Document:

<PAGE>

                                                                    EXHIBIT 10.4

                            BUILD-TO-SUIT NET LEASE

                                    between

                            OPUS NORTHWEST, L.L.C.,

                                  as Landlord

                                      and

                              HOMEGROCER.COM,INC.

                                   as Tenant

                                 March 23, 2000
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                               TABLE OF CONTENTS
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1.    DEFINITIONS AND EXHIBITS...............................................    1

      1.1  Definitions.......................................................    1
      1.2  Exhibits..........................................................    8

2.    GRANT OF LEASE; RENEWAL OPTIONS........................................    8

      2.1  Demise............................................................    8
      2.2  Quiet Enjoyment...................................................    8
      2.3  Landlord and Tenant Covenants.....................................    8
      2.4  Memorandum of Term................................................    8
      2.5  Tenant's Renewal Options..........................................    8
      2.6  Tenant's Termination Option.......................................   10

 3.   CONSTRUCTION; DELIVERY AND ACCEPTANCE OF PREMISES......................   11

      3.1  Landlord's Construction Obligations...............................   11
      3.2  Delivery of Possession............................................   11
      3.3  Punch List........................................................   12
      3.4  Representatives...................................................   12
      3.5  Design Information................................................   13
      3.6  Shell Plans.......................................................   13
      3.7  Shell Construction................................................   13
      3.8  Leasehold Improvements Plans......................................   13
      3.9  Tenant's Cost Proposal............................................   14
     3.10  Construction of Leasehold Improvements; Payment of Tenant's Cost..   14
     3.11  Change Orders.....................................................   15
     3.12  Tenant's Delays...................................................   16
     3.13  Adjustments Upon Completion.......................................   16
     3.14  Tenant's Property.................................................   16

4.   RENT....................................................................   16

      4.1  Basic Rent........................................................   16
      4.2  Additional Rent for Taxes and Operating Expenses..................   17
      4.3  Net Lease; Additional Rent........................................   19
      4.4  Terms of Payment..................................................   19
      4.5  Late Payments.....................................................   19
      4.6  Right to Accept Payments..........................................   19
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5.    USE, OCCUPANCY AND COMPLIANCE..........................................   20

      5.1  Use...............................................................   20
      5.2  Compliance by Landlord............................................   20
      5.3  Compliance by Tenant..............................................   20
      5.4  Contests..........................................................   20
      5.5  Hazardous Substances..............................................   21
      5.6  Americans With Disabilities Act...................................   22

6.    SERVICES AND UTILITIES.................................................   22

      6.1  Services Provided by Landlord.....................................   22
      6.2  Tenant's Utilities................................................   23
      6.3  Interruption of Services..........................................   23

7.    REPAIRS AND MAINTENANCE................................................   24

      7.1  Tenant's Obligations..............................................   24
      7.2  Landlord's Right of Entry.........................................   24

8.    INSURANCE, WAIVERS AND INDEMNITY.......................................   24

      8.1  Landlord's Insurance..............................................   24
      8.2  Tenant's Insurance................................................   25
      8.3  General Insurance Requirements....................................   26
      8.4  Waivers...........................................................   27
      8.5  Landlord's Indemnity..............................................   27
      8.6  Tenant's Indemnity................................................   27

9.    ALTERATIONS; MECHANICS' LIENS..........................................   27

      9.1  Alterations.......................................................   27
      9.2  Mechanics' Liens..................................................   28

10.   ASSIGNMENT AND SUBLETTING..............................................   29

      10.1  Permitted Transfers..............................................   29
      10.2  Transfers Requiring Consent......................................   29
      10.3  Deemed Assignments...............................................   29
      10.4  Excess Consideration.............................................   29
      10.5  General Provisions...............................................   30
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11.  CASUALTY................................................................   30

     11.1  Termination Options...............................................   30
     11.2  Repair Obligations................................................   31
     11.3  Rent Abatement....................................................   31

12.  EMINENT DOMAIN..........................................................   32

     12.1  Termination.......................................................   32
     12.2  Award; Restoration................................................   32

13.  END OF TERM.............................................................   33

     13.1  Surrender.........................................................   33
     13.2  Holding Over......................................................   34

14.  DEFAULTS AND REMEDIES...................................................   34

     14.1  General...........................................................   34
     14.2  Events of Default.................................................   34
     14.3  Landlord's Remedies...............................................   35
     14.4  Landlord's Default; Tenant's Remedies.............................   37

15.  SUBORDINATION...........................................................   38

     15.1  Subordination, Nondisturbance and Attornment......................   38
     15.2  Option to Make Lease Superior.....................................   38

16.  SECURITY DEPOSIT........................................................   38

     16.1  Amount and Form...................................................   38
     16.2  Use and Restoration...............................................   39
     16.3  Transfers.........................................................   39
     16.4  Refund............................................................   40

17.  MISCELLANEOUS...........................................................   40

     17.1  Roof Installations................................................   40
     17.2  Building Signage..................................................   40
     17.3  Non-competition...................................................   40
     17.4  Brokers...........................................................   40
     17.5  Estoppel Certificates.............................................   41
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     17.6   Notices..........................................................   41
     17.7   Actions by Landlord's Agent......................................   41
     17.8   Severability; Governing Law......................................   41
     17.9   Transfers of Landlord's Interest.................................   42
     17.10  Headings.........................................................   42
     17.11  Complete Agreement; Modification.................................   42
     17.12  No Offer.........................................................   42
     17.13  Survival.........................................................   42
     17.14  Limitation on Landlord's Liability...............................   42
     17.15  Tenant's Authority...............................................   43
     17.16  No Partnership...................................................   43
     17.17  Force Majeure....................................................   43
     17.18  Financial Statements.............................................   43
     17.19  Future Covenants.................................................   43
     17.20  Binding Effect...................................................   44
     17.21  Acquisition Contingency..........................................   44

Exhibit A LEGAL DESCRIPTION OF THE LAND......................................  A-1

Exhibit B SHELL SPECIFICATIONS...............................................  B-1
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                            BUILD-TO-SUIT NET LEASE

     THIS BUILD-TO-SUIT NET LEASE ("Lease") is entered into as of March 23, 2000
by and between the Landlord and Tenant identified in Section 1.1.

1.   DEFINITIONS AND EXHIBITS

     1.1  Definitions. In this Lease, the following defined terms have the
meanings set forth for them below or in the section of this Lease indicated
below:

          "ADA" means the Americans with Disabilities Act, as amended from time
     to time.

          "Additional Rent" means all amounts required to be paid by Tenant
     under this Lease in addition to Basic Rent including, without limitation,
     Operating Expenses and Taxes.

          "Affiliates" means, with respect to any party, any entities or
     individuals that control, are controlled by or are under common control
     with such party, together with its and their respective partners,
     venturers, directors, officers, shareholders, trustees, trustors,
     beneficiaries, agents, employees and spouses.

          "Basic Rent" means the Rent payable according to Section 4.1 based on
     a rate per square foot of Rentable Area of the Premises applicable during
     each Lease Year of the Term as follows:

                                        Rate of Base Rent Per
             Lease Year(s)          Square Foot of Rentable Area
             -------------          ----------------------------
                 1 - 3                        $5.50
                --------                     -------
                 4 - 5                        $5.85
                --------                     -------
                 6 - 8                        $6.10
                --------                     -------
                 9 - 10                       $6.45
                --------                     -------

          "Building" means the building containing approximately 100,000 square
     feet of Rentable Area to be constructed by Landlord for Tenant upon the
     Land according to Section 3.

          "Change Order" has the meaning set forth in Section 3.11.

          "Commencement Date" means the first day of the Term, which will be the
     date that is 15 days after the Delivery Date.

          "Covenant Documents" means all grants, declarations or agreements that
     are now or hereafter recorded in the real property records of Douglas
     County, Colorado and that impose or create easements, covenants, conditions
     or restrictions on, over, under, through or with respect to property
     located within the Project and that relate to the use,
<PAGE>

     development or improvement of property within the Project, the operation,
     maintenance, repair or replacement of landscaping, streets or other
     improvements serving property within the Project or the provision of other
     utilities or services to property within the Project.

          "Delivery Date" means the date on which Landlord delivers possession
     of the Premises to Tenant with Landlord's Work Substantially Completed,
     which will be the Projected Delivery Date, unless the Delivery Date is
     extended according to Section 3.2.

          "Design Information" has the meaning set forth in Section 3.5.

          "Environmental Laws" means the Resource Conservation and Recovery Act,
     42 U.S.C. Section 6901 et seq., the Comprehensive Environmental Response,
                            -- ---
     Compensation and Liability Act, U.S.C. Section 9601 et seq. (including the
                                                         -- ---
     so-called "Superfund" amendments thereto), any other applicable Laws
     governing or pertaining to any hazardous substances, hazardous wastes,
     chemicals or other materials, including, without limitation, asbestos,
     polychlorinated biphenyls, radon, petroleum and any derivative thereof or
     any common law theory based on nuisance or strict liability.

          "Event of Default" has the meaning set forth in Section 14.2.

          "Expiration Date" means (i) if the Commencement Date is the first day
     of a month, the 10-year anniversary of the day immediately preceding the
     Commencement Date; or (ii) if the Commencement Date is not the first day of
     a month, the 10-year anniversary of the last day of the month in which the
     Commencement Date occurs.

          "First Renewal Term" has the meaning set forth in Section 2.5(a).

          "Hazardous Substance" means any substance, chemical or material
     declared to be, or regulated as, hazardous or toxic under any Environmental
     Law or the presence of which may give rise to liability under any
     Environmental Law.

          "Improvements" means the Building, the Leasehold Improvements and any
     other structures, pavement, lighting fixtures or other improvements now or
     later constructed or installed upon the Land.

          "Interest Rate" means the Prime Rate plus 5% per annum, but if such
     rate exceeds the maximum interest rate permitted by law, such rate will be
     reduced to the highest rate allowed by law under the circumstances.

          "Land" means the real property, located in the Project that is legally
     described on Exhibit A and depicted on Exhibit A-1.
                  ---------

          "Landlord" means Opus Northwest, L.L.C., a Delaware limited liability
     company.

                                       2
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          "Landlord's Notice Address" means:

                        1855 Blake Street,
                        Suite 200
                        Denver, Colorado 80202

                        with a copy to:

                        Opus Corporation
                        10350 Bren Road West
                        Minnetonka, Minnesota 55343
                        Attention: Legal Department

          "Landlord's Rent Address" means:

                         1855 Blake Street
                         Suite 200
                         Denver, Colorado 80202

          "Landlord's Representative" means John M. Shaw, Marshall Burton or
     Paul Wolters.

          "Landlord's Work" means the construction and installation of the Shell
     and the Leasehold Improvements.

          "Laws" means any and all present or future federal, state or local
     laws, statutes, ordinances, rules, regulations or orders of any and all
     governmental or quasi-governmental authorities having jurisdiction,
     including, without limitation, Environmental Laws, and the Covenant
     Documents.

          "Leasehold Improvements" means all leasehold improvements and
     installations, in addition to the Shell, that are to be constructed or
     installed by Landlord for Tenant according to Section 3.

          "Leasehold Improvements Allowance" means an amount equal to $5.00
     multiplied by the number of square feet of Rentable Area of the Premises.

          "Leasehold Improvements Plans" means construction plans and
     specifications for the Leasehold Improvements.

          "Lease Year" means each successive period of 12 calendar months during
     the Term, ending on the same day and month (but not year, except in the
     case of the last Lease Year) as the day and month on which the Expiration
     Date will occur. If the Commencement Date is not the first day of a month,
     the first Lease Year will be greater than 12 months by the number of days
     from the Commencement Date to the last day of the month in which the
     Commencement Date occurs.

                                       3
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          "Market Rental Rate" has the meaning set forth in Section 2.5(b).

          "Market Escalations" has the meaning set forth in Section 2.5(b).

          "Mortgagee" means any mortgagee, ground lessor, trust deed holder or
     sale-leaseback lessor of Landlord's interest in the Premises

          "Operating Expenses" means all expenses Landlord incurs in any
     applicable calendar year to maintain and operate the Premises in accordance
     with the terms of this Lease, including, but not limited to, insurance
     premiums (including insurance premiums for rent insurance); maintenance and
     repair costs (whether capital or not); lighting costs (such as, for
     example, lamps, tubes, ballasts and starters); the costs of operating,
     maintaining, repairing and replacing the Standard HVAC Equipment (such as,
     for example, preventative maintenance contracts and repairs and
     replacements), but excluding the cost of utilities (which will be paid for
     directly by Tenant) and excluding that portion of the cost of replacing any
     Standard HVAC Equipment for which Landlord is responsible, as provided
     below; trash and rubbish removal costs; wages payable by Landlord to
     employees whose duties are connected with operating and maintaining the
     Premises (but only for the portion of the employees' time allocable to work
     related to the Premises); amounts payable by Landlord to contractors or
     subcontractors for work or services connected with operating and
     maintaining the Premises; all costs of uniforms, supplies and materials
     used in connection with operating and maintaining the Premises; all payroll
     taxes, unemployment insurance costs, vacation allowances, and the cost of
     providing disability insurance or benefits, pensions, profit sharing
     benefits, hospitalization, retirement or other so-called fringe benefits;
     any expense Landlord incurs or its contractors or subcontractors incur
     pursuant to Laws or pursuant to any collective bargaining agreement
     covering employees; Landlord's cost for all services, supplies, repairs,
     replacements or other expenses connected with maintaining and operating the
     Premises; reasonable attorneys' fees and costs Landlord incurs in
     connection with appealing or contesting real estate or other taxes or
     levies; and such other expenses Landlord ordinarily incurs operating and
     maintaining the Premises and not specifically described herein, including
     management fees in an amount not greater than 3% of all Rent payable by
     Tenant hereunder. Operating Expenses also include expenses Landlord incurs
     relating to public sidewalks adjacent to the Premises and any pedestrian
     walkway system (either above or below ground) or other public facility
     which serves the Premises and any assessments, fees or other charges
     imposed upon the Premises or upon Landlord as a result of Landlord's
     ownership of the Premises under any Covenant Documents. Notwithstanding the
     foregoing, Operating Expenses will not include the cost of (1) any repairs
     to, or replacements of (whether capital or not), the Building's roof or
     structural elements (including foundations, structural columns and beams
     and load-bearing walls); (2) correcting or completing any item of
     Landlord's Work set forth on the punch list described in Section 3.3 or
     performing any Warranty Work pursuant to such section; (3) any items
     (including, but not limited to, costs incurred by Landlord for the repair
     of damage to the Building) to the extent Landlord receives reimbursement
     from insurance proceed or from a third party, however, the deductible
     portion of any insured loss may be

                                       4
<PAGE>

     included in Operating Expenses as provided in Section 8.1(b); (4) interest
     or principal payments or any other financing cost on any mortgage or other
     indebtedness of Landlord; (5) any item (including, without limitation, the
     cost of repairs or the cost of late filing penalties) necessitated directly
     and solely by, or resulting directly and solely from, the negligence of, or
     breach of this Lease by, Landlord or any of its agents, employees or
     independent contractors; (6) overhead and profit increment paid to Landlord
     or its Affiliates for goods and/or services to the Premises to the extent
     the same exceeds the cost that would have been charged by an unaffiliated
     third party on a competitive basis; or any costs included in Operating
     Expenses representing an amount paid to a person, firm, corporation or
     other entity related to Landlord which is in excess of the amount which
     would have been paid in the absence of such relationship; (7) advertising
     and promotional expenditures; (8) costs arising from Landlord's charitable
     or political contributions; or (9) any work or service performed for any
     facility other than the Premises. Further notwithstanding the foregoing, if
     during the Term it becomes necessary to replace any Standard HVAC
     Equipment, then Landlord will initially pay for the total cost of the
     replacement equipment (the "Replacement Cost"), and the Replacement Cost,
     together with interest thereon at the Prime Rate in effect at the time
     Landlord purchases the replacement equipment plus 2% per annum, will then
     be amortized over the useful life of the replacement equipment, as
     reasonably determined by Landlord in accordance with generally accepted
     accounting principles, and the annual amortization applicable to each year
     of the then-remaining Term (not including any then-unexercised Renewal
     Term) will be included in Operating Expenses for such year. The inclusion
     of such annual amortization in Operating Expenses will not continue into
     any Renewal Term that was not exercised at the time Landlord purchased the
     replacement equipment; however, the existence of such replacement equipment
     at the Premises will be taken into account in determining the Basic Rent
     for such Renewal Term in accordance with Section 2.5(b).

          "Premises" means the Land and all Improvements.

          "Prime Rate" means the prime interest rate as published from time to
     time by The Wall Street Journal, with any changes in such rate to be
             -----------------------
     effective on the date such change is published.

          "Project" means the Compark Business Campus located in Douglas County,
     Colorado.

          "Projected Delivery Date" means October 31, 2000.

          "Rent" means Basic Rent and all Additional Rent.

          "Renewal Notice" has the meaning set forth in Section 2.5(a).

          "Renewal Term" has the meaning set forth in Section 2.5(a).

                                       5
<PAGE>

          "Rentable Area" means gross building area in square feet, calculated
     in accordance with the Standard Method for Measuring Floor Area in Office
     Buildings published by the Building Owners and Managers Association
     International and approved by the American National Standards Institute,
     Inc. on June 7, 1996.

          "Second Renewal Term" has the meaning set forth in Section 2.5(a).

          "Shell" means those portions of the Building and those additional site
     Improvements that are specified on the Shell Specifications.

          "Shell Plans" means construction plans and specifications for the
     Shell.

          "Shell Specifications" means the preliminary specifications for the
     Shell set forth on Exhibit B.
                        ---------

          "Special HVAC Equipment" means the heating, ventilating, air
     conditioning and refrigeration equipment installed in order to provide
     heating, ventilation, air conditioning or refrigeration to any areas of, or
     equipment within, the Premises that are unique to Tenant's business, such
     as, for example, the equipment installed to provide cooling to Tenant's
     food refrigeration rooms.

          "Standard HVAC Equipment" means the heating, ventilating and air
     conditioning equipment installed in order to provide ordinary and customary
     heating, ventilation and air conditioning to the office and warehouse
     portions of the Premises, but excluding any Special HVAC Equipment.

          "Substantially Completed" means, with respect to Landlord's Work, that
     (a) all utilities called for by the Shell Plans have been installed and
     connected to the Premises; (b) all roads necessary to provide access to the
     Premises have been graded and paved; (c) all of Landlord's Work
     contemplated by Section 3 of this Lease has been substantially completed;
     (d) a certificate of occupancy (temporary or final) has been issued by the
     appropriate governmental authority permitting use of the Premises for the
     use permitted under this Lease (upon Tenant's request, Landlord will
     deliver to Tenant a copy of such certificate of occupancy); (e) Landlord
     has delivered to Tenant a certificate of completion from Landlord's
     architect certifying substantial completion of the matters set forth in the
     Shell Plans and the Leasehold Improvements Plans; and (f) any work
     remaining to be completed or corrected in the Premises is of such a nature
     that it will not materially and adversely interfere with Tenant's use and
     occupancy of the Premises and will be able to be completed within 60 days.

          "Taxes" means all ad valorem real and personal property taxes and
     assessments, special or otherwise, levied upon or with respect to the
     Premises, the personal property used in operating the Premises, and the
     rents and additional charges payable by Tenant according to this Lease, and
     imposed by any taxing authority having jurisdiction; and all taxes, levies
     and charges which may be assessed, levied or imposed in replacement of, or
     in addition to, all or any part of ad valorem real or personal property
     taxes or assessments

                                       6
<PAGE>

     as revenue sources, and which in whole or in part are measured or
     calculated by or based upon the Premises, the leasehold estate of Landlord
     or Tenant in and to the Premises, or the rents and other charges payable by
     Tenant according to this Lease. Taxes will not include any net income,
     franchise, business and occupation, excise, transfer, gift, inheritance or
     other similar taxes of Landlord.

          "Tax Year" means a 12-month period for which Taxes are assessed.

          "Tenant" means HomeGrocer. com, Inc., a Washington corporation.

          "Tenant's Cost" means the total cost of preparing the Leasehold
     Improvements Plans, obtaining all necessary permits for, and constructing
     and installing, the Leasehold Improvements in the Shell, and providing any
     required services during construction of the Leasehold Improvements (such
     as electricity and other utilities and refuse removal). Landlord and Tenant
     agree that Tenant's Cost will include a general contractor's fee payable to
     Landlord in an amount equal to 6% of the costs of constructing and
     installing the Leasehold Improvements and a cost of general conditions in
     an amount equal to 5% of the costs of constructing and installing the
     Leasehold Improvements. Tenant's Cost will also include any increases in
     Landlord's costs of designing, constructing or installing the Shell that
     result from Change Orders requested by Tenant.

          "Tenant's Cost Proposal" has the meaning set forth in Section 3.9.

          "Tenant's Notice Address" means,

                         HomeGrocer.com, Inc.
                         Attn: Vice President Operations
                         10230 NE Points Drive, Suite 300
                         Kirkland, WA 98033

                         with a copy to:

                         HomeGrocer. com, Inc.
                         Attn: Legal Department
                         10230 NE Points Drive, Suite 300
                         Kirkland, WA 98033

          "Tenant's Representative" means David Brown, or such additional or
     alternative person or persons as may be appointed by Tenant pursuant to
     Section 3.4

          "Term" means the duration of this Lease, which will be approximately
     10 years beginning on the Commencement Date and ending on the Expiration
     Date, unless terminated earlier or extended further as provided in this
     Lease. The Term will also include any exercised Renewal Term.

          "Warranty Work" has the meaning set forth in Section 3.3.

                                       7
<PAGE>

    1.2   Exhibits. The Exhibits listed below are attached to and incorporated
in this Lease. In the event of any inconsistency between such Exhibits and the
terms and provisions of this Lease, the terms and provisions of the Exhibits
will control. The Exhibits to this Lease are:

          Exhibit A -  Legal Description of the Land
          Exhibit B -  Shell Specifications

2.  GRANT OF LEASE; RENEWAL OPTIONS

    2.1   Demise. Subject to the terms, covenants, conditions and provisions of
this Lease, Landlord leases to Tenant and Tenant leases from Landlord the
Premises for the Term.

    2.2   Quiet Enjoyment. Landlord covenants that, so long as no Event of
Default exists, Tenant will have quiet and peaceful possession of the Premises
during the Term.

    2.3   Landlord and Tenant Covenants. Landlord covenants to observe and
perform all of the terms, covenants and conditions applicable to Landlord in
this Lease. Tenant covenants to pay the Rent when due, and to observe and
perform all of the terms, covenants and conditions applicable to Tenant in this
Lease.

    2.4   Memorandum of Term. After the occurrence of the Delivery Date, either
party will, upon the other's request, execute and acknowledge a recordable
memorandum setting forth the date on which the Commencement Date occurred or
will occur and the date on which the Expiration Date is scheduled to occur.

    2.5   Tenant's Renewal Options.

           (a) Renewal Terms. Subject to the terms and provisions of this
               -------------
    Section 2.5, Tenant, at its option, may extend the Term of this Lease for
    one five-year period at the end of the initial Term (the "First Renewal
    Term") and, if Tenant exercises its option with respect to the First Renewal
    Term, for an additional five-year period at the end of the First Renewal
    Term (the "Second Renewal Term"). The First Renewal Term and the Second
    Renewal Term are individually referred to herein as a "Renewal Term." To
    exercise each such option, Tenant must deliver written notice of the
    exercise thereof (a "Renewal Notice") to Landlord no earlier than 14 and no
    later than 10 months prior to the expiration of (i) the initial Term, in the
    case of Tenant's option with respect to the First Renewal Term, or (ii) the
    First Renewal Term, in the case of Tenant's option with respect to the
    Second Renewal Term. During each Renewal Term, all of the terms and
    provisions of this Lease will apply, except that (1) after the Second
    Renewal Term there will be no further right of renewal; (2) the Basic Rent
    payable for each month of the first Lease Year of each Renewal Term will be
    1/12 of the amount obtained by multiplying the Market Rental Rate in effect
    at the time Tenant delivers its Renewal Notice with respect to such Renewal
    Term (determined as set forth below) by the Rentable Area of the Premises;
    and (3) the Basic Rent payable during the remaining Lease Years of each
    Renewal Term will be subject to increase in accordance with the Market
    Escalations in effect at the time Tenant delivers its Renewal Notice
    (determined as set forth below).

                                       8
<PAGE>

          (b) Market Rental Rate and Market Escalations. As used herein, "Market
              -----------------------------------------
     Rental Rate" means a rental rate per square foot of Rentable Area per year
     equal to the prevailing first year rental rate then being obtained by
     landlords of buildings comparable to the Building in the market area of
     southeast suburban Denver in which the Project is located under leases of
     comparable space for a comparable term (the "Comparable Transactions");
     provided, however, that (i) in determining the Market Rental Rate, there
     will be an adjustment to such prevailing rental rate (amortized, without
     interest, equally over the subject Renewal Term) to account for (A) any
     tenant improvement allowances, free rent concessions, brokerage commissions
     or other tenant inducements that are required to be paid by the landlords
     in the Comparable Transactions in order to achieve such prevailing rental
     rate but which will not be required to be paid by Landlord with respect to
     the subject Renewal Term under this Lease, and (B) the value of air
     conditioning equipment and other leasehold improvements (but excluding
     Tenant's trade fixtures) then existing at the Premises but which do not
     exist in the premises demised in the Comparable Transactions; and (ii) in
     no event will the Market Rental Rate for any Renewal Term be less than the
     annual rate at which Basic Rent was payable by Tenant for the immediately
     preceding Lease Year of the Term. "Market Escalations" means both the
     rate(s) and frequency by which, in Comparable Transactions, the Market
     Rental Rate is increased during the terms of such transactions (for
     example, the rental rate may be increased by 3% every other year, or by 2%
     every year, or by 4% after two years and by 3% after four years, etc.).
     Landlord and Tenant will, for a period of 30 days from and after the date
     on which Tenant delivers its Renewal Notice, meet with each other and
     negotiate in good faith to agree upon the then-current Market Rental Rate
     and the then current Market Escalations acceptable to both parties. If the
     parties are unable to agree upon the Market Rental Rate and Market
     Escalations during such 30-day period, then, Landlord will, within seven
     days after the expiration of such 30-day period, deliver to Tenant a
     written determination of the Market Rental Rate and Market Escalations as
     determined by Landlord ("Landlord's Determination"). Tenant will have 14
     days from the date of Landlord's delivery of Landlord's Determination to
     notify Landlord of Tenant's acceptance of Landlord's Determination or
     deliver to Landlord Tenant's written determination of the Market Rental
     Rate and Market Escalations ("Tenant's Determination"). If Tenant does not
     deliver Tenant's Determination to Landlord within such 14-day period,
     Tenant will be deemed to have accepted Landlord's Determination and the
     rental rate and escalations set forth in Landlord's Determination will be
     the Market Rental Rate and Market Escalations. If Tenant does deliver
     Tenant's Determination within such 14-day period, then Landlord and Tenant
     will have an additional 10 days from the date of delivery of Tenant's
     Determination to negotiate a Market Rental Rate and Market Escalations
     acceptable to both Landlord and Tenant. If no agreement can be reached as
     to the Market Rental Rate and Market Escalations within such 10-day period,
     then within seven days after such 10-day period expires, Landlord and
     Tenant will mutually appoint a commercial leasing broker that has at least
     10 years full-time experience in the market area. If Landlord and Tenant
     are unable to mutually agree on a broker, either of the parties to this
     Lease, after giving five days prior notice to the other party, may apply to
     the then president of the Denver Board of Realtors for the selection of a
     broker who meets the foregoing qualifications, which selection will be

                                       9
<PAGE>

     made within three days. The broker selected by the president of the Board
     of Realtors will be a person who has not previously acted in any capacity
     for either party and who meets the foregoing experience qualifications. The
     broker will, within 10 days of his or her appointment, review Landlord's
     Determination and Tenant's Determination of the Market Rental Rate and the
     Market Escalations and such other information as he or she deems necessary
     and will determine whether Landlord's Determination or Tenant's
     Determination of the Market Rental Rate and the Market Escalations is more
     reasonable. The broker will immediately notify the parties of his or her
     determination. The Market Rental Rate and Market Escalations determined by
     Landlord or Tenant and selected as the more reasonable by the broker will
     be the Market Rental Rate and Market Escalations used to determine the
     Basic Rent for the subject Renewal Term. Each of the parties will bear 1/2
     the cost of the broker.

          (c) Limitation on Tenant's Rights. Tenant will have no right to extend
              -----------------------------
     the Term and a Renewal Notice will be ineffective if an Event of Default
     exists at the time such notice is given. Any termination of this Lease
     terminates all rights under this Section 2.5.

     2.6  Tenant's Termination Option. Tenant, at its option, will have the one
time right to terminate this Lease (the "Termination Option") effective as of
the last day of the fifth Lease Year (the "Early Termination Date"); provided
that: (a) Tenant gives written notice to Landlord of Tenant's exercise of the
Termination Option no earlier than 14 months and no later than l0 months prior
to the Early Termination Date; (b) simultaneously with delivering such notice of
Tenant's exercise of the Termination Option to Landlord, Tenant pays to Landlord
a termination payment in the amount of $750,000; and (c) notwithstanding the
provisions of Section 13.1, on or before the Early Termination Date, Tenant
removes from the Premises all Leasehold Improvements and equipment installed
therein for Tenant's use (including, without limitation, the Special HVAC
Equipment) that Landlord, at its option, specifies in a notice given to Tenant
within 45 days after delivery of Tenant's notice exercising the Termination
Option and Tenant repairs all damage caused by such removal. If Tenant exercises
the Termination Option, makes the termination payment and removes all Leasehold
Improvements and equipment required to be removed in accordance with the
provisions of this Section 2.6, then this Lease will terminate on the Early
Termination Date, whereupon Tenant will surrender the Leased Premises in
accordance with Section 13.1 (except as otherwise provided above), and both
parties will thereafter be relieved of any obligations under this Lease that
would otherwise have accrued subsequent to the Early Termination Date, except
for those obligations which expressly survive any termination of this Lease. At
Landlord's option, Tenant will have no right to exercise the Termination Option
pursuant to this Section 2.6 if an Event of Default exists at the time Tenant
delivers its notice of exercise of the Termination Option. If Tenant fails to
exercise the Termination Option as provided above, then the Termination Option
and this Section 2.6 will automatically and immediately become null and void and
of no further force or effect.

                                       10
<PAGE>

3.  CONSTRUCTION; DELIVERY AND ACCEPTANCE OF PREMISES

     3.1  Landlord's Construction Obligations. Subject to and in accordance with
the provisions of this Section 3, Landlord will (i) at Landlord's sole cost and
expense, design, construct and install the Shell on the Land; and (ii) at
Landlord's cost up to the amount of the Leasehold Improvements Allowance, and
otherwise at Tenant's sole cost and expense, design, construct and install the
Leasehold Improvements. Landlord will be solely responsible for obtaining all
necessary permits from all applicable governmental and quasi-governmental
agencies having jurisdiction for Landlord's Work. Landlord has estimated that
Landlord's Work will be Substantially Completed by the Projected Delivery Date;
however, Landlord agrees to use reasonable efforts (utilizing ordinary and
customary construction practices) to cause Landlord's Work to be Substantially
Completed as much in advance of the Projected Delivery Date as practicable.
Tenant agrees to reasonably cooperate with such efforts.

     3.2  Delivery of Possession. If Landlord is unable to deliver exclusive
possession (i.e., free and clear of any other occupants or rights of occupancy,
but subject to the rights of Landlord under this Lease and the rights of others
under the Covenant Documents) of the Premises with the Landlord's Work
Substantially Completed by the Projected Delivery Date, then, except as provided
below, Landlord will not be in default or liable in damages to Tenant, nor will
the obligations of Tenant be affected, provided, however, that (i) the Delivery
Date will be extended automatically by one day for each day of the period after
the Projected Delivery Date to the day on which Landlord tenders exclusive
possession of the Premises to Tenant with Landlord's Work Substantially
Completed, less any portion of that period attributable to Tenant's delays as
more particularly described in Section 3.12; and (ii) if Landlord does not
tender exclusive possession of the Premises to Tenant with the Landlord's Work
Substantially Completed on or before March 30, 2001 (pins any period of delay
caused by Tenant's delays as more particularly described in Section 3.12),
Tenant will have the right to terminate this Lease by delivering written notice
of termination to Landlord not more than 30 days after such tender deadline
date. Upon a termination under clause (ii) above, each party will, upon the
other's request, execute and deliver an agreement in recordable form containing
an acknowledgement of the termination of this Lease; neither Landlord nor Tenant
will have any further obligations to each other, including, without limitation,
any obligations to pay for work previously performed in the Premises; all
improvements to the Premises will become and remain the property of Landlord;
and Landlord will refund to Tenant any sums paid to Landlord by Tenant in
connection with the Lease, including, without limitation, any payments to
Landlord of portions of Tenant's Cost, prepaid Rent and the Security Deposit.
Such postponement of the commencement of the Term and termination and refund
right will be in full settlement of all claims that Tenant might otherwise have
against Landlord by reason of Landlord's failure to cause Landlord's Work to be
Substantially Completed by the Projected Delivery Date. If Landlord delivers
possession of the Premises with the Landlord's Work Substantially Completed
prior to the Projected Delivery Date, then Tenant may either accept such
delivery (in which case such date will be the Delivery Date hereunder) or may
refuse to accept delivery until any date selected by Tenant that is no later
than the Projected Delivery Date. Landlord agrees to permit Tenant to enter the
Premises for purposes of installing Tenant's trade fixtures and equipment (but
not for the conduct of Tenant's regular business) prior to the Delivery Date to
the extent such

                                       11
<PAGE>

entry will not interfere with Landlord's completion of Landlord's Work and
Landlord agrees to use all reasonable efforts (without interfering with
customary construction scheduling or incurring extraordinary costs such as
overtime) to make such entry for such purposes possible by approximately 45 days
prior to Delivery Date. Such early entry for fixturing purposes will not
constitute Tenant's acceptance of possession of the Premises or any portion
thereof. Tenant will also have the right to occupy the Premises for completing
such installation of fixtures and equipment, for furnishing the Premises, for
stocking the Premises with Tenant's inventory and for the regular conduct of
Tenant's business during the period from the Delivery Date to the Commencement
Date and, during such period, all of the parties' rights and obligations under
this Lease will apply as if the Term had commenced (including, without
limitation, Tenant's obligation to pay Additional Rent for Taxes and Operating
Expenses); provided that Tenant will have no obligation to pay any Basic Rent
until the Commencement Date.

     3.3  Punch List. Tenant's taking possession of any portion of the Premises
will be conclusive evidence that such portion of the Premises was in good order
and satisfactory condition, and that all of Landlord's Work in or to such
portion of the Premises was satisfactorily completed, when Tenant took
possession, except as to items requiring repair or completion identified on a
punch list prepared and signed by Landlord's Representative and Tenant's
Representative after an inspection of the Premises by both such parties made
within 15 days after the Delivery Date and except as to any Warranty Work.
Landlord will repair or complete all items set forth on such punch list with
reasonable promptness. Landlord will not be responsible for any items of damage
caused by Tenant, its agents, independent contractors or suppliers. Landlord
covenants to repair or replace, at Landlord's expense and as "Warranty Work,"
any defective item of Landlord's Work of which Tenant notifies Landlord within
one year after the Delivery Date and that requires repair or replacement as a
result of (i) any failure to construct the Shell in material compliance with the
Shell Plans; (ii) any failure to construct the Leasehold Improvements in
material compliance with the Leasehold Improvements Plans; or (iii) any
defective materials or workmanship. Within 10 days after the expiration of the
above-described one-year warranty period, Landlord will assign to Tenant any
manufacturers' or subcontractors' warranties or guaranties that are still then
in effect with respect to the Shell or the Leasehold Improvements, except for
any such warranties or guaranties relating to any portions of the Premises which
Landlord is required under this Lease to maintain and repair at Landlord's
expense. No promises to construct, alter, remodel or improve the Premises have
been made by Landlord to Tenant other than as may be expressly stated in this
Lease.

     3.4  Representatives. Landlord appoints Landlord's Representative to act
for Landlord in all matters covered by this Section 3. Tenant appoints Tenant's
Representative to act for Tenant in all matters covered by this Section 3. All
inquiries, requests, instructions, authorizations and other communications with
respect to the matters covered by this Section 3 will be made to Landlord's
Representative or Tenant's Representative, as the case may be. Tenant will not
make any inquiries of or requests to, and will not give any instructions or
authorizations to, any other employee or agent of Landlord, including Landlord's
architect, engineers and contractors or any of their agents or employees, with
regard to matters covered by this Section 3. Either party may change its
representative at any time by three days' prior written notice to the other
party.

                                       12
<PAGE>

     3.5  Design Information. On or before April 10, 2000, Tenant will submit to
Landlord all information in addition to the Shell Specifications necessary for
preparation of the Shell Plans and the Leasehold Improvements Plans (the "Design
Information"). Each day after such date until Tenant has provided such Design
Information will be a day of Tenant's delay.

     3.6  Shell Plans. Promptly after receipt of all Design Information,
Landlord will cause its architect to prepare the Shell Plans based on the Shell
Specifications and the submitted Design Information, provided that,
notwithstanding anything set forth in this Lease to the contrary, Landlord's
architect will not be obligated to include in the Shell Plans, and Landlord will
not be obligated to include in the Shell, any items that do not comply with
Laws. Within five business days after receipt of the proposed Shell Plans,
Tenant will either approve the same in writing or notify Landlord in writing of
how the proposed Shell Plans are inconsistent with the Shell Specifications or
the Design Information and how the Shell Plans must be changed in order to make
them consistent with the Shell Specifications and the Design Information. Each
day following the 5th business day after the proposed Shell Plans are submitted
to Tenant until Tenant approves them or delivers such notice of objections will
be a day of Tenant's delay. Upon receipt of Tenant's notice of objections,
Landlord will cause its architect to prepare revised Shell Plans according to
such notice and submit the revised Shell Plans to Tenant. Upon submittal to
Tenant of the revised Shell Plans, and upon submittal of any further revisions,
the procedures described above will be repeated. If the original Shell Plans, or
any revisions thereof, are consistent with the Shell Specifications and the
Design Information, then each day following Landlord's receipt of Tenant's
notice of any objections until the day on which Landlord receives Tenant's
written approval of the Shell Plans will be a day of Tenant's delay.

     3.7  Shell Construction. At such time as the Shell Plans have been approved
in writing by both Landlord and Tenant, Landlord will cause the Shell to be
constructed or installed on the Land in a good and workmanlike manner and
according to the approved Shell Plans and all applicable Laws.

     3.8  Leasehold Improvements Plans. Promptly after receipt of all Design
Information, Landlord will cause an architect selected by Landlord and approved
by Tenant (which approval will not be unreasonably withheld or delayed and which
approval will be deemed given if Tenant does not notify Landlord to the contrary
within three business days after Landlord notifies Tenant of its proposed
architect), to prepare the Leasehold Improvements Plans based on the submitted
Design Information. Within five business days after receipt of the proposed
Leasehold Improvements Plans, Tenant will either approve the same in writing or
notify Landlord in writing of how the proposed Leasehold Improvements Plans are
inconsistent with the Design Information and how the Leasehold Improvements
Plans must be changed in order to make them consistent with the Design
Information. Each day following the 5th business day after the proposed
Leasehold Improvements Plans are submitted to Tenant until Tenant approves them
or delivers such notice of objections will be a day of Tenant's delay. Upon
receipt of Tenant's notice of objections, Landlord will cause its architect to
prepare revised Leasehold Improvements Plans according to such notice and submit
the revised Leasehold Improvements Plans to Tenant. Upon submittal to Tenant of
the revised Leasehold Improvements Plans, and upon submittal of any further
revisions, the procedures described above

                                       13
<PAGE>

will be repeated. If the original Leasehold Improvements Plans, or any revisions
thereof, are consistent with the Design Information, then each day following
Landlord's receipt of Tenant's notice of any objections until the day on which
Landlord receives Tenant's written approval of the Leasehold Improvements Plans
will be a day of Tenant's delay.

     3.9   Tenant's Cost Proposal. At such time as Leasehold Improvements Plans
that have been approved in writing by both Landlord and Tenant have been
prepared, Landlord will (i) obtain at least three bids for each of the major
trades that will be involved in the construction of the Leasehold Improvements,
unless less than three qualified subcontractors exist for a given trade, in
which case Landlord will obtain a bid from all qualified subcontractors of such
trade, or unless a portion of the Leasehold Improvements will be both designed
and built by a single design/build contractor, in which case Landlord will
obtain the bid of such design/build contractor; (ii) using the lowest qualified
bid from each of the bids so received, prepare a proposed budget for all items
to be included in Tenant's Cost ("Tenant's Cost Proposal"); and (iii) submit
copies of all such bids and Tenant's Cost Proposal to Tenant for Tenant's review
and approval. Tenant, at Tenant's option, may either approve Tenant's Cost
Proposal in writing or elect to eliminate or revise one or more items of
Leasehold Improvements shown on the Leasehold Improvements Plans so as to reduce
Tenant's Cost Proposal and then approve in writing the reduced Tenant's Cost
Proposal (based on the revised Leasehold Improvements Plans). In connection with
Tenant's approval of Tenant's Cost Proposal, Tenant will also have the right to
reasonably approve all subcontractors that Landlord proposes to use. Tenant's
approval of Tenant's Cost Proposal will be deemed also to be Tenant's approval
of the subcontractors whose bids are included in Tenant's Cost Proposal. If
Tenant desires to use a different subcontractor than the one recommended by
Landlord and included in the Tenant's Cost Proposal prepared by Landlord, Tenant
will so notify Landlord as a part of Tenant's response to Tenant's Cost Proposal
and then Tenant's Cost Proposal will be modified as necessary to reflect the bid
of the alternate subcontractor selected by Tenant. Landlord will apply the
Leasehold Improvements Allowance to Tenant's Cost. Tenant will be responsible
for payment of any portion of Tenant's Cost that exceeds the Leasehold
Improvements Allowance. Tenant will receive no credit or other payment for any
unused portion of the Leasehold Improvements Allowance. Each day following the
5th business day after Tenant's receipt of Tenant's Cost Proposal until the day
on which Landlord has received Tenant's written approval of Tenant's Cost
Proposal will be a day of Tenant's delay, Prior to entering into any subcontract
for the Leasehold Improvements, Landlord will deliver to Tenant a copy of the
proposed subcontract for Tenant's review and approval, which approval will not
be unreasonably withheld or delayed and which approval will be deemed given if
Tenant does not notify Landlord to the contrary within three business days after
delivery of the proposed subcontract with Landlord's request for approval.

     3.10   Construction of Leasehold Improvements; Payment of Tenant's Cost. At
such time as Tenant has approved Tenant's Cost Proposal, Landlord will cause the
Leasehold Improvements to be constructed or installed in the Shell in a good and
workmanlike manner and according to the Leasehold Improvements Plans and all
applicable Laws. During construction of the Leasehold Improvements, Landlord
will use all reasonable efforts (without interfering with customary construction
scheduling or incurring extraordinary costs such as overtime) to

                                       14
<PAGE>

coordinate with Tenant and Tenant's vendors for the delivery and installation of
Tenant's trade fixtures and equipment. As construction progresses, Landlord will
make monthly payments for the costs thereof out of the Leasehold Improvements
Allowance, provided that prior to making any payment, Landlord will prepare or
obtain, as applicable, and deliver to Tenant's Representative the following: (i)
invoices from Landlord and from all subcontractors requesting payment reflecting
the amount due for work performed or materials supplied during the preceding
month; (ii) a certificate of the architect for the Leasehold Improvements
confirming that the work for which payment is requested has been completed and
the materials for which payment is requested have been delivered to the
Premises; and (iii) copies of lien releases for all work paid for with the last
month's payments. Tenant's Representative will have three business from delivery
of the foregoing materials to review the same and to verify that the work for
which payment is sought has been completed; if Tenant does not notify Landlord
to the contrary within such three business day period, Tenant will be deemed to
have approved payment and Landlord will be free to make the requested payments
(but the failure of Tenant's Representative to respond will not constitute a
waiver of any of Tenant's other rights hereunder with respect to the proper
completion of the Leasehold Improvements). Landlord will withhold a 10%
retainage from all payments to subcontractors of trades from which retainage is
customarily withheld in the construction industry and will not pay such
retainage to any such subcontractor until all punch list work required to be
performed by such subcontractor has been satisfactorily completed. At such time
as Landlord has paid in full the Leasehold Improvements Allowance, Tenant will
pay Landlord the amount, if any, by which Tenant's Cost exceeds the Leasehold
Improvements Allowance in monthly installments, with each such installment due
within 30 days after receipt from Landlord of the payment request materials
described above. Tenant may also withhold a 10% retainage from its payments for
trades from which retainage is customarily withheld pending completion of any
punch list items. Throughout construction of the Leasehold Improvements and for
a period of six months after Substantial Completion thereof, Tenant will have
the right, during normal business hours and upon reasonable prior notice, to
audit such construction and all of Landlord's books and records relating thereto
to verify that that such construction and all payments therefor are in
accordance with the applicable contracts.

     3.11   Change Orders. Tenant's Representative may authorize changes in
Landlord's Work during construction only by written instructions to Landlord's
Representative on a form approved by Landlord. All such changes will be subject
to Landlord's prior written approval, which will not be unreasonably withheld,
delayed or conditioned so long as the proposed change will not increase
Landlord's costs or have a substantial adverse effect on the construction
schedule. Prior to commencing any change, Landlord will prepare and deliver to
Tenant, for Tenant's approval, a change order ("Change Order") identifying the
total cost of such change, which will include associated architectural,
engineering and construction contractor's fees, and the total time that will be
added to the construction schedule by such change. Landlord will deliver each
Change Order to Tenant within five business days after Tenant's request
therefor, except in cases of extraordinary change where the necessary
information is not available to Landlord within such period. If Tenant fails to
approve such Change Order within 10 days after delivery by Landlord, Tenant will
be deemed to have withdrawn the proposed change and Landlord will not proceed to
perform the change. Upon Landlord's receipt of Tenant's approval, Landlord will
proceed to perform the change.

                                       15
<PAGE>

     3.12   Tenant's Delays. As provided in Section 3.2, the Delivery Date will
not occur until Landlord has Substantially Completed Landlord's Work; provided,
however, that if Landlord is delayed in substantially completing Landlord's Work
as a result of: (a) any Tenant delays described in Sections 3.5, 3.6, 3.8, 3.9
or 3.10; (b) any Change Orders or changes in any drawings, plans or
specifications requested by Tenant; (c) Tenant's failure to review or approve in
a timely manner any item requiring Tenant's review or approval; or (d) any other
act or omission of Tenant or Tenant's architects, engineers, contractors or
subcontractors (all of which will be deemed to be delays caused by Tenant), then
the Delivery Date will only be extended under Section 3.2 until the date on
which Landlord would have Substantially Completed the performance of such work
but for such delays.

     3.13   Adjustments Upon Completion. As soon as practicable after the
completion of the Shell, Landlord will cause its architect to measure and
certify to Landlord and Tenant the Rentable Area of the Premises, and Tenant
will have the right, at its cost, to have such measurement verified. Upon the
request of either party, Landlord and Tenant will execute a certificate
confirming such Rentable Area (as so verified by Tenant, if Tenant elects to do
so) and the actual amounts (based on such Rentable Area) of the Basic Rent
payable per month during each Lease Year of the Term and the actual amount of
the Leasehold Improvements Allowance. Tenant will pay any additional Basic Rent
or Tenant's Cost owing, or Landlord will refund any Basic Rent or Tenant's Cost
previously overpaid by Tenant, upon the execution of such certificate.

     3.14   Tenant's Property. Subject to Section 9.1 (to the extent
applicable), Tenant at its own expense will provide, install and maintain, and
may substitute and alter from time to time, all trade fixtures, equipment and
personal property in addition to the Leasehold Improvements reasonably required
to enable it to conduct its business at the Premises (collectively, "Tenant's
Property"). Tenant's Property will remain the property of Tenant and Tenant may
remove all or part thereof at any time during the Term, subject to the
provisions of Section 13.1. Tenant will repair at its own expense any damage to
the Premises caused by the removal of Tenant's Property by Tenant, ordinary wear
and tear and damages from casualty excepted. Tenant's Property will not be
subject to and will be free of any lien (other than a judgment lien) for the
payment of rent by Tenant or for the performance of any other obligation of
Tenant under this Lease.

4.   RENT

     4.1   Basic Rent. Commencing on the Commencement Date and then throughout
the Term, Tenant agrees to pay Landlord Basic Rent according to the following
provisions. Basic Rent during each Lease Year of the Term will be payable in
monthly installments in an amount equal to 1/12 of the amount obtained by
multiplying the rate of Basic Rent for such Lease Year set forth in the
definition of Basic Rent in Section 1.1 (or, in the case of Lease Years during
any Renewal Term, as determined in accordance with Section 2.5) by the number of
square feet of Rentable Area of the Premises, in advance, on or before the first
day of each and every month during the Term. If the Commencement Date is a date
other than the first day of a calendar month or if the Term ends on a date other
than the last day of a calendar month, Landlord will

                                       16
<PAGE>

prorate monthly Basic Rent for the first month of the Term or the last month of
the Term, as the case may be, based upon the ratio that the number of days of
the Term within such month bears to the total number of days in such month.

     4.2   Additional Rent for Taxes and Operating Expenses. Tenant agrees to
pay Landlord, as Additional Rent, in the manner provided below for each calendar
year that contains any part of the Term, the Taxes and Operating Expenses for
such calendar year.

          (a)   Estimated Taxes and Operating Expenses. Prior to the Delivery
                --------------------------------------
     Date (with respect to the calendar year in which the Term commences) and
     then prior to the commencement of each calendar year within the Term
     thereafter (with respect to such ensuing calendar year), Landlord will
     provide Tenant with a written estimate for such calendar year of (i) the
     total amount of Taxes and Operating Expenses; and (ii) the monthly payments
     of Additional Rent payable by Tenant during such calendar year for Taxes
     and Operating Expenses. Landlord will not increase its estimate of Taxes
     and Operating Expenses for any calendar year to an amount that is greater
     than 105% of the prior calendar year's actual Taxes and Operating Expenses
     unless Landlord has reasonable grounds to believe that a greater increase
     is probable and provides written substantiation to Tenant of such grounds.

          (b)   Payment of Additional Rent. Commencing on the Delivery Date,
                --------------------------
     Tenant will pay, as Additional Rent and, from and after the Commencement
     Date, together with Tenant's monthly Basic Rent payment, Taxes and
     Operating Expenses for each calendar year, as estimated by Landlord, in
     equal monthly installments, in advance, on the first day of each month
     during each applicable calendar year. If Landlord delivers its estimate for
     a calendar year to Tenant after the first day of January of such year,
     Tenant will continue to pay on the basis of the prior calendar year's
     estimate until the month after the month in which the estimate for the
     current year is delivered. In the month Tenant first pays based on
     Landlord's new estimate, Tenant will pay to Landlord 1/12 of the difference
     between the new estimate and the prior year's estimate for each month which
     has elapsed since the beginning of the current calendar year.

          (c)   Re-estimates of Excess Taxes and Operating Expenses. From time
                ---------------------------------------------------
     to time during any applicable calendar year, Landlord may re-estimate Taxes
     and Operating Expenses if Landlord has reasonable grounds to believe that
     the prior estimate is inaccurate, and in such event Landlord will notify
     Tenant in writing of such re-estimate in the manner set forth above,
     include with such notice written substantiation of the grounds for the re-
     estimate, and recalculate Tenant's monthly installments of estimated Taxes
     and Operating Expenses for the then remaining balance of such calendar year
     in an amount sufficient to pay the re-estimated amount over the balance of
     such calendar year. Landlord will appropriately credit Tenant for payments
     made by Tenant pursuant to the previous estimate.

          (d)   Adjustment of Actual Taxes and Operating Expenses. Upon
                -------------------------------------------------
     completion of each calendar year, Landlord will determine the actual amount
     of Taxes and Operating

                                       17
<PAGE>

     Expenses for such calendar year and deliver a written certification of such
     actual amounts to Tenant after the end of each calendar year. If Tenant has
     paid less than the actual Taxes and Operating Expenses for any calendar
     year, Tenant will pay the balance of Taxes and Operating Expenses within 10
     days after receiving Landlord's statement. If Tenant has paid more than the
     actual Taxes and Operating Expenses for any calendar year, Landlord will
     credit such excess against the next monthly installment or installments of
     Rent payable by Tenant to Landlord or, if there are no further installments
     of Rent due, refund such excess. If the Delivery Date occurs on other than
     the first day of a Tax Year or if the Term expires or otherwise terminates
     on other than the last day of a Tax Year, Taxes for the Tax Year in which
     the Delivery Date occurs or the Term ends, as the case may be, will be
     prorated between Landlord and Tenant, based on the most recent levy and
     most recent assessment. Such proration will be subsequently adjusted when
     the actual bills become available for Taxes for the Tax Year for which
     Taxes were prorated. Landlord will also adjust pro rata actual Operating
     Expenses for any fractional calendar year occurring during the Term based
     upon the number of days of the Term during such calendar year as compared
     to 365 days The parties' obligations under this Section 4.2 will survive
     the expiration of the Term or other termination of this Lease.

          (e)   Tenant's Right to Inspect and Audit. Upon reasonable notice to
                -----------------------------------
     Landlord, Tenant, or its authorized representatives, will have the right to
     inspect the books and records of Landlord pertaining to projected or actual
     Taxes or Operating Expenses. In addition, Tenant may upon reasonable prior
     notice to Landlord given within 30 days after the delivery by Landlord of
     any annual statement referred to in Section 4.2(d) above, have any or all
     of Landlord's books and records relating to Taxes and/or Operating Expenses
     for the calendar year covered by such statement audited. If such audit is
     performed by an independent certified public accountant who is not
     regularly engaged by either Landlord or Tenant and is reasonably approved
     by both parties, and if such audit determines that such annual statement
     overstated Taxes and Operating Expenses by more than 4% of the total
     thereof as determined by such audit, Landlord will reimburse Tenant for the
     reasonable costs incurred by Tenant for such audit within 30 days after
     receipt of a copy of the audit report. In addition, if such an audit
     reveals any overpayment or underpayment by Tenant for the year audited,
     within 30 days after the audit report is delivered to Landlord and Tenant,
     Landlord will correct its statement for such year and credit Tenant with
     the amount of any overpayment and Tenant will pay to Landlord the amount of
     any underpayment.

          (f)   Tenant's Right to Contest Taxes. Tenant will have the right to
                -------------------------------
     contest any Taxes payable by Tenant pursuant to this Lease, provided that
     Tenant continues to pay to Landlord all amounts due under this Lease with
     respect to Taxes when and as the same are due notwithstanding the pendency
     of any such contest. However, if applicable Laws permit the withholding of
     payment without delinquency, Landlord will, upon Tenant's written request
     (which must be made at least 60 days prior to the due date of the subject
     payment of Taxes), withhold payment of any Taxes that Tenant is contesting
     until such time as payment thereof (or of such Taxes as the same may be
     reduced by such contest) is required to be made by applicable Laws in order
     to avoid delinquency. Tenant will notify

                                       18
<PAGE>

     Landlord within 5 business days of the commencement of any such contest. So
     long as Tenant complies with the terms of this Section, Tenant will have
     the right, in connection with any such contest, at its sole expense, to
     institute and prosecute, in food faith and, with due diligence and in
     Landlord's name if necessary, any appropriate proceedings, and Landlord
     will, at Tenant's expense, fully cooperate with Tenant's efforts to contest
     any such Taxes.

     4.3   Net Lease; Additional Rent. It is the intent of the parties that the
Basic Rent provided in this Lease will be, except as otherwise expressly
provided in this Lease, a net payment to Landlord and that, in addition to Basic
Rent, Tenant will pay Additional Rent for Operating Expenses and Taxes according
to Section 4.2, the cost of all utilities consumed at the Premises according to
Section 6.2, and the cost of all repairs and maintenance required to be
performed by Tenant according to Section 7.1. It is the intention of the parties
that, except as otherwise expressly provided herein, this Lease will not be
terminable for any reason by Tenant, and that Tenant will not be entitled to any
abatement of, or reduction in, any Rent payable under this Lease.

     4.4   Terms of Payment. All Rent will be paid to Landlord in lawful money
of the United States of America, at Landlord's Rent Address or to such other
person or at such other place as Landlord may from time to time designate in
writing, without notice or demand and without right of deduction, abatement or
setoff, except as otherwise expressly set forth herein. Except to the extent
otherwise expressly provided herein, Tenant's covenants to pay Basic Rent and
Additional Rent are independent of any other covenant, condition, provision or
agreement herein contained.

     4.5   Late Payments. Any payment of Rent which is not received within five
days after it is due will be subject to a late charge equal to 5% of the unpaid
payment, or $100.00, whichever is greater. This amount is in compensation of
Landlord's additional cost of processing late payments. In addition, any Rent
which is not paid when due will accrue interest at the Interest Rate from the
date on which it was due until the date on which it is paid in full with accrued
interest. Notwithstanding the foregoing, for the first time in any calendar year
that Tenant fails to make any payment within five days after its due date, such
late charge and interest will not apply unless Tenant fails to make such payment
within 10 days after delivery of Landlord's notice of such failure to pay.
Landlord will not be required to give Tenant such notice more than once in any
calendar year prior to assessing such late charge and interest.

     4.6   Right to Accept Payments. No receipt by Landlord of an amount less
than Tenant's full amount due will be deemed to be other than payment "on
account," nor will any endorsement or statement on any check or any accompanying
letter effect or evidence an accord and satisfaction. Landlord may accept such
check or payment without prejudice to Landlord's right to recover the balance or
pursue any right of Landlord. No payments by Tenant to Landlord after the
expiration or other termination of the Term, or after the giving of any notice
(other than a demand for payment of money) by Landlord to Tenant, will
reinstate, continue or extend the Term or make ineffective any notice given to
Tenant prior to such payment. After notice or commencement of a suit, or after
final judgment granting Landlord possession of the Premises,

                                       19
<PAGE>

Landlord may receive and collect any sums of Rent due under this Lease, and such
receipt will not void any notice or in any manner affect any pending suit or any
judgment obtained. Any amounts received by Landlord may be allocated to any
specific amounts due from Tenant to Landlord as Landlord determines.

5.   USE, OCCUPANCY AND COMPLIANCE

     5.1   Use. Tenant may use the Premises for any and all uses and purposes
that are from time to time permitted by Laws. Tenant will not keep anything on
or about the Premises which would invalidate any insurance policy required to be
carried on the Premises by Landlord or Tenant pursuant to this Lease. Tenant
will not cause or permit to exist any public or private nuisance on or about the
Premises.

     5.2   Compliance by Landlord. Landlord will, at its sole expense, keep and
maintain the Building's roof and structural elements (including foundations,
structural columns and beams and load-beating walls) in a condition that is in
compliance with all applicable Laws, except (subject to Section 8.4) for damages
caused by the negligence of Tenant, its agents, employees, contractors or
invitees. Such obligation will include, without limitation, the obligation to
make such changes to the Building's roof and structural elements (including
foundations, structural columns and beams and load-beating walls) as may be
required from time to time by applicable Laws, except for changes required by
virtue of a change in use of the Premises by Tenant or by any alterations or
other modifications to the Premises undertaken by Tenant.

     5.3   Compliance by Tenant. Tenant will comply with all Laws applicable to
the use and occupancy of the Premises during the Term, including, without
limitation, obtaining and maintaining all licenses and permits required to
operate Tenant's business. Tenant will, at its sole expense, keep and maintain
the all of Premises (excluding those portions of the Building that Landlord is
obligated to maintain in compliance with Laws pursuant to Section 5.2, except
for damages to such portions caused by the negligence of Tenant, its agents,
employees, contractors or invitees, which damages Tenant will be required to
repair) in a condition that is in compliance with all applicable Laws. Such
obligation will include, without limitation, the obligation to make such changes
to the Premises, whether interior or exterior, as may be required from time to
time by applicable Laws (excluding changes to those portions of the Building
that Landlord is obligated to maintain in compliance with Laws pursuant to
Section 5.2, except for changes required by virtue of a change in use of the
Premises by Tenant or by any alterations or other modifications to the Premises
undertaken by Tenant, which changes Tenant will be required to make).

     5.4   Contests. Landlord and Tenant will each have the right, however, to
contest or challenge by appropriate proceedings the enforceability of any Law or
its applicability to the Premises or the use or occupancy thereof by Tenant or a
Subtenant so long as Landlord or Tenant, as applicable, diligently prosecutes
the contest or challenge to completion and, in the event Landlord or Tenant, as
applicable, loses the contest or challenge, thereafter abides by and conforms to
such Law. In the event of Landlord's or Tenant's challenge or contest of such
Law, Landlord or Tenant, as applicable, may elect not to comply with such Law
during such challenge

                                       20
<PAGE>

or contest; provided, however, that such election not to comply will not result
in any material risk of forfeiture of the other party's interest in the
Premises. Landlord and Tenant will indemnify and hold the other party harmless
from and against all claims, damages or judgments resulting from any such
election not to comply.

     5.5  Hazardous Substances.

          (a)   Tenant's Covenants. Tenant will not cause any Hazardous
                ------------------
     Substance to be located on the Premises and will not conduct or authorize
     the use, generation, transportation, storage, treatment or disposal at the
     Premises of any Hazardous Substance other than as may be in compliance with
     Environmental Laws and (i) contained in ordinary quantifies of products
     used by Tenant for ordinary cleaning of the Premises and associated
     janitorial supplies; (ii) contained in ordinary quantities of customary
     office supplies (such as copier toner and cleaner) used by Tenant for its
     office operations at the Premises; or (iii) contained in packaged products
     intended for resale to customers of Tenant's order-by-internet home-
     delivery grocery distribution warehouse business. If Tenant desires to
     conduct or authorize the use, generation, transportation, storage,
     treatment or disposal at the Premises of any Hazardous Substances other
     than those expressly permitted above, Tenant must first obtain Landlord's
     written consent, which consent may be withheld in Landlord's sole
     discretion. If the presence, release, threat of release, placement on or in
     the Premises or the generation, transportation, storage, treatment or
     disposal at the Premises of any Hazardous Substance as a result of Tenant's
     use or occupancy of the Premises (i) gives rise to liability (including,
     but not limited to, a response action, remedial action or removal action)
     under Environmental Laws; (ii) causes a significant public health effect;
     or (iii) pollutes or threatens to pollute the environment, Tenant will
     promptly take any and all remedial and removal action necessary to clean up
     the Premises and mitigate exposure to liability arising from the Hazardous
     Substance, in compliance with Environmental Laws.

          (b)   Tenant's Indemnity. Tenant will indemnify, defend and hold
                ------------------
     Landlord harmless from and against all damages, costs, losses, expenses
     (including, without limitation, actual reasonable attorneys' fees and
     engineering fees) arising from or attributable to (i) the existence of any
     Hazardous Substance at the Premises as a result of the acts of Tenant or
     its agents, employees or contractors or Tenant's use and occupancy of the
     Premises, and (ii) any breach by Tenant of any of its covenants contained
     in this Section 5.5.

          (c)   Landlord's Representations and Covenant. Landlord represents to
                ---------------------------------------
     Tenant, to Landlord's current actual knowledge (without duty of
     investigation), and except as otherwise disclosed in the environmental site
     assessment report made with respect to the Premises and certain adjacent
     property for Landlord by Hirsch*Gibney and dated November 24, 1999, a copy
     of which has been delivered to Tenant, that there are no Hazardous
     Substances present on the Premises as of the date of this Lease in any
     manner or quantity that violates any Environmental Laws. Landlord further
     represents to Tenant that it has not received any Environmental Notices (as
     defined below) as of the date of

                                       21
<PAGE>

     this Lease. Landlord covenants that Landlord will not cause any Hazardous
     Substances to be incorporated into the Building during its construction
     (except standard building materials incorporated in compliance
     Environmental Laws) and that, as of the Delivery Date, the Improvements
     will not contain any (i) electrical transformers or other equipment
     containing polychlorinated biphenyl in excess of 50 parts per million; (ii)
     asbestos in any form; or (iii) urea formaldehyde foam insulation.

          (d)   Landlord's Indemnity. Landlord will indemnify, defend and hold
                --------------------
     Tenant harmless from and against all damages, costs, losses, expenses
     (including, without limitation, actual reasonable attorneys' fees and
     engineering fees) arising from or attributable to (i) the existence of any
     Hazardous Substance at the Premises as a result of the acts of Landlord or
     its agents, employees or contractors, and (ii) any breach by Landlord of
     any of its representations or covenants contained in this Section 5.5.

          (e)   Environmental Notices. Each party will immediately provide the
                ---------------------
     other with telephone notice, followed by written notice, of any complaint,
     order or other notice with regard to Hazardous Substances issued by any
     governmental entity or any other third party with respect to the Premises
     or the Project ("Environmental Notices").

          (f)   Survival. The parties' obligations under this Section 5.5 will
                --------
     survive the expiration of the Term or other termination of this Lease.

     5.6   Americans With Disabilities Act. Tenant will, at its expense, cause
its operation of any business within the Premises to comply with the ADA.
Landlord will cause Landlord's Work to be designed and constructed in accordance
with the ADA. If any work (such as an alteration made pursuant to Section 9.1)
is performed by, through or under Tenant, Tenant will, at Tenant's expense,
cause such work to be designed and constructed in compliance with the ADA.

6.   SERVICES AND UTILITIES

     6.1   Services Provided by Landlord. During the Term, Landlord will
operate, maintain and repair the Premises (except for any such operation,
maintenance or repair which is expressly the obligation of Tenant pursuant to
this Lease) according to those standards from time to time prevailing for
comparable office/warehouse facilities in the area in which the Premises are
located. Landlord will provide the following services according to such
standards, the costs of which will be included in Operating Expenses to the
extent provided in the definition thereof in Section 1.1:

          (a)   Maintenance and Repairs. Maintenance (excluding routine
                -----------------------
     janitorial services), repair and replacement, as necessary, of the
     Building's roof and structural elements (including foundations, structural
     columns and beams and load-bearing walls), the exterior of the Building,
     the lobbies, corridors and restrooms in the Building, the Building's
     plumbing and electrical systems and the Standard HVAC Equipment, except
     (subject to Section 8.4) for damages caused by the negligence of Tenant,
     its agents, employees, contractors or invitees. Landlord will commence any
     maintenance or repairs

                                       22
<PAGE>

     required of Landlord under this Lease as soon as possible after being
     notified of the need for such maintenance or repair.

          (b)   Electrical Energy. Electrical energy for lighting the Premises
                -----------------
     and operating Planned Equipment (as used in this Lease, "Planned Equipment"
     means those items of equipment that the Shell electrical system and the
     Standard HVAC Equipment are designed to accommodate pursuant to the Shell
     Plans and the Leasehold Improvements Plans). Tenant will not install in the
     Premises any equipment which requires electrical energy or any electrical
     circuits in excess of the energy or circuits available for Planned
     Equipment without Landlord's written consent, which consent Landlord will
     not unreasonably withhold. Tenant will pay all costs of installing
     facilities necessary to furnish such excess electrical energy for such
     equipment and for such increased electrical energy usage. Landlord will
     replace all electric lighting bulbs and tubes and all ballasts and starters
     within the Premises.

          (c)   Heating and Air Conditioning. Heating, ventilating and air
                ----------------------------
     conditioning the portions of the Premises served by the Standard HVAC
     Equipment at such times and at such temperatures as may be reasonably
     established by Tenant (Tenant will have the right, subject to the design
     limitations of the Standard HVAC Equipment, to establish the hours and days
     of HVAC operations and the temperatures at which the interior portions of
     the Premises served by the Standard HVAC Equipment will be maintained
     during the hours of HVAC operation) for comfortable use and occupancy under
     normal business operations with Planned Equipment. If Tenant installs any
     machines, equipment or devices in the Premises that do not constitute
     Planned Equipment and such machines, equipment or devices cause the
     temperature in any part of the Premises to exceed the temperature the
     Standard HVAC Equipment would be able to maintain in the Premises were it
     not for such machines, equipment or devices, then Landlord reserves the
     right to install supplementary air conditioning units in the Premises, and
     Tenant will pay Landlord all costs of installing, operating and maintaining
     such supplementary units.

          (d)   Water. Hot and cold water from the regular Building outlets for
                -----
     lavatory and restrooms and for drinking purposes.

          (e)   Parking Facilities and Landscaped Areas. Maintenance in good
                ---------------------------------------
     order, condition and repair, of the parking facilities, driveways,
     sidewalks and landscaped areas on the Premises. Landlord will keep such
     driveways, sidewalks and parking facilities free from any unreasonable
     accumulation of snow.

     6.2   Tenant's Utilities. Tenant will pay, before delinquency, directly to
the provider, for all separately metered or separately charged utilities
(electricity, natural gas, telecommunications, water, sewer and any other
utility requirements of Tenant) provided to the Premises or to Tenant. Landlord
will not include such mounts as Operating Expenses.

     6.3   Interruption of Services. No interruption in, or temporary stoppage
of, any of the above-described services required to be provided by Landlord that
is caused by reasons beyond Landlord's reasonable control (such as the making,
in a commercially reasonable

                                       23
<PAGE>

manner, of any repairs that Landlord is required to make hereunder; the making
of any renewals, improvements or alterations by Tenant or by third parties;
strikes, lockouts, labor controversy or accidents; or inability to obtain fuel
or supplies), will constitute an eviction or disturbance of Tenant's use and
possession of the Premises, or render Landlord liable for damages, by abatement
of Rent or otherwise, or relieve Tenant from any obligation described in this
Lease. In no event will Landlord be required to provide any heat, air
conditioning, electricity or other service which exceeds that permitted by
involuntary guidelines or by any Laws. However, in the event that, due to
reasons within Landlord's reasonable control, any utilities or services required
to be furnished by Landlord to the Premises pursuant to this Section 6 are
interrupted, disrupted or terminated and such interruption, disruption or
termination prevents the normal conduct of Tenant's business at the Premises for
a continuous period of three business days, then the Basic Rent will equitably
abate, based upon the portion or portions of the Premises so affected by the
interruption, disruption or termination, for so long as such utilities or
services remain so interrupted, disrupted or terminated for such reasons.

7.   REPAIRS AND MAINTENANCE

     7.1   Tenant's Obligations. Tenant will, at its expense (a) maintain,
repair and replace as necessary the Special HVAC Equipment and all other
portions of the Premises, except those portions thereof that Landlord is
obligated to maintain, repair and replace pursuant to Sections 6.1(a) and (e),
in as good order, condition and repair as they were at the time Tenant took
possession of the Premises, ordinary wear and tear and damage from fire and
other casualties excepted; (b) keep the Premises free of insects, rodents,
vermin and other pests; (c) provide such janitorial services to the Building as
may be necessary for the operation of Tenant's business and (d) promptly repair,
restore and replace, to Landlord's reasonable satisfaction, all uninsured damage
or injury to the Premises caused by the willful acts or negligence of Tenant,
its agents, employees, contractors or invitees. All such repairs, restorations
and replacements will be equal in quality and class to the original work and
will comply with all requirements of this Lease.

     7.2   Landlord's Right of Entry. For purposes of performing Landlord's
obligations under Section 6.1, or any of Tenant's obligations under Section 7.1
that Tenant fails to perform within the cure period provided in Section 14.2, or
to inspect the Premises, Landlord may enter the Premises upon at least 48 hours'
prior notice to Tenant (except in cases of actual or suspected emergency, in
which case no prior notice will be required) without liability to Tenant for any
loss or damage incurred as a result of such entry (except to the extent caused
by Landlord's negligence or willful misconduct), provided that Landlord will
take all reasonable and necessary steps in connection with such entry to
minimize any disruption to Tenant's business or its use of the Premises.

8.   INSURANCE, WAIVERS AND INDEMNITY

     8.1   Landlord's Insurance. During the period from the Delivery Date to the
Commencement Date and then throughout the Term, Landlord will provide and keep
in force the following insurance, the costs of which will be included in
Operating Expenses:

                                       24
<PAGE>

          (a)   bodily injury and property damage liability insurance relating
      to Landlord's operation of the Premises, with a combined single occurrence
      limit of not less than $5,000,000.00; such insurance will be on a
      commercial general liability form including, without limitation, personal
      injury and assumed contractual liability for the performance by Landlord
      of the indemnity agreements set forth in Section 8.5; such liability
      insurance will include cross liability and severability of interests
      clauses or endorsements; unless otherwise approved in writing by Tenant,
      such policy will have a deductible of $5,000.00 or less and will not have
      a retention or self-insurance provision;

          (b)   all risk or equivalent property insurance (including fire and
      standard extended coverage perils, leakage from fire protective devices
      and other water damage) covering loss or damage to the Improvements
      (including the Shell and the Leasehold Improvements, but excluding any
      alterations made to the Premises by Tenant, Tenant's fixtures,
      furnishings, equipment, inventory, personal property, documents, files and
      work products) on a full replacement cost basis, excluding excavations,
      footings and foundations, and with a deductible not in excess of $5,000.00
      unless otherwise approved by Tenant (upon the occurrence of any casualty,
      the amount expended by Landlord to satisfy such deductible will be
      included in Operating Expenses);

          (c)   loss of rental income insurance in the amount of one year's
      Basic Rent and Additional Rent for Taxes and Operating Expenses;

          (d)   if any boiler or machinery is operated in the Premises, boiler
      and machinery insurance;

          (e)   worker's compensation insurance insuring against and satisfying
      Landlord's obligations and liabilities under the worker's compensation
      laws of the State of Colorado and employers' liability insurance in the
      limit of $100,000/500,000/100,000;

          (f)   if Landlord operates owned, hired or nonowned vehicles on the
      Premises, comprehensive automobile liability will be carried at a limit of
      liability not less than $1,000,000.00 combined bodily injury and property
      damage; and

          (g)   such other insurance as is then maintained by prudent owners Of
      buildings similar to the Building and that Landlord reasonably elects to
      obtain or any Building mortgagee requires.

Insurance effected by Landlord under Sections 8.1(b), (c) and (d) will permit
the release of Tenant from certain liability under Section 8.4.

     8.2   Tenant's Insurance. During the period from the Delivery Date to the
Commencement Date and then throughout the Term, Tenant will provide and keep in
force the following insurance:

          (a)   bodily injury and property damage liability insurance relating
      to Tenant's business (carried on, in or from the Premises) and Tenant's
      use and occupancy, with a

                                       25
<PAGE>

      combined single occurrence limit of not less than $5,000,000.00; such
      insurance will be on a commercial general liability form including,
      without limitation, personal injury and assumed contractual liability for
      the performance by Tenant of the indemnity agreements set forth in Section
      8.6; Landlord and its mortgagee will be named as an additional insureds in
      the policy providing such liability insurance, which will include cross
      liability and severability of interests clauses or endorsements; unless
      otherwise approved in writing by Landlord, such policy will have a
      deductible of $5,000.00 or less and will not have a retention or self-
      insurance provision;

          (b)   all risk or equivalent property insurance (including fire and
      standard extended coverage perils, leakage from fire protective devices
      and other water damage) covering loss or damage to any alterations made to
      the Premises by Tenant, Tenant's fixtures, furnishings, equipment,
      inventory, personal property, documents, files and work products in the
      Premises on a full replacement cost basis in amounts sufficient to prevent
      Tenant from becoming a coinsurer and subject only to such deductibles and
      exclusions as Landlord may reasonably approve;

          (c)   if any boiler or machinery is operated in the Premises, boiler
      and machinery insurance;

          (d)   worker's compensation insurance insuring against and satisfying
      Tenant's obligations and liabilities under the worker's compensation laws
      of the State of Colorado and employers' liability insurance in the limit
      of $100,000/500,000/100,000; and

          (e)   if Tenant operates owned, hired or nonowned vehicles on the
      Premises, comprehensive automobile liability will be carried at a limit of
      liability not less than $1,000,000.00 combined bodily injury and property
      damage.

Insurance effected by Tenant under Sections 82(b) and (c) will permit the
release of Landlord from certain liability under Section 8.4.

     8.3   General Insurance Requirements. All insurance required to be
maintained by Landlord or Tenant pursuant to Sections 8.1 and 8.2 will be
maintained with insurors licensed to do business in the State of Colorado and
having a Best's Key Rating of at least A-XII. Landlord and Tenant will file with
the other, on or before the Delivery Date and at least 10 days before the
expiration date of expiring policies, such copies of either current policies or
certificates as may be reasonably required to establish that the insurance
coverage required by Sections 8.1 and 8.2 is in effect from time to time and
that the insuror(s) have agreed to give the other party at least 30 days notice
prior to any cancellation of, or material modification to, the required
coverage. Landlord and Tenant will cooperate with each Other in the collection
of any insurance proceeds which may be payable in the event of any loss,
including the execution and delivery of any proof of loss or other actions
required to effect recovery. All commercial general liability and property
policies required to be maintained by either party hereunder will be written as
primary policies, not contributing with and not supplemental to any coverage
that the other party may carry.

                                       26
<PAGE>

     8.4  Waivers. Except to the extent caused by the willful or negligent act
or omission or breach of this Lease by Landlord or anyone for whom Landlord is
legally responsible, Landlord and its Affiliates will not be liable or in any
way responsible for, and Tenant waives all claims against Landlord and its
Affiliates for, any loss, injury or damage suffered by Tenant or others relating
to (a) loss or theft of, or damage to, property of Tenant or others; (b) injury
or damage to persons or property resulting from fire, explosion, failing
plaster, escaping steam or gas, electricity, water, rain or snow, or leaks from
any part of the Improvements or from any pipes, appliances or plumbing, or from
dampness; or (c) damage caused by persons on or about the Premises, or caused by
the public or by construction of any private or public work. Landlord and its
Affiliates will not be liable or in any way responsible to Tenant for, and
Tenant waives all claims against Landlord and its Affiliates for, any loss,
injury or damage that is insured or required to be insured by Tenant under
Section 8.2(b) or (c). Tenant and its Affiliates will not be liable or in any
way responsible to Landlord for, and Landlord waives all claims against Tenant
and its Affiliates for, any loss, injury or damage that is insured or required
to be insured by Landlord under Section 8.1(b), (c) or (d).

     8.5  Landlord's Indemnity. Subject to Sections 6.3 and 8.4 and except to
the extent caused by the willful or negligent act or omission or breach of this
Lease by Tenant or anyone for whom Tenant is legally responsible, Landlord will
indemnify and hold Tenant harmless from and against any and all liability, loss,
claims, demands, damages or expenses (including reasonable attorneys' fees) due
to or arising out of any willful or negligent act or omission or breach of this
Lease by Landlord or anyone for whom Landlord is legally responsible. Landlord's
obligations under this Section 8.5 will survive the expiration or early
termination of the Term.

     8.6  Tenant's Indemnity. Except to the extent caused by the willful or
negligence act or omission or breach of this Lease by Landlord or anyone for
whom Landlord is legally responsible, Tenant will indemnify and hold Landlord
harmless from and against any and all liability, loss, claims, demands, damages
or expenses (including reasonable attorneys' fees) due to or arising out of any
accident or occurrence on or about the Premises during the Term (including,
without limitation, accidents or occurrences resulting in injury, death,
property damage or theft) or any willful or negligent act or omission of or
breach of this Lease by Tenant or anyone for whom Tenant is legally responsible.
Tenant's obligations under this Section 8.6 will survive the expiration or early
termination of the Term.

9.   ALTERATIONS; MECHANICS' LIENS

     9.1  Alterations. Tenant will not make any modifications, improvements,
alterations, additions or installations in or to the Premises that affect the
Building's structure or its mechanical systems, or that will cost more than
$50,000.00 in any calendar year, without Landlord's prior written consent, which
consent will not be unreasonably withheld, conditioned or delayed. Tenant will
notify Landlord prior to making any modifications, improvements, alterations,
additions or installations in or to the Premises (referred to in this section as
the "work"), regardless of whether Landlord's consent is required in connection
with such work. Along with any request for Landlord's consent and at least 15
days before commencement of any work or delivery of any materials to be used in
any work to the Premises, Tenant will furnish

                                       27
<PAGE>

Landlord with plans and specifications, estimated commencement and completion
dates, the name and address of Tenant's general contractor, and the necessary
permits and licenses. Landlord will have the right to post notices of non-
responsibility or similar notices on the Premises in order to protect the
Premises against any liens resulting from such work. Tenant agrees to indemnify,
defend and hold Landlord harmless from any and all claims and liabilities of any
kind and description which may arise out of or be connected in any way with such
work. Tenant will pay the cost of all such work, and also the cost of painting,
restoring or repairing the Premises occasioned by such work. Upon completion of
the work, Tenant will furnish Landlord with contractor's affidavits that include
full and final waivers of liens and receipts for all amounts due for labor and
materials. In the case of any work that required Landlord's consent, Tenant will
also provide Landlord with as-built plans and specifications of the Premises as
altered by such work. All work will comply with all insurance requirements and
all applicable Laws (including, without limitation, the ADA) and will be
constructed in a good and workmanlike manner, using materials of first-class
quality and free and clear of all liens or claims therefor. Tenant will permit
Landlord to inspect construction operations in connection with any such work in
accordance with Section 7.2. Landlord's approval of any plans for any
modifications, improvements, alterations, additions or installations proposed by
Tenant will not constitute a representation that the same will comply with Laws
or be fit for any particular purpose; such approval will merely constitute
Landlord's consent to construct or install the same in the Premises.

     9.2  Mechanics' Liens. Tenant will not permit any mechanic's lien or other
lien to be filed against the Premises by reason of any work performed by or for,
or material furnished to, Tenant (including, without limitation, any work
undertaken by Tenant pursuant to Section 9.1). If any such lien is filed at any
time against the Premises, Tenant will cause the same to be discharged of record
(which discharge may, at Tenant's option, be effected by bonding over such lien
in accordance with applicable law) within 30 days after delivery of notice from
Landlord concerning the filing of such lien. If Tenant fails to discharge any
such lien within such period, then, in addition to any other right or remedy of
Landlord, Landlord may, but will not be obligated to, discharge the same by
paying to the claimant the amount claimed to be due or by procuring the
discharge of such lien as to the Premises by deposit in the court having
jurisdiction of such lien, the foreclosure thereof or other proceedings with
respect thereto, of a cash sum sufficient to secure the discharge of the same,
or by the deposit of a bond or other security with such court sufficient in
form, content and amount to procure the discharge of such lien, or in such other
manner as is now or may in the future be provided by present or future Laws for
the discharge of such lien as a lien against the Premises. Any amount paid by
Landlord, or the value of any deposit so made by Landlord, together with all
costs, fees and expenses in connection therewith (including reasonable
attorney's fees of Landlord), together with interest thereon at the Interest
Rate, will be repaid by Tenant to Landlord on demand by Landlord and if unpaid
may be treated as Additional Rent. Notwithstanding the foregoing, if Tenant
desires to contest any such lien, Tenant may do so provided that, within 15 days
after Landlord notifies Tenant of the filing thereof, Tenant notifies Landlord
of Tenant's intention to do so and, until such time as Tenant causes such lien
to be removed by the payment thereof or by bonding over such lien in the manner
provided by law, posting with Landlord such security as Landlord may reasonably
request to provide funds with which Landlord may discharge such lien in the
event Tenant is

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<PAGE>

unsuccessful in its contest and then fails to discharge such lien. Tenant will
indemnify and defend Landlord against and save Landlord and the Premises
harmless from all losses, costs, damages, expenses, liabilities, suits,
penalties, claims, demands and obligations, including, without limitation,
reasonable attorney's fees resulting from the assertion, filing, foreclosure or
other legal proceedings with respect to any such mechanic's lien or other lien.

10.  ASSIGNMENT AND SUBLETTING

     10.1  Permitted Transfers. Tenant may, upon notice to Landlord but without
obtaining Landlord's consent, assign this Lease or sublet all or any portion of
the Premises to (i) any of Tenant's Affiliates; or (ii) any entity into which or
with which Tenant may be merged or consolidated, or any entity that purchases
substantially all of Tenant's assets, provided that the surviving
entity/transferee or purchaser has a tangible net worth that is at least equal
to the lesser of $100,000,000 or Tenant's net worth immediately prior to the
merger/consolidation or asset purchase transaction. Tenant may reincorporate in
a different state provided that there is no material change to the financial
structure or financial position of the company.

     10.2  Transfers Requiring Consent. Except as expressly permitted by Section
10.1, Tenant will not assign this Lease or sublet all or any portion of the
Premises to any assignee or subtenant without first obtaining Landlord's written
consent, which consent will not be unreasonably withheld, conditioned or
delayed. If Tenant desires to effect an assignment or subletting that will
require Landlord's consent, Tenant will seek such written consent of Landlord by
a written request therefor, setting forth the date (which will not be less than
15 days after date of Tenant's notice) on which Tenant desires to assign this
Lease or to sublet all or any portion of the Premises, all of the major terms of
the proposed assignment or sublease, the consideration to be paid by the
assignee or subtenant, the name and address of the proposed assignee or
sublessee and its proposed use of the Premises, copies of the proposed
assignee's or subtenant's financial statements (to the extent available), and
the proposed form of assignment or sublease.

     10.3  Deemed Assignments. Any change in the partners or members of Tenant,
if Tenant is a partnership or limited liability company, or, if Tenant is a
corporation, any transfer of any or all of the shares of stock of Tenant,
resulting in a change in the identity of the person or persons owning a majority
of equity or voting interests in Tenant as of the date of this Lease, will be
deemed to be an assignment within the meaning of this Section 10. However, none
of the following sales or transfers will constitute an assignment requiting
Landlord's consent pursuant to this Section 10: (a) a transfer of the stock or
partnership or membership interests of Tenant at any time that Tenant is a
publicly held entity whose equity interests are traded on a national stock
exchange; (b) any merger or consolidation transaction expressly permitted under
Section 10.1; (c) any transfer or sale of stock solely among existing
shareholders; (d) any transfer or sale of stock pursuant to Tenant's stock
option programs; or (e) a private sale of stock wherein the existing
shareholders of Tenant retain over 50% of the voting interests in Tenant.

     10.4  Excess Consideration. If Tenant effects an assignment or sublease
that is not one permitted by Section 10.1 or 10.3, then Landlord will be
entitled to receive 50% of the

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<PAGE>

amount by which the consideration required to be paid by the transferee for the
use and enjoyment of Tenant's rights under this Lease (after deducting from such
consideration Tenant's reasonable costs incurred in effecting the assignment or
sublease, including, without limitation, real estate commissions, attorneys'
fees and tenant improvement expenses) exceeds the Rent payable by Tenant to
Landlord allocable to the transferred space. Such percentage of such amount will
be payable to Landlord at the time(s) Tenant receives the same from its
transferee (whether in monthly installments, in a lump sum, or otherwise). In
the event such consideration is payable in installments over the term of the
subletting or assignment, Tenant's costs of effecting the subletting or
assignment will be deducted from such consideration payments in equal amortized
installments over such period to determine the amount of the excess
consideration payable to Landlord.

     10.5  General Provisions. No subletting or assignment by Tenant hereunder,
regardless of whether the same requires Landlord's consent, will release or
discharge Tenant of or from any liability, whether past, present or future,
under this Lease, and Tenant will continue to be fully liable hereunder. The
sublessee or assignee will agree in a form reasonably satisfactory to Landlord
to comply with and be bound by all of the terms, covenants, conditions,
provisions and agreements of this Lease to the extent of the space sublet or
assigned, and Tenant will deliver to Landlord promptly after execution an
executed copy of each such sublease or assignment and such an agreement of
compliance by each such sublessee or assignee. Consent by Landlord to any
assignment of this Lease or to any subletting of the Premises will not be a
waiver of Landlord's rights under this Section 10 as to any subsequent
assignment or subletting. Any sale, assignment, mortgage, transfer or subletting
of this Lease which is not in compliance with the provisions of this Section 10
will be of no effect and void. Landlord's right to assign its interest in this
Lease will remain unqualified. Landlord may charge Tenant for Landlord's actual
costs, up to a maximum of $1,000.00, for attorneys' fees and administrative
expenses incident to a review of any documentation related to any proposed
assignment or subletting by Tenant with respect to which Landlord's consent is
required and requested.

11.  CASUALTY

     11.1  Termination Options. If the Improvements are damaged by fire or other
casualty Landlord will, within 45 days after learning of such damage, notify
Tenant in writing of the time necessary to repair or restore such damage, as
estimated by Landlord's architect, engineer or contractor. If such damage
occurred during the 12-month period that ends on the Expiration Date, and if
such estimate states that repair or restoration of all of such damage that was
caused to the Improvements cannot be completed within the lesser of (i) 180 days
from the date of the damage; or (ii) the number of days then remaining in the
Term, then Tenant or Landlord will have the option to terminate this Lease. If
such damage occurred prior to the 12-month period that ends on the Expiration
Date, and if such estimate states that repair or restoration of all of such
damage that was caused to the Improvements cannot be completed within 270 days
from the date of the damage, then Tenant or Landlord will have the option to
terminate this Lease. If such damage is not insured against by the insurance
policies required to be maintained by Landlord according to Section 8.1, then
Landlord will have the option to terminate this Lease (unless Tenant notifies
Landlord, within 15 days after receipt of Landlord's

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<PAGE>

notice of termination, as provided below, that Tenant will pay for all costs of
repairing and restoring the damage that are in excess of any available insurance
proceeds, in which case Landlord's exercise of such right of termination will be
deemed void and Tenant will be obligated to pay for such costs as they are
incurred and to provide such reasonable assurance of payment as may be required
by Landlord's contractor). Any option to terminate granted above must be
exercised by written notice to the other party given within 10 days after
Landlord delivers to Tenant the notice of estimated repair time. If either party
exercises its option to terminate this Lease, the Term will expire and this
Lease will terminate 10 days after notice of termination is delivered; provided,
however, that Rent for the period commencing on the date of such damage until
the date this Lease terminates will be reduced to the reasonable value of any
use or occupation of the Premises by Tenant during such period and Landlord will
be entitled to all proceeds of the insurance policy described in Section 8.2(b)
applicable to any damaged alterations in the Premises.

     11.2  Repair Obligations. If the Improvements are damaged by fire or other
casualty and neither party terminates this Lease according to Section 11.1, then
Landlord will repair and restore such damage with reasonable promptness, subject
to delays for insurance adjustments and delays caused by matters beyond
Landlord's control. Landlord will have no liability to Tenant and Tenant will
not be entitled to terminate this Lease if such repairs and restoration are not
in fact completed within the estimated time period, provided that Landlord
promptly commences and diligently pursues such repairs and restoration to
completion and provided further that, if Landlord fails to complete such repairs
and restoration within 270 days after the date of the damage, Tenant may
terminate this Lease by notice given to Landlord within 20 days after the
expiration of such 270-day period. In no event will Landlord be obligated to
repair, restore or replace any of the property required to be insured by Tenant
according to Section 8.2; however, if Tenant and Landlord so agree, Landlord
will, in connection with its repair and restoration of such damage, repair and
restore the damage, if any, caused to any or all of the alterations required to
be insured by Tenant according to Section 8.2(b). In such event, Landlord will
be entitled to all proceeds of the insurance policy described in Section 8.2(b)
applicable to the alterations that Landlord will repair or restore.

     11.3  Rent Abatement. If any fire or casualty damage renders the Premises
untenantable and if this Lease is not terminated according to Section 11.1, then
Rent will abate beginning on the date of such damage. Such abatement will end on
the date Landlord has substantially completed the repairs and restoration
Landlord is required to perform according to Section 11.2. Such abatement will
be in an amount bearing the same ratio to the total amount of Rent for such
period as the untenantable portion of the Premises bears to the entire Premises.
In no event will Landlord be liable for any inconvenience or annoyance to Tenant
or injury to the business of Tenant resulting in any way from damage caused by
fire or other casualty or the repair of such damage, provided however that, to
the extent Tenant remains in possession of a portion of the Premises, Landlord
will take all reasonable steps to minimize the disruption to Tenant's business
and use of such portion of the Premises during the period of repair.

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<PAGE>

12.  EMINENT DOMAIN

     12.1  Termination. If the whole of the Premises is taken by any public
authority under the power of eminent domain, this Lease will terminate as of the
day possession is taken by such public authority. If more than 15% of the floor
area of the Building is taken, or if so much of the Land is taken that Tenant is
permanently deprived of the use of (i) so much of its loading dock facilities
(including access thereto and parking therefor) that Tenant cannot continue its
business at substantially the same level and scope as before the taking; or (ii)
more than 20% of the parking spaces previously available on the Land (and such
spaces cannot be reconstructed on the remaining Land or any adjacent land
acquired by Landlord for that purpose within 90 days after Tenant is so deprived
of such use), by any public authority under the power of eminent domain, then
Tenant may, by notice to Landlord, terminate this Lease as of the day possession
is taken by such public authority. In case of any such termination, Landlord
will make a pro rata refund of any prepaid Rent. All damages awarded for such
taking under the power of eminent domain or any like proceedings will belong to
and be the property of Landlord, Tenant hereby assigning to Landlord its
interest, if any, in such award.

     12.2  Award; Restoration. Anything in this Section l2 to the contrary
notwithstanding, Tenant will have the right to prove in any condemnation
proceedings and to receive any separate award which may be made for (a) damages
to or condemnation of any alterations or improvements paid for and installed by
Tenant or Tenant's movable trade fixtures and equipment; (b) moving expenses;
(c) loss of goodwill; (d) business interruption; and (e) loss of value, as a
result of such taking, of Tenant's fixtures, equipment and inventory, provided,
however, Tenant will in no event have any right to receive any award for its
interest in this Lease or for loss of its leasehold. Anything in this Section 12
to the contrary notwithstanding, in the event of a partial condemnation of the
Premises where this Lease is not terminated, (i) Landlord will, at its sole cost
and expense, restore the Premises (including any alterations or improvements
installed by Landlord and Tenant) to a complete architectural unit (but
Landlord's restoration obligations will be limited to the extent of the
condemnation award for restoration made available to Landlord), and (ii) the
Basic Rent provided for herein (1) shall equitably abate during the period of
restoration to the extent the Premises are rendered untenantable by the taking
in a manner that will be corrected by restoration; and (2) during the period
from and after the date of delivery of possession pursuant to such proceedings
to the termination of this Lease will be reduced by (A) in the case of a taking
of any portion of the Building, a sum equal to the product of the Basic Rent
provided for herein multiplied by a fraction, the numerator of which is the
Rentable Area of the portion of the Building that was taken, and the denominator
of which is the Rentable Area of the entire Building prior to such taking; and
(B) in the case of a taking of any portion of the Premises excluding the
Building, a sum equal to the product of the Basic Rent provided for herein
multiplied by a fraction, the numerator of which is the fair market value of the
portion of the Premises, excluding the Building, that was taken, and the
denominator of which is the fair market value of the entire Premises, excluding
the Building, prior to such taking.

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13.  END OF TERM

     13.1  Surrender. On the last day of the Term, or on the sooner termination
thereof, Tenant will peaceably surrender the Premises in good condition and
repair (ordinary wear and tear and damage by casualty excepted), consistent with
Tenant's duty to make repairs as herein provided. Tenant will give written
notice to Landlord at least 30 days prior to vacating the Premises for the
express purpose of arranging a meeting with Landlord for a joint inspection of
the Premises (provided that Tenant's failure to do so will not constitute a
default hereunder). On or before the last day of the Term, or the date of sooner
termination thereof, Tenant will, at its sole cost and expense, remove all of
its personal property and trade fixtures and equipment from the Premises
(including, without limitation, Tenant's Property, as defined in Section 3.14,
and Tenant's personal property installed on the roof of the Building pursuant to
Section 17.1 below) and repair all damage to the Premises caused by such
removal. All property not removed will be deemed abandoned. Tenant hereby
appoints Landlord its agent to remove all property of Tenant not so removed from
the Premises upon termination of this Lease and to cause its transportation and
storage for Tenant's benefit, all at the sole cost and risk of Tenant, and
Landlord will not be liable for damage, theft, misappropriation or loss thereof,
nor will Landlord be liable in any manner in respect thereto. Tenant will
reimburse Landlord upon demand for any expenses incurred by Landlord with
respect to removal, transportation or storage of abandoned property and with
respect to restoring such Premises to good order, condition and repair. All
modifications, improvements, alterations, additions and fixtures, other than
Tenant's trade fixtures and equipment, which have been made or installed by
either Landlord or Tenant upon the Premises (excluding any of the same that were
made or installed by Tenant and then subsequently removed by Tenant in
accordance with Section 9.1), will remain the property of Landlord (in the case
of improvements made by Landlord) or become the property of Landlord (in the
case of improvements made by Tenant) upon the expiration of the Term and will be
surrendered with the Premises as a part thereof, except that Tenant will, at its
expense and prior to the expiration of the Term, remove from the Premises (and
repair all damage caused by such removal) (a) any alterations which required
Landlord's consent to make pursuant to Section 9.1 and which Landlord, at the
time it gave its consent to such installation, required that Tenant remove at
the end of the Term; (b) any alterations which did not require Landlord's
consent to make pursuant to Section 9.1 but which are atypical in a distribution
center environment and which Landlord requires Tenant to remove by notice
delivered within five business days after the joint inspection described above
(or, in the event the parties fail to hold such joint inspection, prior to the
expiration of the Term); and (c) if applicable, any items required to be removed
by Landlord pursuant to Section 2.6. If the Premises are not surrendered
promptly at the end of the Term or sooner termination thereof without Landlord's
written permission to not so surrender the Premises, Tenant will indemnify
Landlord against loss or liability resulting from delay by Tenant in so
surrendering the Premises, including, without limitation, claims made by any
succeeding tenants founded on such delay and any attorneys' fees resulting
therefrom. Tenant will promptly surrender all keys for the Premises to Landlord
at the place then fixed for the payment of Rent and will inform Landlord of
combinations on any vaults, locks and safes left on the Premises. Tenant's
obligations under this Section 13.1 will survive the termination of this Lease
or expiration of the Term.

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<PAGE>

     13.2  Holding Over. In the event Tenant remains in possession of the
Premises after expiration of this Lease, Tenant will be deemed to be occupying
the Premises without claim of right, and Tenant will pay Landlord for all costs
arising out of loss or liability resulting from delay by Tenant in so
surrendering the Premises as above provided and will pay a charge for each day
of occupancy in an amount equal to 150% of the Basic Rent (on a daily basis)
payable immediately prior to such expiration, plus 100% of all Additional Rent
(also on a daily basis).

14.  DEFAULTS AND REMEDIES

     14.1  General. All rights and remedies of Landlord and Tenant enumerated in
this Lease are cumulative and are not intended to be exclusive of any other
remedies or means of redress at law or in equity to which either party may be
lawfully entitled in case of any breach or threatened breach by the other party
of any provision of this Lease. The failure of either party to insist in any one
or more cases upon the strict performance of any of the covenants of this Lease
or to exercise any option herein contained will not be construed as a waiver or
relinquishment for the future of such covenant or option. A receipt by Landlord
of Rent with knowledge of the breach of any covenant hereof (other than breach
of the obligation to pay the portion of such Rent paid) will not be deemed a
waiver of such breach, and no waiver by either party of any provisions of this
Lease will be deemed to have been made unless expressed in writing and signed by
such party. Each party agrees to pay, upon demand, all of the other party's
costs, charges and expenses, including the reasonable fees and out-of-pocket
expenses of counsel, agents, and others retained, incurred in successfully
enforcing the other party's obligations under this Lease.

     14.2  Events of Default. Each of the following events will constitute an
"Event of Default" under this Lease:

          (a) Failure to Pay Rent. Tenant fails to pay Basic Rent or any other
              -------------------
     Rent payable by Tenant under the terms of this Lease when due, and such
     failure continues for 10 days after notice is given by Landlord to Tenant
     of such failure (provided that, with respect to monthly installments of
     Basic Rent and monthly installments of Additional Rent for Operating
     Expenses and Taxes, Tenant will only be entitled to two notices of such
     failure during any calendar year and if, after two such notices are given
     in any calendar year, Tenant fails, during such calendar year, to pay any
     further monthly installment of Basic Rent when due, such failure will
     constitute an Event of Default hereunder without any further notice from
     Landlord or additional cure period).

          (b) Failure to Perform Other Obligations. Tenant breaches or fails to
              ------------------------------------
     comply with any provision of this Lease applicable to Tenant other than a
     covenant to pay Rent, and such breach or noncompliance continues for a
     period of 30 days after notice thereof is given by Landlord to Tenant; or,
     if such breach or noncompliance cannot be reasonably cured within such 30-
     day period, Tenant does not commence to cure such breach or noncompliance
     within such 30-day period or, after commencing to cure such breach or
     noncompliance, does not thereafter diligently pursue such cure in good
     faith to completion.

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<PAGE>

          (c) Execution and Attachment Against Tenant. Tenant's interest under
              ---------------------------------------
     this Lease or in the Premises is taken upon execution or by other process
     of law directed against Tenant, or is subject to any attachment by any
     creditor or claimant against Tenant and such attachment is not discharged
     or disposed of within 60 days after levy.

          (d) Bankruptcy or Related Proceedings. Tenant files a petition in
              ---------------------------------
     bankruptcy or insolvency, or for reorganization or arrangement under any
     bankruptcy or insolvency Laws, or voluntarily takes advantage of any such
     Laws by answer or otherwise, or dissolves or makes a general assignment for
     the benefit of creditors, or involuntary proceedings under any such Laws or
     for the dissolution of Tenant are instituted against Tenant, or a receiver
     or trustee is appointed for the Premises or for all or substantially all of
     Tenant's property, and such involuntary proceedings are not dismissed or
     such receivership or trusteeship vacated within 60 days after such
     institution or appointment.

     14.3  Landlord's Remedies. Time is of the essence for the performance of
obligations by Tenant hereunder. If any Event of Default occurs, Landlord will
have the right, at Landlord's election, then or at any later time, to exercise
any one or more of the following remedies:

          (a) Cure by Landlord. Landlord may, at Landlord's option but without
              ----------------
     obligation to do so, and without releasing Tenant from any obligations
     under this Lease, make any payment or take any action as Landlord deems
     necessary or desirable to cure any Event of Default in such manner and to
     such extent as Landlord in good faith deems necessary or desirable. Tenant
     will pay Landlord, upon demand, all advances, costs and expenses of
     Landlord in connection with making any such payment or taking any such
     action, including reasonable attorney's fees, together with interest at the
     Interest Rate, from the date of payment of any such advances, costs and
     expenses by Landlord.

          (b) Termination of Lease and Damages. Landlord may terminate this
              --------------------------------
     Lease, effective at such time as may be specified by notice to Tenant, and
     demand (and, if such demand is refused, recover) possession of the Premises
     from Tenant. In such event, Landlord will be entitled to recover from
     Tenant, as damages for loss of the bargain and not as a penalty, an
     aggregate sum equal to (i) all unpaid Basic Rent and other Rent for any
     period prior to the termination date of this Lease (including interest from
     the due date to the date of the award at the Interest Rate); plus (ii) the
     present value at the time of termination (calculated by discounting on a
     monthly basis at a discount rate equal to the rate payable on U.S. Treasury
     securities offered at the time of award having a maturity closest to the
     date on which the Term would have expired but for such termination) of the
     amount, if any, by which (A) the aggregate of the Basic Rent and all other
     Rent payable by Tenant under this Lease that would have accrued for the
     balance of the Term after termination, exceeds (B) the amount of such Basic
     Rent and other Rent which could reasonably be recovered by reletting the
     Premises for the remainder of the Term at the then-current fair rental
     value; plus (iii) interest on the amount described in (ii) above from the
     termination date to the date of the award at the Interest Rate.

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<PAGE>

          (c) Repossession and Reletting. Landlord may reenter and take
              --------------------------
     possession of all or any part of the Premises, with process of law but
     without additional demand or notice unless required by applicable Laws, and
     repossess the same and expel Tenant and any party claiming by, through or
     under Tenant, and remove the effects of both using such force for such
     purposes as may be necessary, without being liable for prosecution for such
     action or being deemed guilty of any manner of trespass, and without
     prejudice to any remedies for arrears of Rent or right to bring any
     proceeding for breach of covenants or conditions. No such reentry or taking
     possession of the Premises by Landlord will be construed as an election by
     Landlord to terminate this Lease unless a notice of such intention is given
     to Tenant. No notice from Landlord or notice given under a forcible entry
     and detainer statute or similar Laws will constitute an election by
     Landlord to terminate this Lease unless such notice specifically so states.
     Landlord reserves the right, following any reentry or reletting, to
     exercise its right to terminate this Lease by giving Tenant such notice, in
     which event the Lease will terminate as specified in such notice. After
     recovering possession of the Premises, Landlord will use reasonable efforts
     to relet the Premises on commercially reasonable terms and conditions.
     Landlord may make such repairs, alterations or improvements as Landlord
     considers appropriate to accomplish such reletting, and Tenant will
     reimburse Landlord upon demand for all reasonable costs and expenses,
     including attorneys' fees, which Landlord may incur in connection with such
     reletting. Landlord may collect and receive the rents for such reletting
     but Landlord will in no way be responsible or liable for any inability to
     relet the Premises or to collect any rent due upon such reletting. Landlord
     may apply the same first to the payment of such expenses as Landlord may
     have incurred in recovering possession of the Premises, including
     attorneys' fees and expenses for putting the same into good order and
     condition or preparing or altering the same for re-rental to the extent
     Landlord deems necessary or desirable and all other expenses, commissions
     and charges paid, assumed or incurred by Landlord in or about reletting the
     Premises and then to the fulfillment of the covenants of Tenant hereunder.
     Any such reletting herein provided for may be for the remainder of the Term
     or any renewal term of this Lease, as originally granted, or for a longer
     or shorter period; Landlord will have the right to change the character and
     use made of the Premises, and Landlord will not be required to accept any
     substitute tenant offered by Tenant or to observe any instructions given by
     Tenant about reletting. Regardless of Landlord's recovery of possession of
     the Premises, so long as this Lease is not terminated Tenant will continue
     to pay (and Landlord may recover, if Tenant fails to do so), on the dates
     specified in this Lease, the Basic Rent and other Rent which would be
     payable for the remainder of the Term (excluding any Renewal Term with
     respect to which Tenant has not exercised its option under Section 2.5) if
     such repossession had not occurred, less a credit for the net amounts, if
     any, actually received by Landlord through any reletting of the Premises.

          (d) Bankruptcy Relief. Nothing contained in this Lease will limit or
              -----------------
     prejudice Landlord's right to prove and obtain as liquidated damages in any
     bankruptcy, insolvency, receivership, reorganization or dissolution
     proceeding, an amount equal to the maximum allowable by any Laws governing
     such proceeding in effect at the time when

                                       36
<PAGE>

     such damages are to be proved, whether or not such amount be greater, equal
     or less than the amounts recoverable, either as damages or Rent, under this
     Lease.

     14.4  Landlord's Default; Tenant's Remedies. Time is of the essence for the
performance of obligations by Landlord hereunder. If, during the Term, Landlord
defaults in fulfilling any of its covenants, obligations or agreements set forth
in this Lease, Tenant may give Landlord notice of such default and, if at the
expiration of 30 days after delivery of such notice, such default continues to
exist, or in the event of a default which cannot with due diligence be cured
within a period of 30 days, if Landlord fails to proceed promptly after the
delivery of such notice and with all due diligence to commence to cure the same
and thereafter to prosecute the curing of such default with all due diligence to
completion as soon as reasonably possible, then Tenant will be entitled (a)
subject to the limitations set forth below, to cure any default by Landlord
hereunder and, if the default involves an obligation the costs of which Landlord
(and not Tenant, through inclusion in Operating Expenses or otherwise) is
required to pay, to invoice Landlord for the costs incurred by Tenant in so
doing, plus interest at the Interest Rate from the date such costs are paid by
Tenant to the date reimbursed by Landlord with interest, and if Landlord fails
to pay such invoice within 10 days from delivery thereof, to offset the amounts
due from Landlord against the next ensuing payment(s) of Basic Rent due
hereunder; or (b) to exercise any right or remedy available to Tenant at law or
in equity by reason of such default, except to the extent expressly waived or
limited by the terms of this Lease. Notwithstanding the foregoing, in the event
of a bona fide emergency, if Landlord fails to perform an obligation under this
Lease within one business day after delivery of notice thereof from Tenant
(which notice must include reference to this emergency provision), Tenant may
cure such failure and expend up to a maximum of $2,000 per emergency matter in
so doing; if the default involves an obligation that Landlord is required to pay
for under this Lease, then Tenant may invoice Landlord for amount expended to
effect the emergency cure and, if Landlord fails to pay such invoice within 15
days, Tenant may offset the amount thereof against Basic Rent. Notwithstanding
any other provision of this Lease to the contrary, with respect to any provision
of this Lease which grants Tenant the right to deduct or offset any expenses
incurred by Tenant from its payments due Landlord hereunder, after the
expiration of Landlord's applicable notice and cure period, Tenant must first
advise Landlord by notice that Tenant will effect its remedy of deduction or
offset and thereafter Tenant will only be permitted to offset against each
monthly installment of Basic Rent hereunder an amount not exceeding 25% of the
amount of such installment of Basic Rent and Tenant will not be entitled to
offset any amounts against any other Rent under any circumstances. If such
monthly offset does not total the aggregate amount of Tenant's expenses which
are allowable for offset, the remaining balance thereof may be carried forward
and offset against future installments of Basic Rent, but Tenant may never
offset more than 25% of any monthly installment of Basic Rent. Further
notwithstanding the foregoing, if Tenant has been notified of the name and
address of any Mortgagee, then Tenant will not exercise any remedy as a result
of Landlord's default unless and until Tenant has given any such Mortgagee, by
registered or certified mail, a copy of any notice of default served upon
Landlord simultaneously with the delivery of notice to Landlord. Tenant further
agrees that if Landlord fails to cure such default within the time period
prescribed above, then such Mortgagee will have an additional 30-day period to
cure such default or if such default cannot be cured within that time, then such
additional time as may be necessary if within such 30-day period such Mortgagee
has

                                       37
<PAGE>

commenced and is diligently pursuing the cure of such default (including, but
not limited to, commencement of foreclosure proceedings, if necessary to effect
such cure).

15.  SUBORDINATION

     15.1  Subordination, Nondisturbance and Attornment. This Lease will be
subject and subordinate to any mortgage, deed of trust, ground lease or sale-
leaseback now or hereafter placed upon the Premises by Landlord, and to
amendments, replacements, renewals and extensions thereof, provided that as long
as Tenant is not in default in the payment of Rent and the performance of all
covenants, agreements and conditions to be performed by Tenant under this Lease,
and provided that Tenant attorns to the party acquiring title to the Premises as
a result of the foreclosure, termination or transfer in lieu thereof of any such
mortgage, deed of trust, ground lease or sale-leaseback (so long as such
acquiring party is obligated for the performance of all obligations of Landlord
hereunder required to be performed from and after such acquisition), then
neither Tenant's right to quiet enjoyment under this Lease, nor the right of
Tenant to continue to occupy the Premises and to conduct its business thereon,
in accordance with the terms of this Lease, will be interfered with by the
holder of any such mortgage, deed of trust, ground lease or sale-leaseback, by
any successor thereto or any successor to Landlord as a result of the
foreclosure or termination thereof or transfer in lieu thereof, or by virtue of
any such foreclosure, termination or transfer. Such subordination will be
effective without the necessity of the execution and delivery of any further
instruments on the part of Tenant to effectuate such subordination. However,
Tenant agrees at any time hereafter, within 10 business days after delivery of
Landlord's written request, to execute and deliver any instruments, releases or
other documents, in form reasonably satisfactory to Tenant, that may be
reasonably required for the purpose of subjecting and subordinating this Lease,
as above provided, to the lien of any such mortgage, deed of trust, ground lease
or sale-leaseback, provided the same include the nondisturbance provisions and
covenant to perform Landlord's obligations set forth above.

     15.2  Option to Make Lease Superior. Notwithstanding anything contained in
Section 15.1, in the event the holder of any mortgage, deed of trust, ground
lease or sale-leaseback instrument at any time elects to have this Lease
constitute a prior and superior lien to its mortgage, deed of trust, ground
lease or sale-leaseback instrument, then, and in such event, upon any such
holder or Landlord notifying Tenant to that effect in writing, this Lease will
be deemed prior and superior in lien to such mortgage, deed of trust, ground
lease or sale-leaseback instrument, whether this Lease is dated prior to or
subsequent to the date of such mortgage, deed of trust, ground lease or sale-
leaseback instrument, and Tenant will execute such agreement in form reasonably
acceptable to Tenant as may be reasonably requested by such holder to confirm
such superior status.

16.  SECURITY DEPOSIT

     16.1  Amount and Form. Upon execution of this Lease, Tenant will deposit
$850,000 with Landlord (such amount, as the same may be reduced in accordance
with the provisions hereof, and whether in the form of cash or a letter of
credit, as provided herein, is referred to as the "Security Deposit"). Landlord
and Tenant intend the Security Deposit to be used solely as

                                       38
<PAGE>

security for Tenant's faithful and diligent performance of all of Tenant's
obligations under this Lease. The Security Deposit will remain in Landlord's
possession for the entire Term, and Landlord will not be required to segregate
it from Landlord's general funds. Tenant will not be entitled to any interest on
the Security Deposit. Provided that no Event of Default or event which, with the
giving of notice or the passage of time, or both, could become an Event of
Default then exits, at the end of each Lease Year during the initial 10-year
Term, the amount of the Security Deposit required hereunder will be reduced as
follows: (a) at the end of each of the first through the fifth Lease Years the
amount of the Security Deposit will be reduced by $100,000; and (b) at the end
of each of the sixth through the 10th Lease Years, the amount of the Security
Deposit will be reduced by $60,000. Upon each permitted reduction in the amount
of the Security Deposit, Landlord will refund to Tenant the reduction amount if
the Security Deposit is then in the form of cash or will permit Tenant to reduce
the amount of the letter of credit by the reduction amount if the Security
Deposit is then in the form of a letter of credit. Tenant may provide the
Security Deposit in the form of a letter of credit, provided that (i) the form
of the letter of credit and the issuing bank are reasonably acceptable to
Landlord; (ii) the letter of credit provides that Landlord may draw the entire
amount thereof upon presentation of Landlord's sight draft accompanied by a
certification by Landlord that an Event of Default has occurred under this
Lease; and (iii) at least 30 days prior to the expiration of an existing letter
of credit, Tenant will cause the same to be renewed through issuance and
delivery to Landlord of a substitute letter of credit meeting the requirements
hereof and issued in the amount then-required hereunder (and not in any reduced
amount that may become applicable thereafter), and if Tenant fails to timely
deliver such substitute, then Landlord may draw the entire amount of the
existing letter of credit prior to its expiration. Upon any drawing of a letter
of credit posted as the Security Deposit, the proceeds will be held and applied
by Landlord pursuant to the terms hereof as if Tenant had deposited the Security
Deposit in cash.

     16.2  Use and Restoration. Upon the occurrence of an Event of Default by
Tenant under this Lease, Landlord may, at its option, use, apply or retain all
or any part of the Security Deposit for the payment of (1) any Rent in arrears;
(2) any expenses Landlord may incur as a direct or indirect result of Tenant's
failure to perform; and (3) any other losses or damages Landlord may suffer as a
direct or indirect result of Tenant's failure to perform. If Landlord so uses or
applies all or any portion of the Security Deposit, Landlord will notify Tenant
of such use or application and Tenant will, within 10 days after the date of
Landlord's notice, deposit with Landlord a sum sufficient to restore the
Security Deposit to the amount held by Landlord immediately prior to such use or
application. Tenant's failure to so restore the Security Deposit within 30 days
after deliver of Landlord's written demand therefor will constitute an Event of
Default.

     16.3  Transfers. Tenant will not assign or encumber the Security Deposit
without Landlord's express written consent. Neither Landlord nor its successors
or assigns will be bound by any assignment or encumbrance unless Landlord has
given its consent. Landlord will have the right, at any time and from time to
time, to transfer the Security Deposit to any purchaser or lessee of the entire
Building. Upon any such transfer, and upon delivery to Tenant of a copy of the
purchaser's or lessee's written acknowledgment of its receipt of the Security
Deposit and agreement to perform all of Landlord's obligations arising hereunder
from and after the transfer

                                       39
<PAGE>

date, Tenant agrees to look solely to the new owner or lessee for the return of
the Security Deposit.

     16.4  Refund. Landlord will refund the Security Deposit, or any balance
remaining after application thereof by Landlord pursuant to Section 16.2, to
Tenant within 60 days after the expiration or early termination of the Term and
Tenant's vacation and surrender of the Premises to Landlord in the condition
required by Section 13.1. Landlord may withhold from such refund a reasonable
estimate of the amount that will be due from Tenant pursuant to Section 4.2(d)
for the last year of the Term, pending final settlement between the parties with
the applicable Taxes, assessments and charges are determined for such year.

17.  MISCELLANEOUS

     17.1  Roof Installations. Subject to obtaining Landlord's prior written
approval as to any specific installation, which approval will not be
unreasonably withheld, conditioned or delayed, Tenant will have the right, at
its expense, to install (a) antennas and satellite dishes; (b) refrigeration
equipment; or (c) heating, ventilating and air conditioning equipment, on the
roof of the Building, provided that any such installation will be effected in a
manner that (1) complies with all applicable Laws (including, without
limitation, zoning Laws and the Covenant Documents); and (2) does not void or
otherwise impair any warranties covering the roof. Landlord will not charge
Tenant any additional Rent for any such use of the Building's roof. Tenant will
not enter into any license or sublease permitting a licensee or subtenant to use
the roof of the Building, except that Tenant may permit a bona fide subtenant of
premises within the Building to use a portion of the roof in connection with
such subtenant's use of its sublet premises within the Building.

     17.2  Building Signage. In addition to the monument sign described in the
Shell Specifications (which will be for the exclusive use by Tenant), Tenant
will have the right, at its expense, to install, in a manner and location
reasonably designated by Landlord, one exterior identification sign on the
Building. The size, design and graphics of such sign will be subject to the
Covenant Documents and approval by Douglas County. Landlord will not install,
erect or maintain any signs on the Premises during the Term, except that
Landlord may erect a "For Rent" sign during the last nine months of the Term;
provided, however, that such sign will not obstruct any sign of Tenant or
interfere unreasonably with the conduct of Tenant's business at the Premises.

     17.3  Non-competition. Landlord agrees that, so long as no uncured Event of
Default by Tenant exists under this Lease and Tenant is occupying and operating
the Premises for an order-by-internet home-delivery grocery business ("Tenant's
Use"), Landlord will not permit any tenant under any lease of other premises
owned by Landlord within Lots 1, 2, 3, 4 and 5 of the same filing of the Project
as that within which the Premises are located to use such premises for Tenant's
Use.

     17.4  Brokers. Landlord will pay the commission due to Jim Bolt/CB Richard
Ellis, Inc. in connection with the negotiation and execution of this Lease.
Landlord will also pay to Tenant an amount equal to $2.19 multiplied by the
number of square feet of the Rentable Area of

                                       40
<PAGE>

the Premises to compensate Tenant for the services of its leasing consultant
with respect to this Lease; 50% of such amount will be paid to Tenant upon
execution and delivery of this Lease and the remaining 50% will be paid on the
Commencement Date. Tenant and Landlord will indemnify and hold each other
harmless from all damages paid or incurred by the indemnified party resulting
from any claims asserted against the indemnified party by brokers, agents or
leasing consultants claiming through the indemnifying party.

     17.5  Estoppel Certificates. Tenant agrees, from time to time, upon not
less than 10 business days' prior written request by Landlord, to deliver to
Landlord a statement in writing certifying, to Tenant's actual knowledge (i)
this Lease is unmodified and in full force and effect (or if this Lease is not
in full force and effect, so stating, of if there have been modifications, that
the Lease as modified is in full force and effect and stating the
modifications); (ii) the dates to which Basic Rent and other Rent have been
paid; (iii) Landlord is not in default in any provision of this Lease or, if in
default, the nature thereof specified in detail; (iv) the amount of monthly
Basic Rent currently payable by Tenant; (v) the amount of any prepaid Rent; (vi)
that Tenant has taken possession of the Premises (if Tenant has in fact done so)
and that Landlord has performed all of its obligations under Section 3 with
respect to the design, construction and installation of the Shell and the
Leasehold Improvements, or if there are any such obligations remaining to be
performed, specifying the same in detail; and (vii) such other matters as may be
reasonably requested by Landlord or any Mortgagee or prospective purchaser of
the Premises.

     17.6  Notices. All notices required or permitted under this Lease must be
in writing and will only be deemed properly given and received (i) when actually
given and received, if delivered in person to a party who acknowledges receipt
in writing; or (ii) one business day after deposit with a private courier or
overnight delivery service, if such courier or service obtains a written
acknowledgment of receipt; or (iii) three business days after deposit in the
United States mails, certified or registered mail with return receipt requested
and postage prepaid. All such notices must be transmitted by one of the methods
described above to the party to receive the notice at, in the case of notices to
Landlord, Landlord's Notice Address, and in the case of notices to Tenant, the
applicable Tenant's Notice Address, or, in either case, at such other
address(es) as either party may notify the other of according to this Section
17.6

     17.7  Actions by Landlord's Agent. All rights and remedies of Landlord
under this Lease or that may be provided by law may be executed by Landlord in
its own name, individually, or in the name of its agent, and all legal
proceedings for the enforcement of any such rights or remedies, including those
set forth in Section 14, may be commenced and prosecuted to final judgment and
execution by Landlord in its own name or in the name of its agent.

     17.8  Severability; Governing Law. If any term or provision of this Lease
is to any extent held invalid or unenforceable, the remaining terms and
provisions of this Lease will not be affected thereby, but each term and
provision of this Lease will be valid and enforced to the fullest extent
permitted by law. This Lease will be construed and enforced in accordance with
the laws of the State of Colorado.

                                       41
<PAGE>

     17.9  Transfers of Landlord's Interest. The term "Landlord" as used in this
Lease, so far as covenants or obligations on the part of Landlord are concerned,
will be limited to mean and include only the owner or owners of the Premises at
the time in question, and in the event of any transfer or conveyance, provided
either that the transferee agrees in writing (a copy of which will be provided
to Tenant upon request) to perform all of Landlord's obligations hereunder
arising from and after the transfer or that the transferee is required to
perform such obligations under applicable Laws, the then grantor will be
automatically freed and released from all personal liability accruing from and
after the date of such transfer or conveyance as respects the performance of any
covenant or obligation on the part of Landlord contained in this Lease to be
performed, it being intended hereby that the covenants and obligations contained
in this Lease on the part of Landlord will be binding, subject to Section 17.14,
on the then Landlord only during and in respect to its period of ownership. In
the event of a sale or conveyance by Landlord of the Premises, provided either
that the transferee agrees in writing (a copy of which will be provided to
Tenant upon request) to perform all of Landlord's obligations hereunder arising
from and after the transfer or that the transferee is required to perform such
obligations under applicable Laws, the same will operate to release Landlord
from any future liability upon any of the covenants or conditions herein
contained and in such event Tenant agrees to look solely to the responsibility
of the successor in interest of Landlord in and to this Lease. This Lease will
not be affected by any such sale or conveyance, and Tenant agrees to attorn to
the purchaser or grantee, provided either that the purchaser or grantee agrees
in writing (a copy of which will be provided to Tenant upon request) to perform
all of Landlord's obligations hereunder arising from and after the sale or
conveyance or that the purchaser or grantee is required to perform such
obligations under applicable Laws.

     17.10  Headings. The marginal or topical headings of the several sections
are for convenience only and do not define, limit or construe the contents of
such sections.

     17.11  Complete Agreement; Modification. All of the representations and
obligations of the parties are contained in this Lease and no modification,
waiver or amendment of this Lease or of any of its conditions or provisions will
be binding upon a party unless in writing signed by such party.

     17.12  No Offer. The submission of this document for examination does not
constitute an offer to lease, or a reservation of, or option for, the Premises.
This document becomes effective and binding only upon the execution and delivery
hereof by the proper officers of Landlord and Tenant.

     17.13  Survival. In addition to those obligations set forth in this Lease
that expressly survive the expiration or earlier termination of the Term, all
obligations of Landlord and Tenant hereunder that, by their nature, cannot be
fully performed prior to the expiration or earlier termination of the Term will
survive the expiration or earlier termination of the Term.

     17.14  Limitation on Landlord's Liability. Tenant agrees to look solely to
Landlord's interest in the Premises for the recovery of any judgment from
Landlord, it being agreed that Landlord, and if Landlord is a partnership, its
partners whether general or limited, and if

                                       42
<PAGE>

Landlord is a corporation, its directors, officers or shareholders, and if
Landlord is a limited liability company, its managers or members, will never be
personally liable for any such judgment.

     17.15  Tenant's Authority. Tenant will furnish to Landlord promptly upon
demand, a corporate resolution evidencing the due authorization of Tenant to
enter into this Lease.

     17.16  No Partnership. This Lease will not be deemed or construed to create
or establish any relationship or partnership or joint venture or similar
relationship or arrangement between Landlord and Tenant hereunder.

     17.17  Force Majeure. Whenever a period of time is herein prescribed for
action to be taken by either party, such party will not be liable or responsible
for, and there will be excluded from the Computation of any such period of time,
any delays due to strikes, riots, acts of God, shortages of labor or materials,
war, governmental laws, regulations or restrictions or any other causes of any
kind whatsoever which are beyond the reasonable control of such party. A lack of
funds, however, will never be deemed beyond a party's reasonable control.

     17.18  Financial Statements. Tenant acknowledges that it has provided
Landlord with its financial statement as a material inducement to Landlord's
agreement to lease the Premises to Tenant, and that Landlord has relied on the
accuracy of such financial statement in entering into this Lease. Tenant
represents and warrants that the information contained in such financial
statement is true, complete and correct in all material aspects. Except during
any time that Tenant constitutes a publicly-traded entity whose financial
statements are available for public inspection, Tenant will make available to
Landlord or to any prospective Mortgagee or purchaser of the Premises, within 10
days from request by Landlord, audited financial statements of Tenant or any
guarantor, provided, that Landlord or any such prospective Mortgagee or
purchaser agrees to maintain such statements in confidence, and provided further
that if audited financial statements of Tenant are not available at the time of
such request, Tenant may deliver unaudited statements prepared in accordance
with generally accepted accounting principles consistently applied and certified
to be true and correct by Tenant's chief financial officer. Tenant will have no
obligation to provide such financial statements more than once in any calendar
year.

     17.19  Future Covenants. Landlord agrees that it will not execute or
consent to any future grants, declarations or agreements that may be hereafter
recorded and that impose or create easements, covenants or restrictions on,
over, under, through or with respect to property located within the Project if
the same would materially and adversely affect Tenant's ingress to or egress
from the Premises or would materially and adversely affect Tenant's operation of
a home-delivery grocery distribution warehouse business at the Premises. Tenant
acknowledges that Landlord intends to enter into a Covenant Document that will
permit the owners (and their tenants or other permittees) of both the Land and
the property adjacent thereto on the east to use the common access to such
properties from the adjacent street to the south and the common driveway
consisting of approximately 35 feet on each side of the border between the Land
and such adjacent property for purposes of ingress, egress and truck maneuvering
(but not for parking) and will provide for the sharing of the costs of
maintaining such access and driveway.

                                       43
<PAGE>

Tenant further acknowledges that such an agreement will not be deemed to
materially and adversely affect Tenant's ingress, egress or the conduct of its
business.

     17.20  Binding Effect. The covenants and agreements herein contained will
bind and inure to the benefit of Landlord and its successors and assigns, and
Tenant and its permitted successors and assigns.

     17.21  Acquisition Contingency. Landlord has disclosed to Tenant that, as
of the date of this Lease, Landlord has not yet acquired title to the Land.
Landlord covenants to proceed in good faith to consummate its acquisition of the
Land. However, if Landlord does not acquire title to the Land by May 15, 2000
due to (i) a default by the seller thereof under its contract with Landlord
which default is not within Landlord's control; or (ii) a good faith failure to
satisfy a condition precedent to Landlord's obligation to purchase under such
contract, then Landlord may terminate this Lease by notice to Tenant given at
any time prior to Landlord's acquisition of such title or June 15, 2000,
whichever occurs first, and upon such termination, (a) all prepaid Rent, the
Security Deposit and all other amounts theretofore paid by Tenant to Landlord
hereunder will be refunded to Tenant; (b) the amount paid by Landlord to Tenant
for leasing consultant services pursuant to Section 17.4 will be refunded by
Tenant to Landlord; (c) Tenant will have no obligation to reimburse Landlord for
any costs incurred by Landlord in designing or constructing the Shell or the
Leasehold Improvements; and (d) except as provided above in this Section 17.21,
both parties will be relieved of any further obligations hereunder. In addition,
if Landlord has not acquired title to the Land by July 31, 2000 for any reason
other than a default by Tenant under this Lease, then Tenant may terminate this
Lease by notice to Landlord given at any time prior to Landlord's acquisition of
such title and, upon the timely giving of such notice, this Lease will terminate
in accordance with the foregoing clauses (a) through (d).

     IN WITNESS WHEREOF, the parties have executed this Lease as of the date
first set forth above.

LANDLORD:                               TENANT:

OPUS NORTHWEST, L.L.C., a               HOMEGROCER. COM, INC., a
Delaware limited liability company      Washington corporation

By:  /s/ [ILLEGIBLE]                         By:  /s/ C.J. Karaffa
     -------------------                     ---------------------------------
     Vice President                     Its:  SR.V.P. Operations
                                             ---------------------------------

                                        By:  /s/ Kristin H. Stred
                                             ---------------------------------
                                        Its:  Sr. VP and Corporate Secretary
                                             ---------------------------------

                                       44
<PAGE>

                                   Exhibit A
                                   ---------

                         LEGAL DESCRIPTION OF THE LAND

A parcel of land located in the Northwest Quarter and the Northeast Quarter of
Section 6, Township 6 South, Range 66 West of the 6th P.M., County of Douglas,
State of Colorado, more particularly described as follows:

Beginning at the Northwest comer of said Northeast Quarter of Section 6, then S
89(Degree)40'35" W, along the north line of said Northwest Quarter of Section 6,
a distance of 57.41 feet; thence S 00(Degree)03'40" E a distance of 580.20 feet;
thence N 89(Degree)56'20" E a distance of 538.50 feet; thence N 00(Degree)03'40"
W a distance of 582.74 feet to the north line of said Northeast Quarter of
Section 6; thence S 89(Degree)40'04" W, along said north line, a distance of
481.09 feet to the point of beginning. The basis of bearings for the foregoing
description assumes the north line of said Northeast Quarter runs N
89(Degree)40'04" E.

Landlord and Tenant acknowledge that, prior to Landlord's acquisition of the
Land, the seller thereof will cause the same to be subdivided (and the parties
anticipate that the Land will become Lot 5 of Compark Filing No. 2, Douglas
County, Colorado). At such time as such plat has been recorded, the parties
agree to execute an amendment to this Lease substituting for the above legal
description a new legal description for the Land based on such recorded plat,
with the Land for such purposes being the lot shown on such plat that has
boundaries substantially in accordance with those set forth above.

                                      A-1
<PAGE>

                                  Exhibit A-1

                           [FLOOR PLAN APPEARS HERE]

<PAGE>

                                   Exhibit B
                                   ---------

                             SHELL SPECIFICATIONS

General Site Requirements

Access
------

A.   Separate employee and truck entrances required. Entrances shall be located
     such that they do not create any other adverse traffic situations with the
     streets or other parking areas.

B.   Allow for one (1) 20-yard container for trash and cardboard with easy
     access for pick-up and drop-off by local vendor.

C.   All required fire lanes shall be provided per local regulations.

Delivery Truck Parking Requirements
-----------------------------------

A.   On-site delivery truck parking shall accommodate 80 spaces with 20 spaces
     provided at the dock area and 60 spaces in the parking area.

B.   Typical parking stall dimensions shall be 28'd x 12'w. There shall be a
     clear drive of 34' for maneuvering.

C.   Parking for 4 semi-trailers must also be accommodated up to 65' in length.
     Receiving docks shall be located such that the driver of the tractor-
     trailer has direct visual contact with the docks while backing in, i.e.
     docks at left of approach.

D.   All internal and access roads shall be paved.

E.   Truck parking shall be for Tenant's exclusive use.

Employee Parking
----------------

A.   Site shall meet ADA and local code for number of parking spaces and shall
     accommodate the forecast of at least 200 striped spaces (includes office
     personnel).

B.   All visitor and employee access roads and parking areas shall be paved.

C.   Employee parking shall be for Tenant's exclusive use.

Site Security
-------------

Intentionally left blank.

                                      B-1
<PAGE>

Base Building Spec

High Level Space Summary
------------------------

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------

Type of Space                               Minimum Size        Minimum Clear Height
-------------------------------------------------------------------------------------------------
<S>                                         <C>                 <C>
Office                                      10,000sf            9'-0"
-------------------------------------------------------------------------------------------------
Shipping/Receiving Dock                     14,000sf            22'-0" to 28'-0"
-------------------------------------------------------------------------------------------------
Shopping Area                               50,000sf            22'-0" to 28'-0"
-------------------------------------------------------------------------------------------------
Produce Prep. And Misc.                     3,000sf             no restriction
-------------------------------------------------------------------------------------------------
Cooler/Freezer Area                         28,000sf            22'-0" to 28'-0"
-------------------------------------------------------------------------------------------------
TOTAL                                       105,000sf
-------------------------------------------------------------------------------------------------
</TABLE>

*Depth of building perpendicular to dock door opening should be a minimum of 200
feet and would be optimal at 250 feet.

*Column spacing should be maximum achievable. Bays of 40 ft are acceptable.

*Battery charging area and conveyor compressor room are part of the 105,000sf
and should be included in a detailed space summary of the building.

Floor Requirements
------------------

A.   If new, coordinate freezer/slab requirements prior to placing of slabs,
     i.e. sub slab insulation.

B.   Slab on grade design shall be 6" thick, 4,000psi and shall be FF50/FL30
     minimum in levelness. Soil compaction below must be at least 3,000psf.

C.   Provide Tenant requested sealant. The cost associated with Landlord's
     standard (one coat) sealant will be credited to the Leasehold Improvement
     cost..

Loading Docks
-------------

A.   Door Quantity: Provide a minimum of 20 shipping dock doors, 4 receiving
     dock doors, and 1 ramp door.

B.   Door Size/Spacing: Typical doors shall be steel, 8'-6" wide x 9'-0" high
     and be vertical roll-up in operation. Doors shall be spaced 12'-6" on
     center. Door at ramp shall be 10'-0" wide x 12'-0" high and be a motor
     driven steel vertical roll-up door.

                                      B-2
<PAGE>

Door Criteria

<TABLE>
<CAPTION>
   Vehicle       Door Size      Center to        Dock           Truck          Clear        Total Yard
    Type                         Center         Height         Length       Drive Aisle       (min)
-------------------------------------------------------------------------------------------------------
<S>              <C>            <C>             <C>            <C>          <C>             <C>
Shipping         8'-6"x 9'*      12'-0"           38"            28'            34'             63'
Van
-------------------------------------------------------------------------------------------------------
Receiving        8'-6"x 9'       14'-0"           48"            65'            65'             130'
Truck
-------------------------------------------------------------------------------------------------------
Ramp             10'x 12'          N/A           Grade          N/A            N/A              N/A
-------------------------------------------------------------------------------------------------------
</TABLE>

A.   Canopy: Provide a continuous canopy over all dock doorways.

B.   Dock Height: 20 shipping dock bays shall be at +/- 38" and the 4 receiving
     docks shall be at +/- 48".

C.   Mechanical Dock Levelers: provide 3 levelers at the receiving docks.
     Levelers shall be 7' wide x 8' long and have a minimum capacity of 25,000
     lbs.

D.   Dock Ramp: Provide 1 dock ramp with rough broom finish and a landing at the
     top prior to entering the building. Maximum slope not to exceed 6%.

Structural Requirements

Roof structure will be capable of accommodating approximately twenty (20) - 10
ton mechanical units, antennas and 1,000 LB point loads for conveyor
connections. The cost associated with providing the 1,000 LB point load will be
a Leasehold Improvement cost.

Mechanical Requirements

HVAC Requirements
-----------------

A.   Air changes are to be per governing code requirements.

Potable Water
-------------

A.   A 3" main supply will be provided and metered to the building. The costs
     associated with increasing the supply from 2" to 3" will be included as a
     Leasehold Improvement cost.

                                      B-3
<PAGE>

Waste Lines
-----------

A.  Provide 6' sewer main into building.

Natural Gas
-----------

A.  Gas line supporting typical warehouse use will be stubbed to the building.

Fire Protection
---------------

A.   Landlord will provide a fire protection allowance of $.70 per rentable
     square foot for construction of Tenant's sprinkler system.

Electrical Requirements

Overall Electrical Power
------------------------

A.   Provide a 4 wire, 4,000 amps @ 480v, 3ph, service with a dedicated ground
     (includes HVAC). The cost associated with increasing the service from 3,000
     to 4,000 amps will be included as a Leasehold Improvement cost.

Break Room
----------

Intentionally left blank.

Truck Charging
--------------

Intentionally left blank.

Lighting Requirements
---------------------

A.  Site/Yard: 1 fc average each

Emergency Generator - Transfer Switch Only
------------------------------------------

Intentionally left blank.

                                      B-4
<PAGE>

Telephone
---------

A.   Provide one (1) 3" conduit from point of presence to the telephone panel to
     accommodate T1 phone service. Point of presence shall be within 250 feet of
     the telephone panel. Maximum number of 90 bends not to exceed two (2).

B.   All conduit shall be provided with pull cords.

Server Room
-----------

Intentionally left blank.

Data Cabling
------------

Intentionally left blank.

Health Department Requirements (Verify with Local Health Department)

Intentionally left blank.

                                      B-5<PAGE>

                                                                    EXHIBIT 10.5

STANDARD WAREHOUSE LEASE AGREEMENT.            Approximately 102,297 square feet
Atlanta Industrial/2000                        1851 West Oak Parkway
                                               Marietta, Georgia 30062

                                LEASE AGREEMENT

     THIS LEASE AGREEMENT, is made and entered into as of March 31, 2000 by and
                                                                --
between 3 Plus Limited Partnership hereinafter referred to as "Landlord", and
HomeGrocer.com, Inc. hereinafter referred to as "Tenant";

                                  WITNESSETH:

1.  PREMISES AND TERM. In consideration of the obligation of Tenant to pay rent
as herein provided, and in consideration of the other terms, provisions and
covenants hereof, Landlord hereby demises and leases to Tenant, and Tenant
hereby accepts and leases from Landlord certain premises consisting of a
building containing approximately 102,297 square feet at 1851 West Oak Parkway,
County of Cobb, State of Georgia, (the "Building") together with all site
improvements upon the real property legally described on Exhibit "A" and
depicted on the site plan attached hereto as Exhibit "A-1" (collectively the
"Premises").

     TO HAVE AND TO HOLD the same for a term commencing on the "Commencement
Date", as hereinafter defined, and ending One Hundred Twenty Two (122) months
thereafter; provided however, that in the event the Commencement Date is a date
other than the first day of a calendar month, said term shall extend for said
number of months in addition to the remainder of the calendar month following
the Commencement Date. (See also Additional Provisions, Sections 2, 3, and 4)

     The Commencement Date shall be the date upon which the Landlord's Work
shall have been substantially completed provided however, that if Landlord shall
be delayed in such Substantial Completion as a result of: (i) Tenant's failure
to agree to plans, specifications, and cost estimates, within a reasonable
period of time; (ii) Tenant's request for materials, finishes or installations
not available in same time period or which require more time to complete than
Landlord's standard; (iii) Tenant's changes in plans; or (iv) the performance or
completion of work by a party employed by Tenant, the Commencement Date and the
payment of rent hereunder shall be accelerated by the number of days of such
delay, and provided further that if Landlord can not substantially complete the
Premises as a result of any of events (i) through (iv) above, Landlord may at
its election complete so much of Landlord's Work as may be practical under the
circumstances and, by written notice to Tenant, establish the Commencement Date
as the date of such partial completion, subject to any applicable accelerations
due to delays resulting from events (i) through (iv) above. Notwithstanding the
preceding Landlord's election, Landlord agrees to pursue the completion of
Landlord's Work in an expeditious manner. Taking of possession by Tenant shall
be deemed conclusively to establish that said buildings and other improvements
have been completed in accordance with the plans and specifications and that the
Premises are in good and satisfactory condition (latent defects, Warranty Work
and punch list items excepted), as of when possession was so taken. Tenant
acknowledges that no representations as to the repair of the Premises have been
made by Landlord, unless such are expressly set forth in this lease. After such
Commencement Date Tenant shall, upon demand, execute and deliver to Landlord a
letter of acceptance of delivery of the Premises. In the event of any dispute as
to Substantial Completion of work performed or required to be performed by
Landlord, the certificate of Landlord's architect impartially given shall be
conclusive. (See Also Additional Provisions, Section 15 and 19). Landlord
covenants to repair or replace, at Landlord's expense and as "Warranty Work,"
any defective item of Landlord's Work of which Tenant notifies Landlord within
one year after the Commencement Date and that requires repair or replacement
(other than normal wear and tear) as a result of (i) any failure to construct
the Building in material compliance with Exhibit "B-1"; (ii) any failure to
construct the leasehold improvements in material compliance with the Basic
Outline Specifications in Exhibit "B-1" or improvements made per Exhibit "B-2";
or (iii) any defective materials or workmanship. Within 10 days after the
expiration of the above-described one-year warranty period, Landlord will assign
to Tenant any manufacturers' or subcontractors' warranties or guaranties that
are still then in effect with respect to the Building or the leasehold
improvements, except for any such warranties or guaranties relating to any
portions of the Premises which Landlord is required under this Lease to maintain
and repair at Landlord's expense.

     2.  BASE RENT AND SECURITY DEPOSIT.
     A. Tenant agrees to pay to Landlord rent for the Premises, in advance
without demand, deduction or set off (except as expressly stated in Paragraph 24
of this Lease Agreement and Additional Provision, Section 21), from sixty days
after the Commencement Date and for the entire remaining term hereof, at the
rate of Forty Thousand Six Hundred Ninety-Two Dollars and 00/100 ($40,692.00)
per month. One such monthly installment shall be due and payable on the date
hereof and a like monthly installment shall be due and payable on or before the
first day of each calendar month succeeding the Commencement Date recited above
during the hereby demised term, except that the rental payment for any
fractional calendar month at the commencement or end of the lease period shall
be prorated.

     On each and every January 1/st/ following the Commencement Date during the
term of the lease or extension thereof Tenant agrees to pay an additional
monthly rental for each month during that year an amount equal to Two and One-
Half percent (2.5%) of the previous years December monthly rental.

                                 Page 1 of 27
<PAGE>

     B. In addition, Tenant agrees to deposit with Landlord on the date hereof
the Forty Thousand Six Hundred Ninety-Two Dollars and 00/100 ($40,692.00)
Dollars, which sum shall be held by Landlord, without obligation for interest,
as security for the performance of Tenant's covenants and obligations under this
lease, it being expressly understood and agreed that such deposit is not an
advance rental deposit or a measure of Landlord's damages in case of Tenant's
default. Upon the occurrence of any event of default by Tenant, Landlord may,
from time to time, without prejudice to any other remedy provided herein or
provided by law, use such fund to the extent necessary to make good any arrears
of rent or other payments due Landlord hereunder, and any other damage, injury,
expense or liability caused by such event of monetary default; and Tenant shall
pay to Landlord on demand the amount so applied in order to restore the security
deposit to its original amount. Although the security deposit shall be deemed
the property of Landlord, any remaining balance of such deposit shall be
returned by Landlord to Tenant within 60 days of the termination of this lease,
provided that all of Tenant's obligation under this lease have been fulfilled.

     3. USE.
     A. The demised Premises shall be used only for the purpose of general
office, receiving, storing, shipping and selling (other than retail) products,
materials, merchandise and alcoholic beverages made and/or distributed by Tenant
and for such other lawful purposes as may be incidental thereto, and subject to
the park covenants of record in effect as of the commencement of this Lease.
Outside storage, including without limitation, trucks (other than Tenant's "UPS"
size delivery trucks) and other vehicles, is prohibited without Landlord's prior
written consent. Tenant shall at its own cost and expense obtain any and all
licenses and permits necessary for any such use. Tenant shall comply with all
governmental laws, ordinances and regulations applicable to the use of the
Premises. and shall promptly comply with all governmental orders and directives
for the correction, prevention and abatement of nuisances in or upon, or
connected with. the Premises, all at Tenant's sole expense. Tenant shall not
permit any objectionable or unpleasant odors, smoke, dust, gas, noise or
vibrations to emanate from the Premises, not take any other action which would
constitute a unreasonable nuisance or would disturb or endanger any other
tenants of the building in which their Premises are situated or unreasonably
interfere with their use of their respective Premises. Without Landlord's prior
written consent, Tenant shall not receive, store or otherwise handle any
product, material or merchandise (other than products, in normal quantities,
used by Tenant for ordinary cleaning and janitorial supplies, products used for
office purposes, and typical grocery or drug merchandise) which is explosive or
highly flammable. Tenant will not permit the Premises to be used for any purpose
or in any manner (including without limitation any method of storage) which
would render the insurance thereon void or the insurance risk more hazardous or
cause the State Board of Insurance or other insurance authority to disallow any
sprinkler credits, without assuming additional costs related thereto. (See also
Additional Provisions, Section 13)

     B. Tenant agrees that the point pressure resulting from Tenant's racking
system, inventory, forklifts and equipment pertaining to Tenant's use of the
Premises shall not exceed allowable design floor loading for floor slabs on
grade. Tenant shall hold harmless Landlord from any loss, liability, and
expenses arising out of such damage or repair caused by Tenant's negligence or
failure to comply with this paragraph.

     4. TAXES.
     A. Landlord agrees to pay before they become delinquent all taxes,
assessments and governmental charges of any kind and nature whatsoever
(hereinafter collectively referred to as "taxes") lawfully levied or assessed
against the Premises: provided however, that Tenant shall pay to Landlord as
additional rental, upon demand, the amount of such taxes. In the event any such
amount is not paid within twenty (20) days after the date of Landlord's invoice,
and applicable cure period, to Tenant, the unpaid amount shall bear interest at
the rate of eighteen percent (18%) per annum from the date of such receipt until
payment by Tenant. Landlord reserves the right to require Tenant during each
month of the lease term to pay an escrow deposit to Landlord equal to one-
twelfth of the taxes. If the Tenant's total tax escrow payments are less than
actual taxes, Tenant shall pay to Landlord upon demand the tax payment shortage;
if the total tax escrow payments of Tenant are more than actual taxes, Landlord
shall retain such excess and credit it to Tenant's next accruing tax escrow
payment. For the calendar year in which the Lease commences taxes are estimated
to be $0.35 per square foot.

     B. If at any time during the term of this lease, the present method of
taxation shall be changed so that, in lieu of the whole or any part of any
taxes, assessments or governmental charges levied, assessed or imposed on real
estate and the improvements thereon, there shall be levied, assessed or imposed
on Landlord a capital levy or other tax directly on the rents received therefrom
and/or a franchise tax, assessment, levy or charge measured by or based, in
whole or in part, upon such rents for the present or any future building or
buildings on the Premises, then all such taxes, assessments, levies or charges,
or the part thereof so measured or based, shall be deemed to be included within
the term "taxes" for the purposes hereof.

     C. The Landlord shall have the reasonable right to employ a tax consulting
firm to attempt to assure a fair tax burden on the building and grounds within
the applicable taxing jurisdiction. Tenant shall pay to Landlord upon demand
from time to time, as additional rent, the reasonable cost of such service.

     D. Any payment to be made pursuant to this paragraph 4 with respect to the
real estate tax year in which this lease commences or terminates shall be
prorated.

     5. LANDLORD'S REPAIRS AND OBLIGATIONS. Landlord shall at its expense
maintain only the roof, foundation and the structural soundness of the exterior
walls and structural steel of the Building in good repair, reasonable wear and
tear excepted. Landlord shall at its expense keep and maintain such structural
elements (the roof, foundation and exterior walls) in a condition that complies
with

                                 Page 2 of 27
<PAGE>

applicable laws. Tenant shall repair and pay for any damage caused by the
negligence of Tenant, or Tenant's employees, agents or invitees, or caused by
Tenant's default hereunder. The term "walls" as used herein shall not include
windows, glass or plate glass, doors, store fronts or office entries. Tenant
shall immediately give Landlord written notice of defect or need for repairs,
after which Landlord shall have reasonable opportunity to repair same or cure
such defect. Landlord's liability with respect to any defects, repairs or
maintenance for which Landlord is responsible under any of the provisions of
this lease shall be limited to the cost of such repairs or maintenance or the
curing of such defect. Landlord shall not be in default unless Landlord fails to
perform any obligation (monetary or non-monetary) required of Landlord as set
forth in this Lease within a reasonable time depending on the nature thereof,
but not later than thirty (30) days after Landlord's receipt of written notice
from Tenant specifying wherein Landlord has failed to perform such obligation;
provided, however, that if the nature of Landlord's obligation is such that more
than thirty (30) days are required for its cure then Landlord shall have such
longer period as may be reasonably required if Landlord promptly takes
corrective action and proceeds with due diligence to cure the same. (See Also
Additional Provision, Section 21)

     6. TENANT'S REPAIRS AND OBLIGATIONS.
     A. Tenant shall at its own cost and expense keep and maintain all parts of
the Premises (except those for which Landlord is expressly responsible under the
terms of this lease) in good condition, reasonable wear and tear excepted,
promptly making all repairs, repainting, and replacements, including but not
limited to, windows, glass and plate glass, doors, any office entries, interior
walls and finish work, floors and floor covering, downspouts, gutters, heating
and air conditioning systems, dock boards, truck doors, dock bumpers, paving,
plumbing work and fixtures, termites and pest extermination, regular removal of
trash and debris, grounds maintenance, sewage line plumbing, exterior lighting
(if applicable), dumpster removal and other obligations of the building,
including but not limited to keeping the parking areas, driveways, alleys and
the whole of the Premises in a clean and sanitary condition. Tenant shall not be
obligated to repair any damage caused by fire, tornado or other casualty covered
by the insurance to be maintained by Landlord pursuant to subparagraph 12A
below, except that Tenant shall be obligated to repair all wind damage to glass
except with respect to tornado or hurricane damage.

     B. Intentionally Omitted

     C. Tenant and its employees, customers and licensees shall have the
exclusive right to use the parking areas as shown on Exhibit "A-1". Landlord
shall not be responsible for enforcing Tenant's exclusive parking rights against
any third parties; provided however, that Landlord will reasonably assist Tenant
in enforcing Tenant's parking rights.

     D. If Tenant fails to perform its obligations under this Lease beyond any
applicable notice and cure period, Landlord reserves the right to perform and
provide all or any part of Tenant's repairs and obligations under subparagraph
6A above, and Tenant shall, in lieu of the obligations set forth under
subparagraph 6A above with respect to such items, pay monthly as additional rent
due under subparagraph 2A the reasonable cost and expense, including reasonable
overhead, for those items. If, for any calendar year during which this Lease is
in effect, Tenant's total monthly payments made pursuant to this subparagraph
are less than actual cost of such repairs and obligations, Tenant shall pay to
Landlord the payment shortage. If the total monthly payments are more than
actual cost of such repairs and obligations, Landlord shall retain such excess
and credit it to Tenant's next accruing monthly payment for such repairs and
obligations.

     E. Intentionally omitted.

     F. Tenant shall, at its own cost and expense, enter into a regularly
scheduled preventive maintenance/service contract with a maintenance contractor
(or shall have on staff a qualified engineer) for servicing all hot water,
heating and air conditioning systems and equipment within the Premises. The
maintenance contractor and the contract (or staff engineer) must be approved by
Landlord, which approval shall not be unreasonably withheld, conditioned or
delayed. The service contract (or Tenant's engineer's service protocol) must
meet industry standards for maintenance of such equipment and must become
effective (and a copy thereof delivered to the Landlord) within thirty (30) days
of the date Tenant takes possession of the Premises.

     G. See Additional Provisions, Section 17

     7. ALTERATIONS. Tenant shall not make any alterations, additions or
improvements to the Premises (including but not limited to roof and wall
penetrations) without the prior written consent of Landlord, not to be
unreasonably withheld, conditioned or delayed. In the event Landlord consents to
the making of any such alterations, additions or improvements by Tenant, the
same shall be made by Tenant, at Tenant's sole cost and expense, in accordance
with all applicable laws, ordinances and regulations, and all reasonable
requirements of Landlord's and Tenant's insurance policies and only in
accordance with plans and specifications approved by Landlord, such consent not
to be unreasonably withheld, conditioned or delayed. Tenant may, without the
consent of Landlord, but at its own cost and expense and in a good workmanlike
manner erect such shelves, bins, machinery and trade fixtures as it may deem
advisable, without altering the basic character of the building or improvements
and without overloading or damaging such building or improvements, and in each
case complying with all applicable governmental laws, ordinances, regulations
and other requirements. All alterations, additions, improvements and partitions
erected by Tenant shall be and remain the property of Tenant during the term of
this lease and Tenant shall, unless Landlord otherwise elects as hereinafter
provided, remove all alterations, additions, improvements and partitions erected
by Tenant and restore the Premises to their original condition by the date of
termination of this lease or upon earlier vacating of the Premises, reasonable
wear and tear excepted; provided, however, that if Landlord so elects in writing
prior to termination of this lease or upon earlier vacating of the Premises,
such alterations, additions, improvements and partitions (but not Tenant's trade
fixtures) shall become the property of Landlord as of the date of termination of
this lease or upon earlier vacating of the Premises and shall be delivered up to
the Landlord with the Premises

                                 Page 3 of 27
<PAGE>

Notwithstanding the foregoing sentence, all shelves, bins, machinery and trade
fixtures installed by Tenant may be removed by Tenant prior to the termination
of this lease if Tenant so elects, and shall be removed by the date of
termination of this lease or upon earlier vacating of the Premises if required
by Landlord. Upon any such removal Tenant shall restore the Premises to their
original condition, normal wear and tear excepted. All such removals and
restoration shall be accomplished in a good workmanlike manner so as not to
damage the primary structure or structural qualities of the building and other
improvements situated on the Premises. (See Additional Provisions, Section 8)

     8. SIGNS. Tenant agrees to conform to Landlord's signage program for the
building; however, all costs and expenses for the sign, sign installation,
removal and repair shall be paid by Tenant, provided Tenant may use a portion of
its Allowance, as hereinafter defined, for such work. Tenant shall have the
right to install standard signs upon the Premises only where first approved in
writing by Landlord and subject to any applicable governmental laws, ordinances,
regulations and other requirements. Tenant shall remove all signs prior to the
termination of this lease. Such installations and removals shall be made in such
a manner as to avoid injury or defacement of the building and other
improvements, and Tenant shall repair any injury of defacement, including
without limitation, caused by installation and/or removal.

     9. INSPECTION AND RIGHT OF ENTRY. Landlord and Landlord's agents and
representatives shall have the right to enter the Premises at any time in the
event of an emergency and to enter and inspect the Premises at any reasonable
time during business hours after 48 hours written notice to the manager of the
Premises, for the purpose of ascertaining the condition of the Premises or in
order to make such repairs as may be required or permitted to be made by
Landlord under the terms of this lease. During the period that is six (6) months
prior to the end of the term hereof, Landlord and Landlord's agents and
representatives shall have the right to enter the Premises at any reasonable
time during business hours for the purpose of showing the Premises and shall
have the right to erect on the Premises a suitable sign indicating the Premises
are available. Tenant shall give written notice to Landlord at least thirty (30)
days prior to vacating the Premises and shall arrange to meet with Landlord for
a joint inspection of the Premises prior to vacating. In the event of Tenant's
failure to give such notice or arrange such joint inspection, Landlord's
inspection at or after Tenant's vacating the Premises shall be conclusively
deemed correct for purposes of determining Tenant's responsibility for repairs
and restoration; provided that Landlord has attempted to arrange a joint
inspection and Tenant has failed to respond to Landlord's written request within
five days.

     10. UTILITIES. Landlord agrees to provide at its cost water, electricity
and gas (when applicable) service connections at the Building's exterior in
accordance with the specifications, if any, attached hereto or provided by
Tenant pursuant to the provisions of Exhibit "B-1"; but Tenant shall pay for all
water, gas, heat, light, power, telephone, sewer, sprinkler charges and other
utilities and services used on or from the Premises, together with any taxes,
penalties, surcharges or the like pertaining thereto, and any maintenance
charges for utilities, and shall furnish all electric light bulbs and tubes.
Landlord shall in no event be liable for any interruption or failure of utility
services on the Premises not caused by Landlord, its agents or contractors.
Tenant has the right to negotiate and select provider of utilities among those
providers servicing the Premises.

     11. ASSIGNMENT AND SUBLETTING.
     A. Tenant shall not sell, assign, encumber or otherwise transfer by
operation of law or otherwise, this lease or any interest herein, sublet the
Premises or any portion thereof, or suffer any other person to occupy or use the
Premises or any portion thereof, without the prior written consent of Landlord
as provided herein, not to be unreasonably withheld, conditioned or delayed, nor
shall Tenant permit any lien to be placed on the Tenant's interest by operation
of law. Tenant shall, by written notice, advise Landlord of its desire from and
after a stated date (which shall not be less than thirty (30) days ) to sublet
the Premises or any portion thereof for any part of the term thereof and if such
sublet is for the entire Premises Landlord shall have the right, to be exercised
by giving written notice to Tenant within ten (10) days after receipt of
Tenant's notice, to terminate this lease as of the date stated in Tenant's
notice. Said notice by Tenant shall state the name and address of the proposed
subtenant, and Tenant shall deliver to Landlord a true and complete copy of the
proposed sublease with said notice. If said notice shall specify all of the
Premises and Landlord shall give said termination notice with respect thereto,
this lease shall terminate on the date stated in Tenant's notice

     B. Any subletting hereunder by Tenant shall not result in Tenant being
released or discharged from any liability under this lease. As a condition to
Landlord's prior written consent as provided for in subparagraph 11A above, the
subtenant or subtenants shall agree in writing to comply with and be bound by
all of the terms, covenants, conditions, provisions and agreements of this Lease
during the terms of such sublease, and Tenant shall deliver to Landlord promptly
after execution, an executed copy of each sublease and an agreement of said
compliance by each sublessee.

     C. Landlord's consent to any sale, assignment, encumbrance, subletting,
occupation, lien or other transfer shall not release Tenant from any of Tenant's
obligations hereunder or be deemed to be a consent to any subsequent occurrence.
Any sale, assignment, encumbrance, subletting, occupation, lien or other
transfer of this lease which does not comply with the provisions of this
paragraph 11 or Section 9 of the Additional Provisions shall be null and void.
(See also Additional Provisions, Section 9)

     12. FIRE AND CASUALTY DAMAGE.
     A. Landlord agrees to maintain insurance covering the building of which the
Premises are a part in an amount not less than the full replacement cost
thereof, insuring against the perils of Fire, Lightning, Extended Coverage,
Vandalism and Malicious Mischief, extended by Special Extended Coverage
Endorsement to insure against all other Risks of Direct Physical Loss, such
coverages and endorsements to be as defined, provided and limited in the
standard bureau forms prescribed by the insurance regulatory authority for the
state in which the Premises are situated for use by insurance companies admitted
in such state for the writing of such insurance on risks located within such
state. The cost of such insurance coverage as stated above will be the
responsibility of Tenant and Tenant agrees to pay to Landlord, as additional
rental, the amount of such insurance costs. Said payments shall be made to
Landlord within twenty (20) days after presentation to

                                 Page 4 of 27
<PAGE>

Tenant of Landlord's statement setting forth the amount due. Any payment to be
made pursuant to this subparagraph 12A with respect to the year in which this
lease commences or terminates shall bear the same ratio to the payment which
would be required to be made for the full year as the part of such year covered
by the term of this lease bears to a full year. Subject to the provisions of
subparagraphs 12C, 12D and 12E below, such insurance shall be for the benefit of
both Landlord and Tenant, but shall be under Landlord's sole control. For the
calendar year in which the Lease commences insurance costs are estimated to be
$0.065 per square foot.

     B. If any increase in the fire and extended coverage insurance premiums
paid by Landlord or other Tenants for the building in which Tenant occupies
space is caused by Tenant's use and occupancy of the Premises, or if Tenant
vacates the Premises of this Lease and causes an increase in such premiums, then
Tenant shall pay as additional rental the amount of such increase to Landlord.

     C. If the buildings situated upon the Premises should be damaged or
destroyed by fire, tornado or other casualty, Tenant shall give immediate
written notice thereof to Landlord.

     D. If the Building should be totally destroyed by fire, tornado or other
casualty, or if they should be so damaged thereby that rebuilding or repairs
cannot in Landlord's reasonable estimation be completed within two hundred (200)
days after the date upon which Landlord is notified by Tenant of such damage,
this lease shall terminate and the rent shall be abated during the unexpired
portion of this lease, effective upon the date of the occurrence of such damage.
In the event Landlord elects to rebuild or repair, Landlord shall provide notice
of such election within sixty (60) days of Landlord's receipt of notice of such
damage. If Landlord fails to complete the rebuilding or within 260 days of the
date upon which Landlord is notified by Tenant of such damage, Tenant may give
Landlord written notice of its intent to terminate this Lease and if Landlord is
unable to complete such rebuilding or repairs within 30 days from such the date
of Landlord's receipt of such notification from Tenant, such termination shall
become effective. If Landlord estimates that rebuilding and repairs can not be
completed within two hundred (200) days after the date upon which Landlord is
notified by Tenant of such damage and Landlord chooses to terminate this Lease,
Tenant may choose to rebuild or repair the Premises at its sole expense;
provided however, that if Landlord has received insurance proceeds related to
such damage, said insurance proceeds will be applied to the cost of rebuilding
and repairing the Premises.

     E. If the Building should be damaged by any peril covered by the insurance
to be provided by Landlord under subparagraph 12A above, but only to such extent
that rebuilding or repairs can in Landlord's estimation be completed within two
hundred (200) days after the date upon which Landlord is notified by Tenant of
such damage, this lease shall not terminate, and Landlord shall at its sole cost
and expense thereupon proceed with reasonable diligence to rebuild and repair
such buildings to substantially the condition in which they existed prior to
such damage, except that Landlord shall not be required to rebuild, repair or
replace any part of the partitions, fixtures, additions and other improvements
which may have been placed in, on or about the Premises by Tenant and except
that Tenant shall pay to Landlord upon demand an amount not to exceed $25,000
per occurrence representing the maximum deductible on the insurance to be
provided by Landlord and except that Landlord may elect not to rebuild if such
damage occurs during the last year of the term of the lease exclusive of any
option which is unexercised at the time of such damage. If the Premises are
untenantable in whole or in part following such damage, the rent payable
hereunder during the period in which they are untenantable shall be reduced to
such extent as may be fair and reasonable under all of the circumstances. In the
event that Landlord should fail to complete such above referenced repairs and
rebuilding within two hundred (200) days after the date upon which Landlord is
notified by Tenant of such damage, Tenant may at its option terminate this lease
by delivering written notice of termination to Landlord as Tenant's exclusive
remedy, whereupon all rights and obligations hereunder shall cease and
terminate.

     F. Notwithstanding anything herein to the contrary, in the event the holder
of any indebtedness secured by a mortgage or deed of trust covering the Premises
requires that the insurance proceeds be applied to such indebtedness, then
Landlord shall have the right to terminate this lease by delivering written
notice of termination to Tenant within fifteen (15) days after such requirement
is made by any such holder, whereupon all rights and obligations hereunder shall
cease and terminate. Within fifteen (15) days of receipt of notice Tenant may
notify Landlord in writing that Tenant elects to perform said repairs at
Tenant's sole cost and expense; provided however, that if Landlord has received
insurance proceeds above that applied to such indebtedness, said insurance
proceeds will be applied to the cost of rebuilding and repairing the Premises.
If Tenant elects to make the repairs the lease shall not terminate.

     G. Each of Landlord and Tenant hereby releases the other from any loss or
damage to property caused by fire or any other perils insured in policies of
insurance covering such property, even if such loss or damage shall have been
caused by the fault or negligence of the other party, or anyone for whom such
party may be responsible; provided, however, that this release shall be
applicable and in force and effect only with respect to loss or damage occurring
during such times as the releasor's policies shall contain a clause or
endorsement to the effect that any such release shall not adversely affect or
impair said policies or prejudice the right of the releasor to recover
thereunder and then only to the extent of the insurance proceeds payable under
such policies. Each of the Landlord and Tenant agrees that it will request its
insurance carriers to include in its policies such a clause or endorsement. If
extra cost shall be charged therefore, each party shall advise the other thereof
and of the amount of the extra cost, and the other party, at its election, may
pay the same, but it shall not be obligated to do so.

     13. LIABILITY.
     A. Landlord shall not be liable to Tenant or Tenant's employees, agents,
patrons or visitors, or to any other person whomsoever, for any injury to person
or damage to property on or about the Premises, resulting from and/or caused in
part or whole by the negligence or misconduct of Tenant, its agents, servants or
employees, or of any other person entering upon the Premises, or caused by the
buildings and improvements located on the Premises becoming out of repair,
(through no fault or breach of this lease by Landlord) or caused by leakage of
gas, oil, water or steam or by electricity emanating from the Premises during
the lease term, or due to any cause whatsoever and Tenant

                                 Page 5 of 27
<PAGE>

hereby covenants and agrees that it will at all times indemnify, including the
indemnity for Hazardous Materials set forth herein below, and hold safe and
harmless the property, the Landlord (including without limitation the trustee
and beneficiaries if Landlord is a trust), Landlord's agents and employees from
any loss, liability, claims, suits, costs, expenses, including without
limitation attorney's fees and damages, both real and alleged, arising out of or
relating to any such damage or injury; except injury to persons or damage to
property the cause of which is the negligence or willful misconduct of Landlord,
its agents and contractors or the failure of Landlord to repair any part of the
Premises which Landlord is obligated to repair and maintain hereunder within a
reasonable time after the receipt of written notice from Tenant of needed
repairs.

     B. Tenant shall not be liable to Landlord or Landlord's employees, agents,
patrons or visitors, or to any other person whomsoever for any injury to person
or damage to property on or about the Premises, resulting from and/or caused in
part or whole by the negligence or misconduct of Landlord, its agents, servants
or employees, or invitees entering upon the Premises, or caused by the Premises
becoming out of repair, (through no fault or breach of this lease by Tenant),
and Landlord hereby covenants and agrees that it will at all times indemnify,
including the indemnity for Hazardous Materials set forth herein below, and hold
safe and harmless the property, Tenant, Tenant's agents and employees from any
loss, liability, claims, suits, costs, expenses, including without limitation
attorney's fees and damages, both real and alleged, arising out of or relating
to any such damage or injury; except injury to persons or damage to property the
cause of which is the negligence or willful misconduct of Tenant, its agents and
contractors or the failure of Tenant to repair any part of the Premises which
Tenant is obligated to repair and maintain hereunder within any applicable
notice and cure periods.

     C. Tenant shall procure and maintain throughout the term of this lease a
policy or policies of insurance, including pollution and site remediation
insurance, at its sole cost and expense, insuring both Landlord and Tenant
against all claims, demands or actions arising out of or in connection with: (i)
the Premises; (ii) the condition of the Premises; (iii) Tenant's operations in
and maintenance and use of the Premises; and (iv) Tenant's liability assumed
under this lease, the limits of such policy or policies to be in the amount of
not less than $1,000,000 per occurrence in respect to injury to persons
(including death), and in the amount of not less than $2,000,000 per occurrence
in respect to property damage or destruction, including loss of use thereof. All
such policies shall be procured by Tenant from responsible insurance companies
satisfactory to Landlord. Certified copies or certificate of such policies shall
be delivered to Landlord prior to the Commencement Date of this lease. Not less
than fifteen (15) days prior to the expiration date of any such policies,
certified copies of the renewals thereof shall be delivered to Landlord. Such
policies shall further provide that not less than thirty (30) days written
notice shall be given to Landlord before such policy may be canceled or changed
to reduce insurance provided thereby.

     14. CONDEMNATION.
     A. If the whole or any substantial part of the Premises should be taken for
any public or quasi-public use under governmental law, ordinance or regulation,
or by right of eminent domain, or by private purchase in lien thereof, and the
taking would prevent or materially interfere with the use of the Premises for
the purpose for which they are being used, this lease shall terminate and the
rent shall be abated during the unexpired portion of this lease, effective when
the physical taking of said Premises shall occur.

     B. If part of the Premises shall be taken for any public or quasi-public
use under any governmental law, ordinance or regulation, or by right of eminent
domain, or by private purchase in lieu thereof, and this lease is not terminated
as provided in subparagraph 14A above, this lease shall not terminate but the
rent payable hereunder during the unexpired portion of this lease shall be
reduced to such extent as may be fair and reasonable under all of the
circumstances.

     C. All compensation awarded for any taking (or the proceeds of private sale
in lieu thereof of the Premises, buildings or other improvements, or any part
thereof, shall be the property of Landlord and Tenant hereby assigns its
interest in any such award to Landlord; provided, however, Landlord shall have
no interest in any award made to Tenant for loss of business, the loss of lease
benefits, costs of moving or the taking of Tenant's fixtures and improvements if
a separate award for such items is made to Tenant.

     15. HOLDING OVER. Tenant will, at the termination of this lease by lapse of
time or otherwise, yield up immediate possession to Landlord with all repairs
and maintenance required herein to be performed by Tenant completed. If Landlord
agrees in writing that Tenant may hold over after the expiration or termination
of this lease, unless the parties hereto otherwise agree in writing on the terms
of such holding over, the hold over tenancy shall be subject to termination by
Landlord at any time upon not less than twenty (20) days advance written notice,
or by Tenant at any time upon not less than thirty (30) days advance written
notice, and all of the other terms and provisions of this lease shall be
applicable during that period, except that Tenant shall pay Landlord monthly
rental for the period of any hold over, an amount equal to one and one half (1-
1/2) the rent in effect on the termination date, computed on a daily basis for
each day of the hold over period. No holding over by Tenant, whether with or
without consent of Landlord, shall operate to extend this lease except as
otherwise expressly provided. The preceding provisions of this paragraph 15
shall not be construed as consent for Tenant to hold over.

     16. QUIET ENJOYMENT. Landlord covenants that it now has, or will acquire
before Tenant takes possession of the Premises, good title to the Premises, free
and clear of all liens and encumbrances, excepting only the lien for current
taxes not yet due, such mortgage or mortgages as are permitted by the terms of
this lease, zoning ordinances and other building and fire ordinances and
governmental regulations relating to the use of such property, and easements,
restrictions and other conditions of record as of the date hereof. Landlord
represents end warrants that it has full right and authority to enter into this
lease and that Tenant, upon paying the rental herein set forth and performing
its other material covenants and agreements herein set forth (within any
applicable notice and cure period), shall peaceably and quietly have, hold and
enjoy the Premises for the term hereof without hindrance or molestation from
Landlord, subject to the terms and

                                 Page 6 of 27
<PAGE>

provisions of this lease. Landlord covenants that it will not grant, without
Tenant's prior written consent, any future easements, licenses or such other
similar restrictions affecting Tenant's use of the Premises and Tenant's ingress
to and egress from the Premises.

     17. EVENTS OF DEFAULT. The following events shall be deemed to be events of
default by Tenant under this lease:
     A. Tenant shall fail to pay any installment of the rent herein reserved
when due, or any other payment or reimbursement to Landlord required herein when
due, and such failure shall continue for a period of five (5) days from the date
Tenant receives written notice of such failure; or

     B. Tenant shall abandon all or a substantial portion of the Premises or
fail to continuously operate its business at the Premises for the permitted use
set forth in Paragraph 3 whether or not Tenant is in default of the rental
payments due under this lease, without providing a commercially reasonable level
of security, or without providing reasonable assurance to minimize potential
vandalism; or

     C. Tenant shall fail to discharge or bond against any lien placed upon the
Premises in violation of Paragraph 20 hereof within twenty (20) business days
after any such lien or encumbrance is filed against the Premises; or

     D. Tenant shall fail to comply with any term, provision or covenant of this
lease (other than the foregoing in this Paragraph 17), and shall not cure such
failure within twenty (20) business days after written notice thereof to Tenant
or such longer period as may be reasonably required if Tenant promptly takes
corrective action and continually proceeds with due diligence to cure same.

     18. REMEDIES
     A. Upon each occurrence of an event of default, Landlord shall have the
option to pursue any one or more of the following remedies without any notice or
demand:

     (1)  Terminate this lease, and/or
     (2)  Enter upon and take possession of the Premises with or without
     terminating this lease; and/or
     (3)  Alter all locks and other security devices at the Premises with or
     without terminating this lease, and pursue, at Landlord's option, one or
     more remedies pursuant to this lease, Tenant hereby specifically waiving
     any state or federal law to the contrary;

and in any such event Tenant immediately shall surrender its Premises to
Landlord, and if Tenant fails to do so, Landlord, without waiving any other
remedy it may have, may enter upon and take possession of the Premises or any
part thereof and expel or remove Tenant and any other person who may be
occupying such Premises or part thereof, by force if necessary, without being
liable for prosecution or any claim of damages therefor.

     B. In the event Tenant fails to pay any installment of rent hereunder as
and when such installment is due, to help defray the additional cost to Landlord
for processing such late payments Tenant shall pay to Landlord on demand a late
charge in an amount equal to five (5%) percent of such installment; and the
failure to pay such amount within five (5) business days after demand therefore
shall be an event of default hereunder. The provision for such late charge shall
be in addition to all of Landlord's other rights and remedies hereunder or at
law and shall not be construed as liquidated damages or as limiting Landlord's
remedies in any manner.

     C. In the event Tenant's check given to Landlord in payment, is returned by
the bank for non-payment, Tenant agrees to pay all expenses incurred by Landlord
as a result thereof.

     D. In the event of a default or threatened default of this Lease by Tenant,
Landlord shall be entitled to all equitable remedies, including, without
limitation injunction and specific performance. The various rights, remedies,
powers, options and elections of Landlord reserved, expressed or contained in
this lease are cumulative, and no one of them shall be deemed to be exclusive of
the others, or of such other rights, remedies, powers, options or elections as
are now, or may hereafter, be conferred upon Landlord by law or in equity.
Failure by Landlord to enforce one or more of the remedies herein provided shall
not be deemed or construed to constitute a waiver of such default, or any
violation or breach of any of the terms, provisions, or covenants herein
contained, or a waiver of Landlord's right thereafter to insist upon strict
compliance with the terms hereof.

     E. In the event Landlord elects to terminate the lease by reason of an
event of default, then notwithstanding such termination, Tenant shall be liable
for and shall pay to Landlord, at the address specified for notice to Landlord
herein, the sum of all rental and other indebtedness accrued to date of such
termination, plus, as damages, an amount equal to the total rent hereunder for
the remaining portion of the lease term (had such term not been terminated by
Landlord prior to the expiration stated in Paragraph 1).

     F. In the event Landlord elects to repossess the Premises without
terminating the lease, or in the event Landlord elects to terminate the lease,
then Tenant, at Landlord's option, shall be liable for and shall pay to
Landlord, at the address specified for notice to Landlord herein, all rental and
other indebtedness accrued to the date of such repossession, plus rental
required to be paid by Tenant to Landlord during the remainder of the lease term
until the date of expiration of the term as stated in Paragraph 1 diminished by
any net sums thereafter received by Landlord through releting the Premises
during said period (after deducting expenses incurred by Landlord as provided in
subparagraph 18G below). In no event shall Tenant be entitled to any excess of
any rental obtained by releting over and above the rental herein reserved.
Action to collect amounts due by Tenant to Landlord under this subparagraph may
be brought from time to time, on one or

                                 Page 7 of 27
<PAGE>

more occasions, without the necessity of Landlord's waiting until the expiration
of the lease term. Landlord agrees to make commercially reasonable efforts to
mitigate its damages.

     G. In the case of any event of default or breach by Tenant, or threatened
or anticipated breach or default as a result of bankruptcy, Tenant shall also be
liable for and shall pay to Landlord, at the address specified for notice to
Landlord herein, in addition to any sum provided to paid above, broker's fees
incurred by Landlord in connection with releting the whole or any part of the
Premises; the cost of removing storing Tenant's or other occupant's property;
the cost of repairing, altering, remodeling or otherwise putting the Premises
into condition acceptable to a new tenant or tenants, and all reasonable
expenses incurred by Landlord enforcing or defending Landlord's rights and/or
remedies including reasonable attorney's fees.

     H. In the event of termination or repossession of the Premises for an event
of default, Landlord shall not have any obligation to relet or attempt to relet
the Premises, or any portion thereof, or to collect rental after releting; and
in the event of releting, Landlord may relet the whole or any portion of the
Premises for any period to any tenant for any purpose; provided, however, that
Landlord agrees to make commercially reasonable efforts to mitigate its damages.

     I. If Tenant should fail to make any payment or cure any default hereunder
within the time herein permitted, Landlord, without being under any obligation
to do so and without thereby waiving such default, may make such payment and/or
remedy such other default for the account of Tenant (and enter the Premises for
such purpose), and thereupon Tenant shall be obliged to, and hereby agrees to
pay Landlord upon demand, all costs, expenses and disbursements (including
reasonable attorney's fees) incurred by Landlord in taking such remedial action.

     J. In the event that Landlord shall have taken possession of the Premises
pursuant to the authority herein granted, then Landlord shall have the right to
keep in place and use all of the furniture, fixtures and equipment at the
Premises, including that which is owned by or leased to Tenant at all times
prior to any foreclosure thereon by Landlord or repossession thereof by any
lessor thereof or third party having a lien thereon. Landlord shall also have
the right to remove from the Premises (without the necessity of obtaining a
distress warrant, writ of sequestration or other legal process) all or any
portion of such furniture, fixtures, equipment and other property located
thereon and to place same in storage at any Premises within the County in which
the Premises is located; and in such event, Tenant shall be liable to Landlord
for costs incurred by Landlord in connection with such removal and storage.
Landlord shall also have the right to relinquish possession of all or any
portion of such furniture, fixtures, equipment and other property to any person
("Claimant") claiming to be entitled to possession thereof who presents to
Landlord a copy of any instrument represented to Landlord by Claimant to have
been executed by Tenant (or any predecessor Tenant) granting Claimant the right
under various circumstances to take possession of such furniture, fixtures,
equipment or other property, without the necessity on the part of Landlord to
inquire into the authenticity of said instrument's copy of Tenant's or Tenant's
predecessor's signature(s) thereon and without the necessity of Landlord making
any investigation or inquiry as to the validity of the factual or legal basis
upon which Claimant purports to act; and Tenant agrees to indemnify and hold
Landlord harmless from all cost, expense, loss, damage and liability incident to
Landlord's relinquishment of possession of all or any portion of such furniture,
fixtures, equipment or other property to Claimant. The rights of Landlord herein
stated shall be in addition to any and all other rights which Landlord has or
may hereafter have at law or in equity; and Tenant stipulates and agrees that
the rights herein granted Landlord are commercially reasonable.

     19. MORTGAGES.
     A. Tenant accepts this lease subject and subordinate to any mortgage(s)
and/or deed(s) of trust now or at any time hereafter constituting a lien or
charge upon the Premises or the improvements situated thereon, provided however,
that if the mortgagee, trustee, or holder of any such mortgage or deed of trust
elects to have Tenant's interest in this lease superior to any such instrument,
then by notice to Tenant from such mortgagee, trustee or holder, this lease
shall be deemed superior to such lien, whether this lease was executed before or
after said mortgage or deed of trust. Tenant shall at any time hereafter on
demand execute any reasonable instruments, releases or other documents which may
be required by any mortgagee for the purpose of subjecting and subordinating
this lease to the lien of any such mortgage, provided that Landlord secures a
non-disturbance agreement in a form as attached in Exhibit "C" or such
reasonably similar agreement from such mortgagee. All mortgages or deeds of
trust referred to in this subparagraph 19A refer to first mortgages or deeds of
trust only. (See also Additional Provisions, Section 10)

     B. Tenant agrees not to look to the mortgagee, as mortgagee, mortgagee in
possession, or successor entitled to the property, for accountability for any
security deposit required by the Landlord hereunder, unless said sums have been
received by said mortgagee as security for Tenant's performance of this lease.

     20. MECHANICS LIENS AND OTHER TAXES. Tenant shall have no authority,
express or implied, to create or place any lien or encumbrance of any kind or
nature whatsoever upon, or in any manner to bind the interests of Landlord in
the Premises or to charge the rentals payable hereunder for any claim in favor
of any person dealing with Tenant, including those who may furnish materials or
perform labor for any construction or repairs, and each such claim shall affect
and each such lien shall attach to, if at all, only the leasehold interest
granted to Tenant by this instrument. Tenant covenants and agrees that it will
pay or cause to be paid all sums legally due and payable by it on account of any
labor performed or materials furnished in connection with any work performed on
the Premises (provided such work is at Tenant's direction and is not performed
by Landlord or its contractors) on which any lien is or can be validly and
legally asserted against its leasehold interest in the Premises or the
improvements thereon and that it will save and hold Landlord harmless from any
and all loss, cost or expense based on or arising out of asserted claims or
liens against the leasehold estate or against the right, title and interest of
the Landlord in the Premises or under the terms of this lease. Tenant agrees to
give Landlord immediate written notice if any lien or encumbrance is placed on
the Premises.

                                 Page 8 of 27
<PAGE>

     21. NOTICES. Each provision of this instrument or of any applicable
governmental laws, ordinances, regulations and other requirements with reference
to the sending, mailing or delivery of any notice or the making of any payment
by Landlord to Tenant or with reference to the sending, mailing or delivery of
any notice or the making of any payment by Tenant to Landlord shall be deemed to
be complied with when and if the following steps are taken:

     A. All rent and other payments required to be made by Tenant to Landlord
hereunder shall be payable to Landlord at the address hereinbelow set forth or
at such other address as Landlord may specify from time to time by written
notice delivered in accordance herewith. Tenant's obligations to pay rent and
any other amounts to Landlord under the terms of this lease shall not be deemed
satisfied until such rent and other amounts have been actually received by
Landlord.

     B. All payments required to be made by Landlord to Tenant hereunder shall
be payable to Tenant at the address hereinbelow set forth, or at such other
address within the continental United States as Tenant may specify from time to
time by written notice delivered in accordance herewith.

     C. Any notice or document required or permitted to be delivered hereunder
shall be deemed to be delivered whether actually received or not when deposited
in the United States Mail, postage prepaid, Certified or Registered Mail,
addressed to the parties hereto at the respective addresses set out below, or at
such other address as they have theretofore specified by written notice
delivered in accordance herewith:

     LANDLORD:                               TENANT:

     3 Plus Limited Partnership              HomeGrocer.com, Inc.
     3060 Peachtree Road, NW                 Attn: Vice President Operations
     Suite 1750                              10230 N.E. Points Drive
     Atlanta, Georgia 30305                  Kirkland, Washington 98033

                                             And

                                             HomeGrocer.com, Inc.
                                             Attn: Legal Department
                                             10230 N.E. Points Drive
                                             Kirkland, Washington 98033

If and when included within the term "Landlord", as used in this instrument,
there are more than one person, firm or corporation, all shall jointly arrange
among themselves for their joint execution of such a notice specifying some
individual at some specific address for the receipt of notices and payments to
Landlord; if and when included within the term "Tenant", as used in this
instrument, there are more than one person, firm or corporation, all shall
jointly arrange among themselves for their joint execution of such a notice
specifying some individual at some specific address within the continental
United States for the receipt of notices and payments to Tenant. All parties
included within the terms "Landlord" and "Tenant", respectively, shall be bound
by notices given in accordance with the provisions of this paragraph to the same
effect as if each had received such notice.

     22. HAZARDOUS MATERIALS.
     A. For purposes of this section, "Hazardous Materials" shall include all
solid, liquid or gaseous materials defined or regulated as wastes under any
federal statute or regulation or any state or local law, regulation or ordinance
and shall further include all other substances defined or regulated as
pollutants or as hazardous, toxic, infectious, or radioactive substances under
any federal statute or regulation or any state or local law, regulation or
ordinance, all as amended from time to time.

     B. Tenant shall not cause or permit any Hazardous Materials to be used,
generated, stored or disposed of on, under or about, or transported to or from
the Premises (collectively, "Hazardous Materials Activities") except in
compliance with all applicable federal, state and local laws, regulations,
ordinances and order governing such Hazardous Materials or Hazardous Materials
Activities, which compliance shall be at Tenant's sole cost and expense.
Additionally, Tenant shall not cause or permit any Hazardous Materials to be
disposed of on, under or about the Premises without the express prior written
consent of the Landlord, which may be withheld for any reason and may be revoked
at any time. Tenant further agrees, at all times, to fully disclose in writing
to Landlord the storage, handling, disposal or use of Hazardous Materials under,
on or about the Premises and the property in which the Premises is located.

     C. Landlord shall not be liable to Tenant or to any other party for any
Hazardous Materials Activities conducted or permitted on, under or about the
Premises by Tenant or by Tenant's employees, agents, contractors, licensees or
invitees, and Tenant shall indemnify, defend and hold Landlord harmless from any
claims, damages, fines, penalties, losses, judgments, costs and liabilities
arising out of or related to any Hazardous Materials Activities conducted or
permitted on, under or about the Premises by Tenant or by Tenant's employees,
agents, contractors, licensees or invitees, regardless of whether Landlord shall
have consented to, approved of, participated in or had notice of such Hazardous
Materials Activities. The provisions of this paragraph shall survive the
expiration or termination of this lease.

     D. At the expiration or earlier termination of this lease, Tenant shall
remove from the Premises, at Tenant's sole expense, all Hazardous Materials
located, stored and disposed of on, under or about the Premises during the lease
term, unless caused by a party other than Tenant or Tenant's employees, agents,
contractors, licensees, invitees, subtenants or assignees. Tenant shall close,
remove or otherwise

                                 Page 9 of 27
<PAGE>

render safe any buildings, tanks, containers or other facilities related to the
Hazardous Materials Activities conducted or permitted on the Premises during the
lease term in the manner required by all applicable laws, regulations,
ordinances or orders.

     E. See Additional Provisions, Section 11

     23. INSOLVENCY OR BANKRUPTCY. The appointment of a receiver to take
possession of all or substantially all of the assets of Tenant, or an assignment
of Tenant for the benefit of creditors, or any action taken or suffered by
Tenant under any insolvency, bankruptcy, or reorganization act, shall at
Landlord's option constitute a breach of this Lease by Tenant, unless such
proceedings are involuntary and Tenant is discharged from the same within sixty
(60) days. Upon the happening of any such event or at any time thereafter, this
Lease shall terminate five (5) days after written notice of termination from
Landlord to Tenant. In no event shall this Lease be assigned or assignable by
operation of law or by voluntary or involuntary bankruptcy proceedings or
otherwise and in no event shall this Lease or any rights or privileges hereunder
be an asset of Tenant under any bankruptcy, insolvency, or reorganization
proceedings.

     24. LANDLORD'S LIABILITY. Any liability of Landlord hereunder shall be
enforceable only out of the Premises, including the proceeds thereof and
therefrom and in no event out of any other assets of Landlord or the separate
assets of any constituent partner, shareholder or member of Landlord. No holder
or beneficiary of any mortgage or deed of trust on any part of the Property
shall have any liability to Tenant hereunder for any default of Landlord. This
provision is not intended to be a measure or agreed amount of the Landlord's
liability with respect to any particular breach, and shall not be utilized by
any court or otherwise for the purpose of determining any liability of Landlord
hereunder, except only as a maximum amount not to be exceeded in any event.
Notwithstanding the foregoing and subject to section 21 of the Additional
Provisions, in the event Landlord's liability, as established by a court, for
any breach of this Lease exceeds Landlord's equity value in the Building or
Property (the mortgage or deed of trust on the Property is for an amount greater
than the value of the Property) and Tenant has exhausted all other legal
remedies available to Tenant to collect payment, including written notification
to the holder or beneficiary of any mortgage or deed of trust on the Property,
then and only then, Tenant may offset against Base Rent the uncollected amount
of Landlord's liability established by the court that exceeds Landlord's equity
value in the Building or Property.

     25. MISCELLANEOUS.
     A. Words of any gender used in this lease shall be held and construed to
include any other gender, and words in the singular number shall be held to
include the plural, unless the context otherwise requires.

     B. In the event the Premises constitutes a portion of a multiple occupancy
building, building complex or Business Park, Tenant's "proportionate share" as
used in this lease, shall mean a fraction, the numerator of which is the space
contained in the Premises and the denominator of which is the entire leasable
space contained in the building, building complex or Business Park.

     C. The terms, provisions and covenants and conditions contained in this
lease shall apply to, insure to the benefit of, and be binding upon the parties
hereto and upon their respective heirs, legal representatives, successors and
permitted assigns, except as otherwise herein expressly provided. Landlord shall
have the right to reasonably assign any of its rights and obligations under this
lease. Each party agrees to furnish to the other, promptly upon demand, a
corporate resolution, proof of due authorization by partners, or other
appropriate documentation evidencing the due authorization of such party to
enter into this lease.

     D. The captions inserted in this lease are for convenience only and in no
way define, limit or otherwise describe the scope or intent of this lease, or
any provision hereof, or in any way affect the interpretation of this lease.

     E. Tenant agrees from time to time within ten (10) days after request of
Landlord, to deliver to Landlord, or Landlord's designee a certificate of
occupancy (if applicable) and an estoppel certificate stating (to the extent
such statements are then true and within Tenant's knowledge) that this lease is
in full force and effect, the date to which rent has been paid, the unexpired
term of this lease and such other matters pertaining to this lease as may be
requested by Landlord. It is understood and agreed that Tenant's obligation to
furnish such estoppel certificates in a timely fashion is a material inducement
for Landlord's execution of this lease.

     F. This lease may not be altered, changed or amended except by an
instrument in writing signed by both parties hereto.

     G. All obligations of Tenant or Landlord hereunder not fully performed as
of the expiration or earlier termination of the term of this lease shall survive
the expiration or earlier termination of the term hereof, including without
limitation all payment obligations with respect to taxes and insurance and all
obligations concerning the condition of the Premises. Tenant shall also, prior
to vacating the Premises, pay to Landlord the amount, as estimated by Landlord,
of Tenant's obligation hereunder for real estate taxes and insurance premiums
for the year in which the lease expires or terminates. All such amounts shall be
used and held by Landlord for payment of such obligations of Tenant hereunder,
with Tenant being liable for any additional costs therefor upon demand by
Landlord, or with any excess to be returned to Tenant after all such obligations
have been determined and satisfied, as the case may be. Any security deposit
held by Landlord shall be credited against the amount payable by Tenant under
this subparagraph 25G. The balance of any unused portion of the security deposit
shall be returned to Tenant.

     H. If any clause or provision of this lease is illegal, invalid or
unenforceable under present or future laws effective during the term of this
lease, then and in that event, it is the intention of the parties hereto that
the remainder of this lease shall not be affected thereby, and it is also the
intention of the parties to this lease that in lieu of each clause or provision
of this lease that is illegal, invalid or unenforceable, there be added as a
part of this lease contract a clause or provision as similar in terms to such
illegal, invalid or unenforceable clause or provision as may be possible and be
legal, valid and enforceable.

                                 Page 10 of 27
<PAGE>

     I. Because the Premises are on the open market and are presently being
shown, this lease shall be treated as an offer with the Premises being subject
to prior lease and such offer subject to withdrawal or non-acceptance by
Landlord or to other use of the Premises without notice, and this lease shall
not be valid or binding unless and until accepted by Landlord in writing and a
fully executed copy delivered to both parties hereto.

     J. All references in this lease to "the date hereof" or similar references
shall be deemed to refer to the last date, in point of time, on which all
parties hereto have executed this lease.

     K. Time is of the essence of this lease and all of its provisions. This
lease in all respects shall be governed by the laws of the State of Georgia.

     L. Tenant shall not install drapes, curtains, blinds or any window
treatment without Landlord's prior written approval, which approval shall not be
unreasonably withheld, conditioned or delayed.

     M. The duties and obligations of Tenant herein shall be binding upon all or
any of them. The duties and obligations of Tenant shall run and extend not only
to the benefit of the Landlord, as named herein, but to the following, at the
option of the following or any of them: (i) any person by, through or under
which Landlord derives the right to lease the Premises; (ii) the owner of the
Premises; and (iii) holders of mortgage or rent assignment interests in the
Premises, as their respective interests may appear; provided, however, nothing
contained herein shall be construed to obligate Tenant to pay rent to any person
other than the Landlord until such time as Tenant has been given written notice
of either an exercise of a rent assignment or the succession of some other party
to the interests of Landlord.

     N. In order to induce Landlord to enter into this Lease Agreement, Tenant
agrees to provide to Landlord, before the initiation of construction of the
Premises and at any other time when reasonably requested by Landlord, an audited
balance sheet and income statement for the fiscal year most recently concluded.
Such balance sheet and income statement shall be for the legal entity which is
entering into the Lease Agreement with Landlord and/or the entity guaranteeing
the performance of Tenant's obligations under the lease. Tenant fully
understands and agrees that a request for such information by Landlord's lender
or a prospective buyer for the Building will be deemed reasonable.

     O. Tenant acknowledges that "smoking" is prohibited in all areas of the
Premises and the building. For purposes hereof, "smoking" means inhaling,
exhaling, burning or carrying any lighted cigar, cigarette, pipe or other
smoking equipment or device in any manner or from. Notwithstanding anything in
this Lease to the contrary, no liability shall attach to the Landlord for any
failure to enforce this provision (or similar provisions in other leases).

                           [INTENTIONALLY LEFT BLANK]

                                 Page 11 of 27
<PAGE>

     26. ADDITIONAL PROVISIONS. See Additional Provisions, Paragraphs 1 through
24, attached hereto and made a part hereof as if fully incorporated herein and
when in conflict with the printed portion of this lease, said Additional
Provisions shall prevail.

     EXECUTED BY LANDLORD, this 3/rd/ day of April, 2000.

                              3 Plus Limited Partnership
                              By:  The Phoenix Foundation, LLC,
                                    its sole general partner

                              By:  /s/ J. Robert Mobley
                                   -----------------------------
                                    J. Robert Mobley, its Member

                              Witness:

                              /s/ James M. Mobley
                              ----------------------------------

     EXECUTED BY TENANT, this 31st day of March, 2000.

                              HomeGrocer.com, Inc.

                              By:  /s/ Mary Alice Taylor
                                   -----------------------------

                              Name:  Mary Alice Taylor
                                     ---------------------------

                              Its:  Chairman & CEO
                                    ----------------------------

                              Witness:

                              /s/ Lisa Wirick
                              ----------------------------------

                                 Page 12 of 27
<PAGE>

                             ADDITIONAL PROVISIONS

1.        Brokers/Advisors. Tenant and Landlord hereby represent and warrant
          -----------------
          each to the other that no brokers, agents or finders were involved on
          their behalf in negotiating or consummating this Lease except
          Industrial Brokers and Associates, Inc, whose commission shall be paid
          by Landlord per a separate agreement and E+Y Kenneth Leventhal Real
          Estate Services Company, LLC ("E+Y), who served as Tenant's real
          estate advisor and Landlord will reimburse Tenant for fees paid to E+Y
          per the schedule below;

          Upon Lease execution:                                $46,787.00
          Upon Commencement of Rent;                           $46,787.00
          Upon the beginning of the 75/th/ month of the Lease  $70,545.00

2.        Access to the Premises Prior to Completion
          ------------------------------------------

          Landlord shall use commercially reasonable efforts to provide Tenant
          access to the Premises for the purpose of installing trade fixtures,
          refrigeration, conveyor, racking systems, and other real and personal
          property prior to the commencement of the Lease provided that Tenant
          does not interfere with or delay the work of Landlord's contractor.
          Subject to the reasonable agreement of Landlord's contractor, both
          parties acknowledge that, while not guaranteed, Tenant may have access
          to parts of the Building approximately 45 days prior to the
          Commencement Date and access to other portions of the Building may be
          phased in over time up to the Commencement Date. However, Landlord,
          its agents and contractors shall not be responsible for; (1) any items
          of damage or casualty to the Premises caused by Tenant, its agents,
          contractors, suppliers or invitees, and (2) any damage casualty or
          loss of Tenant's property installed under this Section 2.

3.        Options to Extend Term.
          -----------------------

          A. First Renewal Period.
          Provided this Lease is then in full force and effect and Tenant is not
          in default beyond any applicable grace period set forth in this Lease,
          Landlord hereby grants Tenant a five (5) year renewal period ("First
          Renewal Period"), at a rental rate equal to the Fair Market Base
          Rental (as defined below) of comparable space in 1851 West Oak Parkway
          (the "Building") or in other buildings comparable to the Building
          located in the northwest Atlanta/I-75 Submarket comparable to the
          project in which the Building is located.

          B. Second Renewal Period.
          Furthermore, provided this Lease is then in full force and effect and
          Tenant is not in default beyond any applicable grace period set forth
          in this Lease, and there is no sublease for the entire Premises or
          assignment of any of Tenant's interest in the Lease, other than
          Permitted Transfers, Landlord hereby grants Tenant a second five (5)
          year renewal period ("Second Renewal Period"), at a rental rate equal
          to the Fair Market Base Rental of comparable space in 1851 West Oak
          Parkway (the "Building") or in other buildings comparable to the
          Building located in the northwest Atlanta/I-75 Submarket comparable to
          the project in which the Building is located.

          C. Notice.
          For each renewal period described above, Tenant shall notify Landlord
          no more than eighteen (18) and no less then eight (8) months prior to
          the end the lease of Tenant's desire to renew this Lease under the
          terms of this paragraph.

          D. Fair Market Base Rental
          The phrase Fair Market Base Rental as used in this Section 3 of the
          Additional Provisions shall take into account the condition of the
          Premises; refurbishment cost, if any, required to relet the Premises
          (in no event greater than $100,000); possible lease commissions to be
          paid to relet the Premises (in no event greater then 2% of the rental
          amount); and other relevant factors.

          E. Arbitration.
          Within thirty (30) days of Tenant's notice of exercise, Landlord
          agrees to notify Tenant of the new base rent for the Premises. Tenant
          shall have thirty (30) days after receipt of Landlord's notice to
          either accept or reject the new base rent by written notice to
          Landlord. Failure of Tenant to provide any notice within such thirty
          (30) day period shall be deemed to constitute rejection by Tenant of
          the new base rent proposed by the Landlord in its notice to Tenant. If
          Tenant rejects Landlord's proposed new base rent, it shall state forth
          in its notice to Landlord its determination of the then fair market
          rent. Thereafter, the parties shall negotiate in good faith to resolve
          their difference of opinion.

          If the parties are unable to reach and settle upon a mutually
          acceptable terms within fifteen (15) days after Tenant's notice of
          rejection then either party may require the matter to be submitted to
          arbitration in the manner described below. If either party requires
          the matter to be submitted to arbitration the Landlord and

                                 Page 13 of 27
<PAGE>

          Tenant shall select a neutral arbitrator. Within fifteen (15) days
          following the date either party requires the matter to be submitted to
          arbitration, Landlord and Tenant shall each submit their respective
          estimates of the fair market rent to the arbitrator. The arbitrator
          shall not have the authority to compromise the rates so submitted, but
          subject to the limitations in Section 3 F below, will select which
          party's rental rate most closely approximates actual market rates. The
          arbitrator's determination shall be final and binding upon the
          parties. The cost of the Arbitrator, if any, shall be paid by the
          party not prevailing in arbitration.

          F. Notwithstanding anything else contained in this Lease, including
          Section 3 D or 3 E above, in no event shall the rental rate for any
          renewal or extension of the term be less than that of the previous
          month's rental rate.

4.        Option for Early Termination.
          -----------------------------
          Provided this Lease is then in full force and effect and Tenant is not
          in default of this Lease (beyond any applicable notice and cure
          period), Landlord hereby grants Tenant a one time right to terminate
          this Lease after the 74/th/ full calendar month of the Lease term,
          provided that: (i) Tenant notifies Landlord in writing no more than 15
          months and no less than 12 months prior to the end of the 74th full
          calendar month of the Lease term of Tenant's desire to terminate this
          Lease under the terms of this paragraph; and (ii) concurrently with
          the aforementioned notice pays to Landlord a termination fee of Five
          Hundred Thousand Dollars and 00/100 ($500,000.00).

5.        Intentionally Omitted
          ---------------------

6.        Contesting Real Estate Taxes
          ----------------------------
          In any year which Landlord does not protest the real property tax
          assessment levied against the real property Tenant may choose to
          protest the assessment in Landlord's name. If Tenant chooses to
          protest the assessment, Landlord shall fully cooperate with Tenant's
          efforts provided Tenant pays all costs and expenses necessary to
          conduct such protest. In the event Landlord protests such assessment
          and a reduction in the taxes for the Property results, Tenant shall be
          entitled to the benefit of such reassessment, either as a credit
          against the next payments of Rent and Additional Rent due under this
          Lease or as a refund if this Lease has expired.

7.        Intentionally Omitted
          ---------------------

8.        Notwithstanding the provisions of Paragraph 7 of this Lease Agreement,
          Tenant, subject to the limitations set forth herein and without
          Landlord's prior written permission, may make alterations, additions
          or improvements to only the interior of the Premises (excluding
          floors, roof and wall penetrations) provided that the cost of the
          alterations, additions or improvements is less than Twenty Five
          Thousand Dollars and 00/100 ($25,000.00) in any one calendar year.
          Tenant agrees to provide Landlord within ten days of the commencement
          of any work to alter or modify the Premises under this Section 8,
          written notification of said alteration or modification, such
          notification shall include plans and specifications describing said
          alteration or modification. The intent of this Section 8 is only to
          provide Tenant a means to make minor alterations, additions or
          improvements to the interior of the Premises without the prior written
          consent of the Landlord. Other than as expressly stated in this
          Section 8, nothing herein shall be construed as a modification of
          Paragraph 7 of the Lease Agreement.

          Notwithstanding the provisions of Paragraph 7 of this Lease Agreement,
          Tenant shall maintain, but is not obligated to replace, the air-
          conditioning equipment serving only the warehouse portion of the
          Premises that was installed at Tenant's sole expense. Furthermore, in
          the event Tenant elects to replace, at Tenant's sole expense, the air-
          conditioning equipment, or any portion thereof, serving only the
          warehouse portion of the Premises during the last twelve months of the
          primary lease term, then and only then, Tenant may remove the air-
          conditioning equipment serving only the warehouse portion of the
          Premises that was replaced during the last twelve months of the
          primary lease term. Any removal of air-conditioning equipment by
          Tenant under the provisions of this Section 8 shall be done in such a
          manner that the building is satisfactorily repaired. Other than as
          expressly stated in this Section 8, nothing herein shall be construed
          as a modification of Paragraph 7 of the Lease Agreement.

9.        Permitted Transfers.
          --------------------
          Provided this Lease is then in full force and effect and Tenant is not
          in default beyond any applicable grace period set forth in this Lease,
          Tenant shall have the right to assign the Lease or sublet the Premises
          without Landlord's consent, to (a) a parent, subsidiary, sibling or
          affiliate, controlling, controlled by or under common control with,
          Tenant; (b) a successor entity related to Tenant by merger,
          consolidation, non- bankruptcy reorganization or government action; or
          (c) a purchaser of substantially all of Tenant's assets located in the
          Premises, provided that (i) any said assignee/subtenant assumes, in
          full, the obligations of Tenant under this Lease and has, at a
          minimum, a tangible net worth equal to or greater than the lessor of
          $250 million or that of Tenant, and (ii) that Tenant gives notice to
          Landlord of such assignment of subletting,

                                 Page 14 of 27
<PAGE>

          within 10 days of such occurrence ("Permitted Transfers"). Any such
          assignment/subletting shall not, in any way, affect or limit the
          joint/several liability of Tenant under the terms of this Lease. In
          addition, there are no restrictions or consent requirements associated
          with a transfer occasioned by the sale or other transfer of Tenant's
          stock or partnership or membership interests including: (i) any
          transfer in connection with the merger, consolidation or non-
          bankruptcy reorganization; (ii) any transaction related to a public
          sale or private placement; (iii) any transfer or sale of stock amongst
          existing shareholders, or (iv) any activity in any company stock
          option programs.

          Landlord consents to the reincorporation of Tenant in any State
          provided the financial condition of Tenant is not material changed due
          to such reincorporation.

10.       Intentionally Omitted
          ---------------------

11.       Landlord's Responsibilities Regarding Hazardous Materials.
          ----------------------------------------------------------
          Landlord agrees to furnish Tenant a copy of the current Phase I
          Environmental Assessment for the 9.395-acre property upon which the
          Premises are located. Landlord and its successors and assigns shall
          indemnify and hold Tenant harmless for any loss, fine, penalty,
          damage, cost, liability or claim occasioned by an existing on-site
          environmental condition reflected in the current Phase I Environmental
          Assessment and such other environmental conditions discovered during
          the term of the Lease caused by Landlord, its agents or contractors.
          Landlord's obligations under this Section 11 shall survive the
          expiration or earlier termination of this Lease Agreement.

12.       Parking.
          --------
          Subject to the West Oak Center covenants of record, Tenant shall have
          exclusive use of the area depicted on the attached site plan (Exhibit
          "A-1") for parking of employee vehicles and delivery fleet for the
          entire term and extensions thereof without any additional rent or
          other costs charged for such use of the parking, and Tenant shall have
          the right to secure the truck parking area with fencing and/or
          security cameras.

          Landlord agrees that the Premises as shown on Exhibit "A-1", includes
          all appurtenances thereunto appertaining, including, but not limited
          to, rights of access, ingress and egress at the points shown on the
          Site Plan in, to, from and over any and all streets, ways or alleys
          adjoining, abutting or adjacent to the property, together with the
          right to use, in common with other occupants of the property, any and
          all of the common areas pertaining to the property.

          Except in the event of an emergency, the parking area depicted in
          Exhibit A shall not be disturbed without Tenant's consent which
          consent shall be withheld in Tenant's sole discretion. Landlord shall
          not use or permit the use of the common areas for any purpose other
          than the parking and passage of vehicles and the movement of
          pedestrian traffic, lighting, landscaping, directional and traffic
          control signals, and Landlord will not, except as shown on Exhibit A,
          construct, locate or allow construction or location of any fence,
          barricade, structure, buildings, or other obstruction which would
          interfere with the intended uses thereof, of the free flow of traffic
          to, or access from, the common areas.

13.       Noncompete.
          -----------
          Subject and subordinate to the restrictions of any existing
          commitments to other leases in the Business Park, during the term of
          this Lease Landlord shall not lease to an internet grocery company
          premises in a building which the Landlord has a controlling interest
          in the Business Park.

14.       Roof Installations.
          -------------------
          Tenant, at its sole cost and expense, shall have the option to install
          antennas and/or satellite dishes, refrigeration, heating, ventilation,
          or air conditioning equipment on the roof of the Premises subject to
          applicable codes, recorded covenants, and conditions of Landlord's
          written approval. There shall be no additional rent or other costs
          charged for such use of the roof.

15.       Acceptance of Premises.
          -----------------------
          Upon Substantial Completion Landlord's work in accordance with Exhibit
          "B-1" and Exhibit "B-2" and prior to occupancy by Tenant, Tenant shall
          provide Landlord with a "punch list" of the items which need to be
          corrected or completed, and Landlord will do so as reasonably
          expeditiously as possible. Upon completion of Landlord's work in
          accordance with Exhibit "B-1" and Exhibit "B-2", Tenant agrees to
          execute and deliver to Landlord a letter accepting delivery of the
          Premises subject to punch list items. Landlord shall correct or
          complete such "punch list" within 30 days, or such longer period as
          may be reasonably required if Landlord promptly takes corrective
          action and proceeds with due diligence to correct or complete such
          "punch list".

                                 Page 15 of 27
<PAGE>

16.       Priority of Provisions.
          -----------------------
          In constructing this Lease, the Additional Provisions shall take
          priority over the other Lease Agreement terms.

17.       Landscaping and Owner's Association
          -----------------------------------
          Notwithstanding the provisions of Paragraph 5 and 6 of this Lease,
          Landlord agrees to perform routine maintenance of the grounds of the
          Premises, including the care of the lawns, irrigation system,
          shrubbery, plantings, trees, and general landscaping and shall charge
          Tenant for such costs. In additions, Tenant shall pay, Landlord's
          actual share of owner's association charges pertaining to the Business
          Park. Tenant shall, with respect to such items, pay monthly as
          additional rent due under subparagraph 2A the reasonable cost and
          expense, including overhead of 15 % of such actual cost or expense,
          for those items. For the calendar year in which the Lease commences
          these costs are estimated to be $0.17 per square foot.

18.       Building Expansion
          ------------------
          Provided this Lease is then in full force and effect and Tenant is not
          in default beyond any applicable grace period set forth in this Lease,
          and there is no sublease for the entire Premises or assignment of any
          of Tenant's interest in the Lease, other than Permitted Transfers,
          then at Tenant's option, subject to all government regulations and the
          provision of the park covenants of record, the Building may be
          expanded up to 20,000 square feet, provided Landlord and Tenant agree
          upon the cost, financing and other terms and conditions of said
          expansion.

19.       Substantial Completion
          ----------------------
          MacGregor Associates Architects shall issue a Certificate of
          Substantial Completion (AIA Form G704) for the Building and
          Improvements to Landlord and Tenant, including a verification of the
          size of the Premises ("Substantial Completion"). Tenant shall have
          thirty (30) days from the issuance of the Certificate of Substantial
          Completion to verify the same.

20.       Governmental Compliance
          -----------------------
          Landlord represents to Tenant that on the Commencement Date, the
          Premises will be in good working order, have a temporary certificate
          of occupancy issued by the City of Marietta, GA, and shall be in
          compliance with applicable statutes, laws, ordinances, orders, rules,
          regulations, and other governmental requirements (including but not
          limited to the Americans with Disabilities Act) relating to the
          condition and occupancy of the Premises as then enforced by the City
          of Marietta, Georgia, or such other appropriate governmental
          authority.

21.       Right to Cure
          -------------
          In the event that Landlord fails to so cure any such default following
          notice as aforesaid, Tenant may cure such default and thereafter make
          written demand (with supporting documentation reasonable in detail)
          upon Landlord for the reimbursement of the reasonable cost thereof.
          Notwithstanding the foregoing, in the event of a bona fide emergency,
          if Landlord fails to perform an obligation under this Lease within
          three business day after delivery of notice there of from Tenant
          (which notice must include reference to this emergency provision),
          Tenant may cure such failure and expend such funds as reasonably
          necessary. If repair is an obligation of Landlord then Tenant may
          invoice Landlord a maximum of $2,000 per occurrence and if Landlord
          fails to pay such invoice within 15 days, Tenant may offset the amount
          thereof from Rent. This provision does not limit Tenant's right to
          recover the remaining funds from Landlord as allowed per section 24.

22.       Force Majeure
          -------------
          Notwithstanding any other provision of this Lease Agreement, when a
          period of time is herein prescribed of any action to be taken by
          Landlord or Tenant (except that this provision shall not apply to rent
          and any other monetary obligations of Tenant under this Lease
          Agreement), such party shall not be liable or responsible for, and
          there shall be excluded from the computation for any such period of
          time, any delays due to strikes, riots, acts of God, shortages of
          labor or materials, war, laws, regulations or restrictions or any
          other causes of any other kind whatsoever which are beyond the
          reasonable control of such party ("Force Majeure").

23.       Projected Delivery Date
          -----------------------
          A. Provided that this Lease Agreement is executed on or before March
          31, 2000, Landlord estimates that the Premises shall be substantially
          completed by December 31, 2000 ("Projected Delivery Date"). Landlord
          agrees to cause Landlord's general contractor to use reasonable effort
          (utilizing ordinary and customary construction practice) to have the
          Premises substantially completed prior to the Projected Delivery Date
          and Tenant agrees to reasonably cooperate with such efforts.

          B. If Landlord is unable to substantially complete the Premises by the
          Projected Delivery Date, then, the Landlord will not be in default, or
          in any manner whatsoever liable to Tenant, not will Tenant's
          obligation to

                                 Page 16 of 27
<PAGE>

          Landlord under this Lease Agreement be affected. The Projected
          Delivery Date will be extended automatically by one day for each day
          of delay caused by Tenant, Tenant's agents, contractors, vendors,
          suppliers or invitees; and Force Majeure.

          C. Provided that this Lease Agreement is executed on or before March
          31, 2000, if Landlord is unable to substantially complete the Premises
          by April 30, 2001 ("Termination Notice Date"), then and only then,
          Tenant will have the right to terminate this Lease by delivering
          written notice to Landlord, not more then thirty (30) days after the
          Termination Notice Date of its intent to terminate the Lease if
          Landlord is unable to substantially complete the Premises within
          thirty (30) days of Landlord's receipt of Tenant's notice. The
          Termination Notice Date will be extended automatically by one day for
          each day of delay caused by Tenant, Tenant's agents, contractors,
          vendors, suppliers or invitees; and Force Majeure.

24.       Definitions
          -----------
          For purposes of this Lease, the following defined terms have the
          meanings set forth below or in the section of the Lease indicated
          below:

               "Business Park" shall mean the West Oak Center as defined as the
          Property in the Amended and Restated Declaration of Covenants,
          Conditions, Reservations and Restrictions for West Oak Center, Cobb
          County Georgia

               "Landlord's Work" shall be defined as the construction and
          installation of the work described in the Basic Outline Specifications
          in Exhibit B-1 and improvements made per Exhibit B-2.

                                 Page 17 of 27
<PAGE>

                                  EXHIBIT "A"
                                  -----------

                                   WEST OAK

ALL THAT TRACT or parcel of land lying and being in Land Lots 804 and 853 of the
16th District, Cobb County, City of Marietta, Georgia, and being more
particularly described as follows:

TO FIND THE POINT OF BEGINNING, begin at a point formed by the intersection of
the northwesterly margin of the right-of-way of West Oak Parkway (100-foot
right-of-way), with the southwesterly margin of the right-of-way of West Oak
Drive (60-foot right-of-way), if said margins were extended to form an angle
instead of a curve; thence running southwesterly along the extended margin of
the right-of-way of West Oak Parkway, a distance of 499.51 feet to a point,
which is the POINT OF BEGINNING; from the POINT OF BEGINNING, as thus
established, thence running along the westerly margin of the right-of-way of
West Oak Parkway, along the arc of a curve to the left (said arc being subtended
by a chord bearing South 11(degrees)22'42" West, a distance of 264.31 feet), a
distance of 269.75 feet to a point; thence leaving the westerly margin of the
right-of-way of West Oak Parkway, and running South 81(degrees)23'17" West, a
distance of 117.87 feet to a point; thence running South 47(degrees)07'24" West,
a distance of 379.68 feet to a point; thence running North 42(degrees)52'36"
West, a distance of 617.86 feet to a point located on the southeasterly margin
of the right-of-way of West Oak Drive North 37(degrees)40'40" East, a distance
of 371.79 feet to a point; thence continuing along the southeasterly margin of
the right-of-way of West Oak Drive, along the arc of a curve to the right (said
arc being subtended by a chord bearing North 55(degrees)45'02" East, a distance
of 229.54 feet), a distance of 233.42 feet to a point; thence leaving the
southeasterly margin of the right-of-way of West Oak Drive, and running South
44(degrees)34'12" East, a distance of 368.54 feet to a point; thence running
South 70(degrees)34'12" East, a distance of 158.00 feet to a point; thence
running South 58(degrees)37'53" East, a distance of 50.00 feet to a point
located on the westerly margin of the right-of-way of West Oak Parkway, which is
the POINT OF BEGINNING, said property containing 9.395 acres, as much more
particularly shown on that certain Survey of Property for 3 Plus Limited
Partnership, dated June 18, 1998, prepared by Urban Engineers, Inc., and bearing
the seal of Nelson F. Goetz, GRLS No. 3844.

TOGETHER WITH AND SUBJECT TO, as an appurtenance to the aforedescribed property,
a non-exclusive, perpetual easement for the construction, maintenance and use of
the sanitary sewer and storm drainage lines and the sanitary sewer and storm
drainage patterns, all as shown on that certain Final Subdivision Plat of West
Oak Center, recorded in Plat Book 129, Pages 88 and 89, Cobb County, Georgia
Records.

TOGETHER WITH AND SUBJECT TO, the rights, easements and obligations set forth in
that certain Joint Driveway Easement Agreement between W. Hogewoning B.V., a
Netherlands corporation, and Collin Equities, Inc., a Texas corporation, and New
Cheshire Limited Partnership, a Georgia limited Partnership, dated April 25,
1994, and recorded in Deed Book 8216, Page 377, aforesaid records.

Subject to: (1) all matters of record as of the date hereof, (2) matters shown
on that certain Final Subdivision Plat of West Oak Center, dated December 1,
1989, prepared by Urban Engineers, Inc. and (3) any deed to secure debt.

                                 Page 18 of 27
<PAGE>

                                 EXHIBIT "A-1"
                                 -------------

                           [FLOOR PLAN APPEARS HERE]

                                 Page 19 of 27
<PAGE>

                                 EXHIBIT "B-1"

                         Basic Outline Specifications

                                      For

                          Building Shell and Sitework

                                      For

                             HomeGrocer.com, Inc.
                             (102,297 Square Feet)

                          3 Plus Limited Partnership
                                 March 6, 2000

                                 Page 20 of 27
<PAGE>

THE SITE
--------

The site is to be an approximate 9.395-acre tract of land in West Oak Center
located on West Oak Parkway, Marietta, Cobb County, Georgia.

THE BUILDING AND SITE FACILITIES
--------------------------------

The building gross area will be approximately 102,297 square feet as shown on
the site plan prepared by MacGregor Associates Architects contained in Exhibit
"A-1" (the "Site Plan"). Tenant's exclusive automobile and truck parking to be
approximately as shown on the Site Plan.

PROJECT DESIGN
--------------

3 Plus Limited Partnership will retain the services of MacGregor Associates
Architects (project architect), McCrary Engineering, Inc. (project civil
engineer) and Doran & Karwoski Architects (project landscape architect) for the
site design, architectural design, structural engineering and landscape design
of the project. The design of the building will comply with the guidelines of
Architectural Committee for West Oak/Atlanta, Inc.

PERMITS, LICENSING, FEES
------------------------

All building permit fees and water and sewer tap fees are included. One
vault/manhole and 8' director check is included. One 2" domestic water meter and
one 1" irrigation water meter are included. One 6" sewer main to the Building is
included.

SITEWORK
--------

1.   All grading and excavation will be performed in accordance with the design
     documents. A soils engineer will do a soil analysis and his recommendations
     followed during the structural design. Soil compaction tests will be taken
     during construction to insure compliance with design.
2.   A concrete curb will border all paved areas. Sidewalks will be 4" thick
     with broomed finished and will be placed in accordance with the final
     design. A 6" thick reinforced concrete truck pad will be placed at the 48"
     high loading dock area. All exterior concrete will be 3,000 PSI.
3.   Paved areas will consist of two types. The automobile parking area and
     associated drives will consist of 5' gravel base and 2' of asphalt. The
     truck drive and truck court will consist of 6" of gravel base, a 2" asphalt
     binder and 1" asphalt topping.
4.   All utilities shall be placed underground. Adequate gas, water, electrical
     power and sanitary sewer service will be brought to the building. Storm
     water runoff from both the building and paved areas will be through an
     underground storm sewer system.
5.   Offsite storm water detention shall be provided by the master detention
     facilities in West Oak Center. A detention pond is not required on the
     site.

CONCRETE
--------

1.   Slab on grade shall be 6" thick, with 4,000 PSI unreinforced concrete at 28
     days.
2.   Vapor barrier under slab is included under office area.
3.   All slabs will receive saw-cut control joints at a maximum of 20' on
     center.
4.   A clear bond sealer/hardener will be sprayed on the warehouse floor.

EXTERIOR WALLS
--------------

Exterior walls to be 7-1/4" non-insulated, load bearing concrete tilt-up panels
with a jumbo brick veneer for the projected office area.

METALS
------

1.   Building frame to be steel columns with lightweight joists and joist
     girders. The structure is to be designed by a registered structural
     engineer.
2.   Metal deck to be 22 gage painted gray.
3.   Column spacing to be 50'x40' typical per Site Plan.
4.   Warehouse height shall be an average of 24' clear to the bottom of bar
     joists.
5.   Dock canopies with 4'0" projection are included above dock doors.
6.   Pipe bollards are included at all dock doors, stairs, transformers and
     downspouts.

                                 Page 21 of 27
<PAGE>

THERMAL AND MOISTURE PROTECTION
-------------------------------

1.   Roofing system shall be .45 mil. ballasted EPDM roofing with R-14
     insulation. Cost to upgrade to R-19 insulation will be charged against
     Allowance provide in Exhibit "B-2", if requested.
2.   Roof drainage will be by means of galvanized gutters and downspouts with
     standard Kynar finish.

DOORS AND WINDOWS
-----------------

1.   Glass storefront up to 9' high is included. Storefront glass will be tinted
     insulated panels. Storefront metal will be painted aluminum (standard
     color).
2.   Two storefront doors are included.
3.   Five exterior hollow metal galvanized doors and frames are included.
4.   The building shall have four 9'0"x10'0" 48" dock high doors, sixteen 9'x10'
     38" dock high doors and one 12'0"x14'0" drive-in door, uninsulated with
     standard prefinished color. One pair of 12"x24" dock bumpers is included
     for each overhead door opening. The large overhead door shall be serviced
     by a ramp to grade level. Dock levelers, seals, locks, lights, etc. are not
     included. Tenant shall have the right to use the standard tenant
     improvement allowance or any additional tenant improvement allowance to
     install mechanical levelers dock seals and other dock equipment that will
     become a permanent improvement to the building.

FIRE PROTECTION
---------------

Complete wet pipe fire protection sprinkler system designed for .48 gpm/sf over
the most remote 2,000 S.F. with 286 degrees sprinkler heads is included. Hose
stations, in-rack sprinklers, fire pumps, mechanical smoke ventilation and draft
curtains are not included.

BASIC ELECTRICAL
----------------

1.   One 4,000-amp 277/480-volt 3-phrase service with main panel is included.
2.   Eight 150-watt incandescent soffit lights with twelve 400-watt metal halide
     wall packs with photocell are included. Exterior pole mounted security
     lights and truck charging plugs are not included.
3.   Security and fire alarm systems are not included.
4.   Two 4" PVC conduit lines for telephone service are included.
5.   Two 110v circuits are included for irrigation and telephone.

MODIFICATIONS TO BASIC OUTLINE SPECIFICATIONS
---------------------------------------------

1.  Tenant and Landlord acknowledge that the above Basic Outline Specifications
does not include all of the Tenant's project requirements referred to in the
General Requirements Build to Suit, prepared by E & Y Design and Construction,
dated 12/21/99. Tenant agrees to meet with the project architect and engineer
within twenty (20) days of the execution of this Lease Agreement to identify the
Tenant's project requirements that Tenant desires to include as part of
Landlord's shell building construction. In addition, Tenant agrees that Landlord
may deduct from the Allowance provided by Landlord to Tenant in Exhibit "B-2"
any and all design and construction management costs incurred by Landlord for
the required modifications and alterations to the Basic Outline Specifications
herein above.

2.  All modifications and alterations to the Basic Outline Specifications (the
"Modifications") are subject to Landlord's and Tenant's written approval within
five (5) days after receipt of the plans. Following Landlord's approval of the
Modifications, Landlord shall negotiate a commercially reasonable "cost plus"
fee arrangement with the general contractor for the Modifications (taking into
account consideration such matters as minimum number of bids and contractor's
charges for general conditions and overhead. The cost of Modifications for the
purpose of billing to Tenant shall equal the cost to Landlord of the design and
construction of Modifications (including contractor's fee (not to exceed 7%) and
a construction management fee to Landlord's agent equal to 4% of the first
$500,000.00 in cost of the Modifications and 2% of the cost of the Modifications
above $500,000.00). The cost of Modifications shall be supported by a change
order or similar document, which shall be approved by Tenant.

3.  All costs and expenses incurred in the design and construction of the
Modifications shall be borne by Tenant (the "Tenant Modification Costs") The
Tenant Modification Costs shall be payable as follows:

     (a)  Tenant shall pay to Landlord, within 5 days from delivery of
          Landlord's invoice to Tenant (prior to the commencement of the
          contraction of the Modifications) an amount equal to 90% of such
          Tenant Modification Costs (as then estimated by Landlord);
     (b)  Upon completion of the Modifications, Tenant shall pay to Landlord
          within 5 days from delivery of Landlord's invoice to Tenant, the
          remaining 10% of such Modification Cost;
     (c)  Following Substantial Completion, Landlord will reconcile Landlord's
          estimate of the Tenant Modification Costs with the actual Tenant
          Modification Costs. If the amount paid by Tenant as Tenant
          Modification Costs per 3 (a) and 3 (b) above, is greater than the
          actual Tenant Modification Costs the Landlord will refund the
          difference in Tenant Modification

                                 Page 22 of 27
<PAGE>

          Costs. If the amount paid by Tenant as Tenant Modification Costs per 3
          (a) and 3 (b) above, is less than the actual Tenant Modification Costs
          Tenant will pay to Landlord as additional rent the difference in
          Tenant Modification Costs.

4.  If Tenant requests any changes to the Modifications, Tenant shall present
Landlord with revised drawings and specifications for Landlord's approval.
Landlord's contractor shall produce a change order for such change to the plans
which will include the price and time delay, if any, to the Substantial
Completion of the building. Upon receipt of contractors change order, Tenant
will have 5 days to approve the same, if after five days no approval is given,
then the change order is deemed rejected by the Tenant. Any increase in the
costs of the Modifications as a result of the changes will be the responsibility
of Tenant. In addition, should Tenant's request for a change in the
Modifications cause a delay in the Substantial Completion of the Modifications,
then, without prejudice to the provisions hereof, Landlord shall have the right
to refuse to permit the making of such changes unless and until Tenant shall
have executed then a stipulation and agreement in writing stating that the
Commencement Date of the lease shall occur prior to the Substantial Completion
of the Premises.

5.  Tenant shall pay to Landlord in accordance with the provisions of hereof any
actual out-of-pocket costs incurred by Landlord for costs resulting from the
fact that the Modifications are required to be changed in order to conform to
the plans and specifications for the building or governmental requirements, to
the extent that such plans and specifications or government requirements were
modified after approval of the Modifications and were the result of changes
which were beyond Landlord's control.

6.  Landlord shall provide Tenant with architectural and engineering drawings
for the Building and sitework as specified in Exhibit B-1 for use in Tenant's
determination of necessary changes and evaluation of costs of change orders.

                                 Page 23 of 27
<PAGE>

                                 EXHIBIT "B-2"
                                 -------------

                             IMPROVEMENT AGREEMENT

1.   The Premises are rented in "as-is" condition, except as expressly stated
     elsewhere in this Lease, without any additional improvements to be rendered
     by Landlord, other than those improvements as described in this Exhibit B-
     2.

2.   Tenant shall use the services of MacGregor Associates Architects, subject
     to Tenants receipt and approval of the contract between Landlord and
     MacGregor Associates Architects, to assist Tenant in the preparation of
     drawings, plans and specifications (the "Plans") for the construction of
     tenant interior improvements to the Premises (the "Improvements"). Tenant
     agrees to diligently pursue the completion of the Plans within twenty (20)
     days of the execution of this Lease Agreement. The Plans shall be subject
     to Landlord's and Tenant's approval within five (5) days after receipt of
     the Plans. All costs of preparing the Plans, including Landlord's architect
     costs, shall be applied against the Allowance (as herein defined).

3.   Tenant shall receive an improvement allowance ("Allowance") of Four Hundred
     Fifty Two Thousand Dollars and 00/100 ($452,500.00) to be applied to the
     cost and expense incurred in the design and construction of all standard
     Improvements to the Premises and Building, including approximately 10,000
     square feet of office area, standard warehouse heating and lighting and
     such other improvements as provided in this Lease Agreement. Any costs of
     improving the Premises and Building over the amount of the Allowance shall
     be payable by Tenant. In the event the Allowance is not fully utilized,
     Landlord shall retain any and all unutilized portion of the Allowance.

4.   Following the approval in writing by Landlord of the Plans (the "Approved
     Plans"), Landlord shall Landlord shall negotiate a commercially reasonable
     "cost plus" fee arrangement with the general contractor for the
     Improvements (taking into account consideration such matters as minimum
     number of bids and contractor's charges for general conditions and
     overhead. The cost of Improvements for the purpose of billing to Tenant
     shall equal the cost to Landlord of the design and construction of
     Improvements (including contractor's fee and a construction management fee
     to Landlord's agent equal to 4% of the first $500,000.00 in cost of the
     Improvements and 2% of the cost of the Improvements above $500,000.00). In
     addition, the cost of Improvements shall be supported by a change order or
     similar documentation, which shall be approved by Tenant.

5.   All costs and expenses incurred in the design and construction of the
     Improvements which exceed the Allowance shall be borne by Tenant (the
     "Tenant's Costs"). The Tenant's Costs shall be payable as follows:

     (a)  Tenant shall pay, within 5 days from delivery of Landlord's invoice to
          Tenant, to Landlord prior to the commencement of the construction of
          the Improvements, an amount equal to 90% of such Tenant's Costs (as
          then estimated by Landlord);
     (b)  Upon completion of the Improvements, Tenant shall pay to Landlord
          within 5 days from delivery of Landlord's invoice to Tenant, the
          remaining 10% of such Tenant's Cost;
     (c)  Upon completion of the Improvements, Landlord will reconcile
          Landlord's estimate of the Tenant's Costs with the actual Tenant's
          Cost. If the amount paid by Tenant as Tenant's Costs prior to
          commencement of construction, par Paragraph 5 (a) of this Exhibit B,
          is greater than the actual Tenant's Costs the Landlord will refund the
          difference in Tenant's Costs. If the amount paid by Tenant as Tenant's
          Costs prior to commencement of construction, per Paragraph 5 (a) of
          this Exhibit B, is less than the actual Tenant's Costs the Tenant will
          pay to Landlord as additional rent the difference in Tenant's Costs.

6.   If Tenant requests any changes in the Approved Plans, Tenant shall present
     Landlord with revised drawings and specifications for Landlord's approval.
     Landlord's contractor shall produce a change order for such change to the
     Approved Plans which will include the price and time delay, if any, to the
     Substantial Completion of the building. Upon receipt of contractors change
     order, Tenant will have 5 days to approve the same, if after five days no
     approval is given, then the change order is deemed rejected by the Tenant.
     Any increase in the costs of the Improvements as a result of the changes
     will be the responsibility of Tenant. In addition, should Tenant's request
     for a change in the Approved Plans cause a delay in the Substantial
     Completion of the Improvements, then, without prejudice to the provisions
     hereof, Landlord shall have the right to refuse to permit the making of
     such changes unless and until Tenant shall have executed then a stipulation
     and agreement in writing stating that the Commencement Date of the lease
     shall occur prior to the Substantial Completion of the Premises.

7.   Tenant shall pay to Landlord in accordance with the provisions of hereof
     any actual out-of-pocket costs incurred by Landlord for costs resulting
     from the fact that the Approved Plans are required to be changed in order
     to conform to the plans and specifications for the building or governmental
     requirements, to the extent that such plans and specifications or
     government requirements were modified after approval of the Approved Plans
     and were the result of changes which were beyond Landlord's control.

                                 Page 24 of 27
<PAGE>

                                  EXHIBIT "C"
                                  -----------

            SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT
            -------------------------------------------------------

  THIS SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT made this ______
day of _____, _______, among WACHOVIA BANK, N.A., a national banking association
chartered pursuant to the laws of the United States of America (hereinafter
referred to as "Lender") ________________, (hereinafter referred to as
"Tenant") ____________________, (hereinafter collectively referred to as
"Landlord").

                                  WITNESSETH:
                                  ----------

  WHEREAS, Landlord and Tenant entered into that certain Lease Agreement
(hereinafter referred to as the "Lease") dated as of
__________, relating to the premises described in Exhibit A attached hereto and
                                                  ---------
by this reference made a part hereof (hereinafter referred to as the
"Premises"); and

  WHEREAS, Tenant intends to occupy the Premises as a_____________ store; and

  WHEREAS, in reliance upon the foregoing, Lender has made or has committed to
make a loan to Landlord in the principal amount of $__________ (hereinafter
referred to as the "Loan") secured by a deed to secure debt, assignment and
security agreement (hereinafter referred to as the "Security Instrument") which
contains an assignment of leases and rents from Landlord to Lender covering the
Premises; and

  WHEREAS, Tenant has agreed that the Lease shall be subject and subordinate to
the Security Instrument held by Lender, provided Tenant is assured of continued
occupancy of the Premises under the terms of the Lease;

  NOW, THEREFORE, for and in consideration of the mutual covenants herein
contained, the sum of Ten Dollars ($10.00) and other good and valuable
considerations, the receipt and sufficiency of which are hereby acknowledged,
and notwithstanding anything in the Lease to the contrary, it is hereby agreed
as follows:

  1. Lender, Tenant and Landlord do hereby covenant and agree that the Lease
with all rights, options, liens and charges created thereby, is and shall
continue to be subject and subordinate in all respects to the Security
Instrument and to any renewals, modifications, consolidations, replacements and
extensions thereof and to all advancements made thereunder.

  2. Lender does hereby agree with Tenant that, in the event Lender becomes the
owner of the Premises by foreclosure, conveyance in lieu of foreclosure or
otherwise, so long as Tenant complies with and performs its obligations under
the Lease, (a) Lender will take no action which will interfere with or disturb
Tenant's possession or use of the Premises or other rights under the Lease, and
(b) the Premises shall be subject to the Lease and Lender shall recognize Tenant
as the tenant of the Premises for the remainder of the term of the Lease
(including renewal options) in accordance with the provisions thereof, provided,
however, that Lender shall not be subject to any offsets or defenses which
Tenant might have against any prior landlord except those which arose under the
provisions of the Lease out of such landlord's default and accrued after Tenant
had notified Lender and given Lender the opportunity to cure same as hereinbelow
provided, nor shall Lender be liable for any act or omission of any prior
landlord, nor shall Lender be bound by any rent or additional rent which Tenant
might have paid for more than the current month to any prior landlord nor shall
it be bound by any amendment or modification of the Lease made without its
consent.

  3. Tenant does hereby agree with Lender that, in the event Lender becomes the
owner of the Premises by foreclosure, conveyance in lieu of foreclosure or
otherwise, then Tenant shall attorn to and recognize Lender as the landlord
under the Lease for the remainder of the term thereof (including renewal
options), and Tenant shall perform and observe its obligations thereunder,
subject only to the terms and conditions of the Lease. Tenant further covenants
and agrees to execute and deliver upon request of Lender, or its assigns, an
appropriate agreement of attornment to Lender and any subsequent titleholder of
the Premises.

  4. So long as the Security Instrument remains outstanding and unsatisfied,
Tenant will mail or deliver to Lender, at the address and in the manner
hereinbelow provided, a copy of all notices permitted or required to be given to
the Landlord by Tenant under and pursuant to the terms and provisions of the
Lease. At any time before the rights of the Landlord shall have been forfeited
or adversely affected because of any default of the Landlord, or within the time
permitted the Landlord for curing any default under the Lease as therein
provided (but not less than sixty (60) days from the receipt of notice), Lender
may, but shall have no obligation to, pay any taxes and assessments, make any
repairs and improvements, make any deposits or do any other act or thing
required of the Landlord by the terms of the Lease; and all payments so made and
all things so done and performed by Lender shall be as effective to prevent the
rights of the Landlord from being forfeited or adversely affected because of any
default under the Lease as the same would have been if done and performed by the
Landlord. Nothing contained herein shall be construed as an obligation of Lender
to cure such default. Furthermore, nothing contained herein or in the Lease
shall create any express or implied obligation on the part of Lender to complete
construction of the "improvements" under the Lease in the event of default by
Landlord or in the event Lender acquires the Premises by foreclosure or deed in
lieu of foreclosure.

                                 Page 25 of 27
<PAGE>

  5. Tenant acknowledges that Landlord will execute and deliver to Lender an
assignment of the Lease as a security for the Loan, and Tenant hereby expressly
consents to such assignment.

  6. Landlord and Tenant hereby certify to Lender that the Lease has been duly
executed by Landlord and Tenant and is in full force and effect; that the Lease
and any modifications and amendments specified herein are a complete statement
of the agreement between Landlord and Tenant with respect to the leasing of the
Premises, and the Lease is in default thereunder; that no rent under the Lease
has been paid more than thirty (30) days in advance of its due date; and that
Tenant, as of this date, has no charge, lien or claim of offset under the Lease,
or otherwise, against the rents or other charges due or to become due
thereunder.

  7.  Unless and except as otherwise specifically provided herein, any and all
notices, elections, approvals, consents, demands, requests and responses thereto
("Communications") permitted or required to be given under this Agreement shall
be in writing, signed by or on behalf of the party giving the same, and shall be
deemed to have been properly given and shall be effective upon the earlier of
receipt thereof or deposit thereof in the United States mail, postage prepaid,
certified with return receipt requested, to the other party at the address of
such other party set forth hereinbelow or at such other address within the
continental United States as such other party may designate by notice
specifically designated as a notice of change of address and given in accordance
herewith; provided, however, that the time period in which a response to any
Communication must be given shall commence on the date of receipt thereof; and
provided further that no notice of change of address shall be effective with
respect to Communications sent prior to the time of receipt thereof. Receipt of
Communications hereunder shall occur upon actual delivery whether by mail
telecopy transmission, messenger, courier service, or otherwise) to an
individual party or to an officer or general or limited partner of a party or to
any agent or employee of such party at the address of such party set forth
hereinbelow, subject to change as provided hereinabove. An attempted delivery in
accordance with the foregoing, acceptance of which is refused or rejected, shall
be deemed to be and shall constitute receipt; and an attempted delivery in
accordance with the foregoing by mail, messenger, or courier service (whichever
is chosen by the sender) which is not completed because of changed address of
which no notice was received by the sender in accordance with this provision
prior to the sending of the Communication shall also be deemed to be and
constitute receipt. Any Communication, if given to Lender, must be addressed as
follows, subject to change as provided hereinabove:

          Wachovia Bank, N. A.
          Real Estate Finance Division
          30th Floor, Mail Code 1810
          191 Peachtree Street
          Atlanta, Georgia 30303

and, if given to Tenant. must be addressed as follows, subject to change as
provided hereinabove:

               _______________________
               _______________________
               _______________________

and, if given to Landlord, shall be addressed as follows:

               _______________________
               _______________________
               _______________________

               8. This Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective heirs, legal representatives,
successors, successors-in-title and assigns. When used herein, the term
"landlord" refers to landlord and to any successor to the interest of Landlord
under the Lease.

                                 Page 26 of 27
<PAGE>

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

                                             LENDER:
                                             -------

As to Lender, signed                         WACHOVIA BANK, N.A.
sealed and delivered in
the presence of:

___________________________             By:____________________________
Unofficial Witness                               [Name of Bank Officer]
                                                 [Title of Bank Officer]

                                             (BANK SEAL)
___________________________
     Notary Public

Commission Expiration Date:

 __________________________
      (NOTARIAL SEAL)

                                             TENANT:
                                             ------

As to Tenant, signed
sealed and delivered in
the presence of:                         ________________________________

___________________________                By:________________________
Unofficial Witness                         Its:_______________________

                                             (CORPORATE SEAL)
___________________________
      Notary Public

Commission Expiration Date:

 __________________________
      (NOTARIAL SEAL)

                                             LANDLORD:
                                             --------

As to Landlord, signed,                  _______________________________
sealed and delivered in                  _______________________________
the presence of:

__________________________         By:________________________
Unofficial Witness               Title:__________________________

__________________________
Notary Public

Commission Expiration Date:

__________________________

  (NOTARIAL SEAL)

                                 Page 27 of 27

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