Exhibit 10.16

                                 LEASE AGREEMENT


COMMONWEALTH OF VIRGINIA
CITY OF LYNCHBURG, VIRGINIA


This LEASE AGREEMENT made and entered into as of the 1st day of December by and
between LAWSON FAMILY LLCI whose address is Route No. 6, Box 70, Appomattox,
Virginia 24522, hereinafter referred to as "Lessor" and BGF Industries with
offices in Greensboro, North Carolina, hereinafter referred to as "Lessee";

                                   WITNESSETH:

1.       The Lessor does hereby lease unto the Lessee and the Lessee does hereby
         accept from the Lessor approximately 37,000 square feet of warehouse
         space located in the building on 1400 Thurnum Avenue in Lynchburg,
         Virginia. This space is located on the first floor of the building. The
         term of this Lease will be twelve months starting on 12/1/99 and ending
         on 12/1/2000.

2.       The Lessee covenants and agrees to pay the Lessor as rental for space
         described in item #1 above, the sum of $10,000.00 per month payable in
         advance on the first day of each calendar month of the term of this
         Lease. The first month rent to be negotiated for actual usage.

3.       Through the term of this Lease, the Lessor, at its sole expense, will
         keep in good condition the demised premises, including, but not limited
         to, the foundation, exterior walls, plate glass, roof, heating system,
         including all component parts, air conditioning system, including all
         component parts, plumbing, electrical system, paving and landscaping,
         and will make all necessary repairs thereto. When used in this
         paragraph, the term "repairs" shall mean all necessary replacements,
         removal, alternations, additions, or betterment's.

                  It shall exclude the alarm system. At the request of the
                  Lessee the intrusion system has been disconnected for the
                  space being leased. While the smoke detection and sprinkler
                  systems are being maintained on the lease space, the Lessor
                  shall not be held responsible for any failures or
                  malfunctions.

4.       The Lessor shall pay all real estate taxes, assessments, and other
         governmental levies and charges, general and special, ordinary and
         penalties, interests or costs for the non-payment thereof and become
         due and payable during the term of this Lease. Lessor shall pay all
         other required utilities.

5.       The Lessee shall provide insurance coverage only for the following:
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         a)       General Liability - Lessee shall provide General and Public
                  liability coverage for use of Lessor's premises and agrees
                  that it shall maintain $1,000,000 bodily injury and property
                  damage limits. Lessee agrees that it will indemnify and save
                  Lessor harmless from any and all liability, damage, expenses,
                  cause of action, suits, claims or judgments arising from
                  injury to persons or property, within the leased premises or
                  upon adjoining property, sidewalks, or parking lots up to
                  limits of insurance coverage.

         b)       Fire and Extended Coverage - Lessee will provide insurance
                  coverage to cover its property located at the leased facility.


         c)       Workmen's Compensation - Lessee is self-insured for workmen's
                  compensation and as such will provide workmen's compensation
                  coverage for its employees and guests.

6.       In the event the demised premises shall be damaged by fire or other
         casualty which in the opinion of the Lessee shall render all or any
         portion of the demised premises untenable, the Lessee, upon five (5)
         days prior written notice delivered unto the Lessor, may terminate this
         Lease. In the event the Lessee shall not terminate this Lease in
         accordance with the previous provision of this paragraph, the Lessor
         will, with reasonable promptness, repair the damage and restore the
         demised premises to its former condition and the obligations of the
         Lessee hereunder will there upon continue in full force and effect. If
         the damage to the demised premises is such as to make the premises
         untenable, the payment of the rent shall be suspended from the date of
         damage until the repairs have been completed. If the damage is such as
         to make the demised premises only partially untenable, then the rent
         shall be appropriately reduced until repairs have been completed. When
         the repairs have been completed, the payment of rent will be resumed.
         No abatement of rent, however, shall operate to extend the term of this
         Lease.

7.       In the event that any or all of the demised premises shall be taken in
         condemnation proceedings or by exercise of any right of imminent
         domain, this Lease shall terminate as of the date of such taking, and
         all unearned rent and all other charges paid in advance shall be
         refunded to the Lessee and Lessor shall surrender possession of the
         leased premises to the Lessor. The award of such taking shall belong to
         the Lessor except that the Lessee shall also be entitled to make claim
         in its own name to condemning authorities for the value of any
         furniture, trade fixtures, trade equipment, merchandise, machinery or
         other personal property of any kind belonging to the Lessee and not
         forming part of the real estate or for the cost of moving all of the
         same and any award made directly to Lessee or for the benefit of the
         Lessee shall belong entirely to the Lessee provided said claim shall
         not diminish the Lessor's award.

                  "Taking" shall include the voluntary conveyance by the Lessor
                  of the demised premises to the authority possessing the right
                  of imminent domain.
<PAGE>

8.       The Lessee agrees that it shall fail and neglect to pay any installment
         of rent within ten (10) days after the same has become due and payable
         as herein provided and Lessor has notified Lessee in writing of said
         delinquency, then the Lessor may at its option terminate this Lease and
         enter upon the demised premises and take possession thereof as if this
         Lease has not been entered into all in accordance and in strict
         compliance with the appropriate statutory laws of the State of
         Virginia. In the event the Lessor shall exercise the right to terminate
         this Lease under the provisions of this paragraph or in any other
         lawful manner, it shall not thereby be deprived of any other rights or
         remedies against the Lessee.

9.       The Lessor covenants and agrees with the Lessee that so long as the
         Lessee pays the installments of rent at the time and in the manner
         herein provided and performs and observes the covenants and conditions
         hereof, the Lessee shall quietly enjoy the demised premises during the
         term herein fixed. This agreement shall be binding upon the parties
         hereto and their successors, heirs, and assignees.

IN WITNESS WHEREOF, the parties have caused this Lease to be executed in
duplicate originals the date first herein above set out.

                                           LESSOR:
                                           Lawson Family LLCI



ATTEST:                                    BY:      /s/ Fred H. Lawson

/s/ SL Ferguson III



                                           LESSEE:
                                           BGF Industries, Inc.


ATTEST:                                    BY:     /s/ Gary Verser
                                                  Gary Verser/Operations Manager

/s/ Rita Blanks
    Rita Blanks/Customer Service Supervisor