Document:

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                                                                    EXHIBIT 10.7

                               AGREEMENT OF LEASE

     Agreement of Lease, made as of the 13th day of May 1999, between AVOBA,
INC., a New York corporation maintaining its principal place of business at c/o
Ganje Law Office, Two Tower Place, Albany, NY 12203 (hereinafter called
"Landlord") and American BioMedica Corporation, a New York corporation
maintaining its principal place of business at 300 Fairview Avenue, Hudson, New
York 12534, (hereinafter called "Tenant").

                                  WITNESSETH:

     1.     DEMISED PREMISES.

     1.01   Landlord hereby leases to Tenant and Tenant hereby leases from
Landlord, a building of approximately 26,000 square feet the premises
(hereinafter referred to as the "Demised Premises") owned by Landlord at Smith
Road, Kinderhook, New York as approximately outlined in red on the Drawing
annexed hereto as Exhibit "A", with fixtures and improvements thereon, plus the
grassed areas identified on Exhibit "A". This Lease includes the Tenant's right
to use, the parking facilities in the areas outlined in blue on Exhibit "A".
Tenant may have the use and possession of the adjoining fields and grasslands.
Tenant shall maintain and mow the fields and grasslands.

     2.     TERM.

     2.01   The term of this Lease shall be commence on the 1st of August, 1999
and end on December 31, 2000 unless sooner terminated as herein provided or by
virtue of the purchase of the property.

     3.     RENT.

     3.01   The minimum annual rental for the Demised Premises is $60,000.00,
payable by Tenant monthly in advance in equal installments of $5,000.00 each on
the first day of every month during this Lease term.

     4.     USE OF PREMISES.

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     4.01   Tenant may use and occupy the Demised Premises for all lawful
purposes permitted by the use permit granted by the Stuyvesant Board of Appeals
and may use and occupy the grassed areas of the Demised Premises for the
purpose of agricultural and horticultural purposes and shall maintain same as
provided in paragraph 1.01 herein.

     4.02   Tenant will not, nor will it permit any other persons to do
anything, or bring anything in or upon the Demised Premises or to be kept
therein, which will in any way increase the rate of fire insurance on the
Demised Premises, not use or permit the Demised Premises to be used for any
purpose which would cause an increase in the rate of fire insurance on said
Demised Premises.

     5.     TAXES.

     5.01   In addition to the annual rental provided for in Article "3"
hereof, Tenant agrees to pay to Landlord as additional rent of all real
property taxes, water and sewer rents, rates, and charges, and assessments,
which may be levied or assessed against the building of which Demised Premises
forms a part by any lawful authority for the period of the term of this Lease.
Should the State of New York or any political subdivision thereof or any
governmental authority having jurisdiction thereover, impose a tax and/or
assessment (other than a new income or franchise tax) upon or against the
rental payable by a tenant in the Demised Premises to the Landlord, or any
other tax which is intended in whole or in part as a substitute for the current
method of real estate taxation, such tax and/or assessment shall be deemed to
constitute a tax and/or assessment against the Demised Premises for the
purposes of this Article.

     5.02   Upon receipt of all tax bills and assessment bills attributable to
any year during the term hereof, Landlord shall furnish Tenant with a written
statement of the actual amount of the taxes and assessments for such year, and
with a bill for the Tenant's payment thereof. Tenant shall pay to the Landlord
the amount billed within ten (10) days of the receipt of the statement and
bill. In the event the Landlord is required under a mortgage covering the
Demised Premises to escrow real estate taxes, Landlord may require Tenant to
pay said taxes and assessments during the term hereof in monthly installments
on or before the first day of each calendar month, in advance, in an amount
estimated by such mortgage. If the total amount paid by Tenant under this
Article during the term of this Lease shall be less than the actual amount due
from Tenant for

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any year thereof, as shown on such statement, Tenant shall pay to Landlord the
deficiency within ten (10) days after demand therefor by Landlord; and if the
total amount paid by Tenant hereunder for any such year shall exceed such
amount due from Tenant for such year, Tenant shall be entitled to offset the
excess against payments next thereafter to become due under this Article. For
the years in which this Lease commences and terminates, the provisions of this
Article shall apply and Tenant's liability for taxes and assessments for any
such year shall be subject to a pro rata adjustment based on the number of days
of any such year during which the term of this Lease is in effect. A copy of a
tax bill or assessment bill submitted by Landlord to Tenant shall at all times
be sufficient evidence of the amount of taxes and/or assessments levied or
assessed against the property to which such bill relates. Landlord's and
Tenant's obligations under this Article shall survive the expiration of the
term of this Lease.

     5.03   Nothing herein contained is intended to make the Tenant responsible
for franchise, corporate, or partnership taxes which are charged to the
Landlord, including excise, inheritance, capital, levy, transfer or income,
profits or revenue, upon income of Landlord except that, in the event of the
passage of any statute, act or law as the result of which Landlord becomes
obligated to pay any income tax or any other tax, charge, levy, assessment, or
imposition, in lieu or in place of any school tax, or other real estate tax or
assessment, which would otherwise be levied against and/or become a lien upon
the Demised Premises, such tax, charge, levy, assessment, or imposition shall
be payable by Tenant as provided for by this Article.

     6.     LIABILITY AND FIRE INSURANCE.

     6.01   The Tenant shall maintain fire insurance coverage and other
liability insurance as provided in this Lease for the entire building of which
the Demised Premises forms a part and shall provide Landlord with proof of
payment thereof and with proof of a valid insurance policy.

     6.02   Tenant agrees to pay, during the term hereof the cost of insurance
for fire, extended coverage, vandalism, malicious mischief, and such other
hazards as Landlord or Landlord's first mortgagee may require, insuring the
improvements located on the Demised Premises and all appurtenances thereto
(excluding Tenant's merchandise, trade fixtures, furnishings, equipment,
personal property, and Tenant's work) for not less than the full insurable

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value thereof.

     6.03   Tenant agrees to carry public liability insurance on the Demised
Premises during the term hereof, covering both Tenant and Landlord as insureds,
with the terms and companies reasonably satisfactory to Landlord, including
coverage of Tenant's indemnity to Landlord contained in Article 17 of this
Lease, for limits of not less than One Million ($1,000,000.00) Dollars for
personal injury or death arising out of any one occurrence, and providing that
Landlord and Tenant shall be given a minimum of thirty (30) days written notice
by the insurance company prior to cancellation, termination, or change in such
insurance. Tenant also agrees to carry property damage insurance in the amount
of not less than Three Hundred Thousand ($300,000.00) Dollars for damage to
property arising out of any one occurrence.

     6.04   Tenant shall provide Landlord with copies of the policies or
certificates evidencing that such insurance is in full force and effect and
stating the terms thereof.

     7.     SIGNS, AWNINGS, FIXTURES, AND ALTERATIONS.

     7.01   Tenant shall have the free right of alteration to the demised
premises which alterations shall not affect the structural integrity of the
demised premises provided advance notice is provided in writing to the
Landlord. In the event that any proposed alteration will change the structural
integrity of the premises, Tenant shall obtain prior written Landlord approval.
Fixtures and equipment installed in premises by the Tenant shall be removable
provided any damage to the premises shall be repaired at Tenant's cost and
expense.

     8.     MAINTENANCE OF DEMISED PREMISES.

     8.01   The Tenant shall take good care of the premises and shall at its
own cost and expense make all repairs to the interior of the premises, other
than structural repairs or mechanical capital repairs to the plumbing, heating
or electrical systems. At the end or other expiration of the term, the Tenant
shall deliver up the demised premises in good order and condition, damages by
the elements excepted. Landlord shall be responsible for the maintenance of the
well and septic system.

     9.     DAMAGE OR DESTRUCTION.

     9.01   If all or any part of the Demised Premises is damaged or destroyed
by fire or other casualty insured under the standard fire insurance policy with
approved standard extended

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coverage endorsement applicable to the demised Premises, the Landlord shall,
except as otherwise provided herein, repair and rebuild the Demised Premises
with reasonable diligence, and if there is a substantial interference with the
operation of the Tenant's business in the demised Premises requiring the Tenant
temporarily to close its business to the public, the minimum rental shall be
equitably apportioned for the duration of such repairs in proportion to the
extent to which there is interference with the operation of the Tenant's
business. Notwithstanding the foregoing provisions, in the event the Demised
Premises shall be damaged by fire or other insured casualty due to the fault or
neglect of the Tenant, or the Tenant's servants, employees, contractors,
agents, visitors, or licensees, then, without prejudice to any other rights and
remedies of the Landlord, the damage shall be repaired by the Landlord, but
there shall be no apportionment or abatement of any rent. Except to the extent
provided for in this paragraph, neither the rent payable by the Tenant nor any
of the Tenant's other obligations under any provision of this lease shall be
affected by any damage to or destruction of the Demised Premises by any cause
whatsoever.

     10.   UTILITIES.

     10.01 The Landlord shall furnish heating and air conditioning systems to
the Demised Premises. Landlord shall be responsible for maintenance of such
systems and Tenant shall be responsible for the payment of all utilities
servicing the Demised Premises.

     11.   ASSIGNMENT OF LEASE.

     11.01 Tenant may not sublet or assign this Lease without the Landlord's
consent, which consent will not be unreasonably withheld, provided, however,
that Landlord shall not be liable for damages on any claim that landlord has
unreasonably withheld such consent, Tenant's remedy being limited solely to an
action to determine reasonableness of the withholding of such consent and to
compel giving of same. It is further agreed that no assignment or sublease
shall be effective unless the assignee or sublessee agrees directly with the
Landlord to perform Tenant's obligations under this Lease. Notwithstanding any
permitted assignment or subletting, not further assignment or subletting may be
made without Landlord's consent and, in all events, Tenant shall remain fully
and primarily liable for the payment of all rent, additional rent, and the
performance of all the terms, covenants, and conditions contained herein
jointly and severally

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with such assignee or sublessee. Landlord's dealing with an assignee or
sublessee shall not affect the continued liability of the Tenant under this
Lease.

     12.   COMPLIANCE WITH TERMS.

     12.01 Tenant shall comply with all laws, orders, and regulations of
federal, state, county, and municipal authorities, and with any direction
pursuant to laws of any public officer thereof, which shall impose any
violation, order, or duty upon Landlord or Tenant resulting from the use and
occupancy of the Demised Premises by Tenant. Tenant shall have the right, upon
giving notice to the Landlord, to contest any obligation imposed upon Tenant
pursuant to the provisions of this Article, and to deter compliance during the
pendency of such contest, provided that the failure of Tenant to so comply will
not subject Landlord to prosecution or criminal penalty. Landlord shall comply
with any such laws, orders, regulations, directions, and rules other than those
imposing an obligation upon Tenant as aforesaid, subject, however, to the right
of Landlord similarly to contest as aforesaid and defer compliance during the
pendency of such contest.

     13.   SUBORDINATION.

     13.01 This instrument shall not be a lien against said Demised Premises in
respect to any first mortgage that is now on or that hereafter may be placed
against the Demised premises, and upon the recording of such mortgage or
mortgages, the same shall have preference and precedence and be superior and
prior in lien to this Lease, irrespective of the date of recording of the same
and Tenant agrees to execute any such instrument, without cost, which may be
deemed necessary to any such mortgage, and a refusal to execute such instrument
shall entitle the Landlord, or the Landlord's assigns and legal representatives,
to the option of canceling this Lease without incurring any expense or damage
and the term hereby granted is expressly limited accordingly; provided, however,
that a non-disturbance agreement shall have been first entered into in respect
to such mortgage. The term "non-disturbance agreement" as used in this Article
shall mean an agreement in recordable form between the Tenant and the holder of
any subsequent mortgage lien, which shall provide, in substance, that the Tenant
shall attorn to such mortgagee and that as long as Tenant is not in default
under this Lease beyond any period given to Tenant to cure such default, such
holder will not name or join Tenant to cure such default,

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such holder will not name or join Tenant as a party defendant or otherwise in
any suit, action, or proceeding not to enforce, nor will this Lease be
terminated or otherwise affected by enforcement of, any rights given to such
holder pursuant to the terms covenants, and conditions contained in such
mortgage or mortgages, or any other documents held by such holder or any rights
given to such holder as a matter of law.

     13.02  With reference to any assignment by Landlord of Landlord's interest
in this Lease, or the rents payable hereunder, conditional in nature or
otherwise, which assignment is made to the holder of a mortgage on property
which includes the Demised Premises, Tenant agrees:

     (A)    That the execution thereof by Landlord and the acceptance thereof
by the holder of such mortgage shall never be treated as an assumption by such
holder of such mortgage shall never be treated as an assumption by such holder
of the obligations of the Landlord hereunder, unless and until such holder
shall, by notice to Tenant, specifically otherwise elect; and

     (B)    Except as aforesaid, such holder shall be treated as having assumed
Landlord's obligations hereunder only upon foreclosure of such holder's
mortgage, the taking of possession of the Demised Premises, and such holder's
acceptance of Tenant's attornment.

     14.    WAIVER OF REDEMPTION.

     14.01  Tenant hereby expressly waives any and all rights of redemption
granted by or under any present or future laws in the event of Tenant being
dispossessed or removed from the Demised Premises because of default by Tenant
pursuant to the covenants or agreements contained in this Lease.

     15.    DEFAULT.

     15.01     A)  It is expressly understood and agreed that in case the
Demised Premises shall be deserted or vacated or if default be made in the
payment of the rent or additional rent or any part thereof as herein specified,
or if, without the consent of the Landlord, the Tenant shall sell, assign, or
mortgage this Lease or if default be made in the performance of any of the
covenants and agreements in this Lease contained on the part of Tenant to be
kept and performed, or if the Tenant shall fail to comply with any requirements
of the federal, state and local governments or of any and all their departments
or bureaus, applicable to the Demised

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Premises, or if the Tenant shall file or there shall be filed against Tenant a
petition in bankruptcy or arrangement, or under any insolvency laws now or
hereinafter enacted, or Tenant be adjudicated a bankrupt or make an assignment
for the benefit of creditors to take advantage of any insolvency act, the
Landlord may, if the Landlord so elects, and may at any time thereafter
terminate this Lease and the term hereof, on giving to the Tenant forty-five
(45) days notice in writing to cure such default, other than a non-payment of
rent, except in the case of a nonpayment of rent or additional rent, said
notice shall require a cure within ten (10) days, and if such default is not so
cured, this Lease and the term hereof shall expire and come to an end on the
date fixed in such notice as if the said date were the date originally fixed in
this Lease for the expiration thereof, or Landlord may dispossess or remove
Tenant or any other occupant of the Demised Premises by summary proceedings or
otherwise, and remove their effects and hold the demised Premises as if this
Lease had not been made, but without prejudice to Landlord's remedies, on
account thereof as set forth in paragraph (b) below. Such notice may be given
by mail to the Tenant addressed to the Demised Premises.

               B)  In the event of such dispossession or removal and
notwithstanding such action or the termination of this Lease (I) the Tenant
shall be liable forthwith to pay the rent and additional rent and charges
payable under this Lease up to the date of such dispossession, termination, or
removal, (II) Landlord may relet the Demised Premises, or any part or parts
thereof, either in the name of the Landlord or otherwise, for a term or terms
which may, at the option of Landlord, be less than or exceed the period which
would otherwise have constituted the balance of the term of this Lease and may
grant concessions or free rent for a reasonable time, (III) Tenant shall pay to
Landlord as liquidated damages for the failure of Tenant to observe and perform
the covenants and agreements under this Lease, any deficiency between the rent
and additional rent payable by Tenant under this Lease and the net amount, if
any, of the rents collected on account of this Lease or leases of the Demised
Premises for each month of the period which would otherwise have constituted
the balance of the term of this Lease, (IV) amounts received by Landlord after
reletting shall first be applied against Landlord's expenses incurred in any
reletting, until the same are recovered, and until such recovery, tenant shall
pay, as of each day when a payment would fall due under this Lease, the amount
which Tenant is

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obligated to pay under the terms of this Lease (Tenant's liability prior to any
such reletting and such recovery not in any way to be diminished as a result of
the fact that such reletting might be for a rent higher than the rent provided
for in this Lease); when and if such expenses have been completely recovered,
the amounts received from reletting by Landlord as have previously been applied
shall be credited against Tenant's obligations as of each day when a payment
would fall due under this Lease, and only the net amount thereof shall be
payable by Tenant. Further, amounts received by Landlord from such reletting
for any period shall be credited only against obligations of Tenant allocable
to such period, nor shall any credit of any kind be due for any period after
the date when the term of this Lease is scheduled to expire according to its
terms, and (V) as an alternative, at the election of Landlord, Tenant will,
upon such termination, pay to Landlord, as damages, such a sum as, at the time
of such termination, represents the amount of the excess, if any, of the then
value of the total rent and other benefits which would have accrued to Landlord
under this Lease for the remainder of the Lease term if the Lease terms had
been fully complied with by Tenant over and above the then cash rental value
(in advance) of the Demised Premises for the balance of the term and upon
payment of said sum, Tenant's further liability under the terms of the Lease
would cease. Landlord may make such alterations, repairs, replacements, and
decorations in the Demised Premises as Landlord considers advisable and
necessary for the purpose of reletting the Demised Premises, and the making of
such alterations and decorations shall not operate or be construed to release
Tenant from liability under this Lease. The failure or refusal of Landlord to
relet the Demised Premises or any part thereof shall not release or affect the
liability of Tenant for damages under this Lease; however, Landlord will use
its best efforts to relet the premises at a reasonable rent. Landlord shall in
no event be liable in any way whatsoever for inability to relet the Demised
Premises or, in the event that the Demised Premises or any part or parts
thereof shall not release or affect the liability of Tenant for damages under
this Lease.

               C)  If after default of payment of rent, or violation of any
other provision of this Lease, or expiration thereof, the Tenant moves out or
is dispossessed and fails to remove any trade fixture or other property prior
to such said default, removal, expiration of Lease, or prior to the issuance of
the final order or execution of the warrant, then in that event, the said
fixtures and

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properties shall be deemed abandoned by the said Tenant and shall become the
property of the Landlord.

     16.    CURING DEFAULT.

     16.01  If Tenant shall default in the observance or performance of any
covenant or agreement of this Lease on the part of Tenant to be observed or
performed, beyond any period given to Tenant to cure such default, Landlord may
perform the same for the account of Tenant.

     17.    INDEMNIFICATION.

     17.01  Tenant does hereby covenant and agree with Landlord that it will
indemnify and save harmless Landlord from any and against all liability,
damages, penalties, or judgments arising from injury to person or property
sustained by anyone in and about the Demised Premises resulting from any act or
acts of omission or commission of Tenant, or Tenant's officers, agents,
servants, employees, contractors, or assignees. Tenant shall, at its own cost
and expense, defend any and all suits or actions (just or unjust) which may be
brought against Landlord or Landlord's officers, agents, servants, employees,
assignees, or contractors. Landlord shall not be responsible or liable for any
damage or injury to any property, fixtures, buildings, or other improvements,
or to any person or persons, at any time on the Demised Premises, including any
damage or injury to Tenant or to any of Tenant's officers, agents, servants,
employees, contractors, customers, or assignees; except as may result from any
act or acts of omission or commission of Landlord or Landlord's officers,
agents, servants, employees, assignees, or contractors. Landlord shall not be
responsible or liable for any damage or injury to any property, fixtures,
buildings, or other improvements, or to any person or persons, at any time on
the Demised Premises, including any damage or injury to Tenant or to any of
Tenant's officers, agents, servants, employees, contractors, customers, or
assignees; except as may result from any act of omission or commission of
Landlord which continues after notice from tenant to Landlord of a condition
for the cure or correction of which Landlord is liable, and the Landlord has
failed, within a reasonable time after notice, to cure or correct such
condition.

     18.    END OF TERM.

     18.01  Upon expiration or other termination of the term of this Lease,
Tenant shall quit and surrender to Landlord the Demised Premises, broom clean,
in good order and condition,

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reasonable wear and tear and damage by fire or other casualty excepted.

     19.    QUIET ENJOYMENT.

     19.01  Landlord covenants and agrees that Tenant may peaceably and quietly
enjoy the Demised Premises, subject, however, to the covenants and agreements
contained in this Lease.

     20.    NO WAIVER.

     20.01  The failure of Landlord to seek redress for violation of, or to
insist upon the strict performance of, any covenant or agreement contained
within this Lease shall not prevent a similar subsequent act from constituting
a default under this Lease. This Lease contains the entire agreement between
the parties, and cannot be changed, modified, or amended, unless such change,
modification, or amendment is in writing and signed by the party against whom
enforcement of such change, modification, or amendment is sought.

     20.02  No payment by Tenant, or acceptance by Landlord, of a lesser amount
than shall be due from Tenant to Landlord shall be treated otherwise than as a
payment on account. The acceptance by Landlord of a check for a lesser amount
with an endorsement or statement thereon, or upon nay letter accompanying such
check, that such lesser amount is payment in full, shall be given no effect,
and Landlord may accept such check without prejudice to any other rights or
remedies which Landlord may have against Tenant.

     21.    WAIVER OF TRIAL BY JURY AND COUNTERCLAIMS.

     21.01  Landlord and Tenant agree that they shall, and the hereby do, waive
trial by jury in any action, proceeding, or counterclaim brought by either of
the parties hereto against the other on any matters whatsoever arising out of,
or in any way connected with, this Lease. Landlord and Tenant agree that any
dispute in connection with this Lease be first brought before the American
Arbitration Association in Albany, New York. If Landlord commences any summary
proceeding for nonpayment of rent or additional rent, Tenant will not interpose
any counterclaim in such proceeding unless such counterclaim arises out of,
or is in any way connected with, this Lease.

     22.    MEMORANDUM OF LEASE.

     22.01  Upon request of either party to this Lease, Landlord and Tenant
agree to execute and deliver a memorandum of this Lease and memorandum of any
modification of this Lease, in

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recordable form, containing the information required by Section 291-c and
Section 291-cc of the Real Property Law of the State of New York.

     23.    INSPECTION OF PREMISES.

     23.01  The Tenant agrees that the Landlord and its agents and/or
representatives shall have the right to enter into and upon the Demised
Premises, or any part thereof on prior notice and arrangement with Tenant for
the purpose of examining the same, or making such repairs or alterations
thereon as may be necessary for the safety and preservation thereof.

     24.    NOTICES.

     24.01  Any notice or demand required to be given under this Lease, or
pursuant to any law or governmental regulations, by Landlord to Tenant or by
Tenant to Landlord shall be in writing. Unless otherwise required by law or
governmental regulations, any such notice or demand shall be deemed given if
sent by registered or certified mail, enclosed in a secure postpaid wrapper,
addressed (I) to Landlord, at the address of Landlord first hereinabove set
forth, or such other address as Landlord may designate by notice to Tenant, or
(II) to Tenant, at the address of Tenant first hereinabove set forth or such
other address as Tenant may designate by notice to Landlord.

     24.02  After receiving notice from any person, firm, or other entity that
it holds a mortgage which includes the Demised Premises as part of the
mortgaged premises, no notice from Tenant to Landlord shall be effective unless
and until a copy of same is given to such holder, and the curing of any of
Landlord's defaults by such holder shall be treated as performance by the
Landlord.

     25.    CAPTIONS.

     25.01  The captions preceding the Articles of this Lease are inserted only
as matter of convenience and for reference and in no way define, limit, or
describe the scope of this Lease nor the intent of any provision of this Lease.

     26.    SUCCESSORS OR ASSIGNS.

     26.01  The covenants and agreements contained in this Lease shall bind and
inure to the benefit of Landlord and the successors and assigns of Landlord,
and Tenant and its successors and assigns.

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     27.   BROKER'S COMMISSIONS.

     27.01 Landlord shall hold the Tenant harmless from any and all broker's
fees and commissions due in relation to this Lease.

     28.   MISCELLANEOUS.

     28.01 If any term or provision of this Lease, or the application thereof to
any person or circumstance shall, to any extent, be invalid or unenforceable,
the remainder of this Lease, and the application of such term or provision to
persons or circumstances other than those as to which it is held invalid or
unenforceable, shall not be affected thereby, and each term and provision of
this Lease shall be valid and be enforced to the fullest extent permitted by
law.

     28.02 This Lease and the obligations of Tenant to pay rent and other
charges or sums due hereunder and to perform all of the other covenants and
agreements hereunder shall in no way be affected, impaired, or excused because
Landlord is unable to perform any of the obligations of Landlord in this Lease
where the inability to so perform is due to causes beyond Landlord's reasonable
control.

     IN WITNESS WHEREOF, the parties hereto have caused these presents to be
signed by their duly authorized officers as of the date hereinabove set forth.

LANDLORD:                                AVOBA, INC.

Witness:                                 By:   /s/ A. Ruf     /s/ R. Baldinger
        -------------------------              ----------     ----------------
                                                 A. Ruf         R. Baldinger

TENANT:                                  American BioMedica Corporation

Witness:                                 By:
        -------------------------           --------------------------------

                                                Official legalization  back side

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State of___________)
Country of_________) SS:

     On the ____ day of __________, 19__, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he resides in ________________________________; that he is the
___________________ of Avoba, Inc., the corporation described in and which
executed the above instrument; and that he signed his name thereto by authority
of the board of directors of said corporation.

                                 ------------------------
                                 Notary Public

State of New York )
County of Columbia) SS:

     On the 13th day of May, 1999, before me personally came Stan Apkowski, to
me known, who, being by me duly sworn, did depose and say that he resides in
Ghent, New York; that he is the President of American BioMedica, the
corporation described in and which executed the above instrument; and that he
signed his name thereto by authority of the board of directors of said
corporation.

                                 /s/ Bonnie S. Baker
                                 ------------------------------
                                 Notary Public comm-ex. 2/24/01

                                       16<PAGE>   1
                                                                    EXHIBIT 10.8

                                     LEASE

     THIS LEASE ("Lease") entered into between Whitesell Enterprises
("Landlord") and American BioMedica Corporation ("Tenant").

                              W I T N E S S E T H:

     In consideration of the mutual covenants herein set forth, and intending
to be legally bound hereby, the parties hereto covenant and agree as follows:

     1.   LEASE TERMS. The parties agree that the following defined terms and
provisions, as used in this Lease, shall have the meanings and shall be
construed as set forth below.

          (a)  Date of Lease:      Aug 1, 1999

          (b)  Landlord:           Whitesell Enterprises

               Address:            One Underwood Court, P.O. Box 1605
                                   Delran, New Jersey 08075

          (c)  Tenant:             American BioMedica Corporation

               Address:            603 Heron Drive, Unit 3
                                   Bridgeport, New Jersey 08014

               Type of Entity:     Limited Partnership
               (check one)                                   --------
                                   General Partnership
                                                             --------
                                   Corporation                   X
                                                             --------
                                   Sole Proprietorship
                                                             --------
                                   Limited Liability Company
                                                             --------

               State of Organization:      New York

          (d)  Guarantor:   Yes              No     X
                               -----------     -----------

               Name:
                    --------------------------------------

          (c)  Approximate Number of Employees:      Offices:   15
                                                              -------
                                                   Warehouse:
                                                              -------

          (f)  Approximate Number of Trucks/Trailers per day:    2
                                                              -------

          (g)  Tenant's SIC Number:   2835
                                    --------

          (h)  Premises:   603 Heron Drive, Bridgeport, New Jersey 08014

               Unit Number:    3
                            -------

               Approximate Rentable Square Footage:  3,929 square feet
                                                   -------------------

          (i)  Building:

               Street Address:  603 Heron Drive, Bridgeport, New Jersey 08014

               Lot & Block Number:  Lot 3.08/Block; 46

               Approximate Rentable/Square Footage:    43,233 square feet

          (j)  Tenant's Pro Rata Share:    9.1%

          (k)  Term:    Three (3) Years

                     Lease Commencement Date:  August 1, 1999

                     Expiration Date:          August 31, 2002

                     Rent Commencement Date:   August 1, 1999
<PAGE>   2

          (1-1)  Base Rent:     $6.80 per square foot net
                                $2,226.43 monthly
                                $26,717.20 yearly

          (1-2)  Initial Estimate of Additional Rent:     $1.00 per square foot
                 See Article 5 on page 3 for definitions.

          (m)    Security Deposit:     $5,000.00

          (n)    Permitted Use:  _______________
                                 _______________
                                 _______________

          (o)    Renewals:       Non Applicable

          (p)    Broker:         Non Applicable

          (q)    Tenant's Lease Execution Date Requirements:

<TABLE>
<CAPTION>
                                                          Amount       Received
                                                          ------       --------
<S>                      <C>                              <C>          <C>
                 (i)     initial payment (1st month's     $7,296.43
                         rent plus security deposit)

                 (ii)    insurance certificates per
                         Article 18
</TABLE>

     2.   DEMISE OF PREMISES.  Landlord, for and in consideration of the Rent
(as hereinafter defined) to be paid and the covenants and agreements to be
performed by Tenant as hereinafter set forth, does hereby lease, demise and let
unto Tenant for the Term the Premises, together with the non-exclusive right to
use in common with the other tenants in the Building all common parking spaces
located adjacent to the Building, walks, access roads and land surrounding the
Building and the common areas in the Building (collectively the "Property").

     3.   USE OF PREMISES.  (a) Tenant covenants and agrees to use the Premises
for the Permitted Use, and for no other purpose or purposes. No machinery,
equipment or other thing that could cause vibration, noise, odor or fumes which
could unreasonably disturb other tenants of the Building shall be installed or
placed therein. Tenant shall not subject any portion of the floor to greater
loading than that portion of the Premises is designated to carry. Tenant
agrees that all outside storage of any kind is prohibited. Parking of
inoperable vehicles, non-motorized vehicles or trailers in or about the
Premises is prohibited.

          (b)    Tenant shall, in the use and occupancy of the Premises and the
conduct of Tenant's business or profession therein, at all times and at
Tenant's expense comply with, and conform the Premises to the following
requirements (the "Requirements"): all applicable laws, ordinances, orders,
notices and regulations of the federal, state and municipal governments, or any
of their departments and the regulations of the insurers of the Premises and
Building and the rules and regulations attached hereto as Exhibit "B". Without
limiting the generality of the foregoing, Tenant shall: (i) obtain, at Tenant's
expense, before engaging in Tenant's business or profession within the
Premises, all necessary licenses and permits including (but not limited to)
state and local use or occupancy and business licenses or permits; and (ii)
remain in compliance with and keep in force at all times all licenses,
consents and permits necessary for the lawful conduct of Tenant's business or
profession at the Premises. Tenant shall pay all personal property taxes,
income taxes and other taxes which are or may be assessed, levied or imposed
upon Tenant and which, if not paid, could be liened against the Premises or
against Tenant's property therein or against Tenant's leasehold estate. Tenant
agrees to promptly furnish Landlord with a copy of any notice that it receives
that it is in violation of any Requirements.

          (c)    Tenant shall indemnify, protect, defend and save harmless
Landlord with regard to any non-compliance or alleged non-compliance by Tenant
with any Requirements. If Landlord is named as defendant or a responsible party
with respect to any alleged violation or non-compliance by Tenant as aforesaid,
Landlord also may require, by notice to Tenant as aforesaid, that the matters
or conduct giving rise thereto be discontinued by Tenant unless and until the
alleged violation or non-compliance is resolved in Tenant's favor.

     4.   POSSESSION.  In no event shall Landlord be liable to Tenant for any
actual or consequential damages in the event the Landlord is unable to deliver
possession of the Premises on the Lease Commencement Date. If the Lease Term
does not commence upon the Lease Commencement Date, Landlord and Tenant shall,
by separate writing, set forth the revised Lease Commencement Date and
Expiration Date (which shall be extended accordingly).

     5.   RENT.  (a) The Base Rent shall be paid without notice in equal
monthly installments on or prior to the first day of each month. Tenant shall
pay to Landlord all Rent without demand, setoff or

                                       2
<PAGE>   3

deduction. The first month's rent shall be payable upon the execution of this
Lease. If the Rent Commencement Date is other than the first day of a calendar
month or if the Expiration Date is other than the last day of a calendar month,
Rent for such partial month shall be prorated.

          (b)    In addition to the Base Rent, Tenant shall pay to Landlord its
Pro Rata Share of all real estate taxes and assessments (collectively "Taxes")
incurred during each tax year (pro rated where appropriate) during the Term of
this Lease. The Taxes shall be estimated by Landlord from time to time and
Tenant shall pay to Landlord monthly, in addition to the Basic Rent and on the
same day provided in Article 5(a), 1/12 thereof. Landlord shall have the right,
but not the obligation to appeal or contest any Taxes and Tenant shall pay its
Pro Rata Share of Landlord's costs for the contest or appeal which costs, shall
in no case ever exceed any tax savings.

          (c)    In addition to the Base Rent and Taxes, Tenant shall pay to
Landlord its Pro Rata Share of all operating costs (the "Costs") incurred
during each calendar year (pro rated where appropriate) during the Term of this
Lease. The Cost shall be estimated by Landlord from time to time and Tenant
shall pay to Landlord monthly, in addition to the Basic Rent and Taxes and on
the same day provided in Article 5(a), 1/12 thereof. The Costs shall include any
and all costs incurred (whether internal to Landlord or paid to a third party)
in the maintenance, repair, upkeep, replacement, servicing, securing and
operation of the Building and Property (less any charges invoiced directly to
other tenants in the Building) and shall include but not be limited to:

                 (i)     All costs and expenses directly related to the
operation of the Building and Property including lighting, cleaning,
maintaining and painting the Building exterior, fire suppression and alarm
systems (including monitoring), removing snow, ice and debris and maintaining
all landscape areas, (including replacing and replanting flowers, shrubbery and
trees), maintaining and repairing all other exterior improvements (including
without limitation parking areas, drives and sidewalks) on the Property and all
repairs and compliance costs (including storm water runoff etc., if applicable)
required of Landlord. Landlord's obligation to provide snow removal services
shall be limited to the parking areas and Tenant shall be responsible for its
entrance ways and sidewalks.

                 (ii)    If the Property is located in an industrial park,
Tenant shall pay any applicable owners' association dues and fees and its pro
rata share of maintenance and repair of any common areas in the industrial park
including, but not limited to drainage systems, lighting, trash removal, snow
removal, landscaping and association fees or dues, if applicable.

                 (iii)   Administrative fee of three (3%) percent of the Base
Rent plus legal fees which are applicable to the overall operation of the
Building. It is expressly understood that legal fees incurred in an action
against an individual Tenant shall not be deemed includable as an operating
expense pursuant to this provision.

                 (iv)    All costs and expenses incurred by Landlord for
environmental testing, sampling or monitoring necessary except any cost or
expenses incurred in conjunction with the spilling or depositing of any
hazardous substance for which any other Tenant is legally liable.

                 (v)     All costs for insurance carried by Landlord.

                 (vi)    Capital expenditures and the costs of preparing any
other unit for rental shall not be included as operating expenses. However in
the event that Landlord incurs any capital expense for an improvement required
by virtue of any governmental statute, ordinance or regulation then Landlord
shall be permitted to recover on an amortized basis (not to exceed five (5)
years) the portion of the capital costs applicable to the Term of this Lease
including any renewal or extension. Similarly should Landlord make any capital
improvement which reduces the operating expenses payable hereunder then
Landlord shall be permitted to recover the amortized costs as aforesaid but in
no case shall the expense allocated exceed the cost savings achieved by the
capital improvement. With the exclusion of snow removal and taxes these costs
shall not exceed an increase of ten percent (10%) a year.

          (d)    Within 120 days following the end of each calendar year and/or
tax year, as the case may be, Landlord shall send to Tenant a statement of
actual Costs and/or Taxes, as the case may be, incurred for such year as
appropriate, showing the Pro Rata Share due from Tenant. In the event the
amount paid by Tenant as Additional Rent for such period pursuant to this
Article 5 exceeds the amount that was actually due based upon actual year end
cost, then Landlord shall issue a credit to Tenant in an amount equal to the
overcharge which credit Tenant may apply to future rent payments until Tenant
has been fully credited with the overcharge. If the credit due to Tenant is
more than the aggregate total of future rental payments, Landlord shall pay to
Tenant the difference between the credit in such aggregate total. In the event
Landlord has undercharged Tenant, then Landlord shall send Tenant an invoice
with the additional amount due which amount shall be paid in full by Tenant
within ten (10) days of receipt.

     Tenant shall have the right to review all invoices and other information
on which the calculation of the Costs chargeable to Tenant were based by
written notice to Landlord within thirty (30) days following Tenant's receipt
of the Costs statement from Landlord. Upon receipt of such notice from Tenant,
Landlord shall make such information available to Tenant or Tenant's authorized
representative at

                                       3
<PAGE>   4

Landlord's location (or, at Landlord's option, Landlord may provide copies of
such information to Tenant). Tenant shall have a period of thirty (30) days
following the date on which Landlord notifies Tenant that such information is
available for Tenant's review to advise Landlord of any discrepancy discovered
by Tenant with respect to the Costs charged to Tenant whereupon Landlord and
Tenant shall use their best efforts to resolve any such discrepancy discovered
by Tenant with respect to the Costs charged to Tenant whereupon Landlord and
Tenant shall use their best efforts to resolve any such discrepancy, and if
they are unable to do so, Tenant shall be free to pursue any remedies available
to Tenant by law. If Tenant does not notify Landlord of its wish to review the
Costs information within thirty (30) days of Tenant's receipt from Landlord of
its Costs statement or if Tenant does so notify Landlord, but does not, within
thirty (30) days following the date when such information is made available to
Tenant, notify Landlord of a discrepancy in the Costs charged to Tenant with
respect to the applicable calendar year and to tax year, as the case may be,
Tenant shall be deemed to have waived any right to make any claim against
Landlord with respect to the applicable Costs statement.

          (e)    All Taxes, Costs and other sums other than Base Rent payable
by Tenant to Landlord under this Lease shall be deemed additional rent
("Additional Rent") and Landlord shall have all rights with respect to the
non-payment of Additional Rent as for Base Rent. Base Rent and Additional Rent
are sometimes herein together called "Rent".

     6.   LATE PAYMENT. For each payment of Rent received after the first day
following the due date therefor, Tenant shall pay to Landlord an initial
late charge of ten (10%) percent of the payment due plus one and one-half
(1-1\2%) percent for each additional month such payment is late, which charge
must accompany the late payment. An additional charge will be made for checks
returned for insufficient funds.

     7.   SECURITY DEPOSIT.  Tenant does herewith deposit with Landlord the
Security Deposit to be held as security for the full and faithful performance
by Tenant of Tenant's obligations under this Lease and for the payment of
damages to the Premises. Except for such sum as shall be applied by Landlord
to satisfy claims against Tenant arising from defaults under this Lease or by
reason of damages to the Premises, and further provided that Tenant is not
then in default hereunder and has complied with all obligations for surrender
and redelivery of the Premises to Landlord (including without limitation all
obligations contained in Article 15(c)),  the Security Deposit shall be
returned to Tenant without interest within thirty (30) days of the expiration
of the Term of this Lease or any renewals or extensions thereof. It is
understood that no part of any Security Deposit is to be considered as the
last rental due under the Term of the Lease. Notwithstanding any law to the
contrary, Landlord shall not be required to pay any interest to Tenant on
account of the holding of the Security Deposit and need not maintain this
deposit in a separate account but may co-mingle and use these funds as its own.
In the event of the sale or transfer of Landlord's interest in the Building,
Landlord shall have the right to transfer the Security Deposit to such purchaser
or transferee, in which event Tenant shall look only to the new landlord for the
return of the Security Deposit and Landlord shall thereupon be released from all
liability to Tenant for the return of the Security Deposit. In the event
Landlord applies any portion of the Security Deposit to satisfy claims against
Tenant arising from defaults under this Lease or by reason of damages to the
Premises, within ten (10) days of receipt of written notice from Landlord,
Tenant shall replenish the Security Deposit by the amount withdrawn therefrom by
Landlord.

     8.   SIGNS.  No sign, advertisement or notice shall be affixed to or
placed upon any part of the Premises, Building or Property by Tenant or anyone
acting under Tenant. At any time Landlord may put upon the Premises a suitable
"for sale" sign and for six (6) months prior to the expiration of the current
Term, Landlord or it agents may place the usual "to let" signs thereon.
Landlord shall provide Landlord's standard signage identifying Tenant on
Building pylon and at suite entrance.

     9.   SERVICES AND UTILITIES.  Tenant shall pay all costs and charges for
utilities and services including security deposits and minimum fees. The
utilities shall be deemed to include without limitation the cost of heating,
air conditioning if applicable, electricity, water, gas, sprinkler stand-by
fee, sewer service and septic fee if applicable. Landlord shall not be liable
for any interruption or delay in any of the above services for any reason. Upon
demand, Tenant shall promptly furnish to Landlord payment or evidence of
payment of charges for utilities and services. To the extent that Landlord is
making available any electric or other utilities, Landlord shall have the sole
right to select the provider of such utilities.

     10.  CONDITION OF PREMISES.  (a) If Landlord has agreed to complete any
work in the Premises prior to occupancy by Tenant, then the specifications for
such construction shall be as set forth on the construction documents initialed
by the parties and incorporated by reference into this Lease on Exhibit "C".
Landlord shall be deemed to have delivered possession of the Premises to Tenant
when such work has been substantially completed, except for (i) minor items of
finishing and construction of a nature which are not necessary to make the
Premises reasonably tenantable for the permitted use; and (ii) items then not
completed because of delay by Tenant in furnishing any drawings, plans or
approvals required for Landlord to complete any such work or because of any
changes or additions thereto requested by Tenant. The taking of possession of
the Premises by Tenant shall conclusively establish that the

                                       4
<PAGE>   5

Premises and the Building were at such time in satisfactory condition, order
and repair, subject to any punchlist items.

            (b)  Landlord shall undertake the warranty work in Exhibit "D" (if
any) and except as set forth therein Tenant is leasing the Premises in their
"as-is" condition.

     11.    SURRENDER. Tenant shall at the expiration of the Term hereof,
peaceably surrender possession of the Premises in as good and marketable order
and condition as existed at the inception of this Lease, reasonable wear and
tear of the finishing elements and carpeting and damage by fire, elements or
casualty excepted, and will, at the expiration of said Term, or any
continuation thereof, deliver the keys at the office of said Landlord. Within
the final fifteen (15) days of the Term, the systems shall be inspected by a
reputable electrical, mechanical or plumbing contractor designated by Landlord
at the sole cost and obligation of Tenant. All mechanical, electrical,
plumbing, heating and air conditioning systems shall be in good operating order
at the termination of this Lease and Tenant shall perform a thorough cleaning
of the Premises immediately prior to surrender, including without limitation
shampoo and repairs of all carpeted areas of the Premises. Any property or
fixtures which remain upon the Premises after the expiration of the Lease shall
be deemed abandoned by Tenant and Landlord may take possession of same and
dispose of same in any reasonable manner without any further liability of
Landlord to Tenant. Any costs associated with the removal of such property
shall be payable by Tenant.

     12.  REPAIRS AND MAINTENANCE. (a) Except as specifically otherwise
provided in subsection (d) of this Article 12, Tenant, at its sole cost and
expense throughout the Term of this Lease, shall keep and maintain the Premises
including without limitation hot water heaters, roof fans, plumbing and
electrical systems and fixtures, Tenants improvements, betterments and other
special equipment attached to the Premises, glass, overhead doors, loading dock
bumpers and levelers and carpeting in good order and condition, free of dirt
and rubbish, and shall promptly make all repairs necessary to keep and maintain
such good order and condition, whether such repairs are ordinary or
extraordinary, foreseen or unforeseen. When used in this Article 12, the term
"repairs" shall include replacements and renewals when necessary. All repairs
made by Tenant shall utilize materials and equipment which are at least equal
in quality and usefulness to those originally used in constructing the Building
and the Premises. Tenant shall also repair and maintain any openings in the
roof or walls specifically installed by or for Tenant with Landlord's prior
written consent.

          (b)    Tenant shall pay Landlord's costs to service, repair and
maintain HVAC equipment, any fire suppression system (including alarm
monitoring) and any other service which pertains to the Premises. Tenant shall
have the option to purchase and maintain its own service contract on the HVAC
equipment so long as Landlord has given its prior written consent to the
service agreement.

          (c)    All repairs required pursuant to this subsection shall be
completed within thirty (30) days after written notice from Landlord. If Tenant
does not complete these repairs within thirty (30) days, Landlord has the right
to make the repairs and charge Tenant for same.

          (d)    Landlord, throughout the Term of this Lease shall make all
necessary repairs to the footings and foundations, roof, external walls and
structural steel columns and girders forming a part of the Premises (excluding
doors, windows and other apertures); provided, however, that Landlord shall
have no responsibility to make any repair unless and until Landlord receives
written notice of the need for such repair from Tenant. Tenant shall pay the
cost of any repairs made pursuant to this paragraph as same are occasioned by
the act, omission or negligence of Tenant, its employees or invitees.

     13.  ALTERATIONS AND TRADE FIXTURES. (a) Tenant shall not make any
alterations, additions, or improvements (collectively "Alterations") to the
Building or Property and shall not make any Alteration to the Premises without
Landlord's prior written consent. All Alterations made by either of the parties
hereto upon the Premises, except moveable and detached or detachable office
furniture, partitions, and machinery and equipment put in at Tenant's expense,
shall be the property of Landlord, and shall remain upon and be surrendered
with the Premises, as part thereof at the termination of this Lease or at the
option of Landlord, said Alterations shall be removed by Tenant at Tenant's
sole cost and expense (failing which, Landlord may remove such alterations and
invoice Tenant for such work, which amount shall be Additional Rent immediately
due hereunder). Any damages caused by or arising from Tenant's removal of any
Alterations shall be restored or repaired at Tenant's expense. Tenant shall be
solely responsible for removing all telephone, telefax, computer and other
communications wiring, cabling and equipment and shall repair all damages
caused by or arising from such removal at Tenant's expense.

          (b)    All labor and materials furnished by or on behalf of Tenant
under or pursuant to this Lease shall be first class, not less than the caliber
and quality which exists in the Premises and by contractors approved in writing
by Landlord and shall be accomplished at times so as not to disturb the
business of other tenants. Tenant shall not install any Alterations in such a
manner as to compromise the structural integrity or impair the economic value
or marketability of the Premises or any part thereof. The labor and materials
shall be installed in complete conformity to all applicable statutes, codes,
ordinances and regulations.

                                       5

<PAGE>   6

          (c)    Landlord agrees that it will not unreasonably withhold or
delay its consent to any interior nonstructural Alterations to the Premises
which do not affect any Building systems. Tenant agrees that it will submit to
Landlord sealed plans and specifications along with the name and address of the
proposed contractor and all subcontractors as part of any request made
hereunder. Prior to commencing the work, Tenant will furnish Landlord with
copies of all governmental permits, certificates establishing that its
contractor and subcontractors have adequate insurance coverages naming Landlord
(and any property manager) and Landlord's mortgagee as additional insureds. If
Landlord has installed a master lock system Tenant agrees that under no
circumstances will it change any of the exterior locks thereby making it
impossible for Landlord to gain access with its master key.

     14.  ACCESS TO PREMISES.  Landlord, its employees and agents shall have
the right to enter the Premises at all reasonable times for the purpose of
examining or inspecting the same, showing the same to prospective purchasers,
mortgagees or tenants of the Building, and making such alterations, repairs,
improvements or additions to the Premises or to the Building as may be
necessary. If representatives of Tenant shall not be present to open and permit
entry into the Premises at any time when such entry by Landlord is necessary or
permitted hereunder, Landlord may enter by means of a master key (or forcibly
in the event of an emergency) without liability to Tenant and without such
entry constituting an eviction of Tenant or termination of this Lease.

     15.  ENVIRONMENTAL COMPLIANCE.  (a) Tenant represents and warrants that
Tenant's SIC (Standard Industrial Classification) number as designated in the
Standard Classification Manual prepared by the Office of Management and Budget,
and as set forth in Article 1(g) hereof, is correct. Tenant recognizes that for
purposes of the Industrial Site Recovery Act (formerly known as the
Environmental Cleanup Responsibility Act), N.J.S.A. 13:1K-6 et.seq. ("ISRA"),
Tenant will acquire the SIC number of any entity for which it provides all or
substantially all of its services or products. Tenant represents that the
specific activities intended to be carried on in the Premises are in accordance
with Article 1(n) and Tenant covenants and agrees that it will not do or suffer
anything which will cause its SIC number (or that of any assignee or subtenant)
to change so as to fall within any of the following "major group"
classifications of SIC numbers during the Term or exercised renewal term
hereof: 22 through 39 inclusive, 46 through 49 inclusive, 51 and 76 (together
the "Covered Numbers"). Tenant further covenants and agrees to notify Landlord
at least thirty days (30) prior to any change of facts which would result in
the change of Tenant's SIC number from its present number to any of the Covered
Numbers. Upon such notice, Landlord shall have the right, at its option, to
terminate this Lease within thirty (30) days of receipt of such notice by
notifying Tenant in writing.

          (b)    Tenant shall not engage in operations at the Premises which
involve the unlawful generation, manufacture, refining, transportation,
treatment, storage, handling or disposal of "hazardous substances" or
"hazardous waste" as such terms are defined under ISRA. Tenant further
covenants that it will not cause or permit to exist any Discharge (as such term
is defined under ISRA) on or about the Premises.

          (c)    If Tenant's operations on the Premises now or hereafter
constitute an "Industrial Establishment" subject to the requirements of ISRA,
then prior to: (i) any sale or transfer of the Premises, (ii) Closing
operations or Transferring ownership or operations of Tenant at the Premises
(as defined under ISRA), (iii) the expiration or sooner termination of this
Lease, or (iv) any assignment of this Lease or any subletting of any portion of
the Premises; Tenant shall, at its expense, comply with all requirements of
ISRA pertaining thereto. Without limitation of the foregoing, Tenant's
obligations shall include (i) the proper filing of an initial notice under
N.J.S.A. 13:1K-9(a) to the New Jersey Department of Environmental Protection
("NJDEP"), and (ii) the performance of all remediation and other requirements
of ISRA, including without limitation all requirements of N.J.S.A. 13:1K-9(b)
through and including (i). Upon written request of Landlord, Tenant shall
cooperate with Landlord in obtaining evidence of compliance with ISRA or any
other law, regulation, or order of any governmental authority, which
cooperation shall include, without limitation, providing affidavits, reports,
or responses to questions.

          (d)    The parties acknowledge and agree that, pursuant to the
provisions of Section 20(c) of ISRA, Tenant shall be, and is hereby, designated
the party responsible (the "Party Responsible") to comply with the requirements
of ISRA (P.L. 1983, c.330), and that as a result of DEP shall compel Tenant to
so comply. In addition, any failure of Tenant to provide any information and
submission as required under Section 20(a) and Section 20(c) of ISRA shall
constitute a default under this Lease. Any assignee or subtenant of Tenant
shall be deemed to have, and by entering into such assignment or sublease,
and/or by entering into possession of the Premises, does hereby, acknowledge
that they shall be the Party Responsible, jointly and severally with Tenant,
under the provisions of this Lease.

          (e)    In the event of Tenant's failure to comply in full with this
Article 15, Landlord may, at its option, perform any and all of Tenant's
obligations as aforesaid and all costs and expenses incurred by Landlord in the
exercise of this right shall be deemed to be Additional Rent payable on demand
and with interest at the Rate until payment.

                                       6
<PAGE>   7

          (f)    In the event Tenant is obligated, under this Article or
otherwise, to perform and/or cooperate in performing any ISRA obligations
and/or obtain and/or cooperate in obtaining any ISRA approval, by way of a
non-applicability letter, " negative declaration", the performance of an
approved remedial action work plan, the obtaining of a no further action
letter, the performance under a remediation agreement and/or otherwise
(collectively the "ISRA Obligations") and, prior to fully performing such ISRA
Obligations, there occurs the scheduled expiration of the Term of this Lease or
any other termination of this Lease (collectively, a "Lease Termination"),
Tenant shall, following such Lease Termination, pay, at the time and in the
manner Base Rent payments were due during the Term, an amount equal to: (i)
Base Rent at twice the rate in effect immediately prior to such Lease
Termination; and (ii) Additional Rent as provided under the Lease; until such
time as all such ISRA Obligations have been fully completed.

          (g)    Tenant shall promptly provide Landlord with all documentation
and correspondence, reports, notices and submissions: (i) provided to NJDEP
pursuant to the Worker and Community Right to Know Act, N.J.S.A. 34:5A-1 et
seq. and the regulations promulgated thereunder ("Right to Know Act"); (ii)
pursuant to the Hazardous Substance Discharge-Reports and Notices Act, N.J.S.A.
13:1K-1 5 et seq. and the regulations promulgated thereunder ("Reports and
Notices Act"); (iii) to NJDEP, the United States Environmental Protection
Agency (EPA), the United States Occupational Safety and Health Administration
(OSHA), or any other local, state or federal authority which requires
submission of any information concerning environmental matters or hazardous
wastes or substances. Should the Property be located in a state other than the
state of New Jersey then the provisions of subparagraphs (i) and (ii) shall be
deemed to pertain to the applicable laws of the state in which the Property is
located (e.g. if located in Pennsylvania, the Pennsylvania Worker and Community
Right to Know Act, 35 P.S. Section 7301 et seq.) The copies and notices
required by this paragraph to be submitted to Landlord shall only pertain to
the Property and not to any other site or location where Tenant may occupy
another facility.

          (h)    Tenant shall indemnify, defend and save harmless Landlord from
and against any and all fines, suits, proceedings, claims and/or actions of any
kind and any and all losses, costs, damages and expenses (including, without
limitation, attorney's fees) arising out of or in any way connected with any
(i) spills, releases or discharges of hazardous material at the Premises which
occur during the Term of this Lease (including any renewal periods); (ii)
Tenant's failure to provide all information, make all submissions and take all
actions required by any governmental authority; (iii) Tenant's failure to
comply with all requirements of ISRA (as required herein); (iv) violation of
any environmental law; and/or (v) breach of any provision of this Article 15.
Notwithstanding anything provided herein to the contrary, in no event shall
Tenant's indemnification, defense and hold harmless obligation apply with
respect to, nor shall Tenant have any responsibility for, any spills, releases
or discharges of hazardous material at the Premises which occurred prior to the
Term of this Lease (unless actually caused by Tenant, its contractors, agents
or invitees).

          (i)    In the event that the Premises are located in Pennsylvania all
reference to definitions contained in ISRA or any other New Jersey statutory
references shall be changed to mean the Pennsylvania Solid Waste Management Act
(35 P.S. Section 6018.101 et seq.), Pennsylvania Worker and Community Right to
Know Act (35 P.S. Section 7301 et seq.) or other applicable Pennsylvania
Statutes.

          (j)    This Article shall survive the expiration or sooner
termination of this Lease.

     16.  ASSIGNMENT AND SUBLETTING.  (a) Tenant shall have no right to assign
or sublet by operation of law or otherwise, all or any part of the Premises
without the prior written approval of Landlord.

          (b)    In the event Tenant desires to sublet the Premises or assign
the Lease, Tenant shall give to Landlord written notice of Tenant's intended
subtenant or assignee in order to secure Landlord's written consent. Within
thirty (30) days of receipt of said notice, Landlord shall have the right: (i)
to terminate this Lease by giving Tenant not less than thirty (30) days notice
in the case of an assignment of the entire Lease or a subletting of more than
fifty percent (50%) of the Premises or (ii) to terminate this Lease and
simultaneously to enter into a new Lease with Tenant for that portion of the
demised Premises Tenant may desire to retain upon the same terms, covenants and
conditions of the existing Lease as applicable to the space retained. If
Landlord exercises its right to terminate this Lease, Tenant agrees that
Landlord shall have access to all or a portion of the demised Premises sixty
(60) days prior to the effective termination date for remodeling or
redecorating purposes.

          (c)    On any approved subletting or assignment of all or any part of
the Premises, (i) Landlord shall receive from Tenant all rent in excess of
those defined herein and other profits relating to the premises derived by
Tenant from the assignment or subletting; (ii) Tenant shall remain liable under
all terms and conditions of this Lease; (iii) Landlord shall have the right to
approve the subtenant or assignee and the sublease or assignment documents (and
any assignee or subtenant must agree therein to assume all terms, conditions
and obligations of the Lease) and (iv) Tenant shall be solely responsible for
obtaining, at Tenant's cost, any certificate of occupancy or other permits
required for occupancy of the Premises by and permitted subtenant or assignee.
In the event of default by Tenant under the terms and conditions of this Lease
at such time that all or part of the Premises are then sublet, Landlord may
collect

                                       7
<PAGE>   8
directly from the subtenant(s) all rents becoming due to Tenant under the
Sublease(s) and apply such rents against any sums due to Landlord by Tenant
under this Lease, and Tenant hereby authorizes and directs such subtenant(s) to
make such payment of rent to Landlord upon receipt of notice from Landlord.
Such collection of rent by Landlord shall not constitute a novation or a
release of Tenant from its liability under the terms and conditions of this
Lease.

          (d)  The written approval of Landlord to one or more sublettings or
assignments shall not operate as a waiver of Landlord's right to approve any
further sublettings and assignments.

          (e)  Tenant shall not (i) mortgage, pledge or otherwise encumber its
interest in this Lease or (ii) grant any license, concession or other right of
occupancy of any portion of the Premises, without the prior written consent of
Landlord.

          (f)  As a condition precedent to Tenant's right to sublease the
Premises or to assign this Lease, Tenant shall, at Tenant's own expense, comply
with ISRA. Tenant shall promptly furnish to Landlord true and complete copies
of all documents, submissions and correspondence provided by Tenant to the New
Jersey Department of Environmental Protection (NJDEP) and all documents,
reports, directives and correspondence provided by the NJDEP to Tenant. Tenant
shall also promptly furnish to Landlord true and complete copies of all
sampling and test results obtained from samples and tests taken at and around
the Premises. As a condition precedent to Tenant's right to sublease the
Premises or to assign the Lease, Tenant shall have received from the NJDEP
either (i) a non-qualified approval of Tenant's negative declaration or (ii) a
non-applicability letter, for which Tenant shall promptly apply pursuant to
ISRA. If this condition shall not be satisfied, then Landlord shall have the
right to withhold consent to sublease or assignment.

          (g)  Nothing herein to the contrary withstanding, Landlord's written
consent shall not be required for any sublease or assignment of this Lease to
any other entity which controls or is controlled by Tenant provided that Tenant
shall continue to remain liable in such instance. Tenant shall be required to
give Landlord thirty (30) days written notice in advance of any such subleasing
or assignment.

          (h)  Tenant agrees that any subleasing or assignment to any person,
firm, partnership or corporation which is not an actual user of the Premises is
absolutely prohibited and nothing herein shall require Landlord to consent to
any such assignment. In addition, subleases or assignments are absolutely
prohibited to any person, firm, entity or corporation which (i) at such time is
a tenant in any building owned by Landlord or any affiliate of Landlord or (ii)
is currently or has within six (6) months prior to the date of the proposed
sublease or assignment actively been discussing a proposed lease with Landlord
or any affiliate of Landlord.

     17.  MECHANICS' LIENS.   If any mechanics' or other lien shall be filed
against the Property, Premises or the Building for labor or material furnished
or to be furnished at the request of Tenant, then Tenant shall at its expense
cause such lien to be discharged of record by payment, bond or otherwise,
within ten (10) days after the filing thereof. If Tenant shall fail to cause
such lien to be discharged of record within such ten (10) day period, Landlord
may cause such lien to be discharged by payment, bond or otherwise, without
investigation as to the validity thereof or as to any offsets or defenses
thereto. The cost to Landlord for removal of such lien will be charged to
Tenant as Additional Rent and payable on the first day of the month next
following the payment by Landlord together with interest until payment at a
rate (the "Rate") equal to four (4%) percent per annum over the then domestic
prime rate (the base rate on corporate loans at large U.S. money center
commercial banking) or equivalent rate as announced daily in The Wall Street
Journal under the heading "Money Rates". Tenant shall indemnify and hold
Landlord harmless against any and all claims, costs, damages, liabilities and
expenses (including reasonable attorney fees) which may be brought or imposed
against or incurred by Landlord by reason of any such lien or its discharge.

     18.  INDEMNIFICATION AND LIABILITY INSURANCE.   (a) Tenant covenants and
agrees that it shall, at its own cost and expense, indemnify and save harmless
Landlord, any affiliate of Landlord, any property manager or agent for Landlord
and all of their respective officers, directors, owners and employees (together
the "Protected Parties") against and from, and the Protected Parties shall not
be liable to Tenant for, any and all claims by or on behalf of any person,
entity, firm or corporation arising in any manner whatsoever from, out of or in
connection with (i) the use and occupancy of the Property by Tenant; (ii)
failure to perform any of the terms or conditions of this Lease required to be
performed by Tenant; (ii) failure to perform any of the terms or conditions of
this Lease required to be performed by Tenant; (iii) any failure by Tenant to
comply with any statutes, regulation, ordinances or orders of any governmental
authority; or (iv) any accident, death, injury, or damage, loss or theft of
property in or about the Property (whether involving property belonging to
Tenant or any other person) resulting from any cause whatsoever, unless such
accident, death, injury, damage, loss or theft is caused by the sole negligence
of the Protected Parties, and from and against all costs, attorney fees,
expenses and liabilities incurred in or as a result of any such claim or action
or proceeding brought against the Protected Parties by reason of any such
claim. Tenant, upon notice from the Protected Parties, covenants to resist or
defend such action or proceeding by legal counsel reasonably satisfactory to
the Protected Parties.

                                       8
<PAGE>   9
          (b)  During the Term of this Lease and any renewal thereof, Tenant
shall obtain and promptly pay all premiums for commercial general liability
insurance with respect to the Property, covering at least the hazards of
"premises/operations", "independent contractors" and "contractual liability"
with a per occurrence limit of not less than $1,000,000.00 combined bodily
injury and property damage, and an aggregate limit of not less than
$2,000,000.00. On or before the commencement date of the Term of this Lease,
and thereafter not less than fifteen (15) days prior to the expiration dates of
said policy or policies, Tenant shall provide copies of policies or
certificates of insurance evidencing coverage required by this Lease.

          (c)  Landlord shall insure the Building of which the Premises are a
part and any improvements constructed by Landlord in accordance with Article 10
and Tenant shall insure the trade fixtures, equipment (including but not
limited to all equipment, machinery, furnishings and inventory) and any tenant
improvements and/or Alterations constructed by Tenant against loss or damage by
fire and such other risks as may be included in the broadest form of extended
coverage insurance including sprinkler leakage.

          (d)  Tenant shall not engage in any activity or store any product or
material in the Premises which will either cause an increase in the insurance on
the entire Building or which will make the Building uninsurable. In the event
Tenant engages in any activity or stores any product or material in the Premises
which causes an increase in the insurance on the entire Building (nothing
contained herein being intended to authorize or permit same) Tenant shall pay,
on demand, as Additional Rent from time to time, all such increased cost of
insurance.

          (e)  All Tenant's policies of insurance (and renewals) required to be
carried hereunder shall (i) be with insurance companies with an "A.M. Best"
rating of A or above; (ii) shall name Landlord, its property manager and any
mortgagee as an additional insured, and Landlord as a loss payee; (iii) provide
that no material change or cancellation of said policies shall be made without
thirty (30) days prior written notice to Landlord; (iv) provide that any loss
shall be payable notwithstanding any act or negligence of Landlord which might
otherwise result in the forfeiture of said insurance; (v) provide that the
insurance company issuing the same shall have no right of subrogation against
Landlord; and (vi) provide that as to the interest of Landlord, the insurance
afforded by the policy shall not be invalidated by any breach or violation by
Tenant of any of the warranties, declarations or conditions in the policy.

          (f)  If, in Landlord's sole discretion, Landlord allows Tenant to
self insure any of the coverage required under this Article 18, Tenant shall
deliver to Landlord a certificate in the form of Exhibit "E" attached hereto.

     19.  WAIVER OF SUBROGATION. Tenant and Landlord, respectively, hereby
release each other from any and all liability or responsibility to the other
for anyone claiming by, through or under it or them by way of subrogation or
otherwise for any loss or damage to property covered by any insurance then in
force, even if such loss or damage shall have been caused by the fault or
negligence of the other party or anyone for whom such party may be responsible;
provided, however, that this release shall be applicable and in force and
effect only with respect to any loss or damage occurring during such time as
the policy or policies  of insurance covering said loss shall contain a clause
or endorsement to the effect that this release shall not adversely affect or
impair such insurance or prejudice the right of the insured to recover
thereunder. Landlord and Tenant each agree to use their best efforts to obtain
such a waiver in all applicable insurance policies, failing which such party
shall immediately notify the other of such inability to obtain a waiver and
provide with such notice written evidence of all attempts to procure same and
the written rejection of the insurers consulted.

     20.  WAIVER OF CLAIMS. Except to the extent resulting from the gross
negligence or willful misconduct of the applicable Protected Party, the
Protected Parties shall not be liable for, and Tenant hereby releases and
relieves the Protected Parties from, all liability in connection with any and
all loss of life, personal injury, damage to or loss of property, or loss or
interruption of business occurring to Tenant, its agents, servants, employees,
invitees, licensees, visitors, or any other person, firm, corporation or
entity, in or about or arising out of the Premises, from, without limitation,
(a) any fire, other casualty, accident, occurrence or condition in or upon the
Premises, Building and/or Property; (b) any defect in or failure of (i)
plumbing, sprinkling, electrical, heating or air conditioning systems or
equipment, telecommunication conduit, lines and equipment or any other systems
and equipment of the Premises and the Building, and (ii) the elevators,
stairways, railings or walkways of the Building and/or Property; (c) any steam,
gas, oil, water, rain or snow that may leak into, issue or flow from any part
of the Premises, Building and/or Property from the drains, pipes, roof, or
plumbing, sewer  or other installation of same, or from any other place or
quarter; (d) the breaking or disrepair of any installations and equipment; (e)
the falling of any fixture or any wall or ceiling materials; (f) damaged or
broken interior or exterior glass; (g) latent or patent defects; (h) the
exercise of any rights by Landlord under the terms and conditions of this
Lease; (i) any acts or omissions of the other tenants or occupants of the
Building or of nearby buildings; (j) any acts or omissions of other persons or
requirements or restrictions of governmental entities; (k) any acts or
omissions of the Protected Parties; and (l) theft, acts of God, public enemy,
injunction, riot, strike, insurrection, war, court order or any order of any
governmental authorities having jurisdiction over the Premises.

                                        9
<PAGE>   10
     21.  FIRE OR OTHER CASUALTY.  (a)  Subject to paragraphs (b), (c) and (d)
of this Article 21 below, if the Premises are damaged by fire or other casualty,
the damage shall be repaired by and at the expense of Landlord and the Rent
until such repairs shall be made shall be apportioned from the date of such fire
or other casualty according to the part of the Premises which is usable by
Tenant. Landlord agrees to repair such damage within a reasonable period of time
after receipt from Tenant of written notice of such damage, except that Tenant
agrees to repair and replace its own furniture, furnishings, equipment and any
alteration or improvement installed by Tenant. Landlord shall not be liable for
any inconvenience or annoyance to Tenant or injury to the business of Tenant
resulting from such damage or the repair thereof.

          (b)  If the Premises, in the opinion of Landlord's licensed architect
or engineer, are (i) rendered substantially untenantable by reason of such fire
or other casualty; or (ii) twenty (20)% percent or more of the Premises is
damaged by said fire or other casualty and less than six (6) months would remain
on the Lease Term or any renewal thereof upon completion of the repairs or
reconstruction; or (iii) fifty (50%) percent or more on the Premises is damaged
by said fire or other casualty; then in any such events Landlord shall have the
right to be exercised by notice in writing delivered to Tenant within thirty
(30) days from and after said occurrence, to elect to terminate this Lease, and,
in such event, this Lease and the tenancy hereby created shall cease as of the
date of said occurrence, the Rent to be adjusted as of said date.

          (c)  If the Building, in the sole opinion of Landlord, shall be
substantially damaged by fire or other casualty, regardless of whether or not
the Premises were damaged by such occurrence, Landlord shall have the right, to
be exercised by notice in writing delivered to Tenant within thirty (30) days
from and after said occurrence, to terminate this Lease; and in such event,
this Lease and the tenancy hereby created shall cease as of the date of said
termination, the Rent to be adjusted as of the date of such termination.

          (d)  In the event that any mortgagee unilaterally refuses to make the
proceeds of any policy of insurance available for restoration, Landlord shall
have the right, to be exercise by notice in writing delivered to Tenant within
thirty (30) days from notice of such refusal to terminate this Lease and in
such event, this Lease and the tenancy hereby created shall cease as of the
date of said termination, the Rent to be adjusted as of the date of such
termination.

     22.  CONDEMNATION.  (a) If the whole of the Premises shall be condemned or
taken either permanently or temporarily for any public or quasi-public use or
purpose, under any statute or by right of eminent domain, or by private
purchase in lieu thereof, then in that event the Term of this Lease shall cease
and terminate from the date when possession is taken thereunder pursuant to
such proceeding or purchase. The rent shall be adjusted as of the time of such
termination and any rent paid for a period thereafter shall be refunded. In the
event more than fifteen (15%) percent of the Building containing same shall be
so taken (or if more than fifty (50%) percent of the parking areas are taken
and not promptly replaced with contiguous parking areas) then Landlord may
elect to terminate this Lease from the date when possession is taken thereunder
pursuant to such proceeding or purchase or, Landlord shall repair and restore,
at its own expense, the portion not taken and thereafter the rent shall be
reduced proportionately to the portion of the Premises taken.

          (b)  In the event of any total or partial taking of the Premises or
the Building, Landlord shall be entitled to receive the entire award in such
proceeding and Tenant may make a separate application for Tenant's fixtures,
equipment and moving expenses under the then applicable New Jersey eminent
domain code, but Tenant shall not make any claim that will detract from or
diminish any award for which Landlord may make a claim.

          (c)  If the Premises or the Building are declared unsafe by any duly
constituted authority having the power to make such determination, or are the
subject of a violation notice or notice requiring repair or reconstruction
which cannot be repaired by Landlord at its sole cost and expense within thirty
(30) days, then Landlord at its option, may terminate this Lease, and in such
event, Tenant shall immediately surrender said Premises to Landlord and
thereupon this Lease shall terminate and the rent shall be apportioned as of
the date of such termination.

     23.  ESTOPPEL CERTIFICATE. Tenant shall, at any time and from time to time,
within ten (10) days after written request by Landlord, execute, acknowledge and
deliver to Landlord, or its mortgagee or trustee, a statement in writing duly
executed by Tenant (a) certifying that this Lease is in full force and effect
(if that be the case) without modification or amendment (or, if there have been
any modifications or amendments, that this Lease is in full force and effect as
modified and amended and setting forth the modifications or amendments); (b)
certifying the dates to which Base Rent and Additional Rent have been paid; (c)
either certifying that to the knowledge of Tenant no default exists under this
Lease or specifying each such default; and (d) providing such other information
as Landlords purchaser or mortgagee may reasonably request; it being the
intention and agreement of Landlord and Tenant that any such statement by Tenant
may be relied upon by a prospective purchaser or a prospective or current
mortgagee of the Building, or by others, in any matter affecting the Premises.

                                       10
<PAGE>   11
     24.  TENANT'S DEFAULT.  (a) The occurrence of any of the following shall
constitute a material default and breach of this Lease by Tenant:

               (i)    failure of Tenant to accept possession of the Premises
within thirty (30) days after the date of issuance of a certificate of
occupancy;

               (ii)   a failure by Tenant to pay, within five (5) days after
written notice, any installment of Rent hereunder or any Additional Rent or any
such other sum herein required to be paid by Tenant;

               (iii)  if any representation or warranty of Tenant or guarantor,
if any, set forth in any notice, certificate, demand, request or other
instrument delivered pursuant to, or in connection with, this Lease shall prove
to be either false or misleading in any respect as of the time when the same
shall have been made;

               (iv)   a failure by Tenant to observe and perform any other
provisions or covenants of this Lease to be observed or performed by Tenant,
where such failure continues for thirty (30) days after written notice thereof
from Landlord to Tenant provided, however, that if the nature of the default is
such that the same cannot reasonably be cured within such thirty (30) day
period, Tenant shall not be deemed to be in default if Tenant shall within such
period commence such cure and thereafter diligently prosecute the same to
completion (but in no event shall such cure period exceed an additional thirty
(30) days).

          (b)  Upon the occurrence of any such event of default set forth above:

               (i)    Landlord may (but shall not be required to) perform for
the account of Tenant any such default of Tenant and immediately recover as
Additional Rent any expenditure made and the amount of any obligations incurred
in connection therewith, plus interest at the Rate (as defined in Article 17
hereof) from the date of such expenditure;

               (ii)   Landlord may at its option accelerate all Rent and
Additional Rent due for the balance of the Term of this Lease and declare the
same to be immediately due and payable as liquidated damages;

               (iii)  Landlord, at its option, may serve notice upon Tenant
that this Lease and the then unexpired Term hereof and all renewal options
shall cease and expire and become absolutely void on the date specified in such
notice, to be not less than five (5) days after the date of such notice without
any right on the part of Tenant to save the forfeiture by payment of any sum
due or by the performance of any terms, provision, covenant, agreement or
condition broken; and, thereupon and at the expiration of the time limit in
such notice, the Lease and the Term hereof granted, as well as the right, title
and interest of Tenant hereunder, shall wholly cease and expire and become void
in the same manner and with the same force and effect (except as to Tenant's
liability) as if the date fixed in such notice were the date herein granted for
expiration of the Term of this Lease. Thereupon, Tenant shall immediately quit
and surrender to Landlord the Premises, and Landlord may enter into and
repossess the Premises by summary proceedings, detainer, ejectment or otherwise
and remove all occupants thereof and, at Landlord's option, any property
thereon without being liable to indictment, prosecution or damages therefor. No
such expiration or termination of this Lease shall relieve Tenant of its
liability and obligations under this Lease, whether or not the Premises shall
be relet;

               (iv)   Landlord may, at any time after the occurrence of any
event of default, re-enter and repossess the Premises and any part thereof and
attempt in its own name, as agent for Tenant if this Lease not be terminated or
in its own behalf if this Lease be terminated, to relet all or any part of such
Premises for and upon such terms and to such persons, firms or corporations and
for such period or periods as Landlord, in its sole discretion, shall determine,
including the term beyond the termination of this Lease; and Landlord shall not
be required to accept any tenant offered by Tenant or observe any instruction
given by Tenant about such reletting. For the purpose of such reletting,
Landlord may make repairs and alterations as necessary in Landlord's judgment to
relet the Premises; and the cost of such repairs and alterations shall be
charged to and be payable by Tenant as Additional Rent hereunder, as well as any
reasonable brokerage and legal fees expended by Landlord; and any sums collected
by Landlord from any new tenant obtained on account of Tenant shall be credited
against the balance of the Rent due hereunder as aforesaid. Landlord shall be
entitled to recover from Tenant all damages and losses incurred by Landlord
pursuant to the laws of the state of New Jersey and this subparagraph including,
but not limited to (a) the loss of all Rent and Additional Rent until the
Premises is released and any anticipated loss of future Rent to the end of the
Term of this Lease if the Rent and Additional Rent payable by any new tenant is
less than the amount which would have been payable by Tenant until the end of
the Term; (b) an amount equal to any rental concessions received by Tenant; and
(c) an amount equal to the unamortized cost of the improvements furnished and
installed by Landlord under this Lease;

                                       11
<PAGE>   12
               (v)    Landlord shall have the right of injunction, in the event
of a breach or threatened breach by Tenant of any of the agreements,
conditions, covenants or terms hereof, including the actual or threatened
failure to vacate the Premises at the end of the Term, to restrain the same and
the right to invoke any remedy allowed by law or in equity, whether or not
other remedies, indemnity or reimbursements are herein provided. Landlord shall
have the right of distraint upon Tenant's goods pursuant to N.J.S.A. 2A:33-1 et
seq. upon adequate notice consistent with due process. The right and remedies
given to Landlord in this Lease are distinct, separate and cumulative remedies;
and no one of them, whether or not exercised by Landlord, shall be deemed to be
in exclusion of any of the others;

               (vi)   In the event Tenant fails to vacate the Premises upon the
expiration of this or any extended Term hereunder or upon termination of this
Lease, Tenant shall pay to Landlord double the Rent and Additional Rent due and
payable for the month in which this Lease expired or terminated and for the two
(2) subsequent months of any holdover by Tenant, and triple the Rent and
Additional Rent for any period beyond two months, but such payment shall not
preclude Landlord's right to seek eviction of Tenant nor constitute a consent
by Landlord to such holdover by Tenant;

               (vii)  In addition to all remedies provided herein or by law,
Tenant shall pay to Landlord reasonable attorneys fees and court costs incurred
as a result of such breach;

               (viii) Should Tenant fail to pay any sum required hereunder
within any applicable grace period or should Tenant fail to perform or commit
any other act which would enable Landlord to declare a default, in lieu of the
declaration of default, Landlord shall have the option to suspend, without any
liability to Tenant, any maintenance, repair or other service which it is
required by the terms of this Lease to supply until such time as Tenant has
paid to Landlord the delinquent payment or otherwise cured any event which
would enable Landlord to declare the Lease in default;

               (ix)   Landlord may, but shall not be obligated to, without
prejudice and in addition to any other rights it may have in law or equity,
after giving Tenant written notice of such default and after failure by Tenant
within thirty (30) days of the receipt of such notice to correct or to
undertake and diligently pursue correction of said default(s) (which notice
and/or opportunity to cure shall not be required in case Landlord shall
determine that an emergency exists requiring prompt action), cure such
default(s) on behalf of Tenant; and Tenant shall reimburse Landlord on demand
for all costs incurred by Landlord in that regard plus interest thereon from
the date(s) of expenditure at the Rate (as defined in Article 17 hereof) which
shall be deemed Additional Rent payable hereunder.

               (x)    No right or remedy herein conferred upon or reserved to
Landlord is intended to be exclusive of any other right or remedy, and each and
every right and remedy shall be cumulative and in addition to any other right or
remedy given hereunder or now or hereafter existing at law or in equity or by
statute. The failure of Landlord to insist at any time upon the strict
performance of any covenant or agreement or to exercise any option, right, power
or remedy contained in this Lease shall not be construed as a waiver or a
relinquishment thereof for the future. A receipt by Landlord of any Rent, any
Additional Rent or any other sum payable hereunder with knowledge of the breach
of any covenant or agreement contained in this Lease shall not be deemed a
waiver of such breach, and no waiver by Landlord of any provision of this Lease
shall be deemed to have been made unless expressed in writing and signed by
Landlord. In addition to other remedies provided in this Lease, Landlord shall
be entitled, to the extent permitted by applicable law, to injunctive relief in
case of the violation, or attempted or threatened violation, of any of the
covenants, agreements, conditions or provisions of this Lease, or to decree
compelling performance of any of the covenants, agreements, conditions or
provisions of this Lease, or to any other remedy allowed to Landlord at law or
in equity;

               (xi)   Tenant hereby waives and surrenders for itself and all
those claiming under it, including creditors of all kinds, (i) any right or
privilege which it or any of them may have under any present or future
constitution, statute or rule of law to redeem the Premises or to have a
continuance of this Lease for the Term hereby demised after termination of
Tenant's right of occupancy by order or judgment of any court or by any legal
process or writ, or under the terms of this Lease or after the termination of
the Term of this Lease as herein provided, and (ii) the benefits of any present
or future constitution, statute or rule of law which exempts property from
liability for debt or for distress for rent.

     25.  REQUIREMENT OF STRICT PERFORMANCE. The failure or delay on the part
of either party to enforce or exercise at any time any of the provisions,
rights or remedies in the Lease shall in no way be construed to be a waiver
thereof, nor in any way to affect the validity of this Lease or any part
hereof, or the right of the party to thereafter enforce each and every such
provision, right or remedy. No waiver of any breach of this Lease shall be held
to be a waiver of any other or subsequent breach. The receipt by Landlord of
rent at a time when the rent is in default under this Lease shall not be
construed as a waiver of such default. The receipt by Landlord of a lesser
amount than the rent due shall not be construed to be other than a payment on
account of the rent then due, nor shall any statement on Tenant's check or any
letter accompanying Tenant's check be deemed an accord and satisfaction, and
Landlord may accept such payment without prejudice to Landlord's right to
recover the balance of the rent due or to pursue any other remedies provided in
this Lease. No act or thing done by Landlord or Landlord's agents

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<PAGE>   13
or employees during the Term of this Lease shall be deemed an acceptance of a
surrender of the Premises, and no agreement to accept such a surrender shall be
valid unless in writing and signed by Landlord.

     26.  RELOCATION OF TENANT. Landlord, at its sole expense, on at least
sixty (60) days prior written notice, may require Tenant to move from the
Premises to another unit of comparable size and decor in order to permit
Landlord to consolidate the Premises with other adjoining space leased or to be
leased to another tenant in or coming into the Building provided, however, that
in the event of receipt of any such notice, Tenant by written notice to
Landlord within ten (10) days of the giving of Landlord's notice may elect not
to move to the other space and in lieu thereof to terminate this Lease. In the
event of any such relocation, Landlord will pay all the expenses of preparing
and decorating the new premises so that they will be substantially similar to
the Premises and the expense of moving Tenant's furniture and equipment to the
relocated premises. Occupancy of the new Premises shall be under and pursuant
to the terms of this Lease.

     27.  SUBORDINATION; RIGHTS OF MORTGAGEE. (a) This Lease shall be subject
and subordinate at all times to the lien of any mortgages now or hereafter
placed upon the Property, Premises or the Building without the necessity of any
further instrument or act on the part of Tenant to effectuate such
subordination. Tenant further agrees to execute and deliver upon demand such
further instrument or instruments evidencing such subordination of this Lease to
the lien of any such mortgage and such further instrument or instruments of
attornment as shall be desired by any mortgagee or proposed mortgagee or by any
other person. Notwithstanding the foregoing, any mortgagee may at any time
subordinate its mortgage to this Lease, without Tenant's consent, by notice in
writing to Tenant, and thereupon this Lease shall be deemed prior to such
mortgage without regard to their respective dates of execution and delivery and
in that event such mortgagee shall have the same rights with respect to this
Lease as though it had been executed prior to the execution and delivery of the
mortgage.

          (b)  In the event Landlord shall be or is alleged to be in default of
any of its obligations owing to Tenant under this Lease, Tenant agrees to give
to the holder of any mortgage (collectively the "Mortgagee") now or hereafter
placed upon the Premises or the Building and the Land, notice by registered mail
of any such default which Tenant shall have served upon Landlord, provided that
prior thereto Tenant has been notified in writing (by way of Notice of
Assignment of Rents and/or Leases or otherwise) of the name and address of any
such Mortgagee. Tenant shall not be entitled to exercise any right or remedy as
there may be because of any default by Landlord without having given such notice
to the Mortgagee; and Tenant further agrees that if Landlord shall fail to cure
such default: (i) the Mortgagee shall have an additional thirty (30) days
(measured from the later of the date on which the default should have been cured
by Landlord or the Mortgagee's receipt of such notice from Tenant) within which
to cure such default, provided that if such default be such that the same could
not be cured within such thirty (30) day period and the Mortgagee is diligently
pursuing the remedies necessary to effectuate the cure (including but not
limited to foreclosure proceedings if necessary to effectuate the cure), then
the Mortgagee shall have such additional time as may be necessary for
effectuating the cure within which to cure such default; and (ii) Tenant shall
not exercise any right or remedy as there may be arising because of Landlord's
default, including but not limited to termination of this Lease as may be
expressly provided for herein or available to Tenant as a matter of law, if the
Mortgagee either has cured the default within such thirty (30) day period or, as
the case may be, has initiated the cure of same within such thirty (30) day
period and is diligently pursuing the cure of same as aforesaid. Mortgage shall
not be liable to Tenant for the return of any Security Deposit unless and to the
extent actually received by such Mortgagee.

          (c)  In the event the Mortgagee acquires title to the Property,
Premises or the Building by foreclosure, deed in lieu of foreclosure or pursuant
to the exercise of any remedy provided in the mortgage held by such Mortgagee
such Mortgagee shall not be (i) liable for any debt or omission of Landlord,
(ii) subject to any offset or deficiencies which Tenant might be entitled to
assert against Landlord, (iii) bound by any payment of Rent made by Tenant to
Landlord for more than one month in advance or (iv) bound by any agreement
(other than this Lease) made by Tenant with Landlord without the prior written
consent of the Mortgagee.

          (d)  No rights are to be conferred upon Tenant until this Lease has
been signed by Landlord, approved by the Mortgagee if necessary and an executed
copy of the Lease has been delivered to Tenant. No acceptance or deposit by
Landlord or any payment called for hereunder shall bind Landlord until or unless
it executes this Lease and returns a fully executed copy to Tenant. Tenant
agrees that it will consent to the modification of any provision of this Lease
requested by Landlord's current or future Mortgagees except in no case shall any
such modification increase the amount of Rent payable hereunder or the amount of
any other charge payable by Tenant pursuant to this Lease, or otherwise
materially alter the rights or obligations of Landlord or Tenant under this
Lease.

     28.  BANKRUPTCY AND INSOLVENCY. (a) In addition to the occurrences set
forth in Article 24 herein, the following events shall constitute a default
under this Lease: (i) Tenant admits in writing its inability to pay its debts as
they mature; (ii) Tenant makes an assignment for the benefit of creditors or
takes any other similar action for the protection or benefit of creditors; (iii)
Tenant gives notice to any governmental body of insolvency or pending
insolvency, or suspension or pending

                                       13
<PAGE>   14
suspension of operations; (iv) Tenant files a voluntary petition in bankruptcy
or has an involuntary petition filed against him, her or it; (v) Tenant files
any petition or answer seeking any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or other similar relief under any
present or future bankruptcy statute, regulation or law; (vi) a court of
competent jurisdiction enters an order, judgment or decree approving a petition
filed against Tenant seeking any relief described in the preceding subparagraph
(v) and such order, judgment or decree shall remain unvacated and unstayed for
an aggregate of thirty (30) days from the date of entry thereof; (vii) a
trustee, receiver, conservator or liquidator of Tenant or of all or any
substantial part of its property or its interest in the Premises is employed or
appointed and such receivership remains undissolved for thirty (30) days; or
(viii) this Lease or any estate of Tenant hereunder is levied upon under any
writ of attachment or execution, and such writ shall remain unvacated and
unstayed for ten (10) days.

          (b)  Upon the filing of a petition by or against Tenant under the
United States Bankruptcy Code, Tenant, as debtor in possession, and any Trustee
who may be appointed agree to:

               (i)    Perform each and every obligation of Tenant under this
Lease until such time as this Lease is either rejected or assumed by order of
the United States bankruptcy Court;

               (ii)   Pay Rent in the manner and at the time provided hereunder
as reasonable compensation for use and occupancy for the Premises;

               (iii)  Reject or assume this Lease within sixty (60) days of the
filing of such petition under Chapter 7 of the Bankruptcy Code or within one
hundred twenty (120) days (or such shorter term as Landlord, in its sole
discretion, may deem reasonable so long as notice of such period is given) of
the filing of a petition under any other Chapter;

               (iv)   Give Landlord at least forty-five (45) days prior written
notice of any abandonment of the Premises, any such abandonment to be deemed a
rejection of this Lease; and

               (v)    Do all other things of benefit to Landlord otherwise
required under the Bankruptcy Code.

Tenant, as debtor in possession, and any such trustee shall be deemed to have
rejected this Lease in the event of the failure to comply with any of the above
requirements and to have consented to the entry of an order by an appropriate
Bankruptcy Court providing all of the above, waiving all rights to notice of the
entry of such order.

     29.  BROKERS. Tenant represents and warrants to Landlord that Tenant has
had no dealings, negotiations or consultations with respect to the Premises or
this transaction with any broker or finder other than the Broker, if any; and
that otherwise no broker or finder called the Premises to Tenant's attention
for lease or took any part in any dealings, negotiations or consultations with
respect to the Premises or this Lease. Tenant agrees to indemnify and hold
harmless Landlord from and against all liability, cost and expense, including
attorney's fees and court costs, arising out of any misrepresentation or breach
of warranty by Tenant under this Article 29.

     30.  LANDLORD'S OBLIGATIONS/LIABILITY. Landlord's obligations hereunder
shall be binding upon Landlord only for the period of time that Landlord is in
ownership of the Building; and, upon termination of that ownership, Tenant,
except as to any obligations which have then matured, shall look solely to
Landlord's successor in interest in the Building for the satisfaction of each
and every obligation of Landlord hereunder. Landlord shall have no liability
under any of the terms, conditions or covenants of this Lease and Tenant shall
look solely to the equity of Landlord in the Building of which the Premises form
a part for the satisfaction of any claim, remedy or cause of action accruing to
Tenant as a result of the breach of any action of this Lease by Landlord.

     31.  LANDLORD'S SIGNS. Landlord shall have the right to display a "for
sale" or "for rent" sign on the Premises or the property of which the Premises
is a part, as the case may be, but any "for rent" sign shall not be displayed
prior to six (6) months in advance of the end of the Term hereof.

     32.  QUIET ENJOYMENT. Tenant, upon the payment of all Rent and other
charges provided for herein and upon the performance of all of the terms of this
Lease, shall at all times during the Term hereof peacefully and quietly enjoy
the Premises without any disturbance from Landlord or any person claiming
through Landlord, subject, however, to the reservation and conditions of this
Lease and any mortgage or encumbrance to which this Lease is subordinate.

     33.  TENANT'S AUTHORITY. Tenant warrants and represents that: (a) if it is
a corporation it is in good standing organized and existing under the laws of
its state of incorporation and that it is duly qualified to do business in the
state in which the premises is located, that all corporate action necessary to
authorize the execution of this Lease has been taken by the Board of Directors
and that the President, and Secretary, have been authorized to execute and
attest respectively this Lease; and (b) if is a partnership it is in good
standing organized and existing under the laws of its state of

                                       14
<PAGE>   15
organization and that it is duly qualified to do business in the state in which
the premises is located, that all partnership action necessary to authorize the
execution of this Lease has been taken and the person or persons executing this
Lease are authorized by the partnership agreement to bind the partnership.
Tenant for good and valuable consideration shall indemnify and hold Landlord
harmless from and against any and all claims, suits, proceedings, damages,
obligations, liabilities, counsel fees, costs, losses, expenses, orders and
judgments imposed upon, incurred by or asserted against Landlord by reason of
the falsity or error of this aforesaid warranty.

     34.  NOTICES. Wherever in this Lease it shall be required or permitted
that notice or demand be given or served by either party to this Lease to or on
the other party, such notice or demand shall be deemed to have been duly given
or served if in writing and either personally served or forwarded by nationally
recognized overnight delivery service or Certified Mail, postage prepaid, to
the address set forth in Article 1 (b) or (c), as applicable. Each such mailed
notice shall be deemed to have been given to or served upon the party to which
addressed two (2) days after the date the same is deposited in the United
States Certified Mail, postage prepaid, and properly addressed to the addresses
set forth in Articles 1 (b) and (c) of this Lease in the manner above provided,
or one day after delivered to a nationally recognized overnight delivery
service. Either party hereto may change its address to which said notices shall
be delivered or mailed by giving written notice of such change to the other
party hereto as herein provided.

LANDLORD: WHITESELL ENTERPRISES        TENANT: AMERICAN BIOMEDICA CORPORATION
          PO BOX 1605                          603 HERON DRIVE, UNIT 3
          DELRAN,NJ 08075-0117                 BRIDGEPORT, NJ, 08014

     35.  MISCELLANEOUS PROVISIONS.

          A.   Successors. The respective rights and obligations provided in
this Lease shall bind and inure to the benefit of the parties hereto, their
legal representatives, heirs, successors and assigns; provided, however, that
no rights shall inure to the benefit of any successors of Tenant unless
Landlord's written consent for the transfer to such successor has first been
obtained as provided in Article 16 hereof.

          B.   Governing Law. This Lease shall be construed, governed and
enforced in accordance with the laws of the state in which the Premises are
located.

          C.   Severability. If any provisions of this Lease shall be held to
be invalid, void or unenforceable, the remaining provisions hereof shall in no
way be affected or impaired and such remaining provisions shall remain in full
force and effect.

          D.   Captions. Marginal captions, titles or exhibits and riders and
the table of contents in this Lease are for convenience and reference only, and
are in no way to be construed as defining, limiting or modifying the scope of
intent of the various provisions of this Lease.

          E.   Gender. As used in this Lease, the word "person" shall mean and
include, where appropriate, an individual, corporation, partnership or other
entity; the plural shall be substituted for the singular, and the singular for
the plural, where appropriate; and the words of any gender shall mean to include
any other gender.

          F.   Entire Agreement. This Lease, including the Exhibits and any
Riders hereto (which are hereby incorporated by this reference, except that in
the event of any conflict before the printed portions of this Lease and any
Exhibits or Riders, the term of such Exhibits or Riders shall control),
supersedes any prior discussions, proposals, negotiations and discussions
between the parties and the Lease contains all the agreements, conditions,
understandings, representations and warranties made between the parties hereto
with respect to the subject matter hereof, and may not be modified orally or in
any manner other than by an agreement in writing signed by both parties hereto
or their respective successors in interest. Without in any way limiting the
generality of the foregoing, this Lease can only be extended pursuant to the
due exercise of an option (if any) contained herein or a formal agreement
signed by both Landlord and Tenant specifically extending the terms. No
negotiations, correspondence by Landlord or offers to extend the terms shall be
deemed an extension of the termination date for any period whatsoever.

          G.   Counterparts. This Lease may be executed in any number of
counterparts, each of which shall be deemed to be one and the same instrument.

          H.   Telefax Signatures. The parties acknowledge and agree that
notwithstanding any law or presumption to the contrary a telefaxed signature of
either party whether upon this Lease or any related document shall be deemed
valid and binding and admissible by either party against the other as if same
were an original ink signature.

                                       15
<PAGE>   16
     36.  WAIVER OF TRAIL BY JURY.  LANDLORD AND TENANT WAIVE THE RIGHT TO A
TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON, OR RELATED TO, THE
SUBJECT MATTER OF THIS LEASE. THIS WAIVER IS KNOWINGLY, INTENTIONALLY, AND
VOLUNTARILY MADE BY TENANT AND TENANT ACKNOWLEDGES THAT NEITHER LANDLORD NOR
ANY PERSON ACTING ON BEHALF OF LANDLORD HAS MADE ANY REPRESENTATIONS OF FACT TO
INDUCE THIS WAIVER OF TRIAL BY JURY OR IN ANY WAY TO MODIFY OR NULLIFY ITS
EFFECT. TENANT FURTHER ACKNOWLEDGES THAT IT HAS BEEN REPRESENTED (OR HAS HAD
THE OPPORTUNITY TO BE REPRESENTED) IN THE SIGNING OF THIS LEASE AND IN THE
MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL, SELECTED OF ITS OWN FREE
WILL, AND THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL.
TENANT FURTHER ACKNOWLEDGES THAT IT HAS READ AND UNDERSTANDS THE MEANING AND
RAMIFICATIONS OF THIS WAIVER PROVISION AND AS EVIDENCE OF SAME HAS EXECUTED
THIS LEASE.

     IN WITNESS WHEREOF, the parties hereto have duly executed this Lease and
have initialed the Exhibits and any Riders hereto as of the day and year first
above written.

WITNESS OR ATTEST:                       LANDLORD: WHITESELL ENTERPRISES

                                         By:
----------------------------                -----------------------------------
                                                  THOMAS R. WHITESELL

                                         TENANT: AMERICAN BIOMEDICA CORPORATION

                                         By: /s/ Douglas Casterlin
----------------------------                -----------------------------------
                                                 DOUGLAS CASTERLIN
                                                 V.P. & General Manager
                                                 American Biomedica Corporation

                                       16

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