herein
shall be construed as consent by Lessor to any holding over by Lessee. 

27.      CUMULATIVE REMEDIES. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other remedies at
law or in equity.

28.      COVENANTS AND CONDITIONS; CONSTRUCTION OF AGREEMENT. All provisions of
this Lease to be observed or performed by Lessee are both covenants and
conditions. In construing this Lease, all headings and titles are for the
convenience of the parties only and shall not be considered a part of this
Lease. Whenever required by the context, the singular shall include the plural
and vice versa. This Lease shall not be construed as if prepared by one of the
parties, but rather according to its fair meaning as a whole, as if both parties
had prepared it. 

29.      BINDING EFFECT; CHOICE OF LAW. This Lease shall be binding upon the
parties, their personal representatives, successors and assigns and be governed
by the laws of the State in which the Premises are located. Any litigation
between the Parties hereto concerning this Lease shall be initiated in the
county in which the Premises are located. 

30.      SUBORDINATION; ATTORNMENT; NON-DISTURBANCE.

         30.1  SUBORDINATION. This Lease and any Option granted hereby shall be
subject and subordinate to any ground lease, mortgage, deed of trust, or other
hypothecation or security device (collectively, "SECURITY DEVICE"), now or
hereafter placed upon the Premises, to any and all advances made on the security
thereof, and to all renewals, modifications, and extensions thereof. Lessee
agrees that the holders of any such Security Devices (in this Lease together
referred to as "Lender") shall have no liability or obligation to perform any of
the obligations of Lessor under this Lease. Any Lender may elect to have this
Lease and/or any Option granted hereby superior to the lien of its Security
Device by giving written notice thereof to Lessee, whereupon this Lease and such
Options shall be deemed prior to such Security Device, notwithstanding the
relative dates of the documentation or recordation thereof.

         30.2 ATTORNMENT. Subject to the non-disturbance provisions of
Paragraph 30.3, Lessee agrees to attorn to a Lender or any other party who
acquires ownership of the Premises by reason of a foreclosure of a Security
Device, and that in the event of such foreclosure, such new owner shall not: (i)
be liable for any act or omission of any prior lessor or with respect to events
occurring prior to acquisition of ownership; (ii) be subject to any offsets or
defenses which Lessee might have against any prior lessor, or (iii) be bound by
prepayment of more than one (1) month's rent.

         30.3 NON-DISTURBANCE. With respect to Security Devices entered into by
Lessor after the execution of this Lease, Lessee's subordination of this Lease
shall be subject to receiving a commercially reasonable non-disturbance
agreement (a "NON-DISTURBANCE AGREEMENT") from the Lender which Non-Disturbance
Agreement provides that Lessee's possession of the Premises, and this Lease,
including any options to extend the term hereof, will not be disturbed so long
as Lessee is not in Breach hereof and attorns to the record owner of the
Premises. Further, within sixty (60) days after the execution of this Lease,
Lessor shall use its commercially reasonable efforts to obtain a Non-Disturbance
Agreement from the holder of any pre-existing Security Device which is secured
by the Premises. In the event that Lessor is unable to provide the
Non-Disturbance Agreement within said sixty (60) days, then Lessee may, at
Lessee's option, directly contact Lessor's lender and attempt to negotiate for
the execution and delivery of a Non-Disturbance Agreement. 

         30.4 SELF-EXECUTING. The agreements contained in this Paragraph 30
shall be effective without the execution of any further documents; provided,
however, that, upon written request from Lessor or a Lender in connection with a
sale, financing or refinancing of the Premises, Lessee and Lessor shall execute
such further writings as may be reasonably required to separately document any
subordination, attornment and/or Non-Disturbance Agreement provided for herein.

31.      ATTORNEYS' FEES. If any Party or Broker brings an action or proceeding
involving the Premises to enforce the terms hereof or to declare rights
hereunder, the Prevailing Party (as hereafter defined) in any such proceeding,
action, or appeal thereon, shall be entitled to reasonable attorneys' fees. Such
fees may be awarded in the same suit or recovered in a separate suit, whether or
not such action or proceeding is pursued to decision or judgment. The term,
"PREVAILING PARTY" shall include, without limitation, a Party or Broker who
substantially obtains or defeats the relief sought, as the case may be, whether
by compromise, settlement, judgment, or the abandonment by the other Party or
Broker of its claim or defense. The attorneys' fees award shall not be computed
in accordance with any court fee schedule, but shall be such as to fully
reimburse all attorneys' fees reasonably incurred. In addition, Lessor shall be
entitled to attorneys' fees, costs and expenses incurred in the preparation and
service of notices of Default and consultations in connection therewith, whether
or not a legal action is subsequently commenced in connection with such Default
or resulting Breach. 

32.      LESSOR'S ACCESS; SHOWING PREMISES; REPAIRS. Lessor and Lessor's agents
shall have the right to enter the Premises at any time, in the case of an
emergency, and otherwise at reasonable times for the purpose of showing the same
to prospective purchasers, lenders, or lessees, and making such alterations,
repairs, improvement or additions to the Premises as Lessor may deem necessary.
All such activities shall be without abatement of rent or liability to Lessee.
Lessor may at any time place on the Premises any ordinary "FOR SALE" signs and
Lessor may during the last six (6) months of the term hereof place on the
Premises any ordinary "FOR LEASE" signs. Lessee may at any time place on or
about the Premises any ordinary "FOR SUBLEASE" sign. 

33.      AUCTIONS. Lessee shall not conduct, nor permit to be conducted, any
auction upon the Premises without Lessor's prior written consent. Lessor shall
not be obligated to exercise any standard of reasonableness in determining
whether to permit an auction.

34.      SIGNS. Except for ordinary "For Sublease" signs, Lessee shall not
place any sign upon the Premises without Lessor's prior written consent. All
signs must comply with all Applicable Requirements.

35.      TERMINATION; MERGER. Unless specifically stated otherwise in writing
by Lessor, the voluntary or other surrender of this Lease by Lessee, the mutual
termination or cancellation hereof, or a termination hereof by Lessor for Breach
by Lessee, shall automatically terminate any sublease or lesser estate in the
Premises; provided, however, that Lessor may elect to continue any one or all
existing subtenancies. Lessor's failure within ten (10) days following any such
event to elect to the contrary by witten notice to the holder of any such lesser
interest, shall constitute Lessor's election to have such event constitute the
termination of such interest.



<PAGE>   14

36.      CONSENTS. Except as otherwise provided herein, wherever in this Lease
the consent of a Party is required to an act by or for the other Party, such
consent shall not be unreasonably withheld or delayed. Lessor's actual
reasonable costs and expenses (including but not limited to architects',
attorneys', engineers' and other consultants' fees) incurred in the
consideration of, or response to, a request by Lessee for any Lessor consent,
including but not limited to consents to an assignment, a subletting or the
presence or use of a Hazardous Substance, shall be paid by Lessee upon receipt
of an invoice and supporting documentation therefor. Lessor's consent to any
act, assignment or subletting shall not constitute an acknowledgment that no
Default or Breach by Lessee of this Lease exists, nor shall such consent be
deemed a waiver of any then existing Default or Breach, except as may be
otherwise specifically stated in writing by Lessor at the time of such consent.
The failure to specify herein any particular condition to Lessor's consent shall
not preclude the imposition by Lessor at the time of consent of such further or
other conditions as are then reasonable with reference to the particular matter
for which consent is being given. In the event that either Party disagrees with
any determination made by the other hereunder and reasonably requests the
reasons for such determination, the determining party shall furnish its reasons
in writing and in reasonable detail within ten (10) business days following such
request.

37.      GUARANTOR. 

         37.1  EXECUTION. The Guarantors, if any, shall each execute a guaranty
in the form most recently published by the American Industrial Real Estate
Association, and each such Guarantor shall have the same obligations as Lessee
under this Lease. 

         37.2  DEFAULT. It shall constitute a Default of the Lessee if any
Guarantor fails or refuses, upon request to provide: (a) evidence of the
execution of the guaranty, including the authority of the party signing on
Guarantor's behalf to obligate Guarantor, and in the case of a corporate
Guarantor, a certified copy of a resolution of its board of directors
authorizing the making of such guaranty, (b) current financial statements, (c) a
Estoppel Certificate, or (d) written confirmation that the guaranty is still in
effect. 

38.      QUIET POSSESSION. Subject to payment by Lessee of the Rent and
performance of all of the covenants, conditions and provisions on Lessee's part
to be observed and performed under this Lease, Lessee shall have quiet
possession and quiet enjoyment of the Premises during the term hereof. 

39.      OPTIONS.

         39.1  DEFINITION. "OPTION" shall mean: (a) the right to extend the term
of or renew this Lease or to extend or renew any lease that Lessee has on other
property of Lessor; (b) the right of first refusal or first offer to lease
either the Premises or other property of Lessor; (c) the right to purchase or
the right of first refusal to purchase the Premises or other property of Lessor.

         39.2  OPTIONS PERSONAL TO ORIGINAL LESSEE. Each Option granted to
Lessee in this Lease is personal to the original Lessee, and cannot be assigned
or exercised by anyone other than said original Lessee and only while the
original Lessee is in full possession of the Premises and, if requested by
Lessor, with Lessee certifying that Lessee has no intention of thereafter
assigning or subletting. 

         39.3  MULTIPLE OPTIONS. In the event that Lessee has any multiple
Options to extend or renew this Lease, a later Option cannot be exercised unless
the prior Options have been validly exercised. 

         39.4  EFFECT OF DEFAULT ON OPTIONS. 

               (a) Lessee shall have no right to exercise an Option: (i) during
the period commencing with the giving of any notice of Default and continuing
until said Default is cured, (ii) during the period of time any Rent is unpaid
(without regard to whether notice thereof is given Lessee), (iii) during the
time Lessee is in Breach of this Lease, or (iv) in the event that Lessee has
been given three (3) or more notices of separate Default, whether or not the
Defaults are cured, during the twelve (12) month period immediately preceding
the exercise of the Option.

               (b) The period of time within which an Option may be exercised
shall not be extended or enlarged by reason of Lessee's inability to exercise an
Option because of the provisions of Paragraph 39.4(a).

               (c) An Option shall terminate and be of no further force or
effect, notwithstanding Lessee's due and timely exercise of the Option, if,
after such exercise and prior to the commencement of the extended term, (i)
Lessee fails to pay Rent for a period of thirty (30) days after such Rent
becomes due (without any necessity of Lessor to give notice thereof), (ii)
Lessor gives to Lessee three (3) or more notices of separate Default during any
twelve (12) month period, whether or not the Defaults are cured, or (iii) If
Lessee commits a Breach of this Lease. 

40.      MULTIPLE BUILDINGS. If the Premises are a part of a group of buildings
controlled by Lessor, Lessee agrees that it will observe all reasonable rules
and regulations which Lessor may make from time to time for the management,
safety, and care of said properties, including the care and cleanliness of the
grounds and including the parking, loading and unloading of vehicles, and that
Lessee will pay its fair share of common expenses incurred in connection
herewith. 

41.      SECURITY MEASURES. Lessee hereby acknowledges that the rental payable
to Lessor hereunder does not include the cost of guard service or other security
measures, and that Lessor shall have no obligation whatsoever to provide same.
Lessee assumes all responsibility for the protection of the Premises, Lessee,
its agents and invitees and their property from the acts of third parties.

42.      RESERVATIONS. Lessor reserves to itself the right, from time to time,
to grant, without the consent or joinder of Lessee, such easements, rights and
dedications that Lessor deems necessary, and to cause the recordation of parcel
maps and restrictions, so long as such easements, rights, dedications, maps and
restrictions do not unreasonably interfere with the use of the Premises by
Lessee. Lessee agrees to sign any documents reasonably requested by Lessor to
effectuate any such easement rights, dedication, map or restrictions.

43.      PERFORMANCE UNDER PROTEST. If at any time a dispute shall arise as to
any amount or sum of money to paid to be paid by one Party to the other under
the provisions hereof, the Party against whom the obligation to pay the money is
asserted shall have the right to make payment "under protest" and such payment
shall not be regarded as a voluntary payment and there shall survive the right
on the part of said Party to institute suit for recovery of such sum. If it
shall be adjudged that there was no legal obligation on the part of said Party
to pay such sum or any part thereof, said Party shall be entitled to recover
such sum or so much thereof as it was not legally required to pay.

44.      AUTHORITY. If either Party hereto is a corporation, trust, limited
liability company, partnership, or similar entity, each individual executing
this Lease on behalf of such entity represents and warrants that he or she is
duly authorized to execute and deliver this Lease on its behalf. Each party
shall, within thirty (30) days after request, deliver to the other party
satisfactory evidence of such authority.

45.      CONFLICT. Any conflict between the printed provisions of this Lease
and the typewritten or handwritten provisions shall be controlled by the
typewritten or handwritten provisions.

46.      OFFER. Preparation of this Lease by either Party or their agent and
submission of same to the other Party shall not be deemed an offer to lease to
the other Party. This Lease is not intended to be binding until executed and
delivered by all Parties hereto.



<PAGE>   15

47.      AMENDMENTS. This Lease may be modified only in writing, signed by the
Parties in interest at the time of the modification. As long as they do not
materially change Lessee's obligations hereunder, Lessee agrees to make such
reasonable non-monetary modifications to this Lease as may be reasonably
required by a Lender in connection with the obtaining of normal financing or
refinancing of the Premises.

48.      MULTIPLE PARTIES. If more than one person or entity is named herein as
either Lessor or Lessee, such multiple Parties shall have joint and several
responsibility to comply with the terms of this Lease.

49.      MEDIATION AND ARBITRATION OF DISPUTES. An Addendum requiring the
Mediation and/or the Arbitration of all disputes between the Parties and/or
Brokers arising out this Lease IS X IS NOT attached to this Lease.



LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR
INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE
TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE
AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE
PREMISES.

--------------------------------------------------------------------------------
ATTENTION: NO REPRESENTATION OR RECOMMENDATION IS MADE BY THE AMERICAN
INDUSTRIAL REAL ESTATE ASSOCIATION OR BY ANY BROKERS AS TO THE LEGAL
SUFFICIENCY, LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS LEASE OR THE TRANSACTION
TO WHICH IT RELATES. THE PARTIES ARE URGED TO:

1.  SEEK ADVICE OF COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS LEASE.

2.  RETAIN APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION OF
THE PREMISES. SAID INVESTIGATION SHOULD INCLUDE BUT NOT BE LIMIT TO: THE
POSSIBLE PRESENCE OF HAZARDOUS SUBSTANCES, THE ZONING OF THE PREMISES, THE
STRUCTURAL INTEGRITY, THE CONDITION OF THE ROOF AND OPERATING SYSTEMS, AND THE
SUITABILITY OF THE PREMISES FOR LESSEE'S INTENDED USE.

WARNING: IF THE PREMISES IS LOCATED IN A STATE OTHER THAN CALIFORNIA, CERTAIN
PROVISIONS OF THE LEASE MAY NEED TO BE REVISED TO COMPLY WITH THE LAWS OF THE
STATE IN WHICH THE PREMISES IS LOCATED.
--------------------------------------------------------------------------------

The parties hereto have executed this Lease at the place and on the dates
specified above their respective signatures.
<TABLE>
<CAPTION>

<S>                                       <C>
Executed at:                              Executed at:
            ---------------------------               ----------------------------------------
on:                                       on:
    -----------------------------------      -------------------------------------------------
By LESSOR:                                By LESSEE:
DANAT INVESTMENT COMPANY,                 CONSOLIDATED CAPITAL OF NORTH AMERICA, INC.
---------------------------------------   ----------------------------------------------------
a California general partnership
---------------------------------------   ----------------------------------------------------

By: /s/  Daniel J. Eget                   By:/s/  Christian W. Wolf
   ------------------------------------      -------------------------------------------------
Name Printed: Daniel J. Eget              Name Printed:
              -------------------------                 --------------------------------------
Title: General Partner                    Title:
       --------------------------------          ---------------------------------------------

By: /s/  Nathan J. Reese                  By: /s/ Donald R. Jackson
   ------------------------------------      -------------------------------------------------
Name Printed: Nathan J. Reese             Name Printed:  Donald R. Jackson
              -------------------------                ---------------------------------------
Title:  General Partner                   Title: Secretary/Treasurer/Chief Financial Officer
      ---------------------------------         ----------------------------------------------
Address:                                  Address:
        -------------------------------            -------------------------------------------

---------------------------------------   ----------------------------------------------------
Telephone: (   )                          Telephone: (   )
                 -----------------------                  ------------------------------------
Facsimile : (   )                         Facsimile : (   )
                 -----------------------                  ------------------------------------
Federal ID No.                            Federal ID No.
               -------------------------                  ------------------------------------
</TABLE>


<PAGE>   16


 ADDITIONAL SIGNATURE PAGE FOR ANGELES ACQUISITION CORPORATION ON LEASE 
                                   Agreement


                           Executed at:
                                        --------------------------------------
                                    on:
                                        --------------------------------------

                                    By: LESSEE:
                                        ANGELES ACQUISITION CORP.,
                                        a Delaware Corporation

                                    By:
                                        --------------------------------------

                           Printed Name:     Christian Wolf

                           Title:            Chief Executive Officer


                                    By:
                                        --------------------------------------

                           Printed Name:      Donald R. Jackson

                           Title:  Secretary/Treasurer/Chief Financial Officer

                           Address:
                                    ------------------------------------------

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

                           Telephone:
                                       ---------------------------------------

                           Facsimile:
                                       ---------------------------------------

                           Federal ID No.
                                          ------------------------------------


<PAGE>   17

                 ADDENDUM AGREEMENT REGARDING EQUIPMENT PURCHASE
                                AND OFFSET RIGHTS

Consolidated Capital of North America, Inc.

Gentlemen:

         This letter will confirm our understanding concerning the terms and
conditions which will prevail in the event that the Federal Bankruptcy Court in
Case #LA 97-48259 KM, determines that you, or either of you, are obligated to
purchase the cranes, craneways and/or electrical systems, located and installed
at 20000 South Western Avenue, Torrance, California 90501 (the PREMISES), form
Capitol Metals Company, Inc., and the value placed upon said items (the PRICE),
Danat (DANAT) agrees to do the following:

      1.    DANAT will purchase those same items from you for the PRICE as set
            by the court.
      2.    The PRICE, plus interest at prime rate (as published by the Wall
            Street Journal) plus two percent (2%), shall be paid monthly over
            the remaining original term of the LEASE for the PREMISES.
      3.    The monthly payment amount shall be adjusted every six months to
            reflect changes in the prime rate, if any. 
      4.    When the LEASE terminates, title to said equipment shall vest in
            DANAT and you shall execute a Bill of Sale for said equipment.
      5.    Said terms shall be free and clear of any liens or encumbrances.
      6.    During the period of the LEASE, you shall be totally responsible for
            the maintenance and repair of said equipment. 
      7.    At all times said equipment shall remain at and not be removed from 
            the PREMISES. 
      8.    Each said monthly payment may be deducted by you from the payment 
            to be made by you to DANAT under the terms of the LEASE.

         By signing this letter agreement at the place provided below, you will
be indicating your agreement and acceptance of the terms of the transaction set
forth.


DANAT INVESTMENT COMPANY


By:   \s\ Daniel J. Eget                \s\ Nathan J. Reese
      -----------------------------------------------------
      Daniel J. Eget
Its:  General Partner


CONSOLIDATED CAPITAL OF NORTH AMERICA, INC.


By:
    --------------------------------------
Its:


<PAGE>   18


        ADDITIONAL SIGNATURE PAGE FOR ANGELES ACQUISITION CORPORATION ON
        ADDENDUM AGREEMENT REGARDING EQUIPMENT PURCHASE AND OFFSET RIGHTS



                           Executed at:
                                        --------------------------------------
                                    on:
                                        --------------------------------------

                                    By: LESSEE:
                                           ANGELES ACQUISITION CORP.,
                                           a Delaware Corporation

                                    By:
                                        --------------------------------------
                           Printed Name:     Christian Wolf

                           Title:            Chief Executive Officer


                                    By:
                                        --------------------------------------
                           Printed Name:      Donald R. Jackson

                           Title:  Secretary/Treasurer/Chief Financial Officer

                           Address:
                                    ------------------------------------------

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

                           Telephone:
                                       ---------------------------------------

                           Facsimile:
                                       ---------------------------------------

                           Federal ID No.
                                          ------------------------------------


<PAGE>   19


                               OPTION(S) TO EXTEND
                                   ADDENDUM TO
                                 STANDARD LEASE


       DATED             January 1, 1998

       BY AND BETWEEN (LESSOR) DANAT INVESTMENT COMPANY, a California general
                               partnership

                      (LESSEE) Consolidated Capital of North America, Inc., a
                               Colorado corporation

       PROPERTY ADDRESS: 20000 South Western Avenue, Torrance, California 90501

Paragraph    50

A.   OPTION(S) TO EXTEND:

         Lessor hereby grants to Lessee the option to extend the term of this
Lease for 2 additional 36 month period(s) commencing when the prior term expires
upon each and all of the following terms and conditions:

     (i) Lessee gives to Lessor, and Lessor actually receives on a date which is
prior to the date that the option period would commence (if exercised) by at
least 120 and not more than 150 days, a written notice of the exercise of the
option(s) to extend this Lease for said additional term(s), time being of
essence. If said notification of the exercise of said option(s) is (are) not so
given and received, the option(s) shall automatically expire; said option(s) may
(if more than one) only be exercised consecutively;

     (ii) The provisions of paragraph 39, including the provisions relating to
default of Lessee set forth in paragraph 39.4 of this Lease are conditions of
this Option;

     (iii) All of the terms and conditions of this Lease except where
specifically modified by this option shall apply;

     (iv) The monthly rent for each month of the option period shall be
calculated as follows, using the method(s) indicated below:

(Check Method(s) to be Used and Fill in Appropriately)

   X    III. Fixed Rental Adjustments(s) (FRA)
 ----

The monthly rent payable under paragraph 1.5 ("Base Rent") of the attached Lease
shall be increased to the following amount on the dates set forth below:

<TABLE>
        <S>                                    <C>
        On (Fill in FRA Adjustment Date(s)):    The New Base Rental shall be:

           January 1, 2001                          $ 90,000.00 per month
        -----------------------------------          --------------------
           January 1, 2004                          $110,000.00 per month
        -----------------------------------          --------------------
        -----------------------------------          --------------------
        -----------------------------------          --------------------
</TABLE>

B. NOTICE: Unless specified otherwise herein, notice of any escalations other
than Fixed Rental Adjustments shall be made as specified in paragraph 23 of the
attached Lease.

















                               OPTION(S) TO EXTEND
                                   PAGE 1 of 1
<PAGE>   20
                   ADDENDUM TO STANDARD INDUSTRIAL/COMMERCIAL
                            SINGLE-TENANT LEASE-NET


                 This Addendum ("Addendum") is attached to and made a part of
that certain Standard Industrial/Commercial Single-Tenant Lease-Net ("Lease")
dated September 2, 1997, and made by and between Danat Investment Company, a
California general partnership as Lessor, and Angeles Acquisition Corporation,
a Delaware corporation and Consolidated Capital of North America, Inc., a
Colorado corporation, collectively, as Lessee, covering the Premises commonly
known as 20000 South Western Avenue, Torrance, California 90501, as more
particularly described in the Lease.  Capitalized terms used herein and not
otherwise defined shall have the same meaning as set forth in the Lease.  In
the event of any conflict or inconsistency between the terms and provisions of
this Addendum and the terms and provisions of the Lease, the terms and
provisions of this Addendum shall prevail.  This Addendum and the Lease may be
executed  in any number of counterparts, each of which shall be deemed an
original, but all of which, when taken together, shall constitute one and the
same instrument.  The terms and provisions of the Lease are hereby modified or
supplemented as follows:

                 Paragraph 51.  The following paragraph is hereby added after
Paragraph 50 of the Lease as a new Paragraph 51:

         "51.    Lessee's Right of First Refusal to Purchase.

         51.1.   If during the term of this Lease, Lessor intends to accept an
offer from any bona fide third party ("Proposed Purchaser") to  purchase the
Premises, then, before accepting such offer, Lessor shall give Lessee the right
to purchase the Premises in accordance with this Paragraph 51.1 by notifying
Lessee in writing of the sale price and other material terms upon which Lessor
is willing to sell the Premises  to the Proposed Purchaser and including
therewith a full and correct photocopy of the purchase offer which Lessor
intends to accept, but deleting therefrom any information as to the identity of
the Proposed Purchaser, if so requested by said Proposed Purchaser (the "Offer
Notice").  The Offer Notice shall constitute an offer to sell the Premises to
Lessee upon the terms and conditions set forth therein, as modified by this
Paragraph 51.1.  Lessee shall have the right for a period of ten (10) business
days after delivery of the Offer Notice (the "Exercise Period") to deliver by
certified mail, return receipt requested, written notice to Lessor of Lessee's
election to purchase the Premises on the exact terms of the Offer Notice, as
hereafter modified ("Notice of Acceptance"), together with a deposit in the
amount equal to the deposit amount stated in the Offer Notice ("Deposit").
Notwithstanding the terms of the Offer Notice, the following shall apply to
Lessee's purchase: (a) there shall be no contingencies for the benefit of
Lessee to the closing relating to feasibility, physical or environmental
inspection, termite inspection, suitability for a particular use, legality of a
particular use, or the obtaining of governmental approvals; and (b) the
contingency, examination or other periods for the exercise of any right or the
performance of any obligation specified in the Purchase Agreement (defined
below) shall commence on the date of delivery of Lessee's Notice of Acceptance.

         Lessee's timely delivery to Lessor of the Notice of Acceptance and the
Deposit shall constitute a binding acceptance on the part of Lessee to enter
into a purchase agreement with Lessor on Lessor's form of purchase agreement
("Purchase Agreement") which Purchase Agreement shall contain all of the terms
which are set forth in the Offer Notice, as modified by this Paragraph 51.1,
and such other terms and conditions not materially inconsistent with those set
forth above, as determined by Lessor in its reasonable discretion.  If (i)
Lessee does not timely deliver to Lessor the Notice of Acceptance or make the
required Deposit, (ii) Lessee fails to execute and deliver the Purchase
Agreement for the purchase of the Premises within twenty (20) calendar days
following Lessor's delivery of same to Lessee or (iii) escrow does not close
within the time period set forth for closing under the Purchase Agreement for
any reason other than a material default of Lessor thereunder, then Lessor may
sell the Premises to the Proposed Purchaser on such terms and conditions as
Lessor and such Proposed Purchaser shall agree, and without the necessity of
offering the Premises for sale to Lessee, provided, however, that if pursuant
to negotiations with the Proposed Purchaser, Lessor agrees to sell the Premises
to such Proposed Purchaser for  a purchase price which is less than ninety-five
percent (95%) of the purchase price set forth in the Offer Notice, then Lessor
shall be required to re-offer the Premises to Lessee in accordance with the
procedures set forth in this Paragraph 51. Any successor owner of the Premises
shall not be required to first offer the Premises to Lessee in the case of
future sales or transfers and, once the Premises is sold pursuant to the
provisions of this Paragraph 51.1, Lessee's right of first refusal hereunder
shall terminate and be null and void.

         The occurrence of a default  by Lessee or Lessor under the terms of
this paragraph 51.1, including but not limited to any default in connection
with the purchase and sale of the Premises, shall not entitle either party to
terminate this Lease.

         51.2.   The right of first refusal contained in Paragraph 51.1 shall
not apply to the following sales or transfers of any of the Premises , and any
offers to purchase the Premises made in connection with the following sales or
transfers shall not constitute "bona fide" offers hereunder:  (a) the sale or
transfer of the Premises or any portion thereof or interest therein to any of
Lessor's currently existing constituent partners; (b) the sale or transfer of
the Premises or any portion thereof or interest therein to a trust (including a
living trust), the beneficiaries of which consist solely of either Lessor, or
the beneficiaries of either Lessor, one or more of Lessor's currently existing
constituent partners or such partners' children or grandchildren; (c) the sale
or transfer of the Premises or any portion thereof or interest therein to any
one or more of the children, grandchildren, parents, brothers or sisters of
either  of Lessor's currently existing constituent partners or beneficiaries;
(d) any other sale or transfer, which is a change in the form of ownership but
does not involve a change in the beneficial ownership of the Premises, unless
such change in beneficial ownership is covered by any of the foregoing
exceptions (by way of example, the right of first refusal shall not apply to a
sale or transfer to a partnership or corporation, the sole partners or
shareholders of which are the currently existing partners of either party
comprising Lessor or any of such partners' children or grandchildren); and (e)
the sale by foreclosure of any deed of trust or other lien on the Premises or
by deed in lieu of foreclosure to the beneficiary of any such deed of trust or
other lien or its designee.  The purchaser or transferee set forth in
subsections (a) through (d) of this Paragraph 51.2 above shall be bound by the
terms of Paragraph 51.1 in the case of subsequent sales or transfers not
exempted by this Paragraph 51.2.  Lessee's right of first refusal hereunder
shall terminate and be of no further force or effect in the event that the
Premises are sold as set forth in subsection (e) above.  In addition, Lessee
agrees, within five (5) business
<PAGE>   21
days after Lessors written request therefor, to execute a subordination
agreement in favor of any lender or mortgagee of Lessor in order to subordinate
its rights under this Paragraph 51 to such lender or mortgagee.

         51.3    Neither Lessee's rent payments nor any other payments made to
Lessor pursuant to the Lease shall be applied against the purchase price
payable under the Purchase Agreement.  If Lessor defaults under this Paragraph
51 after notice to Lessor as provided in the Lease, Lessee shall not have the
right to terminate the Lease or offset against rent, however, Lessee may bring
an action for actual damages or for specific performance provided that Lessee
shall have fully performed all of its obligations hereunder and under the
Purchase Agreement (including, without limitation, deposit of the purchase
price in good funds to escrow), Lessee shall have given notice to Lessor
("Notice") of Lessor's default or alleged default within thirty (30) days after
Lessee has first obtained knowledge of Lessor's default or alleged default and
the action shall have been commenced, and service of process upon Lessor made,
not later than thirty (30) days after Lessee's delivery to Lessor of the
Notice."


                 Paragraph 2.2: CONDITION.  Paragraph 2.2 of the Lease is
hereby deleted in its entirety and is replaced with the following:

                 "2.2 CONDITION.  Subject to the disclosures and other items
                 set forth on the Disclosure Schedule attached to that certain
                 Asset Purchase Agreement dated September 5, 1997 by and
                 between Lessee, as "Purchaser" and Capitol Metals Co., Inc., a
                 California corporation as "Seller," and subject to matters to
                 which Lessee or its agents, representatives, employees or
                 brokers are aware pursuant to an inspection of the Premises or
                 otherwise, Danat Investment Company warrants that, as of the
                 earlier of the Commencement Date or the Early Possession Date
                 ("Start Date") the improvement on the Premises necessary to
                 operate the business existing at the Premises as of the Start
                 Date (the "Pre-Existing Business") are in good condition and
                 are structurally sound, and all mechanical and other systems
                 necessary to operate the Pre-Existing Business and which are
                 located on the Premises are in good operating condition,
                 subject to normal wear and tear, and no condition exists
                 requiring material repairs, alterations or corrections to such
                 improvements or mechanical or other systems necessary to run
                 the Pre-Existing Business."

                 Paragraph 2.3: COMPLIANCE.  The following sentence is inserted
at the end of the first sentence of Paragraph 2.3 of the Lease, before the
period:

                 "and except as provided in that certain Phase 1 Environmental
                 Site Assessment for the Premises dated August 20, 1997 by
                 Levine-Pricke and Recon ("ESA"), Lessor has received no
                 notices, oral or written, from any governmental body, and has
                 no reason to believe, that the Premises, and improvements
                 erected or situated thereon, or the uses of the Pre-Existing
                 Business conducted thereon or therein, violate any Applicable
                 Requirements in effect on the Start Date."

                 Paragraph 2.4: ACKNOWLEDGMENTS.   The following is hereby
added after subsection (c) of Paragraph 2.4 of the Lease before the period:

                 ", (d) it has received and reviewed the ESA and is familiar
                 with its contents and the environmental condition of the
                 Premises and surrounding areas as reported in the ESA, and,
                 notwithstanding anything to the contrary set forth in this
                 Lease, Lessee is leasing the Premises subject to such
                 conditions disclosed in the ESA and (e) no further action is
                 required by Lessor at this time with respect to the
                 recommendations set forth in Section 6.0 of the ESA."

                 Paragraph 6.2(a): REPORTABLE USES REQUIRE CONSENT.   The
following sentence is hereby added at the end of Paragraph 6.2(a) of the Lease:

                 "Notwithstanding anything to the contrary set forth above,
                 Lessor hereby consents to Lessee's use of the materials and
                 substances listed on Exhibit A attached hereto on the
                 condition that said materials and substances shall at all
                 times be used in compliance with all Applicable Requirements."

                 Paragraph 6.2(e): LESSOR INDEMNIFICATION.  Paragraph 6.2(e) of
the Lease is hereby deleted  in its entirety and is replaced with the
following:

                 "Lessor shall indemnify, defend, reimburse and hold Lessee,
                 its agents, employees and lenders ("Lessee's Parties")
                 harmless from and against any and all damages, liabilities,
                 judgments, claims, expenses, penalties and attorneys' and
                 consultants' fees arising out of or involving any Hazardous
                 Substance in, on, or about, the Premises  prior to the Start
                 Date, the presence of which was caused by Lessor or Lessor's
                 prior tenants, provided, however, that Lessor shall have no
                 liability under this Lease with respect to the migration of
                 any Hazardous Substance in, on, under or about the Premises
                 from adjacent properties.  Lessor's obligations shall include,
                 but not be limited to, the effects of any contamination or
                 injury to person, property or the environment created or
                 suffered by Lessor, and the cost of investigation, removal,
                 remediation, restoration and/or abatement and, except as
                 otherwise provided in this Lease or the Addenda and Exhibits
                 attached hereto, shall survive the expiration or termination
                 of this Lease.  Except as set forth herein, no termination,
                 cancellation or release agreement entered into by Lessee and
                 Lessor shall release Lessor from its obligations under this
                 Lease with respect to Hazardous Substances, unless
                 specifically so agreed by Lessee in writing at the time of
                 such agreement.  Lessor's indemnification provided herein and
                 all representations and warranties set forth in this Lease
                 shall expire and terminate upon Lessee's purchase of the
                 Premises pursuant to the provisions of Paragraph 51 hereof, in
                 the event that the purchase of the Premises is on an as-is
                 basis.  Upon the issuance by a court of competent jurisdiction
                 of a final, nonappealable order ('Order') for damages against
                 Lessor which gives rise to Lessor's indemnity obligations
                 under this Paragraph 6.2(e) Lessor shall have until the time
                 period specified in such Order to make payment to Lessee as
                 required by such Order.  If Lessee does not receive payment by
                 the date specified in any such Order, then Lessee shall have
                 the right to offset its payments of Rent due
<PAGE>   22
                 under the Lease until the amount of Rent withheld equals the
                 amount stated in the Order, at which time Lessee shall then
                 again be obligated to pay all Rent due under the Lease without
                 offset, in accordance with the terms of this Lease.  Lessee
                 agrees that Lessor's indemnity obligations set forth in this
                 Paragraph 6.2(e) are subject to the provisions of Paragraphs
                 17 and 20 hereof regarding the definition of  'Lessor' and the
                 limitation of Lessor's liability, respectively."

                 Paragraph 6.2(h):  APPLICABLE REQUIREMENTS.  The following
paragraph is hereby added as a new Paragraph 6.2(h) to the Lease:

                 "As used in Paragraph 6 hereof, the term "Applicable
                 Requirements" shall also include any federal, state and local
                 environmental or health and safety laws, ordinances, rules,
                 regulations, codes, and any judicial and administrative
                 orders, directives, decrees, judgments, guidelines, permits or
                 permit conditions currently existing and as amended, enacted,
                 issued or adopted in the future which are applicable to or
                 otherwise related to the Premises."

                 Paragraph 8.1: PAYMENT FOR INSURANCE.  The following is hereby
added at the end of Paragraph 8.1 of the Lease:

                 "Notwithstanding the foregoing, Lessee shall have the right,
                 for a period of thirty (30) days after the Commencement Date
                 of the Lease, and for a period of thirty (30) days following
                 each successive anniversary of the Commencement Date of this
                 Lease, to review the premiums charged for the insurance
                 required under Paragraph 8 to be obtained by Lessor as the
                 Insuring Party.  If Lessee determines, in its reasonable
                 discretion, that the cost of the insurance premiums for the
                 insurance maintained by Lessor are materially greater than the
                 premiums being charged for such insurance by like insurance
                 companies, then, Lessee may elect, upon written notice to
                 Lessor given within ten (10) days following the expiration of
                 said thirty (30) day period, to be the "Insuring Party"
                 hereunder and procure and maintain the insurance required
                 under Paragraph 8 subject to all the terms and conditions set
                 forth herein.  The foregoing shall not affect any obligation
                 of Lessee to pay for insurance premiums hereunder which accrue
                 during the time that Lessor is the Insuring Party."

                 Paragraph 12.1(b) and (c).  All references to "Lessee" in
Paragraphs 12.1(b) and (c) are hereby changed to "Angeles".

                 Paragraph 12.1(f).  The following paragraph is hereby added as
a new Paragraph 12.1(f):

                 "(f) Notwithstanding anything to contrary set forth in this
                 Paragraph 12.1, any change in control in Angeles which shall
                 be deemed to have occurred solely as a result of a change in
                 control of Consolidated Capital of North America, Inc., the
                 parent company of Angeles Acquisition Corporation, shall not
                 be deemed a change in control of Lessee for purposes of this
                 paragraph 12.1."



         IN WITNESS WHEREOF, Lessee and Lessor have executed this Addendum
concurrently with their execution of the Lease.


LESSOR:                                          LESSEE:
DANAT INVESTMENT COMPANY,                        CONSOLIDATED CAPITAL OF 
a California general partnership                 NORTH AMERICA, INC.  
                                
                                

By: \s\ Daniel J. Eget                           By: \s\ Christian W. Wolf 
   --------------------------------                 ----------------------------
Name:   Daniel J. Eget
Its:    General Partner                          Its:
                                                     ---------------------------



By:  \s\ Nathan J. Reese                         By: /s/ Donald R. Jackson 
   --------------------------------                 ----------------------------
Name:   Nathan J. Reese                          Name:    Donald R. Jackson 
Its:     General Partner                         Its:  Secretary/Treasurer/
                                                       Chief Financial Officer
                                                       -------------------------

<PAGE>   23





                                  EXHIBIT "A"

                   LIST OF HAZARDOUS MATERIALS AND SUBSTANCES


1.  Waste oil - DOT combustible liquid, N.O.S., (Waste Petroleum Oil), NA 1993,
    PGIII

2.  Pickle liquor - DOT Ferrous chloride, Corrosive material, NA 1760







<PAGE>   24

                    OPTION TO PURCHASE PREMISES LEASE RIDER


         This Option to Purchase Premises Lease Rider (this "Rider") is
attached to and forms a part of the Standard Industrial Commercial
Single-Tenant Lease-Net ("Lease") dated September 2, 1997 between Danat
Investment Company, a California general partnership and Howard and Sandra
Gosch, Co-trustees of the Sammy Narens Family Trust, U/T/D of September 7,
1988, collectively as Lessor, and Consolidated Capital of North America, Inc.,
a Colorado corporation, collectively as Lessee, covering the real property
commonly known as 20000 South Western Avenue, Torrance, California 90501, as
more particularly described in the Lease ("Premises").   Capitalized terms used
herein and not otherwise defined shall have the same meaning as set forth in
the Lease.  In the event of any conflict or any inconsistency between the terms
and provisions of this Rider and the terms and provisions of the Lease, the
terms and provisions of this Rider shall prevail.  This Rider may be executed
in any number of counterparts, each of which shall be deemed an original, but
all of which, when taken together, shall constitute one and the same
instrument.

Option to Purchase Premises.

         A.      Grant and Exercise of Option.  Lessor hereby grants to Lessee
three (3) separate options to purchase the Premises (each, an "Option" and
collectively, the "Options"), at a price and upon the terms and conditions set
forth below.  Subject to the conditions set forth in Paragraph C below, Lessee
shall exercise an Option, if at all, by delivering written notice thereof by
certified mail, return receipt requested (the "Notice of Exercise") to Lessor
on or between the dates set forth below with respect to each Option.  If Lessor
has not received the applicable Notice of Exercise on or between such dates,
than such Option shall lapse and Lessee shall have no further right to exercise
such Option.  The dates between which Lessee may exercise its Options are as
follows (the "Option Periods"):

<TABLE>
<CAPTION>
Option Number             Dates of Exercise
--------------            -----------------
<S>                       <C>
Option No. 1:             Between October 1, 2000 and December 31, 2000
Option No. 2:             Between October 1, 2003 and December 31, 2003
Option No. 3:             Between October 1, 2006 and December 31, 2006
</TABLE>

         B.      Summary of Basic Terms of Option to Purchase Premises.  This
paragraph B contains the basic terms concerning the Option.  These basic terms
are to be read together with the remainder of this Rider.

                 1.       Purchase Price Amount.  The purchase price ("Purchase
Price") for the Premises shall be the Fair Market Value (defined below) of the
Premises as of the date of the Lessee's delivery of the Notice of Exercise and
Deposit (defined below) to Lessor.

                 2.       Deposit Amount.  The amount of the deposit which
Lessee shall deliver to Escrow Agent when the Purchase Price is determined
shall be an amount equal to five percent (5%) of the Purchase Price
("Deposit").  The Deposit shall be credited against the Purchase Price payable
pursuant to paragraph B(3).

                 3.       Purchase Price Terms: Contingencies.  The Purchase
Price shall be payable, all cash, at lease two (2) business days prior to the
Closing.   Once the Purchase Price has been ascertained as provided herein,
there shall be no contingencies or conditions precedent to the Close of Escrow
(defined below) except for the title contingency set forth in paragraph B(5).

                 4.       Escrow Company.  The name and address of the escrow
company ("Escrow Agent") through which the purchase and sale of the Premises is
to be consummated is:

                           Commerce Escrow Company
                           1545 Wilshire Boulevard, Suite 600
                           Los Angeles, CA 90017
                           Attn:  Mark Minsky

If Commerce Escrow Company is not in business at the time of the exercise of
the applicable Option, then the parties shall select an Escrow Agent by mutual
agreement.

                 5.       Title Review.  Lessee shall cause a title insurance
company of its choice ("Title Company") to furnish it with a preliminary title
report for the Premises ("Preliminary Report"), together with copies of all
underlying documents referred to as exceptions in the Preliminary Report.
Lessee shall pay for all costs and expenses associated  with the preparation
and furnishing of the Preliminary Report.  As a condition precedent to Lessee's
obligation to purchase the Premises hereunder, Lessee shall have until the
expiration of ten (10) days from its delivery of the applicable Notice of
Exercise to Lessor ("Title Review Expiration Date") to deliver to Lessor and
Escrow Agent a "Notice of Disapproval" disapproving of any exceptions shown in
the Preliminary Report of which Lessee disapproves, except for the standard
printed exceptions reflected in the Preliminary Report or on the title policy
to be issued to Lessee by the Title Company at the Close of Escrow.  If Lessee
fails to deliver such Notice of Disapproval on or before the Title Review
Expiration Date, Lessee shall be deemed to have approved of all exceptions set
forth in the Preliminary Report.  Upon Lessor's timely receipt of a Notice of
Disapproval, Lessor shall have the right, to be exercised within five (5)
business days after receipt of Lessee's notice to notify Lessee in writing that
it intends to cure any such disapproved matter prior to or concurrently with
the Close of Escrow.  Failure of Lessor to deliver a written notice to Lessee
that it intends to cure any disapproved matter shall constitute Lessor's
refusal to cure said matter.  Lessee shall thereupon have three (3) business
days in which to notify Escrow Agent and Lessor in writing that Lessee waives
its previous disapproval.  Lessee's failure to timely provide such notice shall
constitute Lessee's unwillingness to waive said disapproved matter, whereupon
the escrow and  Lessee's right to purchase the Premises as provided herein
(including, but not limited to, any remaining Options) shall immediately
terminate and be of no further force and
<PAGE>   25
effect, Lessee shall be entitled to the return of its Deposit from Escrow Agent
(to the extent that the Deposit has been received by Escrow Agent) and the
parties shall have no further rights or obligations to each other under this
Rider.

                 6.       Date of Closing.  The date of Closing (defined below)
will be sixty (60) calendar days (unless such day is a Saturday, Sunday or
legal holiday, in which case the Closing shall be on the next succeeding
business day) after Lessee delivers to Lessor the Notice of Exercise and the
Deposit.


         C.  Conditions to the Exercise of the Options; Termination of Options.

                 1.       Lessee hereby agrees that a condition precedent to
the effectiveness of the Notice of Exercise is that the Lease shall be in full
force and effect on the date that Lessee delivers to Lessor the Notice of
Exercise.

                 2.       Lessee hereby agrees that Option Number 2 and Option
Number 3, and Lessee's rights thereunder, respectively, shall automatically
terminate and expire if Lessee does not timely exercise either or both of its
options to extend the Lease term as set forth in Option to Extend Addendum to
Standard Lease attached  to the Lease.

                 3.       Lessee hereby agrees that the Options granted herein
shall terminate and be of no further force or effect in the event that the
Lease is terminated or otherwise expires pursuant to its terms or Lessor sells
the Premises to Lessee or to a third party (other than a third party described
in Paragraph 51.2 of the Lease) pursuant to or after Lessor complies with the
provisions of Paragraph 51 of the Lease.

                 4.       If, during any Option Period, Lessor delivers an
Offer Notice to Lessee pursuant to Paragraph 51 of the Lease, then Lessee shall
not have the right to exercise the applicable Option unless and until Lessee
fails to timely (a) exercise its right of first refusal, (b) execute the
Purchase Agreement, or (c) close escrow, all as provided under Paragraph 51 of
the Lease, and Lessor notifies Lessee that the sale of the Offered Property to
the Proposed Purchaser under the applicable Offer Notice will not be
consummated.  Thereafter,  Lessee's right to exercise such Option shall only be
permitted during the applicable Option Period as provided herein, which Option
Period shall be extended by the lesser of (y) the number of days that Lessee is
prohibited from exercising its Option as provided above or (z) the number of
days between the date of Lessee's receipt of the Offer Notice and the scheduled
expiration date of the then applicable Option Period.  For example, if Lessor
delivers an Offer Notice to Lessee on December 1, 2000, Lessee elects or has
deemed to have elected not to exercise its right of first refusal under
Paragraph 51, and Lessor notifies Lessee on March 1, 2001 that the sale of the
Offer Property will not be consummated, than the Option Period for Option No. 1
shall be extended by thirty-one (31) days and Lessee shall have the right  to
exercise Option No. 1 by delivering  a Notice of Exercise between March 1, 2001
and March 31, 2001.

         D.  Computation of Purchase Price.

                 1.       Promptly after Lessor's receipt of the applicable
Notice of Exercise and the Deposit, Lessor and Lessee shall meet in an effort
to negotiate, in good faith, the Fair Market Value (defined below) of the
Premises as of the date of Lessee's delivery of the Notice of Exercise and
Deposit.  If Lessor and Lessee have not agreed upon such Fair Market Value
within fifteen (15) days after Lessor's receipt of the Notice of Exercise and
the Deposit, then Lessor and Lessee shall each appoint one appraiser not later
than ten (10) days after the expiration of said fifteen (15) day period.
Within five (5) days after the appointment of such appraisers, the two
appointed appraisers shall appoint a third appraiser.  If they are unable to
agree on a third appraiser within the five (5) day period set forth above, then
Lessor or Lessee may, by giving five (5) days notice to the other party, apply
to the presiding judge of the Superior Court of the County in which the
premises are located, for the selection of a third appraiser who meets the
qualifications stated in this paragraph.  The third appraiser, however
selected, shall be a person who has not previously acted in any capacity for
either party.  Lessor and Lessee shall instruct the appraisers to complete the
determination of Fair Market Value within thirty (30) days after appointment of
such appraisers.  If either Lessor or Lessee fails to appoint its appraiser
within the prescribed time period, the single appraiser appointed shall
determine the Fair Market Value of the Premises.  Each party shall bear the
cost of its own appraiser, and the parties shall bear equally the cost of the
third or single appraiser.  All appraisers  shall be independent, shall have
at least five (5) years' experience in the appraisal of commercial/industrial
real property substantially similar to the Premises, and shall be members of
professional organizations such as MAI or equivalent.

                 2.       For the purpose of such appraisal, the term "Fair
Market Value" shall mean the price that a ready and willing buyer would pay to
a ready and willing seller for the Premises, as of the date of the appraisal,
if the Premises were exposed for sale on the open market for a reasonable
period of time, taking into account the highest and best use of the Premises
(whether or not such use is the use to which the Premises are then put).  If
three appraisals are submitted, the Fair Market Value of the Premises shall be
the arithmetic average of the two appraisals closest in value to each other and
the third appraisal shall be disregarded.  Otherwise, the appraisal of the
single appraiser so appointed shall be conclusive and binding on both Lessor
and Lessee.  When the Fair Market Value of the Premises has been determined,
Lessor shall deliver notice thereof to Lessee and Lessee shall, within one (1)
business day thereafter, deliver the Deposit to Escrow Agent.  If the Fair
Market Value of the Premises is not determined in accordance with the time
schedule set forth above, the date of Closing shall be postponed to the date
which is ten (10) days after the final determination of Fair Market Value.
Notwithstanding anything to the contrary set forth herein, if Lessor reasonably
believes that the Fair Market Value of the Premises, as determined by the
appraiser(s), was adversely affected as a result of any Hazardous Substance
brought on to the Premises and to which Lessor is entitled to indemnification
from Lessee as set forth in Paragraph 6.2(d) of the Lease, then Lessor shall
have no obligation to sell the Premises to Lessee and close escrow hereunder
until such time as Lessee's indemnification obligations have been satisfied in
full by (a) agreement between the parties, (b) pursuant to a final and
non-appealable decision of a court of competent jurisdiction or (c) pursuant to
a final and binding determination of an arbitrator in the event that the
parties elect to arbitrate such dispute.
<PAGE>   26
         E.  Escrow.

                 1.       Within three (3) business days after Lessor's receipt
of the Notice of Exercise, Lessor and Lessee shall deliver to the Escrow Agent
executed counterparts of this option, and such other supplemental escrow
instructions as are customarily and reasonably required by the Escrow Agent,
which shall be the escrow instruction for the closing of the purchase and sale
contemplated hereunder.  The Deposit shall be credited against the Purchase
Price at Closing.

                 2.       The escrow instructions to be prepared by Escrow
Holder shall include the following provisions:

                          LESSEE ACKNOWLEDGES AND AGREES THAT THE PREMISES IS
BEING PURCHASED BY LESSEE ON AN "AS IS," "WHERE IS" AND "WITH ALL FAULTS" BASIS
AT THE CLOSING (AS DEFINED BELOW).  LESSEE HEREBY WAIVES AND RELINQUISHES ALL
RIGHTS AND PRIVILEGES ARISING OUT OF, OR WITH RESPECT OR IN RELATION TO, ANY
REPRESENTATIONS, WARRANTIES OR COVENANTS, INDEMNITIES WHETHER EXPRESS OR
IMPLIED, WHICH MAY HAVE BEEN MADE OR GIVEN UNDER THE LEASE, INCLUDING WITHOUT
LIMITATION PARAGRAPH 6.2 OF THE LEASE, OR WHICH MAY BE DEEMED TO HAVE BEEN MADE
OR GIVEN, BY LESSOR.  LESSEE HEREBY FURTHER ACKNOWLEDGES AND AGREES THAT
WARRANTIES OF MERCHANTABLILITY AND FITNESS FOR A PARTICULAR PURPOSE ARE
EXCLUDED FROM THE TRANSACTION CONTEMPLATED HEREBY, AS ARE ANY  WARRANTIES
ARISING FROM A COURSE OF DEALING OR USAGE OF TRADE, AND THAT THE LESSOR HAS NOT
WARRANTED, AND DOES NOT HEREBY WARRANT, THAT THE PREMISES NOW OR IN THE FUTURE
WILL MEET OR COMPLY WITH THE REQUIREMENTS  OF ANY APPLICABLE REQUIREMENTS OR
OTHER LAW, CODE, REGULATION OR ORDINANCE OF ANY APPLICABLE GOVERNMENTAL
AUTHORITY OR JURISDICTION.  WITHOUT LIMITING THE GENERALITY OF THE FOREGOING,
LESSEE HEREBY ASSUMES ALL RISK AND LIABILITY (AND AGREES THAT LESSOR SHALL NOT
BE LIABLE FOR ANY SPECIAL, DIRECT, INDIRECT, CONSEQUENTIAL, OR OTHER DAMAGES)
RESULTING OR ARISING FROM OR RELATING TO THE OWNERSHIP, USE, CONDITION
(INCLUDING ENVIRONMENTAL CONDITION), LOCATION, MAINTENANCE, REPAIR, OR
OPERATION OF THE PREMISES.  LESSEE ACKNOWLEDGES AND AGREES THAT THE SALE
PROVIDED FOR HEREIN IS MADE WITHOUT ANY WARRANTY BY LESSOR AS TO THE NATURE OR
QUALITY OF THE PREMISES; THE DEVELOPMENT POTENTIAL OF THE PREMISES; THE PRIOR
HISTORY OF OR ACTIVITIES ON THE PREMISES; THE QUALITY OF LABOR AND/OR MATERIALS
INCLUDED IN ANY OF THE IMPROVEMENTS; THE FITNESS OF THE PREMISES FOR AND/OR THE
SOIL OR ENVIRONMENTAL CONDITIONS EXISTING AT THE PREMISES FOR ANY PARTICULAR
PURPOSE OR DEVELOPMENT POTENTIAL; THE PRESENCE OR SUSPECTED PRESENCE OF
HAZARDOUS WASTE OR HAZARDOUS SUBSTANCES IN, ON, ABOUT, OR UNDER THE PREMISES OR
THE IMPROVEMENTS; OR THE ZONING OR OTHER LEGAL STATUS OF THE PREMISES.  LESSEE
HEREBY ACKNOWLEDGES THAT NEITHER LESSOR, NOR ITS PARTNERS, EMPLOYEES, AGENTS,
ATTORNEYS, CONSULTANTS OR ANY OTHER PERSON HAS MADE, ANY REPRESENTATION,
AGREEMENT, STATEMENT, WARRANTY, GUARANTY OR PROMISE REGARDING THE PREMISES, OR
THE TRANSACTION CONTEMPLATED HEREIN, OR REGARDING THE ZONING, CONSTRUCTION,
PHYSICAL CONDITION OR OTHER STATUS OF THE PREMISES, AND NO REPRESENTATION,
WARRANTY, AGREEMENT, STATEMENT, GUARANTY OR PROMISE, IF ANY, MADE BY ANY PERSON
ACTING ON BEHALF OF LESSOR SHALL BE VALID OR BINDING UPON LESSOR. ALL OF THE
FORGOING SHALL SURVIVE THE CONVEYANCE OF THE PREMISES TO LESSEE.

LESSEE EXPRESSLY WAIVES THE BENEFITS OF SECTION 1542 OF THE CALIFORNIA CIVIL
CODE, WHICH PROVIDES AS FOLLOWS:

"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW
OR EXPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH  IF
KNOW TO HIM MUST HAVE MATERIALLY AFFECTED THE SETTLEMENT WITH THE DEBTOR."

         F.      Closing.  The close of escrow (the "Closing") shall take place
on or before the date specified in Paragraph B(6).  Title to the Premises shall
be conveyed to Lessee by grant  deed at the Closing.  The "Close of Escrow"
shall be the date upon which the grant deed conveying the Premises  to the
Lessee is recorded in the official records of the county of which the Premises
are located.  The Closing shall be accomplished as follows:

                 1.       The Purchase Price shall be paid by Lessee through
Escrow.  All funds required to be paid by Lessee at the Closing shall be
deposited with Escrow Agent by Lessee not later then two (2) business days
prior to the day set for the Closing and such funds shall be immediately
available or good funds.

                 2.       Base Rent shall be prorated as of Closing.   Lessor
shall pay all documentary transfer taxes required as a result of the sale.
Lessee shall pay for any title insurance policy obtained by Lessee in
connection with its acquisition of the Premises.  Lessor and Lessee shall pay
equally the escrow fee.  All other costs shall be borne by Lessor and Lessee in
accordance with the standard practices  of the county in which the Premises is
located, except as otherwise stated herein.

                 3.       The parties shall execute such other documents as are
reasonably requested by Escrow in order to complete the purchase of the
Premises as provided by this Rider.

         G.      Rent Payments: Lessor Default.  Neither Lessee's rent payments
nor any other payments made to Lessor pursuant to the Lease shall be applied
against the Purchase Price.  If Lessor defaults under this Rider after notice
to Lessor as provided in the Lease, Lessee's sole remedy shall be an action
against Lessor for actual damages caused by Lessor's default, and Lessee shall
not have the right to terminate the Lease, offset against rent or injunctive
relief.
<PAGE>   27
         H.      Attorneys' Fees and Legal Expenses.  Should either party
hereto institute any action or proceeding to enforce any provision hereof or
for damages by reason of any alleged breach of any provision of this Rider or
for any other remedy, the prevailing party shall be entitled to receive from
the losing party all reasonable attorneys' fees, costs and all court costs in
connection with said proceeding.

         IN WITNESS WHEREOF, Lessee and Lessor have executed this Rider
concurrently with their execution of the Lease.



LESSOR:                                       LESSEE:
DANAT INVESTMENT COMPANY,                     CONSOLIDATED CAPITAL OF
a California general partnership              NORTH AMERICA, INC.
                                             
                                       
By:      \s\ Daniel J. Eger                   By: \s\ Christian W. Wolf 
    ----------------------------                 -------------------------------
Name:    Daniel J. Eger                
Its:     General Partner                      Its:
                                                  ------------------------------
                                       
                                       
By:      \s\ Nathan J. Reese                  By:      /s/ Donald R. Jackson 
    ----------------------------                  ------------------------------
Name:    Nathan J. Reese                      Name:   Donald R. Jackson
Its:     General Partner                      Its:    Secretary/Treasure/
                                                      Chief Financial Officer
                                                      --------------------------






<PAGE>   28





        ADDITIONAL SIGNATURE PAGE FOR ANGELES ACQUISITION CORPORATION ON
                    OPTION TO PURCHASE PREMISES LEASE RIDER



                                 Executed at:                                  
                                              ----------------------------------
                                                                               
                                          on:                                  
                                              ----------------------------------
                                                                               
                                          By: LESSEE:                          
                                                 ANGELES ACQUISITION CORP.,    
                                                 a Delaware Corporation        
                                                                               
                                          By:                                  
                                              ----------------------------------
                                                                               
                                 Printed Name:    Christian Wolf               
                                                                               
                                 Title:           Chief Executive Officer      
                                                                               
                                                                               

                                          By:                                  
                                              ----------------------------------
                                                                               
                                 Printed Name:    Donald R. Jackson            
                                                                               
                                 Title:  Secretary/Treasurer/                  
                                         Chief Financial Officer               
                                                                               

                                 Address:                                      
                                          --------------------------------------

                                                                               
                                                                               
                                          --------------------------------------
                                                                               
                                 Telephone:                                    
                                            ------------------------------------
                                                                               
                                 Facsimile:                                    
                                            ------------------------------------
                                                                               
                                 Federal ID No.                                
                                                --------------------------------
                                                                               

<PAGE>   29
        ADDITIONAL SIGNATURE PAGE FOR ANGELES ACQUISITION CORPORATION ON
                       OPTION TO PURCHASE LEASED PREMISES



                                 Executed at:                                  
                                              ----------------------------------
                                                                               
                                          on:                                  
                                              ----------------------------------
                                                                               
                                          By: LESSEE:                          
                                                 ANGELES ACQUISITION CORP.,    
                                                 a Delaware Corporation        
                                                                               
                                          By:                                  
                                              ----------------------------------
                                                                               
                                 Printed Name:    Christian Wolf               
                                                                               
                                 Title:           Chief Executive Officer      
                                                                               
                                                                               

                                          By:                                  
                                              ----------------------------------
                                                                               
                                 Printed Name:    Donald R. Jackson            
                                                                               
                                 Title:  Secretary/Treasurer/                  
                                         Chief Financial Officer               
                                                                               

                                 Address:                                      
                                          --------------------------------------

                                                                               
                                                                               
                                          --------------------------------------
                                                                               
                                 Telephone:                                    
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                                 Federal ID No.                                
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