LEASE TERMINATION AGREEMENT

      THIS LEASE TERMINATION  AGREEMENT  ("Agreement"),  is made effective as of
the  31st  day  of  July,  2006  ("Effective  Date"),   between  CLP  Industrial
Properties,  LLC, a Delaware limited liability company ("Landlord"),  and GALAXY
NUTRITIONAL  FOODS,  INC.  (f/k/a Galaxy Food Company),  a Delaware  corporation
("Tenant").

                              W I T N E S S E T H :

A. On or about July 28,  1999,  Cabot  Industrial  Properties,  L.P.  ("Original
Landlord") and Tenant made and entered into that certain  industrial real estate
lease ("Original Lease") for the premises more particularly described therein in
a portion of the building known as OCP VII, located at 2901 Titan Row,  Orlando,
Florida 32809 ("Building").

B. On or about September 10, 1999, Original Landlord and Tenant made and entered
into that certain First Amendment to Lease ("First  Amendment"),  wherein Tenant
leased  certain  additional  space from  Landlord  in  Building,  and  otherwise
modified certain terms of the Original Lease.

C. On or about April 24,  2000,  Original  Landlord  and Tenant made and entered
into that certain Second Amendment to Lease ("Second Amendment"), wherein Tenant
also leased certain  additional  space from Landlord in Building,  and otherwise
modified certain of the terms of the Original Lease and/or the First Amendment.

D. On or about June 10, 2004, Original Landlord and Tenant made and entered into
that certain Third Amendment to Lease  Agreement  ("Third  Amendment"),  wherein
Original  Landlord  and Tenant  agreed to reduce  the amount of space  rented by
Tenant and otherwise  modified  certain terms of the Original  Lease,  the First
Amendment, and/or the Second Amendment.

E. The Original Lease, the First  Amendment,  the Second Amendment and the Third
Amendment collectively are referred to herein as the "Lease."

F.  Landlord is the  successor in interest to Original  Landlord as owner of the
New Premises (which, together with any and all other space ever rented to Tenant
in the Building, shall be referred to collectively herein as the "Premises").

G.  Landlord  and  Tenant  desire to  terminate  the Lease  prior to the  stated
expiration of the term thereof,  subject to the terms and  conditions  contained
herein.

      NOW,  THEREFORE,  in  consideration of the mutual covenants and conditions
contained  herein and other good and  valuable  considerations,  the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:


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<PAGE>

1.    Recitals.  The  foregoing  recitals are true and correct and  incorporated
      herein by this reference.

2.    Definitions.   Unless  otherwise   specifically  set  forth  herein,   all
      capitalized  terms  herein shall have the same meaning as set forth in the
      Lease.

3.    Termination.  Effective as of the Effective Date, Tenant hereby surrenders
      and turns over the right of  possession  to the  Premises to Landlord  and
      irrevocably  sells,  transfers,  assigns  and  conveys  to  Landlord,  and
      Landlord hereby accepts,  receives and takes all of Tenant's right,  title
      and interest in and to the  Premises.  Tenant shall vacate the Premises on
      or before 5:00 p.m. on the Effective  Date,  leaving same in the condition
      required under the Lease,  as modified by this  Agreement.  From and after
      the Effective Date,  Landlord may re-enter and possess the Premises as its
      own, and may lease the  Premises.  Landlord and Tenant  hereby agree that,
      subject to Tenant having made all of the Termination  Payments (as defined
      herein) as and when required, (i) the Lease and all of Tenant's rights and
      obligations   thereunder   shall   terminate  at  5:00  p.m.  EST  on  the
      ninety-first  (91st) day after the Final  Payment  Date (the  "Termination
      Date");   and  (ii)  this  Agreement  shall  be  self-executing   and  the
      transaction  contemplated  herein  shall be effected  without the need for
      further documentation.

4.    Termination Payments.  Tenant shall continue to be responsible for payment
      of all rent as  provided  for  under  the  Lease up to and  including  the
      Effective  Date  hereof.  Additionally,   Tenant  shall  pay  the  sum  of
      $228,859.00  (the  "Termination  Fee")  to  Landlord,   payable  upon  the
      following schedule (the "Termination Payments"):

      (a)   Simultaneous with execution hereof, Tenant shall pay to Landlord the
            sum of  $78,859.00  (less  credit  for  current  unearned  pro-rated
            monthly rent already paid by Tenant); and

      (b)   Effective as of the Effective  Date,  Tenant hereby  irrevocably and
            unconditionally assigns,  conveys, grants, and sets over to Landlord
            as part of the Termination Fee the security deposit held by Landlord
            in the amount of  $50,000.00,  and Tenant shall be hereby  deemed to
            have waived any claim or right to said security deposit; and

      (c)   On the thirtieth  (30th) day after the Effective Date,  Tenant shall
            pay to Landlord the sum of $75,000.00; and

      (d)   On the  forty-fifth  (45th) day after the Effective Date (the "Final
            Payment Date"),  Tenant shall pay to Landlord the sum of $25,000.00,
            which shall be the final Termination Payment hereunder.


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5.    Delivery of Termination  Payments.  Each of the Termination Payments shall
      be  delivered  to Landlord by the same method as rental  payments are made
      under the Lease, or in the Tenant's sole  discretion,  by wire transfer in
      accordance with instructions  provided by Landlord or its  representative,
      prior to 5:00 p.m.,  Orlando,  Florida time, on its  respective  due date.
      Time is of the essence with respect to making of the Termination Payments.

6.    Acceleration of Payments.  In the event of any sale of Tenant or of all or
      substantially  all of Tenant's assets,  each of the remaining  Termination
      Payments shall be accelerated  and shall be due within thirty (30) days of
      the Effective Date.

7.    Condition  and Use of Premises.  Notwithstanding  anything in the Lease to
      the  contrary,  Tenant  shall  leave the  Premises  in good,  broom  clean
      condition  subject to normal wear and tear incurred during the term of the
      Lease.  Tenant  shall be solely  responsible  for the repair of any damage
      done to the Premises while moving out.  Landlord and Tenant agree that, as
      of the Effective Date, Tenant shall have no further right to possession of
      the  Premises,  and Landlord may itself enter,  use,  modify and lease the
      Premises as it may see fit.

8.    Default.  In the event of a default by Tenant under this  Agreement  which
      default under this  Agreement is not cured within five (5) days of receipt
      of notice of default,  Tenant's right of possession will not be reinstated
      but the Lease shall not  otherwise  terminate as  aforesaid,  and Landlord
      shall be entitled to all remedies  available under the terms of the Lease,
      as modified by this Agreement,  or at law or in equity. In such event, any
      amounts  paid by Tenant  hereunder  shall be  applied to  Tenant's  rental
      payment obligations under the Lease.

9.    Warranty and  Indemnification.  Tenant  warrants and represents that it is
      currently  the  tenant  under  the  Lease  and  that it has not  made  any
      assignment,   sublease,   transfer,   conveyance,   encumbrance  or  other
      disposition of the Lease. Tenant agrees to, and shall,  indemnify and hold
      Landlord  harmless from any claim arising from the foregoing  warranty and
      representation being untrue.  Landlord and Tenant agree that no consent of
      any third  party  (that has not been  obtained)  is  required  for or as a
      condition precedent to the effectiveness of this Agreement.

10.   Release. Effective upon the Termination Date, subject to the making of all
      Termination  Payments  hereunder,  each  of  Landlord  and  Tenant  hereby
      releases   and  forever   discharges   the  other,   and  its   respective
      shareholders,    partners,   officers,    directors,   agents,   trustees,
      beneficiaries,  and  employees,  of and  from  any and all  claims,  acts,
      damages,  demands,  rights of action and causes of action which such party
      ever had,  now has or in the future may have,  against the other,  arising
      from or in any way connected with the Lease, the Building or the Premises,
      except for those obligations contained herein. This release is intended as
      a full  settlement and  compromise of each,  every and all claims of every
      kind and nature,  whether now known or hereafter  discovered,  except that
      this paragraph shall not operate to release Tenant from any claims brought
      by  Landlord  within one year of the  Termination  Date which arise out of
      latent damage or hidden contamination of the Building.


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11.   Authority. If Tenant signs as a corporation,  partnership,  trust or other
      legal  entity each of the persons  executing  this  Agreement on behalf of
      Tenant represents and warrants that Tenant has been and is qualified to do
      business in the state in which the  Building  is located,  that the entity
      has full right and  authority to enter into this  Agreement,  and that all
      persons  signing  on  behalf of the  entity  were  authorized  to do so by
      appropriate actions. Tenant agrees to deliver to Landlord,  simultaneously
      with the  delivery  of this  Agreement  a  resolution  evidencing  the due
      authorization  of  Tenant  to  enter  into  this  Agreement.   Each  party
      represents  to the other that it has full power and  authority  to execute
      this Agreement.

12.   Incorporation.  Except as modified herein,  all other terms and conditions
      of the Lease between the parties above  described  shall  continue in full
      force and effect  until the  Termination  Date.  Landlord and Tenant shall
      comply with all terms of the Lease, as modified by this Agreement.

13.   Attorneys'  Fees and Costs.  In any action by either  party to enforce the
      terms of this  Agreement,  the  prevailing  party shall  collect  from the
      non-prevailing party all of its reasonable attorneys' and paralegals' fees
      and costs, and court fees and costs,  whether  incurred before,  during or
      after trial or on appeal.  The parties  expressly agree that time shall be
      of the essence in the performance of all obligations under this Agreement.

14.   Successors  and Assigns.  This  Agreement  shall be binding upon and shall
      inure to the  benefit  of each  party and its  respective  successors  and
      assigns  and shall be governed by the laws of the State of Florida and may
      not be amended or modified other than in writing signed by the party to be
      charged.

15.   Validity.  Should any provision of this  Agreement be declared  invalid or
      unenforceable,  whether  in whole or in part,  by any  court of  competent
      jurisdiction,  the remaining  provisions  and/or  portions of the effected
      which remain valid or enforceable shall not be effected thereby,  provided
      that  if  Section  3 of  this  Agreement  shall  be  declared  invalid  or
      unenforceable,  in whole or in part,  for any reason,  any amounts paid by
      Tenant  hereunder shall be applied to Tenant's rental payment  obligations
      under the Lease.

16.   Commissions. Each of the parties represents and warrants to the other that
      it has not  dealt  with any  broker  or  finder  in  connection  with this
      Agreement  other than RREEF  Management  Company,  to which Landlord shall
      solely be  responsible  for the payment of any fee,  commission,  or other
      amount payable thereto, and Cushman & Wakefield of Florida, Inc., to which
      Tenant shall solely be responsible for the payment of any fee, commission,
      or other amount payable thereto.


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17.   Counterparts.  This  Amendment  may be executed in separate  counterparts,
      each of which shall be deemed an original and all of which  together shall
      constitute one and the same  instrument  (facsimile  transmission  of such
      signature  pages shall be  acceptable,  provided that the parties agree to
      thereafter  cause at least one fully  executed  original  Agreement  to be
      delivered to each other.)

18.   Whole Agreement.  The mutual obligations of the parties as provided herein
      are the sole  consideration  for this Agreement,  and no  representations,
      promises of inducements have been made by the parties other than as appear
      in this Agreement.

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19.   Limitation of Landlord's Liability. Redress for any claim against Landlord
      under the Lease or this Agreement shall be limited to and enforceable only
      against  and to the extent of  Landlord's  interest in the  Building.  The
      obligations  of  Landlord  under  the  Lease  and this  Agreement  are not
      intended  to be and  shall not be  personally  binding  on,  nor shall any
      resort be had to the private  properties  of, any of its or its investment
      manager's trustees, directors, officers, partners, beneficiaries, members,
      stockholders,  employees,  or  agents,  and in no case shall  Landlord  be
      liable to Tenant  hereunder for any lost profits,  damage to business,  or
      any form of special, indirect or consequential damages.

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

LANDLORD:                               TENANT:

CLP INDUSTRIAL PROPERTIES, LLC,         GALAXY NUTRITIONAL FOODS, INC., a
a Delaware limited liability company    Delaware corporation

By:    RREEF MANAGEMENT COMPANY,
       a Delaware corporation,
       Authorized Agent

By:    /s/ John Frederick               By:    /s/ Salvatore J. Furnari
   ---------------------------------       -------------------------------------
Name:  John Frederick                   Name:  Salvatore J. Furnari
     -------------------------------         -----------------------------------
Title: Vice President                   Title: Chief Financial Officer
      ------------------------------          ----------------------------------

Dated: August 1, 2006                   Dated: July 31, 2006
      ------------------------------          ----------------------------------


Witness:  /s/ Lee Morris                Witness:   /s/ Christine Perno
        ----------------------------            --------------------------------

Witness:  /s/ Christine Thollander      Witness:   /s/ Diana Pratt
        ----------------------------            --------------------------------


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