ex10-35.htm


    Exhibit
10.35

      
        


         

        


      

      CACTUS
COMMERCE, LLC,

       

      as
Landlord

       

      AND

       

      UNITED
NATURAL FOODS, INC.,

       

      as
Tenant

       

      _________________________

       

      LEASE
AGREEMENT

       

      _________________________

       

      Dated:

       

      December 3,
2007

       

      Premises:

       

      22150
Goldencrest Drive

       

      Moreno
Valley, California

       

      
        


         

        


      


      
        
           


        

        
           


           


        

        
           


          
            TABLE
OF CONTENTS

            


            Page

             

            


          

        

      


      
        	
                ARTICLE 1

              	
                REFERENCE
      DATA AND DEFINITIONS

              	
                1

              
	
                ARTICLE
      2

              	
                DEMISED
      PREMISES AND TERM

              	
                4

              
	 
      	
                Section
      2.1

              	
                Demised
      Premises

              	
                4

              
	 
      	
                Section
      2.2

              	
                Term

              	
                4

              
	 
      	
                Section
      2.3

              	
                Tenant’s
      Entry upon Demised Premises before Commencement Date

              	
                5

              
	
                ARTICLE
      3

              	
                RENT
      AND SECURITY DEPOSIT

              	
                5

              
	 
      	
                Section
      3.1

              	
                Fixed
      Rent

              	
                5

              
	 
      	
                Section
      3.2

              	
                Additional
      Rent

              	
                5

              
	 
      	
                Section
      3.3

              	
                Past
      Due Rent

              	
                5

              
	 
      	
                Section
      3.4

              	
                Intentionally
      Omitted

              	
                6

              
	 
      	
                Section
      3.5

              	
                Rent
      Payments

              	
                6

              
	
                ARTICLE
      4

              	
                TENANT’S
      SHARE OF OPERATING COSTS AND TAXES

              	
                6

              
	 
      	
                Section
      4.1

              	
                Definitions

              	
                6

              
	 
      	
                Section
      4.2

              	
                Tenant’s
      Payment of Operating Costs, Taxes and Insurance

              	
                8

              
	 
      	
                Section
      4.3

              	
                Refunds;
      Other Items

              	
                10

              
	
                ARTICLE
      5

              	
                COMPLETION
      AND OCCUPANCY OF DEMISED PREMISES

              	
                11

              
	 
      	
                Section
      5.1

              	
                Delivery
      of Demised Premises

              	
                11

              
	 
      	
                Section
      5.2

              	
                Construction
      of Tenant Improvements

              	
                11

              
	
                ARTICLE
      6

              	
                CONDUCT
      OF BUSINESS BY TENANT

              	
                11

              
	 
      	
                Section
      6.1

              	
                Use
      of Demised Premises

              	
                11

              
	 
      	
                Section
      6.2

              	
                Compliance
      with Laws and Requirements of Public Authorities

              	
                11

              
	 
      	
                Section
      6.3

              	
                Rules
      and Regulations

              	
                12

              
	
                ARTICLE
      7

              	
                INTENTIONALLY
      OMITTED

              	
                13

              
	
                ARTICLE
      8

              	
                REPAIRS,
      ALTERATIONS AND MECHANICS’ LIENS

              	
                13

              
	 
      	
                Section
      8.1

              	
                Repairs

              	
                13

              
	 
      	
                Section
      8.2

              	
                Alterations

              	
                14

              
	 
      	
                Section
      8.3

              	
                Mechanics’
      Liens

              	
                15

              
	
                ARTICLE
      9

              	
                UTILITIES
      AND BUILDING SERVICES

              	
                15

              
	 
      	
                Section
      9.1

              	
                Utilities
      and Building Services

              	
                15

              
	 
      	
                Section
      9.2

              	
                Interruption
      of Services

              	
                15

              
	
                ARTICLE
      10

              	
                PROPERTY
      AND OTHER TAXES

              	
                16

              
	 
      	
                Section
      10.1

              	
                Tenant’s
      Property

              	
                16

              
	
                ARTICLE
      11

              	
                INSURANCE
      AND INDEMNITY

              	
                16

              


      

      



      
        
           


        

        
          -i-

           


        

        
           


          
            TABLE
OF CONTENTS

            (continued)

            Page

             

            


          

        

      


      


      
        	 
      	
                SECTION
      11.1

              	
                INSURANCE

              	
                16

              
	 
      	
                Section
      11.2

              	
                Indemnity
      and Non Liability

              	
                17

              
	 
      	
                Section
      11.3

              	
                Waiver
      of Subrogation

              	
                18

              
	
                ARTICLE
      12

              	
                DAMAGE
      BY CASUALTY

              	
                19

              
	 
      	
                Section
      12.1

              	
                Notice

              	
                19

              
	 
      	
                Section
      12.2

              	
                Restoration
      of Improvements

              	
                19

              
	 
      	
                Section
      12.3

              	
                Damage
      During Last Year of Lease Term

              	
                20

              
	
                ARTICLE
      13

              	
                EMINENT
      DOMAIN

              	
                20

              
	 
      	
                Section
      13.1

              	
                Taking
      of Demised Premises

              	
                20

              
	 
      	
                Section
      13.2

              	
                Partial
      or Temporary Taking of Building

              	
                20

              
	 
      	
                Section
      13.3

              	
                Surrender

              	
                21

              
	 
      	
                Section
      13.4

              	
                Rent
      Adjustment for Partial Taking of Demised Premises

              	
                21

              
	 
      	
                Section
      13.5

              	
                Awards

              	
                21

              
	 
      	
                Section
      13.6

              	
                Sole
      Remedy

              	
                21

              
	
                ARTICLE
      14

              	
                RIGHTS
      RESERVED TO LANDLORD

              	
                22

              
	 
      	
                Section
      14.1

              	
                Access
      to Demised Premises

              	
                22

              
	 
      	
                Section
      14.2

              	
                Additional
      Rights

              	
                22

              
	
                ARTICLE
      15

              	
                ASSIGNMENT
      AND SUBLETTING

              	
                23

              
	 
      	
                Section
      15.1

              	
                Consent
      Required

              	
                23

              
	
                ARTICLE
      16

              	
                BANKRUPTCY

              	
                25

              
	 
      	
                Section
      16.1

              	
                Bankruptcy

              	
                25

              
	 
      	
                Section
      16.2

              	
                Measure
      of Damages

              	
                25

              
	
                ARTICLE
      17

              	
                DEFAULT

              	
                26

              
	 
      	
                Section
      17.1

              	
                Events
      of Default

              	
                26

              
	 
      	
                Section
      17.2

              	
                Remedies

              	
                26

              
	 
      	
                Section
      17.3

              	
                Waiver
      of Jury Trial

              	
                27

              
	
                ARTICLE
      18

              	
                SURRENDER

              	
                28

              
	 
      	
                Section
      18.1

              	
                Possession

              	
                28

              
	 
      	
                Section
      18.2

              	
                Merger

              	
                28

              
	
                ARTICLE
      19

              	
                HOLDING
      OVER

              	
                28

              
	 
      	
                Section
      19.1

              	
                Holding
      Over

              	
                28

              
	
                ARTICLE
      20

              	
                REMEDIES
      CUMULATIVE

              	
                28

              
	 
      	
                Section
      20.1

              	
                No
      Waiver

              	
                28

              
	
                ARTICLE
      21

              	
                ESTOPPEL
      CERTIFICATE, SUBORDINATION, ATTORNMENT

              	
                29

              
	 
      	
                Section
      21.1

              	
                Estoppel
      Certificate

              	
                29

              


      

      



      
        
           


        

        
          -ii-

           


        

        
           


          
            TABLE
OF CONTENTS

            (continued)

            Page

             

            


          

        

      


      


      
        	 
      	
                Section
      21.2

              	
                Subordination

              	
                29

              
	 
      	
                Section
      21.3

              	
                Attornment

              	
                29

              
	 
      	
                Section
      21.4

              	
                Mortgages

              	
                29

              
	
                ARTICLE
      22

              	
                QUIET
      ENJOYMENT

              	
                30

              
	 
      	
                Section
      22.1

              	
                Quiet
      Enjoyment

              	
                30

              
	
                ARTICLE
      23

              	
                NOTICES

              	
                30

              
	 
      	
                Section
      23.1

              	
                Notices

              	
                30

              
	
                ARTICLE
      24

              	
                MISCELLANEOUS
      PROVISIONS

              	
                30

              
	 
      	
                Section
      24.1

              	
                Time

              	
                30

              
	 
      	
                Section
      24.2

              	
                Applicable
      Law and Construction

              	
                30

              
	 
      	
                Section
      24.3

              	
                Parties
      Bound

              	
                31

              
	 
      	
                Section
      24.4

              	
                Representations
      by Landlord

              	
                31

              
	 
      	
                Section
      24.5

              	
                Brokers

              	
                31

              
	 
      	
                Section
      24.6

              	
                Severability

              	
                32

              
	 
      	
                Section
      24.7

              	
                Force
      Majeure

              	
                32

              
	 
      	
                Section
      24.8

              	
                Definition
      of Landlord

              	
                32

              
	 
      	
                Section
      24.9

              	
                No
      Option

              	
                32

              
	 
      	
                Section
      24.10

              	
                Exculpatory
      Clause

              	
                32

              
	 
      	
                Section
      24.11

              	
                No
      Recording

              	
                32

              
	 
      	
                Section
      24.12

              	
                Counterparts

              	
                32

              
	 
      	
                Section
      24.13

              	
                Financial
      Statements

              	
                33

              
	 
      	
                Section
      24.14

              	
                ERISA

              	
                33

              
	
                ARTICLE
      25

              	
                OPTIONS
      TO RENEW

              	
                33

              
	 
      	
                Section
      25.1

              	
                Grant
      of Option

              	
                33

              
	
                ARTICLE
      26

              	
                ABATEMENT
      OF RENT

              	
                34

              
	 
      	
                Section
      26.1

              	
                Abatement
      of Rent

              	
                34

              


      

      



      
        
           


        

        
          -iii-

           


        

        
           


        

      


      LEASE

       

      This
Lease is made between Landlord and Tenant named in Article l as of the date set
forth therein.  Landlord and Tenant, in consideration of the covenants
and agreements contained herein, agree as follows:

       

      ARTICLE
1

       

      


       

      REFERENCE DATA AND
DEFINITIONS

       

      The
following are definitions of terms used in this Lease, and each reference in
this Lease to any of the following subjects shall be construed to incorporate
the data, terms, covenants and provisions stated for that subject in this
Article 1, subject to the terms of the balance of this Lease:

       

      
        	
                DATE OF
      EXECUTION:

              	
                December 3,
      2007

              
	 	 
	
                LANDLORD:

              	
                CACTUS
      COMMERCE, LLC, a Delaware limited liability company

              
	 	 
	
                MANAGING
      AGENT:

              	
                BlackRock
      Realty Advisors, Inc.

              
	 	 
	
                LANDLORD’S
      AND

                MANAGING AGENTS
      ADDRESS:

              	
                CACTUS
      COMMERCE, LLC,

                a
      Delaware limited liability company

                BlackRock

                4400
      MacArthur Boulevard, Suite 700

                Newport
      Beach, CA  92660

                Attn:  Larry
      Mohr

                With
      a copy to:

                BlackRock

                300
      Campus Drive, 3rd
      Floor

                Florham
      Park, NJ  07932

                Attn:  Jeremy
      A. Litt

              
	 	 
	
                WIRE INSTRUCTIONS
      AND/OR 
ADDRESS FOR RENT PAYMENT:

              	
                Overton
      Moore Properties

                19300
      Hamilton Avenue, Suite 200

                Gardena,
      CA 90248

                Attn:
      Accounts Receivable

              
	 	 
	
                TENANT:

              	
                United
      Natural Foods, Inc.

              
	 	 
	
                STATE OF
      TENANT’S

                FORMATION/INCORPORATION:

              	
                Delaware

              
	 	 
	
                TENANT’S
      ADDRESS:

              	
                260
      Lake Road

                Dayville,
      Connecticut 06241

              


      

      



      
        
           


        

        
          1

           


        

        
           


        

      


      


      
        	
                DEMISED
      PREMISES:

              	
                The
      Building described below, as shown on Exhibit A, which is agreed for
      all purposes of this Lease to contain 613,174 square feet of floor area,
      and any and all other improvements now or hereafter constructed on the
      Land described below.

              
	 	 
	
                LAND:

              	
                The
      Land described on Exhibit B, it being agreed and understood that the
      portion of Day Street that is currently included within the legal
      description set forth in Exhibit B and shown within the property line on
      the Site Plan attached hereto as Exhibit A shall eventually be dedicated
      to the City and will become public property.

              
	 	 
	
                BUILDING:

              	
                The
      building located on the Land described above, having an address of 22150
      Goldencrest Drive, Moreno Valley, California

              
	 	 
	
                PROPERTY:

              	
                The
      Land, the Building and all other improvements located on the Land,
      including, without limitation, parking areas, driveways, walkways and
      landscaped areas.

              
	 	 
	
                USE OF DEMISED
      PREMISES:

              	
                The
      storage and distribution of food products and uses incidental thereto,
      including some temperature control space and any other legally permitted
      use, subject to Landlord’s prior written consent thereof which consent
      shall not be unreasonably withheld (collectively, “Permitted
      Use”).

              
	 	 
	
                SCHEDULED

                COMMENCEMENT
      DATE:

              	
                July
      1, 2008

              
	 	 
	
                EXPIRATION
      DATE:

              	
                July
      31, 2018

              
	 	 
	
                TERM:

              	
                Ten
      (10) Years; one (1) Month.

              
	 	 
	
                RENEWAL
      TERM:

              	
                Two
      (2) renewal term(s) – each of Five (5) Years; Zero (0)
    Months

              


      

      



      
        
           


        

        
          2

           


        

        
           


        

      


      


      
        	
                ANNUAL FIXED
      RENT:

              	
                Initial
      Term:

                Months
      1-12--       $2,182,899.44 per
      annum

                Months
      13-24--     $2,379,115.12 per annum

                Months
      25-36--     $2,438,593.00 per annum

                Months
      37-48--     $2,499,542.49 per annum

                Months
      49-60--     $2,561,963.61 per annum

                Months
      61-72--     $2,626,162.92 per annum

                Months
      73-84--     $2,691,956.49 per annum

                Months
      85-96--     $2,759,099.05 per annum

                Months
      97-108--   $2,828,142.44 per annum

                Months
      109-121-- $3,107,995.05 per annum

                 

                First
      Renewal Term:

                Months
      122-133-- $3,090,396.96 per annum

                Months
      134-145-- $3,183,108.84 per annum

                Months
      146-157-- $3,278,763.96 per annum

                Months
      158-169-- $3,376,626.60 per annum

                Months
      170-181-- $3,478,168.20 per annum

                 

                Second
      Renewal Term:

                Months
      182-193-- $3,679,044.00 per annum

                Months
      194-205-- $3,789,415.32 per annum

                Months
      206-217-- $3,903,465.72 per annum

                Months
      218-229-- $4,020,459.24 per annum

                Months
      230-241-- $4,141,131.96 per annum

              
	 	 
	
                MONTHLY FIXED
      RENT:

              	
                Initial
      Term:

                Months
      1-7--     $171,688.72 per month

                Months
      8-19--   $196,215.68 per month

                Months
      19-31-- $201,121.07 per month

                Months
      32-43-- $206,149.10 per month

                Months
      44-55-- $211,299.76 per month

                Months
      56-67-- $216,573.06 per month

                Months
      68-79-- $222,030.31 per month

                Months
      80-91-- $227,548.87 per month

                Months
      92-103-- $233,251.39 per month

                Months
      104-121-- $239,076.54 per month

                 

                First
      Renewal Term:

                Months
      122-133-- $257,533.08 per month

                Months
      134-145-- $265,259.07 per month

                Months
      146-157-- $273,230.33 per month

                Months
      158-169-- $281,385.55 per month

                Months
      170-181-- $289,847.35 per month

                 

                Second
      Renewal Term:

                Months
      182-193-- $306,587.00 per month

                Months
      194-205-- $315,784.61 per month

                Months
      206-217-- $325,288.81 per month

                Months
      218-229-- $335,038.27 per month

                Months
      230-241-- $345,094.33 per month

              


      

      



      
        
           


        

        
          3

           


        

        
           


        

      


      


      
        	
                TENANT’S

                PROPORTIONATE
      SHARE:

              	
                100%

              
	 	 
	
                DEFAULT
      RATE:

              	
                The
      Prime Rate plus six percent (6%) per annum.  “Prime Rate” shall
      mean the highest of the prime rates as reported in the Money Rate Section
      of the Wall
      Street Journal.  If the Wall Street
      Journal no longer publishes the Prime Rate as an index, Landlord
      may substitute a comparable index including the Prime Rate or reference
      rate of a reputable financial institution.

              
	 	 
	
                SECURITY DEPOSIT
      AMOUNT:

              	
                None

              
	 	 
	
                BROKERS:

              	
                Collins
      Commercial Corporation for Landlord Charles Dunn Company for
      Tenant

              


      

       

      ARTICLE
2

       

      DEMISED PREMISES AND
TERM

       

      Section
2.1                                Demised
Premises.  Landlord hereby leases unto Tenant, and Tenant
hereby leases from Landlord, the Demised Premises, upon and subject to the
covenants, agreements, terms, conditions, limitations, exceptions and
reservations of this Lease. 

       

      Section
2.2                                Term.  The
Term and Tenant’s obligation to pay Rent shall commence on July 1, 2008
(the “Commencement
Date”) and shall end, unless sooner terminated or extended as herein
provided or pursuant to law, at the close of business on the Expiration Date set
forth in Article 1 (“Expiration
Date”).

       

      Section
2.3                                Tenant’s
Entry upon Demised Premises before Commencement Date.  Provided
that Tenant complies at all times with the provisions and requirements of this
Lease (other than the obligation to pay Fixed Rent and, except as provided for
below, the obligation to pay Additional Rent (as defined in Section 3.2
hereof)), including without limitation providing Landlord with the proof of
insurance required under Section 11.1(b) prior to any such entry, Tenant may
enter upon the Demised Premises prior to the Commencement Date to perform its
tenant improvement work therein pursuant to, and in accordance with, the terms
and conditions of Exhibit D and to install trade fixtures and furnishings, to
make the Demised Premises ready for the conduct of Tenant’s business and to use
the Premises for the Permitted Use.  Tenant shall be obligated to pay
for electricity, HVAC (as defined in Section 4.1(a)(2) hereof) and other
services furnished to the Demised Premises upon Tenant’s entry pursuant to this
Section 2.3 at Landlord’s stated rates therefor.  However, Landlord,
subject to Landlord’s representations and warranties set forth in Section 24.4
below, does not assume responsibility for the availability of any services
during the period prior to the Commencement Date.

       


      
        
           


        

        
          4

           


        

        
           


        

      


      ARTICLE
3

       

      RENT AND SECURITY
DEPOSIT

       

      Section
3.1                                Fixed
Rent.  Tenant shall pay to Landlord, without any prior demand
therefor and without any deduction or set off whatsoever except as otherwise
expressly set forth in this Lease, the Fixed Rent set forth in Article
1.  Fixed Rent shall be due and payable in monthly installments each
equal to the Monthly Fixed Rent set forth in Article l, in advance on the first
day of each and every calendar month during the Term.  Tenant shall
pay to Landlord upon execution of this Lease an amount equal to the first
Monthly Fixed Rent, which amount shall be held by Landlord without interest and
applied to the first Monthly Fixed Rent obligation of Tenant. 

       

      Section
3.2                                Additional
Rent.  Any sums or charges to be paid by Tenant pursuant to the
provisions of this Lease, other than the Fixed Rent, shall be designated as
“Additional
Rent” and shall be payable within 10 days after Landlord gives written
notice that payment is due, unless otherwise provided in this
Lease.  Landlord shall have the same rights against Tenant for default
in payment of Additional Rent as for default in payment of the Fixed
Rent.  As used in this Lease, the term “Rent”
shall mean the Fixed Rent and Additional Rent. 

       

      Section
3.3                                Past Due
Rent.

       

      (a)           If
Tenant shall fail to pay any installment of Rent before the sixth day after such
Rent is due and payable, Tenant shall pay a charge (the “Late
Charge”) which shall be 2% of the amount of such unpaid installment of
Rent.  The parties agree that the amount of such Late Charge
represents a reasonable estimate of the cost and expense that will be incurred
by Landlord in processing each delinquent payment of Rent by Tenant and that
such Late Charge shall be paid to Landlord as liquidated damages for each
delinquent payment.  Notwithstanding the foregoing Tenant shall not be
obligated to pay the Late Charge with respect to the first late payment by
Tenant during any twelve (12) month period so long as Tenant makes the
applicable payment, in full, within five (5) days after written notice from
Landlord to Tenant that the applicable payment is overdue.

       

      (b)           Any
amount due from Tenant to Landlord which is not paid when due shall bear
interest at the Default Rate from the date such payment is due, after the
expiration of any applicable grace period, until paid.  The rate so
determined shall continue in effect following any default by Tenant pursuant to
this Lease.  Payment of such interest shall not excuse or cure any
default by Tenant under this Lease.  The parties agree that the
payment of interest and the payment of Late Charges provided for in Section
3.3(a) above are distinct and separate from one another in that the payment of
interest is to compensate Landlord for its inability to use the money improperly
withheld by Tenant, while the payment of Late Charges is to compensate Landlord
for its additional administrative expenses in handling and processing delinquent
payments.

       


      
        
           


        

        
          5

           


        

        
           


        

      


      Section
3.4                                Intentionally
Omitted.

       

      Section
3.5                                Rent
Payments.  All Rent payments shall be made to Landlord at the
address set forth in Article l, or at such other place designated by Landlord in
writing, in lawful currency of the United States of America.  Rent
payments applicable to partial months falling within the Term or occurring as a
result of the application of the Monthly Fixed Rent payable upon Lease execution
shall be prorated.

       

      ARTICLE
4

       

      TENANT’S SHARE OF OPERATING
COSTS AND TAXES

       

      Section
4.1                                Definitions.  As
used herein: 

       

      (a)           “Operating
Costs” shall, subject to (d) below, mean any and all costs, charges,
expenses and disbursements of every kind and nature which Landlord shall pay or
become obligated to pay in connection with the operation, ownership,
maintenance, management and repair of the Property, including, without being
limited to, the following:

       

      (1)           All
normal and customary wage, salary and labor costs of all persons engaged in the
operation, maintenance, management and repair of the Property (including,
without being limited to, all applicable taxes, insurance and benefits);
provided, however, that to the extent any such person is engaged in the
operation, maintenance, management and repair of other properties the costs of
any such person shall be prorated by Landlord on a reasonable
basis.

       

      (2)           Intentionally
Omitted.

       

      (3)           Costs
of repairs, replacements, and general maintenance, including, without being
limited to, exterior building maintenance, paving, curbs, drainage, lighting and
sidewalks.

       

      (4)           Professional
fees and expenses (including, without being limited to, legal, accounting,
architectural and engineering fees); provided, however, that to the extent any
such fees relate to other properties such fees shall be prorated by Landlord on
a reasonable basis.

       

      (5)           All
costs of making any capital improvements or repairs to the Property, amortized
over the useful life of such improvements or repairs, with a return on capital
at the rate of ten percent (10%) per annum, it being agreed and understood that
Tenant shall be responsible only for that portion of such  amortized
costs that fall within the Term of this Lease, as such may be
extended.

       


      
        
           


        

        
          6

           


        

        
           


        

      


      (6)           A
property management fee, it being agreed and understood that the property
management fee over the Term of this Lease shall be equal to two percent (2%) of
the gross rental income (i.e., the sum of (i) Fixed Rent
(ii) Operating Costs, (iii) Taxes and
(iv) Insurance).

       

      (7)           All
fees or other charges incurred in conjunction with involuntary membership in any
energy conservation, air quality, environmental, traffic management or similar
organizations which benefit or affect the Property.

       

      (b)           “Taxes”
shall include any form of assessment; real estate, general, special, ordinary or
extraordinary, or rental levy or tax (other than inheritance, personal income or
estate taxes); improvement bond; and/or license fee imposed upon or levied
against any legal or equitable interest of Landlord in the Property, Landlord's
right to other income therefrom, and/or Landlord's business of leasing, by any
authority having the direct or indirect power to tax and where the funds are
generated with reference to the Property address and where the proceeds so
generated are to be applied by the city, county or other local taxing authority
of a jurisdiction within which the Property is located.  Taxes shall
also include any tax, fee, levy, assessment or charge, or any increase therein:
(i) imposed by reason of events occurring during the Term of this Lease,
including but not limited to, a change in the ownership of the Property, (ii) a
change in the improvements thereon, and/or (iii) levied or assessed on machinery
or equipment provided by Landlord to Tenant pursuant to this Lease.

       

      (c)           “Insurance”
shall mean costs of all insurance, including, without being limited to,
casualty, worker’s compensation, rental and liability insurance; provided,
however, that to the extent any such costs relate to other properties, such
costs shall be prorated by Landlord on a reasonable basis.

       

      (d)           “Exclusions
from Operating Costs.”  Notwithstanding
anything to the contrary in the definition of Operating Costs set forth above,
Operating Costs shall not include the following, except to the extent
specifically permitted by a specific exception to the following:

       

      (i)           Any
ground lease rental;

       

      (ii)           Costs
incurred by Landlord for the repair of damage to the Building, to the extent
that Landlord is reimbursed by insurance proceeds;

       

      (iii)           Costs
incurred by Landlord due to the violation by Landlord of the terms and
conditions of this Lease;

       

      (iv)           Overhead
and profit increment paid to Landlord or to subsidiaries or affiliates of
Landlord for goods and/or services in or to the Building to the extent the same
exceeds the costs of such goods and/or services rendered by unaffiliated third
parties on a competitive basis;

       


      
        
           


        

        
          7

           


        

        
           


        

      


      (v)           Interest,
principal, points and fees on debts or amortization on any mortgage or mortgages
or any other debt instrument encumbering the Building or the Property (except as
permitted in Section 4.1(a)(5) above);

       

      (vi)           Landlord’s
general corporate overhead and general and administrative expenses;

       

      (vii)           Costs
arising from the negligence or fault of Landlord or its agents, or any vendors,
contractors, or providers of materials or services selected, hired or engaged by
Landlord or its agents including, without limitation, the selection of Building
materials;

       

      (viii)                      Costs
arising from latent defects in the base, shell or core of the Building or
improvements installed by Landlord or repair thereof;

       

      (ix)           Costs
associated with the operation of the business of the partnership or entity which
constitutes Landlord as the same are distinguished from the costs of operation
of the Property, including limited liability company accounting and legal
matters, costs of defending any lawsuits with any mortgagee (except as the
actions of Tenant may be in issue), costs of selling, syndicating, financing,
mortgaging or hypothecating any of Landlord’s interest in the Property, costs of
any disputes between Landlord and its employees (if any) engaged in Building
operation or disputes of Landlord with Building management; and

       

      (x)           “In
house” legal and/or accounting fees.

       

      Section
4.2                                Tenant’s
Payment of Operating Costs, Taxes and Insurance.  

       

      (a)           For
each calendar year during the Term, Tenant shall pay to Landlord, as Additional
Rent, at the times and in the manner provided below, Tenant’s Proportionate
Share of the sum of (1) Operating Costs for such calendar year, (2) Taxes for
such calendar year, and (3) Insurance for such calendar year (collectively,
“Tenant’s
Expense Charge”).

       

      (b)           At
any time during the Term (but not more than two times in any calendar year),
Landlord shall have the right to compute and deliver to Tenant an estimate (an
“Estimate”)
of Tenant’s Expense Charge for the applicable calendar year together with any
reasonably required supporting documentation and Tenant shall pay to Landlord
commencing with the next payment of Monthly Fixed Rent which is due at least
thirty (30) days after Tenant’s receipt of the Estimate and continuously
thereafter with payments of Monthly Fixed Rent until delivery of the next
Estimate, monthly installments equal to one twelfth of the amount set forth in
such Estimate, together with, in the case of the first such monthly payment, an
amount equal to the difference between (i) the amount of such monthly
installment times the number of months in such year preceding the first monthly
payment, less (ii) the amount of any monthly installments in respect of the
prior Estimate theretofore paid to Landlord.  The
foregoing

       


      
        
           


        

        
          8

           


        

        
           


        

      


      notwithstanding,
if the first monthly payment pursuant to the foregoing sentence is more than
twice the previously established amount under the Estimate, the first monthly
payment will be capped at twice such amount and the unpaid balance shall be
spread ratably over the remaining monthly payments in such year.  In
the event Landlord is required under any mortgage of the Land or the Building to
escrow Operating Costs and/or Taxes, Landlord may (without obligation) use the
amount required to be escrowed as a basis for determining the
Estimate.

       

      (c)           Landlord
shall endeavor to deliver to Tenant within 120 days after the end of each
calendar year during the Term a written statement (the “Statement”)
setting out in reasonable detail Tenant’s Expense Charge for such year certified
to be correct by Landlord.  If the aggregate of the monthly
installments actually paid by Tenant to Landlord on account of the estimated
Tenant’s Expense Charge during any calendar year (the “Actual
Payments”) differs from the amount of Tenant’s Expense Charge payable
according to the Statement (the “Obligated
Payments”), Tenant shall (1) if the Obligated Payments shall exceed the
Actual Payments, pay to Landlord, within 30 days after the date of delivery of
the Statement, an amount equal to such excess, or (2) if the Actual Payments
shall exceed the Obligated Payments, be granted a credit against the next
installments of Rent in an amount equal to such overpayment.  Each
time Landlord provides Tenant with an actual and/or estimated Statement of
Operating Costs, such Statement shall be itemized on a line item by line item
basis, showing the applicable expense for the applicable year.

       

      (d)           Tenant
shall have the right to examine Landlord’s books and records with respect to the
items in a Statement during Normal Business Hours (except, however, Saturdays)
at any time within one hundred eighty (180) days following the furnishing of the
Statement to Tenant.  In conducting such examination, Tenant must
utilize either its own full time salaried employees or an independent certified
public accountant (“CPA”),
which CPA shall be paid by Tenant on an hourly fee for services rendered basis,
and not on a contingency fee basis.  Unless Tenant takes written
exception to any item on the subject Statement within one hundred eighty (180)
days after the furnishing of the Statement, such Statement shall be considered
as final and accepted by Tenant.  If Tenant timely provides such
written exception to Landlord, but Landlord and Tenant disagree on the accuracy
of Tenant’s Expense Charge as set forth in the Statement, Tenant shall
nevertheless make payment in accordance with the Statement, but the disagreement
shall immediately be referred by Landlord for prompt decision to a mutually
acceptable public accountant or other professional consultant who shall be
deemed to be acting as an expert and not as an arbitrator, and a determination
signed by the selected expert shall be final and binding on both Landlord and
Tenant.  If Landlord and Tenant shall fail to agree on such an expert
within 15 days after Tenant’s notice of disagreement (as hereinafter described),
such expert shall be Ernst &
Young, so long as such firm is available to do the work and is not then
doing any work for either Landlord or Tenant.  If Ernst &
Young is not available or is then doing work for either Landlord or Tenant,
Landlord and Tenant shall agree upon another of the “Big 4” accounting
firms or a regional accounting firm to serve as expert.  Any
adjustment required to be made by reason of any such decision shall be made
within 15 days thereof and payment shall be made or credit allowed in the manner
set forth in Section 4.2(c) hereof together with interest on the amount of any
such

       


      
        
           


        

        
          9

           


        

        
           


        

      


      adjustment
at a rate equal to the Prime Rate plus two percent (2%) per annum for the period
from the time the original payment was made to the time the adjusted payment or
credit is made or applied.  If the adjustment is greater than 3% and
the amount of the adjustment is to be paid to Tenant, Landlord will pay the cost
of the expert; otherwise Tenant will pay the cost of the expert.

       

      (e)           Tenant
shall pay prior to delinquency all taxes assessed against and levied upon Tenant
owned alterations and utility installations, trade fixtures, furnishings,
equipment and all personal property of Tenant contained in the Demised
Premises.  When possible, Tenant shall cause its Tenant owned
alterations and utility installations, trade fixtures, furnishings, equipment
and all other personal property to be assessed and billed separately from the
real property of Landlord.   If any of Tenant's said property
shall be assessed with Landlord's real property, Tenant shall, within twenty
(20) days of demand by Landlord, pay Landlord the taxes attributable to Tenant's
property in accordance with the provisions of Section 10.1.  Landlord
agrees that it will provide Tenant with a copy of any notice which Landlord
receives with respect to any taxes payable by Tenant pursuant to this Section
4.2(e).

       

      Section
4.3                                Refunds;
Other Items.  

       

      (a)           In
the event a refund of any Operating Costs or Taxes is obtained and actually paid
to Landlord, Landlord shall credit an appropriate portion thereof (after
deducting any unrecouped expenses in connection with obtaining such refund) to
the next installment(s) of Rent.

       

      (b)           The
rendering of a Statement for any year shall not preclude Landlord from issuing a
correction thereto at a later time, including a correction for items not
included in the original Statement, it being agreed and understood that any such
correction shall be subject to Tenant’s rights set forth in Section 4.2(d) above
and further that this Section 4.3(b) shall not be applicable to any items which
were resolved pursuant to the provisions of Section 4.2(d).

       

      (c)           Attached
hereto as Exhibit F is an estimate of the Operating Costs, Taxes and
Insurance for calendar year 2008.  Tenant acknowledges that the
attached Exhibit F is an estimate only and does not constitute a
representation or warranty of any kind by Landlord that the amounts shown on
Exhibit F will be the actual amount of Operating Costs, Taxes and Insurance
for calendar year 2008.

       

      ARTICLE
5

       

      COMPLETION AND OCCUPANCY OF
DEMISED PREMISES

       

      Section
5.1                                Delivery
of Demised Premises.  Landlord shall, upon the execution of
this Lease, tender possession of the Demised Premises to Tenant.

       

      Section
5.2                                Construction
of Tenant Improvements.  Upon Landlord’s tender of possession
of the Demised Premises to Tenant, Tenant shall, subject to Landlord’s
representations and warranties set forth in Section 24.4 below, accept the
Demised Premises in

       


      
        
           


        

        
          10

           


        

        
           


        

      


      their
then “as-is” condition and shall promptly commence the design and installation
of the Tenant Improvements and shall diligently prosecute same to completion,
all in accordance with the terms and conditions of the Work Letter.

       

      ARTICLE
6

       

      CONDUCT OF BUSINESS BY
TENANT

       

      Section
6.1                                Use of
Demised Premises.  Tenant shall use the Demised Premises during
the Term solely for Permitted Use specified in Article 1 and for no other
purpose. 

       

      Section
6.2                                Compliance
with Laws and Requirements of Public
Authorities.  

       

      (a)           At
all times during the Term, Tenant shall give prompt notice to Landlord of any
notice Tenant receives of any violation of any law or requirement of a
governmental authority affecting the Demised Premises or the Property or any
regulation of the board of fire underwriters having jurisdiction over the
Property (“Applicable
Law”), and, at its sole cost and expense, shall comply with all
Applicable Laws, including any violation, order or duty imposed upon Landlord or
Tenant, arising from or relating to (1) Tenant’s use of the Demised Premises;
(2) the manner or conduct of Tenant’s business or operation of its
installations, equipment or other property therein; (3) any cause or condition
created by or at the insistence of Tenant; or (4) breach of any of Tenant’s
obligations hereunder.

       

      (b)           Tenant
shall not do, permit or suffer any act or thing to be done which is injurious to
the Property or the Demised Premises, which is immoral, a nuisance, contrary to
Applicable Law or in violation of the certificate of occupancy issued for the
Building or which would result in the cancellation of, or any increase in
premiums for, insurance maintained by Landlord with respect to the Property or
the Demised Premises.

       

      (c)           Tenant
shall not use, maintain or allow the use or maintenance of the Demised Premises
or any part thereof to treat, store, dispose of, transfer, release, convey or
recover Hazardous Materials (as hereinafter defined) nor shall Tenant otherwise,
in any manner, possess or allow the possession of any Hazardous Materials on or
about the Demised Premises; provided, however, any Hazardous Material lawfully
permitted and generally recognized as necessary and appropriate for the
Permitted Use specified in Article 1 may be stored and used on the Demised
Premises so long as (i) such storage and use is in the ordinary course of
Tenant’s business permitted under this Lease or any other Permitted Use; (ii)
such storage and use is performed in compliance with all applicable laws and in
compliance with the standards prevailing in the industry for the storage and use
of such materials; and (iii) Tenant delivers prior written notice to Landlord of
the identity of and information regarding such materials as Landlord may
reasonably require.  “Hazardous Materials” shall mean any solid,
liquid or gaseous waste, substance or emission or any combination thereof which
may (i) cause or significantly contribute to an increase in mortality or serious
illness, or (ii) pose the risk of a substantial present or potential hazard to
human health, to the environment or otherwise to animal or plant life, and shall
include without limitation hazardous substances and materials described in
the

       


      
        
           


        

        
          11

           


        

        
           


        

      


      Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended; the
Resource Conservation and Recovery Act, as amended; and any other applicable
federal, state or local laws.  Tenant shall immediately notify
Landlord of the presence or suspected presence of any Hazardous Materials on or
about the Demised Premises and shall deliver to Landlord any notice received by
Tenant relating thereto.  Landlord acknowledges that Tenant intends to
provide on-site refueling and minor maintenance (e.g., oil changes) for its
vehicles, and
Tenant acknowledges that Tenant must obtain any and all government approvals for
any such activities and that all such activities must be performed in compliance
with all Applicable Laws and with any reasonable rules and regulations imposed
by Landlord.

       

      (d)           Tenant
agrees that it shall not keep, use, sell or offer for sale in or upon the
Demised Premises any article which may be prohibited by any then available
standard forms of fire insurance policies with extended
coverage.  Tenant agrees to pay to Landlord any increase in premiums
for insurance maintained by Landlord with respect to the Demised Premises or the
Property resulting from the use of the Demised Premises by Tenant, whether, or
not Landlord has consented to such use.

       

      (e)           Tenant
shall pay all costs, expenses, fines, penalties or damages which may be imposed
upon Landlord by reason of Tenant’s failure to comply with the provisions of
this Section 6.2.

       

      Section
6.3                                Rules and
Regulations.  Tenant and its agents, employees, contractors and
invitees shall faithfully observe and comply with the rules and regulations
attached hereto as Exhibit C and incorporated herein by this reference, and such
reasonable changes thereto, whether by modification, elimination or addition, as
Landlord may, at any time and from time to time, make in respect of the Demised
Premises and/or the Property so long as any such change does not materially and
unreasonably interfere with Tenant’s use of the Property for the Permitted Use
(the “Rules and
Regulations”).  Such changes shall be effective upon notice
thereof from Landlord to Tenant.  In the case of any conflict or
inconsistency between the provisions of this Lease and any of the Rules and
Regulations, as originally promulgated or as changed, the provisions of this
Lease shall control.  Landlord shall not be liable to Tenant for the
nonperformance or violation thereof by any party.

       

      ARTICLE
7

       

      INTENTIONALLY
OMITTED

       

       

      ARTICLE
8

       

      REPAIRS, ALTERATIONS AND
MECHANICS’ LIENS

       

      Section
8.1                                Repairs.  

       

      (a)           Landlord
shall make all necessary repairs to keep the roof, exterior walls, foundation
and structural frame of the Building and the parking area in good order and
repair, excluding, however, all repairs which Tenant is obligated to make or pay
for

       


      
        
           


        

        
          12

           


        

        
           


        

      


      pursuant
to this Section 8.1. Tenant shall give Landlord prompt notice of any defective
condition required to be corrected by Landlord pursuant to this Section 8.1(a)
and following such notice, Landlord shall use commercially reasonable efforts to
initiate all repairs promptly and to remedy the condition with due diligence,
subject to unavoidable delay, but at the expense of Tenant if repairs are
necessitated by any act attributable to Tenant, Tenant’s servants, agents,
employees, invitees or licensees; provided, however, that no liability of
Landlord to Tenant shall accrue hereunder unless and until Tenant has given
notice to Landlord of the specific repair to be made.  If Tenant
provides written notice (or oral notice in the event of an emergency such as
damage or destruction to the roof of the Building), to Landlord of an event or
circumstance which requires the action of Landlord with respect to repair and/or
maintenance pursuant to this Section 8.1(a), Landlord shall provide for such
repair or maintenance within a reasonable period of time, given the
circumstances after the receipt of such notice but in any event not later than
thirty (30) days after receipt of such notice.  Tenant waives any
rights and benefits of Section 1 of Section 1982 and Sections 1941 and 1942 of
the California Civil Code or under any similar law, statute or ordinance now or
hereafter in effect.

       

      (b)           Tenant,
at its sole cost and expense, shall take good care of the Demised Premises,
including all landscaping, all Building equipment and HVAC and other systems
(including without limitation any fire/life safety, plumbing, heating system or
electrical lines located in, servicing or passing through the Demised Premises)
located therein and serving the Demised Premises and plate glass, floors,
windows and doors, and Tenant’s property and fixtures.  Tenant, at its
expense, shall obtain a preventative maintenance contract on the HVAC system,
the form and contractor under which shall be subject to Landlord’s reasonable
approval.  Tenant shall provide Landlord with an executed copy of the
preventative maintenance contract no later than ninety (90) days after the
Commencement Date.  The preventative maintenance contract shall
provide for the inspection and maintenance of the HVAC system on not less than a
semi-annual basis.  In addition Tenant shall be responsible for the
maintenance and testing, as required by applicable codes, of all fire/life
safety equipment (including the pump, fire sprinklers and fire
hydrants).  Tenant shall provide Landlord with monthly reports of all
such testing of the fire/life safety systems.  All repairs made by or
on behalf of Tenant shall be made and performed in accordance with the
provisions of Section 8.2 and shall be at least equal in quality and design to
the original construction of the Demised Premises and the
Building.  If Tenant fails to proceed with due diligence to make
repairs required to be made by Tenant, and such failure shall continue for 10
days after notice from Landlord, the same may be made by Landlord at the expense
of Tenant and the amount so incurred by Landlord shall be paid to Landlord by
Tenant immediately upon submission of a bill or statement therefor by
Landlord.

       

      Section
8.2                                Alterations.  Tenant
is granted the right, subject to Landlord’s prior written consent which shall
not be unreasonably withheld, to make alterations, additions or improvements
(collectively, “Alterations”)
in or to the Demised Premises, as long as (a) Tenant pays for the entire cost of
such Alterations, (b) Tenant agrees to remove said Alterations upon the
expiration or termination of the Lease if requested by Landlord at the time the
Alterations are approved by Landlord, and (c) such Alterations will not (i)
adversely affect the structure of the Building, (ii) adversely affect the
systems of the Building, (iii) affect the exterior appearance of

       


      
        
           


        

        
          13

           


        

        
           


        

      


      the
Building, and (iv) be in violation of any applicable law, code or ordinance
((i), (ii), (iii) and (iv) individually and collectively hereinafter referred to
as a “Design
Problem”).  Any time Tenant proposes to make any Alterations,
Tenant shall provide Landlord with at least ten (10) business days’ prior
written notice of the proposed Alterations, together with the plans and
specifications therefor, and Landlord shall grant its approval or disapproval
(which may be given only if a Design Problem exists) within such ten (10)
business day period.  Notwithstanding the foregoing, Tenant may make
Alterations which do not involve a Design Problem and do not cost in excess of
$50,000.00 without any obligation to obtain Landlord’s approval but subject to
the other terms and conditions of this Section 8.2 Tenant shall, before making
any Alterations, at its expense, obtain all permits, approvals and certificates
required by any governmental or quasi governmental bodies and (upon completion)
certificates of final approval thereof and shall deliver promptly duplicates of
all such permits, approvals and certificates to Landlord, and Tenant agrees to
carry, and to cause Tenant’s contractors and sub contractors to carry such
workmen’s compensation, general liability, personal and property damage
insurance as Landlord may reasonably require.  Upon completion of any
Alterations, Tenant shall deliver to Landlord one set of “as built” plans and
specifications therefor.  All fixtures and all paneling, partitions,
railing and like Alterations, installed in the Demised Premises, either by
Tenant or by Landlord on Tenant’s behalf, shall become the property of Landlord
and shall remain upon and be surrendered with the Demised Premises upon the
expiration or earlier termination of the Lease, unless Landlord, by notice to
Tenant given at the time Tenant requests Landlord’s consent to the applicable
Alteration, elects to have them removed by Tenant, in which event, the same
shall be removed from the Demised Premises by Tenant.  Landlord hereby
acknowledges that upon the expiration or earlier termination of this Lease
Tenant shall not be required to remove any of the initial tenant improvements or
any of the equipment or trade fixtures which are to be installed by Tenant as
part of Tenant’s initial tenant improvement work in the Building and which are
specifically listed on Exhibit E attached hereto.  Other than as
listed on Exhibit E Landlord may, at Landlord’s option, require Tenant to remove
any of Tenant’s initial tenant improvements or any of its equipment or trade
fixtures initially installed in the Building.  Nothing in this section
shall be construed to give Landlord title to or to prevent Tenant’s removal of
trade fixtures, moveable furniture and equipment, but upon removal of any such
equipment and fixtures from the Demised Premises or upon removal of other
installations as may be required by Landlord pursuant to this Section 8.2,
Tenant shall immediately and at its expense, repair and restore the Demised
Premises to the condition existing prior to installation (subject to ordinary
wear and tear) and repair any damage to the Demised Premises or the Property due
to such removal.  All property that was permitted or required to be
removed by Tenant at the end of the Term but which remains in the Demised
Premises for 10 days after Tenant vacates the Demised Premises shall be deemed
abandoned and may, at the election of Landlord, either be retained as Landlord’s
property or may be removed from the Demised Premises by Landlord at Tenant’s
expense.  Except as otherwise expressly set forth in this
Section 8.2 with respect to Tenant’s restoration obligations with respect
thereto, the design and construction of the initial tenant improvements in the
Demised Premises by Tenant shall be governed by the provisions of the Work
Letter Agreement attached hereto as Exhibit D.  

       

      Section
8.3                                Mechanics’
Liens.  Tenant shall (a)  pay before delinquency all
costs and expenses of work done or caused to be done by Tenant in the Demised
Premises; (b) keep the title to the Property and every part thereof free and
clear of any lien or encumbrance in respect of such work; and (c) indemnify and
hold harmless Landlord against any claim, loss, cost, demand

       


      
        
           


        

        
          14

           


        

        
           


        

      


      (including
reasonable legal fees), whether in respect of liens or otherwise, arising out of
the supply of material, services or labor for such work.  Tenant shall
immediately notify Landlord of any lien, claim of lien or other action of which
Tenant has or reasonably should have knowledge and which affects the title to
the Property or any part thereof, and shall cause the same to be removed within
15 days (or such additional time as Landlord may consent to in
writing).  If Tenant shall fail to remove same within said time
period, Landlord may take such action as Landlord deems necessary to remove the
same and the entire cost thereof shall be immediately due and payable by Tenant
to Landlord and such amount shall bear interest at the Default
Rate.  Nothing contained in this Section 8.3 or elsewhere in this
Lease shall be deemed or construed in any way as giving Tenant any right, power
or authority to contract for or permit the rendering of any services or the
furnishing of any materials that would give rise to the filing of a
materialmen’s, mechanics’ or other lien against the Demised Premises or any
other portion of the Property.

       

      ARTICLE
9

       

      UTILITIES AND BUILDING
SERVICES

       

      Section
9.1                                Utilities
and Building Services.  Tenant shall obtain in its own name and
shall pay directly to the appropriate supplier the cost of all utilities and
services serving the Demised Premises and the Property, including but not
limited to: natural gas, heat, light, electrical power, telephone, janitorial
service, refusal disposal and other utilities and services.

       

      Section
9.2                                Interruption
of Services.  Landlord does not covenant that utility or other
Building services will be free from interruptions caused by repairs,
improvements, changes of service, alterations, strikes, lockouts, labor
controversies, accidents, inability to obtain fuel, water or supplies or any
other cause beyond the reasonable control of Landlord.  No such
interruption of service shall be deemed a constructive eviction or disturbance
of Tenant’s use and possession of the Demised Premises or any part thereof, or
otherwise render Landlord liable to Tenant for damages, by abatement of rent or
otherwise, or otherwise relieve Tenant from performance of Tenant’s obligations
under this Lease except as otherwise expressly set forth in Article 26
below.  Tenant hereby waives and releases all claims against Landlord
for damages for interruption or stoppage of such services except as otherwise
expressly set forth in Article 26 below.

       

      ARTICLE
10

       

      PROPERTY AND OTHER
TAXES

       

      Section
10.1                                Tenant’s
Property.  In addition to the Rent and other charges to be paid
by Tenant hereunder, Tenant shall reimburse Landlord, upon demand, for any and
all taxes payable by Landlord whether or not now customary or within the
contemplation of the parties hereto, levied, assessed or imposed:  (1)
upon or with respect to the possession, leasing, operation, management,
maintenance, alteration, repair, use or occupancy by Tenant of the Demised
Premises or any portion thereof; (2) upon the measured value of Tenant’s
personal property owned, installed, used or located in the Demised Premises, it
being the intention of Landlord and Tenant that, to the extent possible, such
personal property taxes shall be billed to and paid directly by Tenant; (3) upon
the leasehold interest or any right of occupancy of Tenant

       


      
        
           


        

        
          15

           


        

        
           


        

      


      in the
Demised Premises; or (4) upon this transaction.  Any reimbursement
referred to above shall be collectible by Landlord as Additional Rent hereunder.


       

      ARTICLE
11

       

      INSURANCE AND
INDEMNITY

       

      Section
11.1                                Insurance.  

       

      (a)           Landlord’s
Insurance.  At all times Landlord shall keep in full force and
effect a policy of property damage insurance with respect to the Building (i.e.,
the shell and core of the Building).

       

      (b)           Tenant’s
Insurance.  At all times Tenant shall keep in full force and
effect a policy of comprehensive public liability with respect to the Demised
Premises and property damage insurance with respect to all of Tenant’s tenant
improvements, alterations, equipment, trade fixtures and personal property, in
such limits as may be reasonably required from time to time by
Landlord.  The limits of public liability insurance on the
Commencement Date shall be not less than $3,000,000 for death or injury to any
number of persons or for property damage, for each occurrence.  Such
limits may be provided through a combination of primary and excess
policies.  In no event shall the limits of any coverage maintained by
Tenant pursuant to this Section 11.1 be considered as limiting Tenant’s
liability under this Lease.  These policies shall name Landlord, any
person, firms or corporations (including, without being limited to, any
mortgagee or lessor of Landlord) reasonably designated by Landlord and Tenant as
insureds, shall include blanket contractual liability coverage which insures
contractual liability under the indemnifications set forth in Section 11.2
hereof and shall contain a clause that the insurer will not cancel or change the
insurance without first giving Landlord 30 days prior written
notice.  The insurance shall be written by an insurance company,
licensed and qualified to do business in the State in which the Property is
located, which is reasonably acceptable to Landlord.  An original copy
of the policy or a certificate of insurance shall be delivered to Landlord upon
the execution and delivery of this Lease and replacement certificates shall be
delivered not less than ten (10) days prior to the expiration of any then
existing coverage.  The insurance which Tenant is required to maintain
in force and effect under this Section 11.1 shall be primary insurance as
respects Landlord (and any other additional insureds designated by Landlord) and
not excess over or contributory with any other available
insurance.  Certificates of insurance evidencing the liability
insurance coverage required under this Section 11.1 shall contain an endorsement
to such effect.  In addition, at all times during the Term hereof,
Tenant shall procure and maintain Worker’s Compensation Insurance in accordance
with the laws of the State in which the Property is located.

       

      Section
11.2                                Indemnity
and Non Liability.  

       

      (a)           Neither
Landlord nor Landlord’s agents (including, without being limited, to the
Managing Agent), employees, contractors, officers, trustees, directors,
shareholders, partners or principals (disclosed or undisclosed) shall be liable
to Tenant or

       


      
        
           


        

        
          16

           


        

        
           


        

      


      Tenant’s
agents, employees, contractors, invitees or licensees or any other occupant of
the Demised Premises, and Tenant shall save Landlord, its successors and assigns
and their respective agents, employees, contractors, officers, trustees,
directors, shareholders, partners and principals (disclosed or undisclosed)
harmless from any loss, cost, liability, claim, damage, expense (including
reasonable attorneys’ fees and disbursements), penalty or fine incurred in
connection with or arising from any injury to Tenant or to any other person or
for any damage to, or loss (by theft or otherwise) of, any of Tenant’s property
or of the property of any other person, irrespective of the cause of such
injury, damage or loss unless due to the gross negligence or willful misconduct
of Landlord or Landlord’s agents or employees.  However, even if such
loss or damage is caused by the gross negligence or willful misconduct of
Landlord, its agents or employees, Tenant waives, to the full extent permitted
by law, any claim for consequential damages in connection
therewith.  Likewise, even if any loss or damage is caused by the
gross negligence or willful misconduct of Tenant, its agents or employees,
Landlord waives, to the full extent permitted by law, any claim for
consequential damages in connection therewith.

       

      (b)           Neither
any (1) performance by Landlord, Tenant or others of any repairs, improvements,
alterations, additions, installations, substitutions, betterments or decorations
in or to the Property or the Building, the Building equipment and systems, or
the Demised Premises, (2) failure of Landlord or others to make any such repairs
or improvements, (3) damage to the Property or the Building, the Building
equipment and systems, the Demised Premises or Tenant’s property, (4) injury to
any persons, caused by other persons in the Building, or by operations in the
construction of any private, public, or quasi public work, or by any other
cause, (5) latent defect in the Building, the Building equipment and systems, or
the Demised Premises, nor (6) inconvenience or annoyance to Tenant or injury to
or interruption of Tenant’s business by reason of any of the events or
occurrences referred to in the foregoing subdivisions (1) through (5) shall
impose any liability on Landlord to Tenant, other than, subject to Section 24.10
hereof, such liability as may be imposed upon Landlord by law for Landlord’s
gross negligence or the gross negligence of Landlord’s agents or employees in
the operation or maintenance of the Building, the Building equipment and systems
or the Common Areas or for the breach by Landlord of any express covenant of
this Lease on Landlord’s part to be performed or as expressly set forth in
Section 26.1.

       

      (c)           Tenant
hereby indemnifies and holds harmless Landlord and Landlord’s agents, employees,
contractors, officers, trustees, directors, shareholders, partners or principals
(disclosed or undisclosed) from any loss, cost, liability, claim, damage,
expense (including reasonable attorneys’ fees and disbursements), penalty or
fine incurred in connection with or arising from (1) any default by Tenant in
the performance of any of the terms of this Lease on Tenant’s part to be
performed, or (2) the use or occupancy or manner of use or occupancy of the
Demised Premises by Tenant or any person claiming under Tenant, or (3) any acts,
omissions or negligence of Tenant or any such person, or the contractors,
agents, employees, invitees, licensees, assignees or sublessees of Tenant or any
such person, or (4) any accident, injury or damage whatsoever caused to any
person or to the property of any person and occurring in or about the Demised
Premises except to the extent of Landlord’s gross negligence or

       


      
        
           


        

        
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      willful
misconduct.  Tenant’s obligations under this Section 11.2 shall
survive the expiration or earlier termination of this Lease.

       

      (d)           Tenant
shall pay to Landlord as Additional Rent, within 30 days after submission by
Landlord to Tenant of bills or statements therefor, sums equal to all losses,
costs, liabilities, claims, damages, fines, penalties and expenses referred to
in this Section 11.2; provided, however that if a court or an arbitration makes
a final judgment that the damages were caused solely by Landlord’s gross
negligence or willful misconduct then Landlord shall reimburse Tenant for all of
Tenant’s reasonable out-of-pocket costs (including reasonable attorneys’ fees)
incurred in defending Landlord together with interest thereon at a rate equal to
the Prime Rate plus two percent (2%).

       

      Section
11.3                                Waiver of
Subrogation.  Landlord and Tenant shall each endeavor to
procure an appropriate clause in, or endorsement to, each of its policies for
fire and extended coverage insurance, pursuant to which the insurance company
waives subrogation or consents to waiver of its right of recovery against the
other party, which, in the case of Tenant, shall be deemed to include any
subtenant in the Demised Premises, and having obtained such clause or
endorsement of waiver of subrogation or consent to a waiver of the right of
recovery, such party hereby agrees that it will not make any claim against or
seek to recover from the other for any loss or damage to its property or the
property of others covered by such fire or extended coverage insurance;
provided, however, that the release, discharge and covenant not to sue herein
contained shall be limited by the terms and provisions of the waiver of
subrogation clause or endorsement, or the clause or endorsement consenting to a
waiver of right of recovery, and shall be co extensive therewith.  If
either party hereto shall not be able to obtain such clause or endorsement on a
particular policy or if the inclusion of such clause or endorsement would result
in an increase in premium, then that party shall so notify the other party
hereto at least 15 days prior to the date the policy is to take
effect.  The other party shall be obligated to pay the amount of any
increase in premium resulting from the inclusion of such clause or endorsement,
unless such other party notifies the party obtaining the insurance, within
twenty (20) days following notice of the amount of such increase, that such
other party declines to pay such increase, in which event the party obtaining
the insurance may omit such clause or endorsement.  If a party shall
fail to give notice either of inability to obtain such clause or endorsement or
notice of an increase in premium, then that party shall be deemed to have waived
its right of recovery from the other party with respect to any loss or damage
insured against by the policy with respect to which notice was not given as
provided above. 

       

      ARTICLE
12

       

      DAMAGE BY
CASUALTY

       

      Section
12.1                                Notice.  Tenant
shall give immediate written notice to Landlord of any damage caused to the
Demised Premises by fire or other casualty. 

       

      Section
12.2                                Restoration
of Improvements.  

       

      (a)           In
the event the Building is damaged by fire or other casualty, Landlord shall,
unless this Lease is terminated as hereinafter provided, proceed with
reasonable

       


      
        
           


        

        
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      diligence
and at its sole cost and expense to repair the shell and core of the Building,
but only to the extent of the insurance proceeds that are available to Landlord
or that would have been available if Landlord had carried the insurance required
under this Lease.  Tenant shall promptly, at its sole cost and
expense, remove such of its furniture and other belongings from the Building as
Landlord shall require in order to repair and restore the shell and core of the
Building.  Until any such repairs to the Building are completed, the
Fixed Rent shall be abated in proportion to the part of the Building, if any,
that is unusable by Tenant in the conduct of its business.  If the
fire or other casualty is due to the negligence or misconduct of Tenant, its
agents, employees, contractors or invitees, there shall be no abatement of Fixed
Rent, and Tenant shall be liable to Landlord for the amount by which the cost of
such repairs exceeds the insurance proceeds received by Landlord.

       

      (b)           If
the shell and core of the Building shall be destroyed or damaged by a casualty
not sufficiently, in Landlord’s sole judgment, covered by insurance or, even if
covered by insurance, which, in Landlord’s sole judgment, cannot be restored to
tenantable condition within 180 days after the casualty, then Landlord may elect
to proceed to rebuild and repair the shell and core of the Building or to
terminate this Lease, effective upon giving notice of such election to Tenant
within 30 days after the occurrence of such casualty.  Landlord’s
obligation to rebuild and repair under this Section 12.2 shall in any event be
limited to restoring the shell and core of the Building to substantially the
condition in which it existed prior to the casualty (in no event shall Landlord
be required to repair any of Tenant’s leasehold improvements, fixtures,
equipment, furniture, furnishings and personal property) and then only to the
extent that insurance proceeds shall be sufficient to pay for such
restoration.  Tenant agrees that, promptly after the completion of
such work by Landlord, it will proceed with reasonable diligence and at its sole
cost and expense to rebuild, repair and restore its fixtures, equipment and
other installations.

       

      (c)           If
the Demised Premises shall be destroyed or damaged by a casualty such that, in
Landlord’s reasonable judgment, the Demised Premises cannot be restored
(including Tenant’s tenant improvements and trade fixtures) to a tenantable
condition for the operation of Tenant’s business therein within 270 days after
the casualty, and Landlord has not elected to terminate this Lease pursuant to
Section 12(b) above, then Tenant may elect to terminate this Lease, effective
upon giving notice of such election to Landlord within 30 days after the
occurrence of such casualty.  In the event of any such termination by
Tenant pursuant to this Section 12.2(c) Tenant shall provide Landlord with the
proceeds of any insurance carried by Tenant (or required to be carried by Tenant
under this Lease) with respect to the Tenant Improvements and any Alterations
and any coverage for the removal of debris.

       

      (d)           Tenant
shall have no right to terminate this Lease in the event of the damage or
destruction of the Demised Premises other than as set forth in this Section 12.2
and hereby waives the provisions of any Applicable Law granting Tenant such
right, including, without limitation, Sections 1932(2) and 1933(4) of the
California Civil Code.

       


      
        
           


        

        
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      Section
12.3                                Damage
During Last Year of Lease Term.  Without limiting Landlord’s or
Tenant’s rights under Section 12.2, in the event the Building or Demised
Premises shall, in Landlord’s reasonable judgment, be substantially damaged
during the last year of the term of this Lease, either party may elect to
terminate this Lease effective upon giving notice of such election, in writing,
to the other party within thirty (30) days after the happening of the fire or
other casualty.   For purposes of this Section 12.3
“substantially damaged” shall mean that, in Landlord’s reasonable judgment, the
Demised Premises cannot be restored to tenantable condition within 60 days after
the casualty.

       

      ARTICLE
13

       

      EMINENT
DOMAIN

       

      Section
13.1                                Taking of
Demised Premises.  If during the Term all of the Demised
Premises shall be taken for any public or quasi public use under any statute or
by right of eminent domain, or sale in lieu of such taking, this Lease shall
automatically terminate on the date on which the condemning authority takes
possession of the Demised Premises (hereinafter called the “Date of
Taking”).  If so much of the Demised Premises (but less than
all) is taken as shall render the Demised Premises untenantable in Landlord’s
reasonable judgment, Tenant and Landlord shall each have the right to terminate
this Lease by giving written notice to the other party of termination within 30
days after the Date of Taking. 

       

      Section
13.2                                Partial
or Temporary Taking of Building.  

       

      (a)           If
during the Term, the Building, or any portion thereof, is taken or sold as set
out in Section 13.1, then (1) if in the reasonable opinion of Landlord
substantial alteration or reconstruction of the Building is necessary as a
result thereof; (2) if one quarter or more of the value, in Landlord’s sole
judgment, of the  Building is included in such taking or sale; or (3)
if such portion of the parking area and access areas shall be taken as, in
Landlord’s sole judgment, to materially interfere or prevent access to the
Building or reduce the value of the Land and the Building by more than one
quarter; then, either party shall have the right to terminate this Lease by
giving the other party at least 30 days’ written notice thereof.

       

      (b)           If
during the Term the Building or the parking area and access areas, or any
portion thereof, shall be taken as set out in Section 13.1 for a period of less
than one (1) year, this Lease shall remain in full force and effect subject to
Section 13.4 hereof.  If such a taking shall be for a period of one
(1) year or more, then the provisions of Section 13.1 and Section 13.2(a), as
the case may be, shall be applicable.

       

      (c)           If
either party exercises its rights of termination under Section 13.1 or 13.2 (and
any such right must be exercised within 30 days after the Date of Taking,
failing which such right shall be deemed waived), this Lease shall terminate on
the date stated in the notice, provided, however, that no termination pursuant
to notice hereunder may occur later than 60 days after the Date of
Taking.

       


      
        
           


        

        
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      Section
13.3                                Surrender.  On
the date of any termination under Section 13.1 or 13.2, Tenant shall immediately
surrender to Landlord the Demised Premises and all interests therein under this
Lease and Tenant shall pay Landlord Rent through the date of termination (or
through the Date of Taking if such date shall not be the same as the date of
termination).  Landlord may re enter and take possession of the
Demised Premises and remove Tenant therefrom. 

       

      Section
13.4                                Rent
Adjustment for Partial Taking of Demised Premises.  If any
portion of the Demised Premises (but less than the whole thereof) is so taken,
and no rights of termination herein conferred are timely exercised, the Term
shall expire (or, in respect of a taking pursuant to Section 13.2(b) hereof,
have no force and effect for the period of such temporary taking) with respect
to the portion so taken on (or from) the Date of Taking.  In such
event, the Rent thereafter payable under this Lease shall be adjusted pro rata
by Landlord in order to account for the resulting reduction (either temporarily
or permanently) in the number of rentable square feet in the Demised Premises.


       

      Section
13.5                                Awards.  Upon
any taking or sale described in this Article 13, Landlord shall be entitled to
receive and retain the entire award or consideration for the affected lands and
improvements, and Tenant shall not have nor advance any claim against Landlord
or anyone else for the value of its property or its leasehold estate under this
Lease, or for the costs or removal or relocation, or business interruption
expense or any other damages arising out of such taking or
purchase.  Nothing herein shall give Landlord any interest in or
preclude Tenant from seeking and recovering on its own account a separate award
from the condemning authority attributable to the taking or purchase of Tenant’s
trade fixtures, or the removal or relocation of its business and effects, or the
interruption of its business provided that Landlord’s award is not diminished
thereby.  If any such award made or compensation paid to either party
specifically includes an award or amount for the other, the party first
receiving the same shall promptly account therefor to the other. 

       

      Section
13.6                                Sole
Remedy.  The rights contained in this Article 13 shall be
Tenant’s sole and exclusive remedy in the event of a taking or
condemnation.  Each party waives the provisions of Sections 1265.130
and 1265.150 of the California Code of Civil Procedure and the provisions of any
successor or other law of like import.

       

      ARTICLE
14

       

      RIGHTS RESERVED TO
LANDLORD

       

      Section
14.1                                Access to
Demised Premises.  Landlord and Landlord’s agents shall have
the right (but shall not be obligated) to enter the Demised Premises in any
emergency at any time, and to perform any acts related to the safety, protection
or preservation thereof or of the Building.  At other reasonable
times, and upon reasonable notice, Landlord may enter the Demised Premises (1)
to examine and make such repairs, replacements and improvements as Landlord may
deem necessary or reasonably desirable to the Demised Premises or to any other
portion of the Building, (2) for the purpose of complying with laws, regulations
and other requirements of governmental authorities or the provisions of this
Lease, (3) for the purpose of posting notices of nonresponsibility, or (4) for
the purposes of showing the same to prospective purchasers or mortgagees of the
Building, and during the last 12 months of the Term for the

       


      
        
           


        

        
          21

           


        

        
           


        

      


      purpose
of showing the same to prospective tenants.  Tenant shall, so long as
Landlord uses commercially reasonable efforts so as not to unreasonably disrupt
Tenant’s business operations in the Demised Premises permit Landlord to use and
maintain and replace unexposed pipes and conduits in and through the Demised
Premises and to erect new unexposed pipes and conduits
therein.  Landlord may, during the progress of any work in the Demised
Premises, take all necessary materials and equipment into the Demised Premises
and close or temporarily suspend operation of areas of the Demised Premises
without such interference constituting an eviction, but subject to the
provisions of Section 26.1.  Tenant shall not be entitled to any
damages by reason of loss or interruption of business or otherwise during such
periods.  During such periods Landlord shall use reasonable efforts to
minimize any interference with Tenant’s use of the Demised
Premises.  If Tenant is not present to open and permit an entry into
the Demised Premises, Landlord or Landlord’s agents may enter the same whenever
such entry may be necessary or permissible by master key or otherwise, provided
reasonable care is exercised to safeguard Tenant’s property.  Such
entry shall not render Landlord or its agents liable therefor, nor in such event
shall the obligations of Tenant hereunder be affected.  

       

      Section
14.2                                Additional
Rights.  Landlord shall have the following additional rights
exercisable without notice (except as provided below) and without liability to
Tenant for damage or injury to property, person or business, all claims for
damage being hereby released, and without effecting an eviction or disturbance
of Tenant’s use or possession or giving rise to any claim for setoffs, or
abatement of Rent: 

       

      (a)           To
change the name, number or designation by which the Building may be known;
and

       

      (b)           To
perform any act, obligation or other commitment required of or by Tenant which
Tenant has failed to perform for any reason whatsoever (including, without being
limited to, obtaining insurance coverage) where such failure has continued for
thirty (30) days after written notice from Landlord (except in the case of an
emergency where no such notice shall be required except what may be reasonable
given the circumstances), and to charge Tenant as Additional Rent all reasonable
costs and expenses incurred by Landlord for such performance, together with
interest thereon at the Default Rate from the dates of Landlord’s expenditures
until paid.

       

      ARTICLE
15

       

      ASSIGNMENT AND
SUBLETTING

       

      Section
15.1                                Consent
Required.  

       

      (a)           Tenant
shall not, voluntarily or involuntarily, by operation of law or
otherwise:  (i) assign, mortgage, pledge, encumber or in any manner
transfer this Lease in whole or in part, or (ii) sublet all or any part of the
Demised Premises, or allow any other person to occupy all or any part thereof,
without the prior written consent of Landlord in each instance, which consent
shall not be unreasonably withheld, and any attempt to do any of such acts
without such consent shall be null and void and of no effect.  Along
with Tenant’s request, Tenant shall pay Landlord Five Hundred and No/100 Dollars
($500.00)

       


      
        
           


        

        
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      to cover
Landlord’s expenses in reviewing said request.  The consent by
Landlord to any assignment, mortgage, pledge, encumbrance, transfer or
subletting shall not constitute a waiver of the necessity for such consent to
any subsequent assignment, mortgage, pledge, encumbrance, transfer or
subletting.

       

      (b)           In
the event Tenant desires to assign this Lease or sublet all or a portion of the
Demised Premises, Tenant shall submit to Landlord:  (a) the proposed
sublease or assignment, which is not to commence prior to thirty (30) days from
the date the submission to Landlord occurs, and (b) sufficient information to
permit Landlord to determine the acceptability, financial responsibility, and
character of subtenant or assignee.

       

      (c)           Within
thirty (30) days after receipt of the materials and information set forth in
Section 15.1(b), Landlord shall respond by, either: (i) granting or refusing its
consent to the proposed sublease or assignment, as provided in Section 15.1(d);
(ii) as to an assignment or a sublease of all or substantially all of the
Demised Premises for all or substantially all of the remaining Term of this
Lease terminating this Lease on the date the assignment or sublease was to
commence; or (iii) as to a sublease other than as described in (ii) above and
other than any subleases entered into during the first two (2) years of the Term
of this Lease, up to an aggregate of 200,000 square feet of floor area,
terminating this Lease for only the portion of the Demised Premises to be
subleased (the “Subject
Premises”) as of the date on which the sublease was to commence and only
for the proposed term of the sublease.  Tenant shall remain liable for
all payments due under this Lease through the date of termination even though
such amounts may be billed subsequent to termination.

       

      (d)           If
Landlord does not terminate this Lease in the case of a proposed assignment or
terminate the Lease as to the Subject Premises pursuant to Section 15.1(c),
Landlord shall not unreasonably withhold its consent to the proposed sublease or
assignment.  Such consent shall be deemed to be reasonably withheld
if: (i) in the judgment of Landlord the  subtenant or assignee is of a
character or engaged in a business which is not in keeping with the standards of
Landlord for the Building; (ii) in the judgment of Landlord the purposes for
which the subtenant or assignee intends to use the Demised Premises or Subject
Premises, as the case may be, are not in keeping with the standards of Landlord
for the Building or the terms of this Lease, or are in violation of the terms of
any other lease in the Building; (iii) Tenant is in default under this Lease;
(iv) the Subject Premises or the remaining balance of the Demised Premises, if
any, is not regular in shape with appropriate means of ingress and egress and
suitable for normal renting purposes; (v) the proposed subtenant or assignee is
either a governmental unit (or subdivision or agency thereof) or negotiating for
space in the Building; (vi) the assignee or sublessee is not, in the sole
judgment of Landlord, solvent or does not have unencumbered assets of a value at
least equal to twice the projected costs of the obligations to be assumed for
the unexpired term of this Lease; (vii) in the judgment of Landlord such a
sublease or assignment would violate any term, condition, covenant, or agreement
of the Landlord involving the Building; (viii) the proposed use or occupancy of
the Demised Premises or Subject Premises, as the case may be, by the assignee
or

       


      
        
           


        

        
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      sublessee
would either violate any applicable law, statute, ordinance, code or regulation
or would impose any obligation upon Landlord to comply with any of the foregoing
or increase Landlord’s obligation to comply with any of the foregoing
(including, without limitation, the restriction on office use with respect to
the westerly one-fifth (1/5th) of the
Property as set forth in March Air Reserve Base and Inland Cargo Port Operations
(APZ-2); or (ix) any such proposed sublease or assignment would cause a breach
of the ERISA representations set forth in Section 24.14
below.  Notwithstanding anything to the contrary contained in this
Lease, Tenant’s sole right and remedy in any dispute as to whether Landlord’s
consent to a proposed sublease or proposed assignment has been unreasonably
withheld shall be an action for declaratory judgment or specific performance and
Tenant shall not be entitled to any damages if Landlord is adjudged to have
unreasonably withheld such consent.

       

      (e)           If
Landlord grants consent to any assignment or sublease hereunder, it shall be
upon and subject to the following terms: (i) the terms and conditions of this
Lease shall in no way be deemed modified, abrogated or amended; (ii) Tenant
shall pay Landlord a reasonable fee determined by Landlord for each sublease or
assignment submitted; and (iii) the consent shall not be deemed a consent to any
further subletting or assignments by either Tenant, subtenants or
assignees.  In addition to the foregoing conditions, if Tenant shall
assign this Lease, the assignee shall expressly assume all obligations of Tenant
hereunder in a written instrument satisfactory to Landlord and furnished to
Landlord by Tenant not later than fifteen (15) days prior to the effective date
of the assignment; if Tenant shall sublease any portion or all of the Demised
Premises as permitted herein, Tenant shall obtain and furnish to Landlord, not
later than fifteen (15) days prior to the effective date of such sublease and in
form satisfactory to Landlord, the written agreement of such subtenant to the
effect that the subtenant will attorn to Landlord, at Landlord’s option and
written request, in the event this Lease terminates before the expiration of the
sublease.  Tenant shall not be released from any obligations or
liabilities under this Lease as a result of any assignment of this Lease or
sublet of all or any portion of the Demised Premises.

       

      (f)           If
Tenant shall assign
this Lease or sublet all or any portion of the dry storage area of the Demised
Premises pursuant to the terms of this Article 15, then Tenant shall pay
Landlord as additional Rent,

       

      
        	
                 
      

              	
                A.

              	
                With
      respect to the First Year of the term of any such sublease all of the
      excess payments or other economic consideration whether denominated as
      rent or otherwise (together with escalations) payable to Tenant under the
      sublease or assignment which might be in excess of the sum of (i) the
      Fixed Rent plus Additional Rent payable to Landlord under this Lease (or,
      if only a portion of the Demised Premises is being sublet, the excess
      payments or other economic consideration allocable on a rentable square
      footage basis to the space sublet) plus (ii) any out-of-pocket costs
      incurred by Tenant in connection with the sublease or assignment amortized
      over the term of the sublease or the assignment;
  and

              


      

       


      
        
           


        

        
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                B.

              	
                With
      respect to the balance of the term of any such sublease, fifty percent
      (50%) of any such excess.

              


      

       

      In
computing the amount to be paid to Landlord pursuant to this Section 15(f) the
total excess payable to Tenant pursuant to any such sublease shall be amortized
over the term of the sublease.

       

      ARTICLE
16

       

      BANKRUPTCY

       

      Section
16.1                                Bankruptcy.  If
at any time after the execution and delivery of this Lease, there shall be filed
by or against Tenant in any court pursuant to any statute either of the United
States or of any State a petition in bankruptcy or insolvency or for
reorganization or for the appointment of a receiver or trustee or conservator of
all or a portion of Tenant’s property, or if Tenant makes an assignment for the
benefit of creditors, this Lease, (a) if such event shall occur prior to the
Commencement Date, shall ipso facto be cancelled and terminated, or (b) if such
event shall occur on or after the Commencement Date, at the option of Landlord
to be exercised within 60 days after notice of the happening of any one or more
of such events, may be cancelled and terminated, and in any such event of
termination neither Tenant nor any person claiming through or under Tenant or by
virtue of any statute or of an order of any court shall be entitled to
possession or to remain in possession of the Demised Premises but shall
forthwith quit and surrender the Demised Premises, and Landlord, in addition to
the other rights and remedies granted by virtue of any other provision in this
Lease or by virtue of any statute or rule of law, may retain as damages any
Rent, Security Deposit, or moneys received by it from Tenant or others on behalf
of Tenant.

       

      Section
16.2                                Measure
of Damages.  In the event of the termination of this Lease
pursuant to Section 16.1 above, Landlord shall be entitled to the same rights
and remedies as set forth in Article 17.

       

      ARTICLE
17

       

      DEFAULT

       

      Section
17.1                                Events of
Default.  Each of the following events shall be deemed to be an
Event of Default by Tenant under this Lease: 

       

      (a)           whenever
Tenant shall have failed to pay any installment of Rent, or any portion thereof
when the same shall be due and payable, and Tenant shall have failed to pay same
for a period of five (5) days after the due date of such payment;
or

       

      (b)           whenever
Tenant shall have failed to comply with, shall have violated or shall be in
default in the performance of any other provision of this Lease and Tenant shall
have failed to cure such default (except a default under Section 17.1(e)) within
30 days after notice from Landlord of such noncompliance, violation or default
(in the case of a default which cannot with due diligence be cured within a
period of 30 days, Tenant shall have such additional time, but in no event to
exceed 90 days in the aggregate, to

       


      
        
           


        

        
          25

           


        

        
           


        

      


      cure same
as may reasonably be necessary, provided Tenant commences curing such default
within the 30 day period and proceeds promptly, effectively, continuously
and with due diligence to cure such default after delivery of said notice);
or

       

      (c)           whenever
Tenant shall vacate or abandon the Demised Premises and leave same vacated or
abandoned for a period of 15 days; or

       

      (d)           whenever
Tenant shall do or permit to be done anything which creates a lien upon the
Demised Premises and/or the Building and such lien is not removed within 30
days; or

       

      (e)           whenever
any warranty, representation or statement made or furnished by Tenant to
Landlord at any time in connection with this Lease or any other agreement to
which Tenant and Landlord are parties is determined to have been false or
misleading in any material respect when made or furnished.

       

      Section
17.2                                Remedies.  In
the event of an Event of Default, Landlord may, with or without further notice
or demand, and without limiting Landlord in the exercise of any right or remedy
which Landlord may have by reason of such Event of Default:

       

      (a)           Terminate
Tenant's right to possession of the Demised Premises by any lawful means, in
which case this Lease shall terminate and Lessee shall immediately surrender
possession to Landlord. In such event Landlord shall be entitled to recover from
Tenant: (i) the unpaid Rent which had been earned at the time of termination;
(ii) the worth at the time of award of the amount by which the unpaid rent which
would have been earned after termination until the time of award exceeds the
amount of such rental loss that Tenant proves could have been reasonably
avoided; (iii) the worth at the time of award of the amount by which the unpaid
rent for the balance of the Term after the time of award exceeds the amount of
such rental loss that Tenant proves could be reasonably avoided; and (iv) any
other amount necessary to compensate Landlord for all the detriment proximately
caused by Tenant's failure to perform its obligations under this Lease or which
in the ordinary course of things would be likely to result therefrom, including
but not limited to the cost of recovering possession of the Demised Premises,
expenses of reletting, including necessary renovation and alteration of the
Demised Premises, reasonable attorneys’ fees, and that portion of any leasing
commission paid by Landlord in connection with this Lease applicable to the
unexpired Term of this Lease.  The worth at the time of award of the
amount referred to in provision (iii) of the immediately preceding sentence
shall be computed by discounting such amount at the discount rate of the Federal
Reserve Bank of the District within which the Demised Premises are located at
the time of award plus one percent (1%). Efforts by Landlord to mitigate damages
caused by Tenant's Breach of this Lease shall not waive Landlord's right to
recover damages under this Article 17.  If termination of this Lease
is obtained through the provisional remedy of unlawful detainer, Landlord shall
have the right to recover in such proceeding any unpaid Rent and damages as are
recoverable therein, or Landlord may reserve the right to recover all or any
part thereof in a separate suit.  If a notice and grace period
required under Section 17.1 was not previously given, a notice to pay rent or
quit, or to perform or quit given to Tenant under the unlawful detainer
statute

       


      
        
           


        

        
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      shall
also constitute the notice required by Section 17.1.  In such case,
the applicable grace period required by Section 17.1 and the unlawful detainer
statute shall run concurrently and the failure of Tenant to cure the Event of
Default within the greater of two such grace periods shall constitute both an
unlawful detainer and an Event of Default entitling Landlord to the remedies
provided for in this Lease and/or by said statute.

       

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

       

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

       

      Section
17.3                                Waiver of
Jury Trial.  To the fullest extent permitted by the applicable
law, the parties hereto shall and they 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 or the interpretation thereof, the relationship of
Landlord and Tenant, Tenant’s use or occupancy of the Demised Premises, and/or
any claim of injury or damage.  

       

      ARTICLE
18

       

      SURRENDER

       

      Section
18.1                                Possession.  Upon
the expiration or earlier termination of this Lease, Tenant shall immediately
quit and surrender possession of the Demised Premises in as good a state and
condition as they were when entered into, reasonable wear and tear and casualty
damage (other than that which Tenant is obligated to repair)
excepted.  Upon such surrender, all right, title and interest of
Tenant in the Demised Premises shall cease. 

       

      Section
18.2                                Merger.  The
voluntary or other surrender of this Lease by Tenant or the cancellation of this
Lease by mutual agreement of Tenant and Landlord shall not work a merger, but
shall, at Landlord’s option, terminate all or any subleases and subtenancies or
operate as an assignment to Landlord of all or any subleases or
subtenancies.  Landlord’s option hereunder shall be exercised by
notice to Tenant and all known sublessees or subtenants in the Demised Premises
or any part thereof. 

       


      
        
           


        

        
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      ARTICLE
19

       

      HOLDING
OVER

       

      Section
19.1                                Holding
Over.  If Tenant retains possession of the Demised Premises or
any part thereof after the expiration or earlier termination of this Lease,
Tenant shall pay as Rent a sum equal to two times the amount, including Fixed
Rent and Additional Rent hereunder, payable for the month preceding such holding
over computed on a daily basis for each day that Tenant remains in
possession.  Tenant shall also be liable for and shall pay to
Landlord, all damages, consequential as well as direct, sustained by reason of
Tenant’s holding over.  In addition, at any time while Tenant remains
in possession, Landlord may elect instead, by written notice to Tenant and not
otherwise, to have such retention of possession constitute a renewal of this
Lease for one (1) year for the fair market rental value of the Premises as
reasonably determined by Landlord but in no event less than the Rent payable
immediately prior to such holding over.  The provisions of this
section do not waive Landlord’s right of re entry or right to regain possession
by actions at law or in equity or any other rights hereunder, and any receipt of
payment by Landlord shall not be deemed a consent by Landlord to Tenant’s
remaining in possession or be construed as creating or renewing any lease or
right of tenancy between Landlord and Tenant. 

       

      ARTICLE
20

       

      REMEDIES
CUMULATIVE

       

      Section
20.1                                No
Waiver.  No waiver by Landlord or Tenant of a breach of any
covenants, agreements, obligations or conditions of this Lease shall be
construed to be a waiver of any future breach of the same or any other covenant,
agreement, obligation or condition hereof.  No receipt of money by
Landlord from Tenant after notice of default, or after the termination of this
Lease or the commencement of any suit or final judgment of possession of the
Demised Premises, shall reinstate, continue or extend the term of this Lease or
affect any notice, demand or suit.  The rights and remedies hereby
created are cumulative, and the use of one remedy shall not be construed to
exclude or waive the right to the use of another, or exclude any other right or
remedy allowed by law.

       

      ARTICLE
21

       

      ESTOPPEL CERTIFICATE,
SUBORDINATION, ATTORNMENT

       

      Section
21.1                                Estoppel
Certificate.  Tenant shall at any time upon the request of
Landlord, execute and deliver in recordable form and in substance reasonably
satisfactory to Landlord, an estoppel certificate certifying:  the
date Tenant accepted occupancy of the Demised Premises; the date to which Rent
has been paid; the amount of any Security Deposit; that this Lease is in full
force and effect and has not been modified or amended (or if modified or
amended, describing the same) and that there are no defenses or offsets thereto
or defaults of Landlord under this Lease (or if any be claimed, describing the
same); and such other matters as Landlord may reasonably request; provided,
however, that in no event may any such requested

       


      
        
           


        

        
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      matter
modify or amend any provision of this Lease.  Tenant’s failure to
deliver such certificate within ten (10) days of the demand therefor shall be a
default hereunder. 

       

      Section
21.2                                Subordination.  This
Lease is and shall be subject and subordinate to all ground or underlying
leases, mortgages and deeds of trust which now or hereafter affect the Land,
Building and/or any ground or underlying leases thereof and to all renewals,
modifications, consolidations, replacements and extensions
thereof.  The provisions of this section shall be automatic and shall
not require any further action.  In confirmation of such
subordination, Tenant will execute and deliver upon demand of Landlord any and
all instruments desired by Landlord subordinating this lease to such lease,
mortgage or deed of trust.  Landlord is hereby irrevocably appointed
and authorized as agent and attorney in fact of Tenant to execute and deliver
all such subordination instruments in the event Tenant fails to execute and
deliver said instruments within five (5) days after notice from Landlord
requesting the execution thereof.

       

      Section
21.3                                Attornment.  Tenant
agrees that, at the option of the landlord under any ground lease now or
hereafter affecting the real property of which Demised Premises forms a part,
Tenant shall attorn to said landlord in the event of the termination or
cancellation of such ground lease and if requested by said landlord, enter into
a new lease with said landlord (or a successor ground lessee designated by said
landlord) for the balance of the term then remaining hereunder upon the same
terms and conditions as those herein provided. 

       

      Section
21.4                                Mortgages.  Tenant
covenants and agrees that, if by reason of default under any mortgage or deed of
trust which may now or hereafter affect the Land and/or the Building, the
mortgagee thereunder enters into and becomes possessed of the said mortgaged
property either through possession or foreclosure action or proceeding, or in
the event of the sale of the said mortgaged property as a result of any action
or proceeding to foreclosure the said mortgage, Tenant will attorn to the
mortgagee or such then owner as its landlord under this Lease.  Tenant
agrees to execute and deliver, at any time and from time to time, upon the
request of the mortgagee or the then owner of the said mortgaged property of
which the Demised Premises forms a part any instrument which may be necessary or
appropriate to evidence such attornment.  Tenant further waives the
provisions of any statute or rule of law now or hereafter in effect which may
give or purport to give Tenant any right of election to terminate this Lease or
to surrender possession of the Demised Premises in the event any proceeding is
brought by the mortgagee under any such mortgage to terminate the same, and
agrees that this Lease shall not be affected in any way whatsoever by any such
proceeding.

       

      ARTICLE
22

       

      QUIET
ENJOYMENT

       

      Section
22.1                                Quiet
Enjoyment.  Landlord covenants and agrees with Tenant that upon
payment by Tenant of the Rent hereunder and upon the observance and performance
of all of the terms, covenants and conditions on Tenant’s part to be observed
and performed, Tenant may peaceably and quietly enjoy the Demised Premises, free
of all claims from Landlord and those claiming by, through or under Landlord,
but subject, nevertheless, to the terms and conditions of this Lease.


       


      
        
           


        

        
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      ARTICLE
23

       

      NOTICES

       

      Section
23.1                                Notices.  Whenever
any notice or consent is required or permitted hereunder, such notice or consent
shall be in writing.  Any notice or document required or permitted to
be delivered hereunder shall be deemed to be delivered (a) upon receipt or
refusal of receipt when sent by recognized overnight courier or (b) upon receipt
or refusal of receipt when deposited in the United States Mail, postage prepaid,
Registered or Certified Mail, Return Receipt Requested, addressed to the parties
hereto at the addresses set forth in Article l, or at such other addresses as
they have theretofore specified by written notice delivered in accordance
herewith. 

       

      ARTICLE
24

       

      MISCELLANEOUS
PROVISIONS

       

      Section
24.1                                Time.  Time
is and shall be of the essence of this Lease and all its
provisions.

       

      Section
24.2                                Applicable
Law and Construction.  

       

      (a)           This
Lease shall be governed by and construed under the laws of the State in which
the Property is located.

       

      (b)           The
necessary grammatical changes required to make the provisions of this Lease
apply in the plural sense where there is more than one tenant and to either
corporations, associations, partnerships or individuals, males or females, shall
in all instances be assumed as though fully expressed.  If there is
more than one person or entity who or which are Tenant under this Lease, the
obligations imposed upon Tenant under this Lease shall be joint and
several.  The relationship between Landlord and Tenant created
hereunder shall be that of lessor and lessee and nothing herein shall be
construed as creating any joint venture or partnership.  The captions
used in this Lease are for convenience only and do not in any way limit or
amplify the terms and provisions hereof.

       

      Section
24.3                                Parties
Bound.  It is agreed that this Lease, and each and all the
covenants and obligations hereof, shall be binding upon and inure to the benefit
of, as the case may be, the parties hereto, their respective heirs, executors,
administrators, successors and assigns, subject to all agreements and
restrictions herein contained with respect to assignment or other transfer of
Tenant’s interest herein. 

       

      Section
24.4                                Representations
by Landlord.  Neither Landlord nor Landlord’s agents have made
any representations or promises with respect to the physical condition of the
Property or the Building, the Demised Premises, permissible uses of Demised
Premises, the rents, leases, expenses of operation or any other matter or thing
affecting or related to the Demised Premises except as herein expressly set
forth below, and no rights, easements, or licenses are acquired by Tenant by
implication or otherwise except as expressly set forth in the provisions of this
Lease.

       


      
        
           


        

        
          30

           


        

        
           


        

      


      Tenant
has inspected the Building and the Demised Premises and is thoroughly acquainted
with their condition, and agrees to accept the same “as is” subject to
completion of Landlord’s Work, if any, and further subject to Landlord’s
representations and warranties set forth below.  All understandings
and agreements heretofore made between the parties hereto are merged in this
Lease, which alone fully and completely expresses the agreement between Landlord
and Tenant, and any executory agreement hereafter made shall be ineffective to
change, modify, discharge or effect an abandonment of it, in whole or in part,
or a surrender of this Lease or of the Demised Premises or any part thereof or
of any interest of Tenant therein unless such executory agreement is in writing
and signed by Landlord and Tenant. 

       

      Landlord
hereby warrants and represents to Tenant, for the express benefit of Tenant, as
follows:

       

      (a)           Landlord
has good, indefeasible, and marketable fee simple title to the Demised Premises
and the Property, full right and authority to make and execute this Lease and,
to Landlord’s current actual knowledge, as of the Date of Execution, the Demised
Premises are free and clear of and from any liens, restrictions, leases or other
encumbrances which would materially and adversely restrict or prevent Tenant’s
use of the Demised Premises for the Permitted Use; and

       

      (b)           To
Landlord’s actual knowledge, based on the Phase I Environmental Report prepared
by Golder Associates for Alere Property Group, LLC and dated July 2004 (a copy
of which has been provided to Tenant), the Demised Premises and the Property are
in full compliance with all environmental laws;

       

      (c)           The
structural elements of the Building, the roof and any of the systems currently
installed in the Building are in good condition; and

       

      (d)           There
is access to Day Street from the Property.

       

      Section
24.5                                Brokers.  Tenant
warrants that it has had no dealings with any broker, agent or any other person
in connection with the negotiation or execution of this Lease other than the
brokers identified in Article 1.  Tenant agrees to indemnify and hold
harmless Landlord from and against any and all cost, expense, or liability for
commissions or other compensation and charges claimed by any broker or agent
(other than the brokers identified in Article 1) with respect to this Lease on
account of Tenant’s acts.  

       

      Section
24.6                                Severability.  The
invalidity or unenforceability of any provision of this Lease shall not affect
or impair the validity of any other provision. 

       

      Section
24.7                                Force
Majeure.  In the event Landlord shall be delayed or hindered in
or prevented from the performance of any act required hereunder by reason of
strikes, lock outs, labor troubles, inability to procure materials, failure of
power, restrictive governmental laws or regulations, riots, insurrection, war or
other reason of a like nature beyond the reasonable control of Landlord, in
performing work or doing acts required under the terms of this Lease, then
performance of such act shall be extended for a period equivalent to the period
of such delay. 

       


      
        
           


        

        
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      Section
24.8                                Definition
of Landlord.  As used in this Lease, the term “Landlord” shall
mean only the owner, or the mortgagee in possession, for the time being, of the
Building and the Land or the owner of a lease of the Building or of the Land and
the Building, so that in the event of any sale of the Building or of the Land
and the Building or of said Lease, or in the event of a lease of the Building or
of the Land and the Building, said Landlord shall be and hereby is entirely
freed and relieved of all covenants and obligations of Landlord hereunder
thereafter to be performed or observed, and it shall be deemed and construed
without further agreement between the parties or their successors in interest,
or between the parties and any such purchaser or lessee, that such purchaser or
lessee has assumed and agreed to performed and observe any and all covenants
and  obligations of Landlord hereunder. 

       

      Section
24.9                                No
Option.  The submission of this Lease for examination or
execution does not constitute a reservation of or option for the Demised
Premises, and this Lease becomes effective as a lease only upon execution and
delivery thereof by Landlord and Tenant. 

       

      Section
24.10                                Exculpatory
Clause.  All separate and personal liability of Landlord or any
trustee, director, officer, partner or principal (disclosed or undisclosed)
thereof of every kind or nature, if any, is waived by Tenant, and by every
person now or hereafter claiming by, through or under Tenant; and Tenant shall
look solely to Landlord’s estate in the Property for the payment of any claim
against Landlord. 

       

      Section
24.11                                No
Recording.  Tenant shall not record this Lease, or any portion
or any reference hereto.  In the event Tenant records this Lease, or
permits or causes this Lease, or any portion hereof or reference hereto to be
recorded, this Lease shall terminate at Landlord’s option or Landlord may
declare a default hereunder and pursue any and all of its remedies provided in
this Lease. 

       

      Section
24.12                                Counterparts.  The
parties may execute this Lease in multiple counterparts, each of which
constitutes an original, and all of which, collectively, constitute only one
agreement.  The signatures of all of the parties need not appear on
the same counterpart, and delivery of an executed counterpart signature page by
facsimile is as effective as executing and delivering this Lease in the presence
of the other parties to this Lease.  This Lease is effective upon
delivery of one executed counterpart from each party to the other
parties.  In proving this Lease, a party must produce or account only
for the executed counterpart of the party to be charged.  Any party
delivering an executed counterpart of this Lease by facsimile shall also deliver
a manually executed counterpart of this Lease, but the failure to do so does not
affect the validity, enforceability, or binding effect of this
Lease.

       

      Section
24.13                                Financial
Statements.  Tenant, within 15 days after request, shall
provide Landlord with a current financial statement and such other information
as Landlord may reasonably request in order to create a “business profile” of
Tenant and determine Tenant’s ability to fulfill its obligations under this
Lease.  Landlord, however, shall not require Tenant to provide such
information unless Landlord is requested to produce the information in
connection with a proposed financing or sale of the
Building.  Notwithstanding the foregoing, so long as Tenant is a
publicly traded company and its financial statements are available online,
Tenant shall not be required to comply with the foregoing provisions of this
Section 24.13.

       


      
        
           


        

        
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      Section
24.14                                ERISA.  Tenant
hereby represents and warrants to Landlord that (i) Tenant is not a “party in
interest” (within the meaning of Section 3(14) of the Employee Retirement Income
Security Act of 1974, as amended) or a “disqualified person” (within the meaning
of Section 4975 of the Internal Revenue Code of 1986, as amended) with respect
to any retirement or pension plan of the Metropolitan Life Insurance Company,
and (ii) no portion of or interest in the Lease will be treated as a “plan
asset” within the meaning of Regulation 29 CFR Section 2510.3-101 issued by the
Department of Labor.

       

      ARTICLE
25

       

      OPTIONS TO
RENEW

       

      Section
25.1                                Grant of
Option.  Landlord hereby grants to Tenant two (2) options
(each, an “Option”;
collectively, the “Options”)
to extend the Term of this Lease, each for an additional five (5) years (each, a
“Renewal
Term”; collectively, the “Renewal
Terms”) upon and subject to the terms and conditions set forth in this
Lease.  Tenant shall have no right to extend the Term except as
provided herein.  The Options shall be personal to United Natural
Foods, Inc. and to any entity controlling, controlled by or under common control
with United Natural Foods, Inc. (collectively, “Affiliates”),
and shall not be transferable or assignable to any other assignee of the
Lease.  Each of the Options shall be exercised, if at all, by Tenant’s
delivery of written notice of exercise to Landlord no later than nine (9) months
nor earlier than twelve (12) months prior to the expiration date of the initial
Term or the first Renewal Term, as applicable.  The Fixed Rent to be
paid by Tenant during the Renewal Terms shall be as set forth in Article
1.  If (i) Tenant is in default under any of the terms,
covenants, or conditions of this Lease or (ii) Tenant and/or Affiliates do
not occupy, in the aggregate, all of the Demised Premises, either at the time
Tenant exercises the applicable Option or at any time thereafter prior to the
commencement date of the applicable Renewal Term, then in each case, Tenant’s
exercise of the applicable Option shall be of no force and effect and Tenant
shall have no rights hereunder to extend the Term.

       

      ARTICLE
26

       

      ABATEMENT OF
RENT

       

      Section
26.1                                Abatement
of Rent.  In the event that Tenant is prevented from using, and
does not use, the Demised Premises or any portion thereof as a result of
Landlord’s failure to provide Tenant with services or access to the Demised
Premises and/or the Building as required by this Lease, which is caused by the
gross negligence or willful misconduct of Landlord or Landlord’s employees,
agents or contractors, then Tenant shall give Landlord written notice of any
such event and if such event continues for three (3) consecutive business days
after Landlord’s receipt of such notice (the “Eligibility
Period”), then the Fixed Rent and Additional Rent payable under this
Lease shall be abated or reduced, as the case may be, after expiration of the
Eligibility Period for such time that Tenant continues to be prevented from
using, and does not use, the Demised Premises or a portion thereof in the
proportion that the floor area of the portion of the Demised Premises that
Tenant is prevented from using, and does not use, bears to the total floor area
of the Demised Premises (i.e., 613,174 square feet).  However, in the
event that Tenant is prevented from conducting, and does not conduct, its
business in any portion of the

       


      
        
           


        

        
          33

           


        

        
           


        

      


      Demised
Premises for a period of time in excess of the Eligibility Period, and the
remaining portion of the Demised Premises is not sufficient to allow Tenant to
effectively conduct its business therein, and if Tenant does not conduct its
business from such remaining portion, then for such time after expiration of the
Eligibility Period during which Tenant is so prevented from effectively
conducting its business therein, the Fixed Rent and Additional Rent for the
entire Demised Premises shall be abated; provided, however, if Tenant reoccupies
and conducts its business from any portion of the Demised Premises during such
period, the rent allocable to such reoccupied portion, based on the proportion
that the floor area of such reoccupied portion of the Demised Premises bears to
the total floor area of the Demised Premises, shall be payable by Tenant from
the date such business operations commence.

       

      IN WITNESS WHEREOF, the
parties hereto have caused this Lease to be executed as of the date first
written above.

       

      
        
          	
                  TENANT:

                   

                  UNITED NATURAL FOODS,
      INC., 
a Delaware corporation

                	 
      	
                  LANDLORD:

                   

                  CACTUS COMMERCE,
      LLC,

                  a
      Delaware limited liability company

                   

                  By:
      BlackRock Realty Advisors, Inc., its manager

                   

                
	
                  By:

                	/s/
      Mark Shamber  	 
      	
                  By:

                	
                  /s/
      Robert D. Norberg

                
	 
      	
                  Mark
      Shamber

                	 
      	
                  Name:

                	
                  Robert
      D. Norberg

                	 
      
	 
      	
                  Chief
      Financial Officer

                	 
      	
                  Title:

                	
                  Director

                	 
      


        

      

       

      
      


      
        
           


        

        
          34

           


        

        
           


        

      


      EXHIBIT
A

       

      SITE PLAN SHOWING LOCATION
OF BUILDING

       

      
      

      


      
        
           


        

        
          A-1 


           


        

        
           


        

      


      EXHIBIT
B

       

      LEGAL DESCRIPTION OF
PROPERTY

       

      PARCEL 7
OF PARCEL MAP NO. 27732, IN THE CITY OF MORENO VALLEY, COUNTY OF RIVERSIDE,
STATE OF CALIFORNIA, AS PER MAP FILED IN BOOK 195, PAGES 75 TO 79 INCLUSIVE OF
PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

      



      
        
           


        

        
          B-1 


           


        

        
           


        

      


      EXHIBIT
C

       

      RULES AND
REGULATIONS

       

      1.           No
sidewalks or entrance shall be obstructed or encumbered by Tenant or used for
any purpose other than ingress and egress to and from the Demised Premises, the
Building or the landscaping, parking facilities and other improvements and
appurtenances.

       

      2.           No
awning or other item or projection (including, without limitation, aerials,
antennae and satellite dishes) shall be attached to the outside walls or windows
of the Building, or affixed to the roof or any other portion of the Building,
without the prior written consent of Landlord.  Such awnings and
projections must be of a quality, type, design, color, material and general
appearance approved by Landlord, and shall be attached in the manner approved by
Landlord.

       

      3.           No
sign, advertisement, notice or other lettering shall be exhibited, inscribed,
painted or affixed by Tenant on any part of the outside of the Building without
the prior written consent of Landlord.  In the event of the violation
of the foregoing by Tenant, Landlord may remove same without liability, and may
charge the expense incurred by such removal to Tenant.

       

      4.           No
show cases or other articles shall be put in front of or affixed to, or stored
on or about, any part of the exterior of the Building without the prior written
consent of Landlord.

       

      5.           Except
as otherwise permitted under the Lease or consent to by Landlord, neither Tenant
nor any of Tenant’s agents, servants, employees, contractors, visitors or
licensees shall at any time bring or keep upon the Demised Premises or in the
Building or the Property any flammable, combustible or explosive fluid, chemical
or substance.

       

      6.           No
additional locks, bolts or mail slots of any kind shall be placed upon any of
the doors or windows by Tenant, nor shall any change be made in existing locks
or the mechanism thereof; however, the foregoing shall not apply to any card key
system which Tenant installs in full compliance with all other provisions of the
Lease at its sole expense and with respect to which Landlord is provided with
all access cards necessary to fully exercise all of its entry rights under the
Lease with respect to the Demised Premises; provided, however that Tenant may
upgrade the locks at the Building so long as Tenant provides written notice to
Landlord with respect to any such upgrade and immediately provides copies of
keys to the new locks.  Tenant must, upon the termination of the
tenancy, restore to Landlord all keys of stores, offices and toilet rooms either
furnished to or otherwise procured by Tenant and, in the event of the loss of
any keys so furnished, Tenant shall pay to Landlord the cost
thereof.

       

      7.           If
the Demised Premises is or becomes infested with vermin as a result of the use
or any misuse or neglect of the Demised Premises by Tenant, its agents,
servants, employees, contractors, visitors, or licensees, Tenant shall forthwith
at Tenant’s expense cause the same to be exterminated from time to time to the
satisfaction of Landlord.

       

      8.           Tenant
shall, to the extent required by any applicable law, install and maintain, at
Tenant’s sole cost and expense, an adequate visibly marked (at all times
property operational)

       


      
        
           


        

        
          C-1 


           


        

        
           


        

      


      fire
extinguisher next to any duplicating or photocopying machine or similar heat
producing equipment, which may or may not contain combustible material, in the
Demised Premises.

       

      9.           Tenant
shall not use the name of the Property for any purpose other than as the address
of the business to be conducted by Tenant in the Demised Premises, nor shall
Tenant use any picture of the Property in its advertising, stationary or in any
other manner without the prior written permission of
Landlord.  Landlord expressly reserves the right at any time to change
said name without in any manner being liable to Tenant therefor.

       

      10.           Landlord
reserves the right to make such other and further reasonable rules and
regulations as in Landlord’s judgment may from time to time be needful for the
safety, care and cleanliness of the Demised Premises or the Building, or the
Property, and any such other or further rules and regulations shall, upon
written notice thereof to Tenant, be binding upon Tenant with the same force and
effect as if they had been inserted herein at the time of the execution
hereof.

       


      
        
           


        

        
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      EXHIBIT
D

       

      WORK
LETTER

       

      This WORK
LETTER AGREEMENT (“Agreement”) is being entered into as of December 3,
2007, by and between CACTUS COMMERCE, LLC, a Delaware limited liability company
(“Landlord”) and UNITED NATURAL FOODS, INC., a Delaware corporation
(“Tenant”), in connection with the execution of the Lease between Landlord and
Tenant dated of even date herewith (“Lease”), who hereby agree as
follows:

       

      1.           General.

       

      (a)           The
purpose of this Agreement is to set forth how the interior improvements in the
Demised Premises as set forth on the Construction Documents, as defined below in
Section 3(e) (“Tenant Improvements”), are to be designed and constructed,
who will be responsible for the design and construction of the Tenant
Improvements, who will pay for the design and construction of the Tenant
Improvements, and the time schedule for completion of the design and
construction of the Tenant Improvements.

       

      (b)           Except
as defined in this Agreement to the contrary, all terms utilized in this
Agreement shall have the same meaning as the defined terms in the
Lease.

       

      (c)           The
provisions of the Lease, except where clearly inconsistent or inapplicable to
this Agreement, are hereby incorporated into this Agreement.

       

      (d)           Except
for the Tenant Improvements to be constructed pursuant to this Agreement, Tenant
accepts the Demised Premises in its “as-is” condition and acknowledges that it
has had an opportunity to inspect the Demised Premises prior to signing the
Lease.

       

      2.           Commencement
Date.  The Commencement Date shall be determined in accordance
with Section 2.2 of the Lease.

       

      3.           Tenant Improvement
Plans.

       

      (a)           Tenant’s
Designer.  Tenant shall retain a designer (“Designer”) to
prepare Space Plans as defined in Section 3(b) below, and Final Plans as
defined in Section 3(c) below for the Tenant Improvements.  The
Designer shall be familiar with the Building and with all applicable laws,
statutes, codes, rules and regulations (collectively, “Laws”) applicable to
tenant construction in the Building and shall be subject to the approval of
Landlord, which approval will not be unreasonably withheld or delayed and shall
be conditioned on the Designer’s reputation for quality of work, timeliness of
performance, integrity, and Landlord’s prior experience (if any) with such
Designer.  Landlord hereby consents to and approves of ARCO
Design/Build as Designer.

       

      (b)           Space
Plans.  Tenant shall deliver the Space Plans to
Landlord.  Such Space Plans shall be compatible with the design,
construction and equipment of the Building, comply with all applicable Laws, and
must identify all demising walls, corridors, entrances, exits, doors, interior
partitions, offices, dry storage areas and temperature control space and any
other information required to obtain a building permit.  Landlord
shall approve or disapprove, for

       


      
        
           


        

        
          D-1

           


        

        
           


        

      


      reasonable
reasons and subject to the Approval Criteria as defined in Section 3(d)
below, the Space Plans within five (5) business days after Landlord receives the
Space Plans and, if disapproved, Landlord shall return the Space Plans to
Tenant, who shall make all necessary revisions within five (5) business days
after Tenant’s receipt thereof.  This procedure shall be repeated
until Landlord ultimately approves the Space Plans.

       

      (c)           Construction
Documents.  After the Space Plans are ultimately approved by
Landlord, Tenant shall, subject to (e) below, cause the Designer to prepare a
fully coordinated and engineered set of architectural, structural, mechanical,
electrical and plumbing final plans and specifications (“Final Plans”) to allow
for the full and complete construction of the Tenant
Improvements.  Tenant shall then deliver the Final Plans to
Landlord.   Landlord shall approve or disapprove, for reasonable
reasons and subject to the Approval Criteria, the Final Plans within ten (10)
business days after
Landlord receives the Final Plans and, if disapproved, Landlord shall return the
Final Plans to Tenant who shall make all necessary revisions within five (5)
business days after Tenant’s receipt thereof.  This procedure shall be
repeated until Landlord ultimately approves the Final Plans.  As
approved, the Final Plans, as modified, shall be deemed the “Construction
Documents.”  Subject to Section 6(c) below, any and all costs incurred
by Tenant and/or Landlord in connection with the preparation, review and
approval of the Space Plans and the Final Plans shall be deducted from the
Tenant Improvement Allowance set forth below in
Section 6(a).  All deliveries of the Space Plans and the Final
Plans shall be delivered by messenger service, by personal hand delivery, by
overnight parcel service or by electronic delivery.

       

      (d)           Standards for Landlord’s
Approval.  Landlord’s approvals required hereunder shall not be
unreasonably withheld, but Landlord will be deemed to have acted reasonably if
Landlord’s disapproval is predicated upon (i) affect on the structural
integrity of the Building, (ii) possible damage to any of the Building’s
electrical, plumbing or fire/life safety systems that were in place when the
Building was delivered to Tenant, (iii) non-compliance with applicable
laws, codes and regulations, (iv) incompatibility with the base building
plans, and (v) any material affect on the exterior appearance of the
Building or any of the exterior areas of the Property which, in Landlord’s
reasonable judgment, is not compatible with a first-class industrial property,
it being agreed and understood that this Approval Criteria No. (v) may not
be used by Landlord to disapprove Tenant’s construction of any required
refrigeration equipment outside the Building so long as any such construction is
done in compliance with all applicable Laws (“Approval
Criteria”).  While Landlord has the right to approve the Space Plans,
Preliminary Plans, Engineering Plans and the Final Plans, Landlord’s sole
interest in doing so is to protect the Building and Landlord’s
interests.  Accordingly, Tenant shall not rely upon Landlord’s
approvals and Landlord shall not be the guarantor of, nor responsible for, the
correctness or accuracy of any such Space Plans, Preliminary Plans, Engineering
Plans or Final Plans, or the compliance thereof with applicable Laws, and
Landlord shall incur no liability of any kind by reason of granting such
approvals.

       

      (e)           Design-Build.  Notwithstanding
anything to the contrary set forth in (c) above, Landlord and Tenant acknowledge
that it is currently anticipated that the Tenant Improvements will be
constructed on a “design build” basis.  Accordingly, plans may be
submitted to Landlord with respect to portions of the work (e.g., mechanical or
electrical or structural) rather than as a complete set of Construction Drawings
as contemplated in (c) above.  The procedure set forth in (c) above
shall be applicable with respect to any plans which are

       


      
        
           


        

        
          D-2

           


        

        
           


        

      


      submitted
to Landlord for approval and Tenant may not start construction on any portion of
the work until the plans therefor have been approved by
Landlord.  Such plans, as approved by Landlord, shall individually and
collectively be defined as the Construction Documents for purposes of this
Agreement.

       

      (f)           Ammonia
Equipment.  Notwithstanding anything to the contrary set forth
herein Landlord hereby acknowledges and consents to the installation of ammonia
equipment outside of the Building so long as any such installation is done in
compliance with Applicable Law.

       

      (g)           4,000 AMP
Transformer.  Landlord and Tenant each acknowledges that Tenant
intends to have a 4,000 AMP transformer (“Transformer”) installed by Southern
California Edison (“Edison”).  In this regard, Landlord and Tenant
agree that the costs, if any, incurred in connection with Edison’s installation
of the Transformer shall be split 50/50 between Landlord and Tenant; provided,
however, that any costs incurred in connection with expediting the installation
of the Transformer shall be the sole responsibility of Tenant.

       

      4.           Permits.  Tenant
shall be responsible for obtaining all governmental approvals of the
Construction Documents to the full extent necessary for the issuance of a
building permit for the Tenant Improvements based upon such Construction
Documents.  Thereafter, Tenant shall also cause to be obtained all
other necessary approvals and permits from all governmental agencies having
authority over the construction and installation of the Tenant Improvements in
accordance with the approved Construction Documents and shall undertake all
steps necessary to insure that the construction of the Tenant Improvements is
accomplished in strict compliance with all Laws applicable to such construction
and the requirements and standards of any generally recognized insurance
underwriting board, or inspection bureau or insurance carrier insuring the
Demised Premises pursuant to the Lease.

       

      5.           Construction.  Tenant
shall employ an outside contractor or contractors of Tenant’s choice
(“Contractor”) to construct the Tenant Improvements in substantial conformance
with the Construction Documents; provided, however, that such construction
contracts shall provide for progress payments, and Tenant shall pay for the
entire cost of design and construction of the Tenant Improvements and all
permits and governmental review and approval fees in connection therewith,
subject to Landlord’s obligation to disburse the Tenant Improvement Allowance in
accordance with Section 6 below.  Contractor and the performance
of the work shall be subject to the following conditions:

       

      (a)           Contractor
shall be duly licensed and subject to Landlord’s prior written approval, which
approval shall not be unreasonably withheld and shall be conditioned on the
Contractor’s reputation for quality of work, timeliness of performance,
integrity and Landlord’s prior experience (if any) with such
Contractor.  Landlord hereby consents to and approves ARCO
Design/Build as the Contractor

       

      (b)           Landlord
or Landlord’s agents shall have the right, upon at least 48 hours’ advance
notice (which notice may be oral) and subject to compliance with all on-site
safety requirements, to inspect the construction of the Tenant Improvements by
Tenant during the progress thereof, it being the intent of the parties hereto
that Landlord shall be reasonable in its inspection of the construction of the
Tenant Improvements and that Landlord shall recognize, to the extent
commercially reasonable and practicable, the necessity of field changes based on
field

       


      
        
           


        

        
          D-3

           


        

        
           


        

      


      conditions.  If
Landlord shall give written notice to Tenant of any material deviation from the
Construction Documents, Tenant shall, unless Tenant disagrees with Landlord with
respect thereto, cause Contractor to make corrections promptly.  If
Tenant disagrees with Landlord’s determination that there has been a material
deviation from the Construction Documents, Tenant shall give Landlord written
notice thereof within one (1) business day of Tenant’s receipt of
Landlord’s notice with respect thereto, and the parties shall negotiate in good
faith to resolve their disagreement.  If, however, the parties do not
reach agreement within three (3) business days after Landlord’s receipt of
Tenant’s notice, then the determination of Landlord’s construction supervisor
shall be final.  Neither the privilege herein granted to Landlord to
make such inspections, nor the making of such inspections by Landlord, shall
operate as a waiver of any rights of Landlord to require good and workmanlike
construction and improvements erected in accordance with the Construction
Documents.

       

      (c)           Tenant
shall instruct the Contractor to cause the Tenant Improvements to be completed
as soon as reasonably possible.

       

      (d)           Tenant’s
construction of the Tenant Improvements shall comply with the
following:  (i) the Tenant Improvements shall be constructed in
strict accordance with the Construction Drawings; and (ii) Tenant’s and
Tenant’s Contractor shall, prior to the commencement of any work, submit
schedules of all work relating to the Tenant Improvements to Landlord for
Landlord’s information only.

       

      (e)           Tenant
hereby indemnifies and holds Landlord harmless with respect to any and all
costs, losses, damages, injuries and liabilities related in any way to any act
or omission of Tenant or Tenant’s Contractor, or anyone directly or indirectly
employed by any of them, or in connection with Tenant’s non-payment of any
amount arising out of the Tenant Improvements.  Such indemnity by
Tenant, as set forth above, shall also apply with respect to any and all costs,
losses, damages, injuries and liabilities related in any way to Landlord’s
performance of  any ministerial acts reasonably necessary (i) to
permit Tenant to complete the Tenant Improvements, and (ii) to enable
Tenant to obtain any building permit or certificate of occupancy for the Demised
Premises; provided, however, that Tenant’s indemnity set forth herein shall not
apply to any damages or costs that result from any illegal act performed by
Landlord.

       

      (f)           Tenant’s
Contractor and the subcontractors utilized by Tenant’s Contractor shall provide
the standard and customary warranties to Tenant and for the benefit of Landlord
with respect to the portion of the Tenant Improvements for which it is
responsible.  Tenant’s Contractor shall be responsible for the
replacement or repair, without additional charge, of all work done or furnished
in accordance with its contract that shall become defective within one (1)
year after the substantial completion of the work performed by such contractor
or subcontractors.  The correction of such work shall include, without
additional charge, all additional expenses and damages incurred
in  connection with such removal or replacement of all or any part of
the Tenant Improvements, and/or the Building and/or common areas that may be
damaged or disturbed thereby.  All such warranties as to materials or
workmanship of or with respect to the Tenant Improvements shall be contained in
the Contract or subcontract and shall be written such that such warranties shall
inure to the benefit of both Landlord and Tenant, as their respective interests
may appear, and can be directly enforced by either.  Tenant
covenants

       


      
        
           


        

        
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      to give
to Landlord any assignment or other assurances which may be necessary to effect
such right of direct enforcement.

       

      (g)           Commencing
upon the issuance of a building permit, Landlord and/or its agents (“Landlord’s
Representative”) shall have the right to attend any meetings held by Tenant with
its Contractor or Designer regarding the progress of the construction of the
Tenant Improvements.  Meetings will be held on the first and third
Wednesdays of each month at 10 a.m.  At Tenant’s request, other than
at such meeting, Landlord’s Representative shall make no direct communications
whatsoever with Tenant, the Contractor, any subcontractors and/or the Designer;
and all communications from Landlord’s Representative shall be made in writing
to Landlord who shall convey them in writing to Tenant.  If Landlord’s
Representative acts in a manner that is outside the scope of, or not in keeping
with, his job description as set forth in this Section 5(g) and that in
Tenant’s reasonable judgment is interfering with the construction of the Tenant
Improvements, then upon notice from Tenant to Landlord the Landlord’s
Representative shall be replaced prior to the next bi-monthly
meeting.

       

      (h)           Within
ten (10) days following the completion of the Tenant Improvements, Tenant shall
notify Landlord of the completion thereof and shall provide Landlord an
opportunity to inspect the same.  Within ten (10) days following
Tenant’s notice, Landlord (or its representative) shall walk through and inspect
the Tenant Improvements, and upon the completion of such walk-through shall
either approve such work or advise Tenant in writing of any failure of the
Tenant Improvements to conform with the Construction
Documents.  Tenant shall, at Tenant’s sole cost and expense, promptly
repair such nonconforming items to Landlord’s
satisfaction.  Landlord’s approval of the Tenant Improvements, or
Landlord’s failure to advise Tenant of any nonconforming items in the Tenant
Improvements, shall not relieve Tenant of responsibility for constructing and
installing the Tenant Improvements substantially in accordance with the
Construction Drawings and this Agreement, and in conformance with all applicable
laws, statutes and ordinances.

       

      (i)           Upon
completion of the Tenant Improvements, Tenant shall:  (i) obtain
and deliver to Landlord a certificate of occupancy for the Tenant Improvements
from the governmental agency having jurisdiction thereof; (ii) deliver to
Landlord a full set of reproducible as-built drawings for the Tenant
Improvements (including all Change Orders) to the extent applicable, including,
without limitation, architectural drawings, structural drawings, mechanical
drawings, including plumbing, fire sprinkler, electrical and life safety;
(iii) obtain and deliver to Landlord the building permit or permits for the
Tenant Improvements with final sign-off by the applicable governmental entity;
(iv) complete Landlord’s punch list items provided by Landlord to Tenant in
accordance with (h) above; and (v) deliver to Landlord copies of all written
construction and equipment warranties related to the portions of the Tenant
Improvements involving Building systems or those portions of the Demised
Premises Landlord is required to maintain or repair under the
Lease.

       

      (j)           Tenant
agrees to (A) fully pay and discharge all claims for labor done and materials
and services furnished in connection with the construction of the Tenant
Improvements and (B) immediately upon Landlord’s request cooperate with Landlord
in connection with the filing of (i) a valid notice of completion on the
standard form used in California within ten (10) days following the completion
of construction of the Tenant Improvements, and (ii) a valid notice of cessation
on the standard form used in California upon a cessation of labor of
the

       


      
        
           


        

        
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      Tenant
Improvements for a continuous period of thirty (30) days or more, and (C) take
all steps to forestall the assertion of claims of lien against the Property or
any part thereof or right or interest appurtenant thereto by contractors
retained by Tenant in connection with the Tenant Improvements.  In the
event that there shall be recorded against the Demised Premises or the Building
or the Property any claim or lien arising out of the Tenant Improvements, and
such claim or lien shall not be removed from title or discharged within the time
period specified in Section 8.3 of the Lease, then Landlord may exercise its
right to remove said liens in accordance with Section 8.3 of the
Lease.

       

      6.           Tenant Improvement
Allowance.

       

      (a)           Tenant Improvement
Allowance.  Landlord will pay $2,452,696.00 (“Tenant
Improvement Allowance”) toward the cost of the design, construction and
permitting (only to the extent set forth herein) of the Tenant Improvements and
for the review and approval of the Space Plans and Final Plans, including
Landlord’s costs with respect thereto as set forth in Section 6(c)
below.  Landlord will pay the Tenant Improvement Allowance to Tenant
within thirty-five (35) days after all of the following have occurred:
(i) Tenant has submitted a final request for disbursement on the standard
AIA form, (ii) a certificate of occupancy for the  Demised
Premises has been issued, (iii) a notice of completion has been duly
recorded with respect to the Tenant Improvements, (iv) no lien claim shall
have been recorded within the thirty (30) day period following such recordation
(or if there be a lien claim, such lien shall have been removed) and
(v) Landlord’s receipt of an unconditional mechanics’ lien release from the
Contractor.  In the event the cost of the design and construction of
the Tenant Improvements is less than the Tenant Improvement Allowance, the
difference shall be retained by Landlord.

       

      (b)           Change
Orders.  In the event that Tenant requests or approves of any
“material changes” to the Construction Documents (each, a “Change Order”),
Landlord shall not unreasonably withhold its consent to any such Change Order,
but subject to the Approval Criteria listed in Section 3(d) above.  If
any such Change Orders, as approved by Landlord, increase the cost of
constructing the Tenant Improvements as shown on the Construction Documents in
excess of the Tenant Improvement Allowance, Tenant shall pay such increased
costs.  For purposes of this Section 6(b), a “material change” shall
be one that involves a change to any of the structural elements or building
systems of the Building, the exterior of the Building or any exterior areas of
the Property or that will cost in excess of $50,000.00.

       

      (c)           Landlord’s
Costs.  Landlord shall in connection with Landlord’s
obligations set forth in Section 3 with respect to reviewing and approving
the Space Plans and Final Plans and in Section 6 with respect to inspecting and
supervising the construction of the Tenant Improvements be reimbursed for all of
its costs incurred in connection with such review, approval, inspection and
supervision (including services performed in-house to the extent the costs are
not in excess of costs that would have been incurred if such services were
performed by independent third parties), which reimbursement shall be
accomplished by Landlord deducting such amount from the Tenant Improvement
Allowance; provided, however, in no event shall Tenant’s reimbursement
obligation under this Section 6(c) exceed $20,000.

       

      7.           Default.  Any
default by Tenant under the terms of this Agreement shall, if not cured within
five (5) days after written notice from Landlord, constitute a default under the
Lease to which this Agreement is attached, and shall entitle Landlord to
exercise all remedies set forth

       


      
        
           


        

        
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      in the
Lease.  Tenant shall have any and all rights to remedy such default
pursuant to the provisions of the Lease.

       

      8.           Reasonable
Diligence.  Both Landlord and Tenant agree to use reasonable
diligence in performing all of their respective obligations and duties under
this Agreement and in proceeding with the construction and completion of the
Tenant Improvements in the Demised Premises.

       

      9.           Insurance
Requirements.

       

      (a)           General
Coverages.  All of Tenant’s Contractors shall carry worker’s
compensation insurance covering all of their respective employees, and shall
also carry public liability insurance, including property damage, all with
limits, in form and with companies as are required to be carried by Tenant as
set forth in Article XI of the Lease.

       

      (b)           Special
Coverages.  Tenant shall carry “Builder’s All Risk” insurance
in an amount approved by Landlord covering the construction of the Tenant
Improvements, and such other insurance as Landlord may require, it being
understood and agreed that the Tenant Improvements shall be insured by Tenant
pursuant to Article VI of this Lease immediately upon completion
thereof.  Such insurance shall be in amounts and shall include such
extended coverage endorsements as may be reasonably required by Landlord
including, but not limited to, the requirement that all of Tenant’s Contractors
shall carry excess liability and Products and Completed Operation Coverage
insurance, each in amounts not less than $500,000 per incident, $1,000,000 in
aggregate, and in form and with companies as are required to be carried by
Tenant as set forth in Article VI of this Lease.

       

      (c)           General
Terms.  Certificates for all insurance carried pursuant to this
Work Letter must comply with the requirements of Article VI of the Lease
and shall be delivered to Landlord before the commencement of construction of
the Tenant Improvements and before the Contractor’s equipment is moved onto the
site.  In the event that the Tenant Improvements are damaged by any
cause during the course of the construction thereof, Tenant shall immediately
repair the same at Tenant’s sole cost and expense.  Tenant’s
Contractors shall maintain all of the foregoing insurance coverage in force
until the Tenant Improvements are fully completed and accepted by Landlord,
except for any Products and Completed Operation Coverage insurance required by
Landlord, which is to be maintained for three (3) years following completion of
the work and acceptance by Landlord and Tenant.  All policies carried
under this Section 10 shall insure Landlord and Tenant, as their interests
may appear, as well as the Contractor.  All insurance, except Workers’
Compensation, maintained by Tenant’s Contractors shall preclude subrogation
claims by the insurer against anyone insured thereunder.  Such
insurance shall provide that it is primary insurance as respects the owner and
that any other insurance maintained by owner is excess and noncontributing with
the insurance required hereunder.  Landlord may, in its discretion,
require Tenant to obtain a lien and completion bond or some alternate form of
security satisfactory to Landlord in an amount sufficient to ensure the
lien-free completion of the Tenant Improvements and naming Landlord as a
co-obligee.

       


      
        
           


        

        
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      IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
written above.

       

      LANDLORD:

       

      CACTUS
COMMERCE, LLC,
a
Delaware limited liability company

      


      
        	
                 
      

              	
                By:

              	
                BlackRock
      Realty Advisors, Inc.,
its
Manager

              


      

       

       

      By:                                                                

      Its:                                                                

       

      TENANT:

       

      UNITED
NATURAL FOODS, INC.,
a
Delaware corporation

      


      


      
        	
                 
      

              	
                By:

              	
                /s/ Mark
      Shamber

              	
                 

              	 


      

       

      
        	
                 
      

              	
                Mark
      Shamber,


                  Chief
      Financial Officer

                

              


      

       

      
      

       


      
        
           


        

        
          D-8

           


        

        
           


        

      


      EXHIBIT
E

       

      LIST OF INITIAL
INSTALLATIONS WHICH

       

      TENANT WILL NOT HAVE TO
REMOVE

       

      ·      Any
standard office improvements

       

      ·      Any
restrooms

       

      
        	
                 
      

              	
                ·

              	
                Structural
      improvements made to roof structure to support equipment approved by
      Landlord

              


      

       

      
        	
                 
      

              	
                ·

              	
                Electrical
      improvements approved by Landlord

              


      

       

      
        	
                 
      

              	
                ·

              	
                Concrete
      slab associated with freezer section of tenant improvements and all under
      slab insulation and piping.  If glycol is used as the underslab
      warming system, then Tenant agrees that piping will be drained and capped
      below slab upon termination of this
Lease

              


      

       

      
        	
                 
      

              	
                ·

              	
                Data
      cabling and phone cabling throughout Demised
  Premises

              


      

       

      
        	
                 
      

              	
                ·

              	
                Modifications
      to sprinkler system required to meet code and/or insurance requirements
      which are approved by Landlord

              


      

       

      
        	
                 
      

              	
                ·

              	
                Dock
      equipment including dock levelers, shelters, lights,
  etc.

              


      

       


      
        
           


        

        
          E-1 


           


        

        
           


        

      


      EXHIBIT
F

       

      


      

      
      

       


      
        
           


        

        
          F-1