ASSIGNMENT AND ASSUMPTION OF LEASE AGREEMENT

Lease Assumption Agreement

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STERLING JEWELERS INC. | COMMERCIAL NET LEASE REALTY, INC., | AEI INCOME & GROWTH FUND 25 LLC

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Title: ASSIGNMENT AND ASSUMPTION OF LEASE AGREEMENT
Date: 12/22/2005

(The Above Space for Recorder's Use Only)

ASSIGNMENT AND ASSUMPTION OF LEASE AGREEMENT

THIS ASSIGNMENT AND ASSUMPTION OF LEASE AGREEMENT (this

"Assignment") is made and entered into as of the 16 day of

December, 2005 by and between AEI INCOME & GROWTH FUND 25 LLC, a

Delaware limited liability company, having a mailing address at

1300 Wells Fargo Place, 30 East 7th Street, St. Paul, Minnesota

55101 ("Assignee"), and COMMERCIAL NET LEASE REALTY, INC., a

Maryland corporation, having a mailing address at 450 South

Orange Avenue, Suite 900, Orlando, Florida 32801 ("Assignor").

W I T N E S S E T H:

WHEREAS, Assignor has agreed to assign to Assignee all of

its right, title and interest in and to a) that certain Lease

between Assignor (as successor in interest to Captec Ster Aurora,

L.L.C.), as lessor, and Sterling Jewelers Inc., a Delaware

corporation, as lessee dated January 23, 2000 (the "Lease") and

b) that certain Net Ground Lease between Seller (as successor in

interest to Captec Ster Aurora, L.L.C.), as tenant, and AEI

Income & Growth Fund 25, LLC (successor in interest to Duke-Weeks

Realty Limited Partnership, an Indiana limited partnership), as

landlord dated October 14, 1999 (the " Prime Lease") for

property located at 1016 N. Rte. 59, Aurora, Illinois as more

particularly described in Exhibit "A"; and

WHEREAS, Assignee has agreed to assume and perform certain

of Assignor's liabilities and obligations arising under the Lease

and Prime Lease on and after the date hereof, all in accordance

with this Assignment.

NOW, THEREFORE, for good and valuable consideration, the

receipt and sufficiency of which are hereby acknowledged, and

intending to be legally bound, the parties agree as follows:

a. Assignment. Assignor hereby assigns, transfers, and conveys

to Assignee (i) all of Assignor's right, title and interest as

the landlord or lessor in and to the Lease and all of the rights,

benefits and privileges of the landlord or lessor thereunder; and

(ii) all of Assignor's right, title and interest as the tenant or

lessee in and to the Prime Lease and all of the rights, benefits

and privileges of the tenant or lessee thereunder.

b. Indemnity by Assignor. Assignor shall indemnify and hold

Assignee harmless from any claim, liability or cost or arising

out of any obligation or liability of the landlord or lessor

under the Lease, or tenant or lessee under the Prime Lease which

was to be performed or which became due during the period in

which Assignor owned the Real Property.

c. Assumption. Assignee hereby assumes all liabilities and

obligations of Assignor under the Lease and Prime Lease which

arise on or after the date hereof and agrees to perform all

obligations of Assignor under the Lease and Prime Lease which are

to be performed or which become due on or after the date hereof.

Assignee expressly does not intend by virtue of this Assignment

and Assumption to terminate the Prime Lease and hereby expressly

waives any operation of the doctrine of merger as the same may

apply.

d. Indemnity by Assignee. Assignee shall indemnify and hold

Assignor harmless from any claim, liability, cost or expense

arising out of Assignee's failure to perform any obligations or

liability of the landlord or lessor under the Lease, or tenant or

lessee under the Prime Lease arising on or after the date hereof.

Assignee releases and holds Assignor harmless from any claim,

liability or cost or arising out of any obligation or liability

of the Assignor under Prime Lease.

e. Counterparts. This Assignment may be executed by the

parties in counterparts, in which event the signature pages

thereof shall be combined in order to constitute a single

original document.

f. Binding Effect. This Assignment shall be binding upon and

inure to the benefit of Assignor, Assignee and their respective

successors and assigns.

g. Assignor Representation. Assignor is the Landlord

under the Lease with full right and title to assign the

Lease and the Rent to Assignee as provided herein. The

Lease is valid, in full force and effect and has not been

modified or amended. So far as is known to Assignor, there

is no default by Tenant under the Lease and no Rent has been

waived, anticipated, discounted, compromised or released.

Assignor is the Tenant under the Prime Lease with full right

and title to assign the Tenant's interest under the Prime

Lease (subject to Prime Lease Landlord consent) as provided

herein. The Prime Lease is valid, in full force and effect,

and has not been modified or amended. So far as is known to

Assignor, there is no default by Landlord under the Prime

Lease.

IN WITNESS WHEREOF, the parties have executed this

Assignment as of the date set forth above.

"ASSIGNOR"

COMMERCIAL NET LEASE REALTY,

INC., a Maryland corporation

By: /s/ Kevin B Habicht

Name: Kevin B Habicht

Title: Executive Vice Presdient

STATE OF FLORIDA

COUNTY OF ORANGE

The foregoing instrument was acknowledged before me this 14

day of December, 2005 by Kevin B Habicht, as Executive Vice

President of COMMERCIAL NET LEASE REALTY, INC., a Maryland

corporation, on behalf of the corporation. He is personally

known to me or has produced as identification.

/s/ Kella Schaible

(NOTARY SEAL) Signature of Notary Public

Typed or Printed Name of Notary

Commission No.:

My Commission Expires:

[SIGNATURES TO CONTINUE ON THE FOLLOWING PAGE]

"ASSIGNEE"

AEI INCOME & GROWTH FUND 25 LLC,

a Delaware limited liability

company

By: AEI Fund Management XXI, Inc.,

a Minnesota corporation, its

Managing Member

By: /s/ Robert P Johnson

Name: Robert P Johnson

Title: President

STATE OF MINNESOTA )

) ss.

COUNTY OF RAMSEY )

The foregoing was acknowledged before me this 16 day of December,

2005, by Robert P Johnson, in his capacity as the President of

AEI Fund Management XXI, Inc., a Minnesota corporation, the

Managing Member of AEI Income & Growth Fund 25 LLC, a Delaware

limited liability company, who acknowledged the execution of the

foregoing instrument to be the voluntary act and deed of said

corporation by authority of its board of directors on behalf of

the company.

[Notary Seal] /s/ Jennifer L Schreiner

Print Name: Jennifer L Schreiner

My Commission Expires: 1-31-2010

EHHIBIT A

Legal description

Lot 1 in Meridian Business Campus Phase 2 Unit 8, being a

Subdivision in Section 16, Township 38 North, Range 9, East of

the Third Principal Meridian, according to the Plat thereof

recorded October 30, 1998 as Document R98-226549, in DuPage

County, Illinois.

Lease No. 8876

Meridian Shopping Center

Aurora, Illinois

Jan 23, 2000

LEASE

BETWEEN

CAPTEC STER AURORA L.L.C.

AND

STERLING JEWELERS INC

CONFIDENTIAL

LEASE

In consideration of the rents and covenants set forth below,

Landlord (as hereinafter defined) hereby leases to Tenant (as

hereinafter defined), and Tenant hereby leases from Landlord, the

Premises (as hereinafter defined), upon the following terms and

conditions:

ARTICLE 1

FUNDAMENTAL LEASE PROVISIONS

The provisions in this Article shall be referred to in this Lease

as the "Fundamental Lease Provisions."

1.1 EXHIBITS TO LEASE. The following exhibits are attached

to and made a part of this Lease, and are incorporated herein by

reference:

Exhibit "A", The description of the Premises (if a

separate descr1ption is attached).

Exhibit "B". The site plan showing the location of the

Premises and the Building, the adjacent Shopping

Center buildings, parking areas, driveways and

common areas (as cross-hatched) and containing

other general information relative to the

development of the Premises Site (the" Site

Plan").

Exhibit "C" The plans and specifications prepared and

provided by Tenant and approved by Landlord,

wherein are detailed Landlord's Work (as

hereinafter defined) in the Premises Exhibit "C"

shall include the plans and specifications for

Tenant's satellite dish.

Exhibit "C-1". The list of items which comprise

Tenant's Work (as hereinafter defined).

Exhibit "D" The plans and specifications prepared and

provided by Tenant and approved by Landlord,

wherein are detailed Tenant's exterior sign(s).

Exhibit "E" The cost to perform Landlord's Work.

Exhibit "F" The Ground Lease.

1.2 DEFINITIONS. Unless otherwise defined herein,

capitalized term used in this

Lease shall have the meanings listed in the Fundamental Lease

Provisions.

Additional Rent: shall mean all insurance premiums, Taxes,

operating charges, maintenance charges,

construction costs, reasonable accounting and

legal fees, and any other charges, costs and

expenses which arise or may be contemplated under

any provision of this Lease during the Lease Term.

Alterations: shall mean any alterations, replacements,

additions, changes, and improvements to the

Premises as Tenant may find necessary or

convenient for its purposes.

Building: shall mean the building containing approximately

6000 square feet of floor area and all

improvements thereto (including Tenant's Work) to

be constructed on the Premises and as identified

on Exhibit B attached hereto.

CONFIDENTIAL

Commencement Date shall mean the earlier of (i) 60 days after the

Delivery Date or (ii) the day that Tenant opens

for and conducts business in the Premises.

Notwithstanding anything in this Lease to the

contrary , Tenant shall not be obligated to open

for or conduct business in the Premises during any

period that a Market Condition exists in the

Shopping Center.

Common Areas: shall mean the parking areas, driveways, aisles,

sidewalks, malls (whether enclosed or unenclosed),

truck storage areas, and other common, service and

related areas and improvements within the Shopping

Center, whether open to the public generally or

for the "non-exclusive" use of one or more

tenants, as more particularly identified on

Exhibit "8" by cross-hatching. Future easements to

be granted by Ground Lessor or current easements

to benefit the rest of the Shopping Center,

including but not limited to, ingress and egress,

and parking easements and more specifically, the

"Access Drives" and the "Utility Easement Area",

all as generally designated on the Site Plan. If

any such future easements shall affect Tenants use

or occupancy of the Premises or impose any

additional financial obligation on Tenant,

Landlord, or Ground Lessor, as the case may be,

must first obtain Tenant's consent, which consent

shall not be unreasonably withheld, conditioned or

delayed, before granting such easement.

Common Area Costs: shall mean Landlord's reasonable costs for

the operation, maintenance and repair of the

interior and exterior Common Areas identified on

Exhibit "B" attached hereto, consistent with other

first- class shopping centers in the area. In no

event shall the Common Area Costs include amounts

for (i) depreciation of the original cost of

constructing, erecting and installing the Shopping

Center, the Common Areas, common facilities and

related services; or (ii) principal and interest

payments pursuant to any mortgage or deed of trust

which encumbers the Premises or Shopping Center or

any ground lease payments; or (iii) Taxes; or (iv)

administrative charges, marketing fees, management

fees, merchants association fees or leasing

commissions; or (v) legal fees incurred in the

negotiation of leases for the Shopping Center or

in leasing disputes with Tenants; (vi) excess

premiums for insurance covering the Common Areas

occasioned by the extra-hazardous use or

activities or occupants other than Tenant; or

(vii) expenses incurred due to the negligence or

willful misconduct of Landlord or any occupant of

the Shopping Center or their respective agents or

employees; or (viii) costs and expenses incurred

for repairs or replacements due to faulty

construction, faulty workmanship or structural

defects; or (ix) costs and expenses for repairs or

replacements due to the installation of antiquated

machinery, equipment, components, pipes and lines

or resulting from improper engineering or

substandard quality; or (x) costs and expenses of

any structural and roof repair and replacements

and renovations to the Shopping Center; (xi)

replacement or repairs covered by construction

contracts or contractor's warranties, or by

insurance proceeds; (xii) charges or fees for, or

taxes on, the furnishing of water, sewer service,

gas, fuel, electricity or other utility

CONFIDENTIAL

services to those portions of the Shopping Center

which are leased to tenants; (xiii) the cost of

providing janitorial or trash removal service to

those portions of the Shopping center which are

leased to tenants; (xiv) the cost incurred in

repairing or replacing structural portions of the

Shopping Center; (xv) the cost of acquiring

property to be added to the Shopping Center and

the cost of any construction appertaining to any

property so added; or (xvi) the cost of Landlords

federal, state or local income taxes; (xvii)

expenses related to an individual occupant of the

Shopping Center or to a particular tenant space;

or (xviii) any costs, fees, fines or penalties. or

interest thereon, related to violations by

Landlord or any occupant or any governmental law,

ordinance, code, rule or regulation; or (xix) any

cost, fees, fines or penalties, or interest

thereon incurred to remediate asbestos or other

environmental conditions in the Shopping Center;

or (xx) capital expenditures; or (xxi) reserves

for replacement; or (xxii) costs for insuring the

Common Areas; (xxiii) entertainment,

transportation, means and lodging of anyone; and

(xxiv) amounts paid in excess of "competitive

rates".

Construction Period: shall mean the one hundred fifty (150)

day period immediately following the date of

Tenant's Permit Approval Notice.

Delivery Date: shall mean the date that Landlord delivers

the Premises to Tenant with Landlord's Work

substantially complete such that Tenant may

reasonably enter the Premises to perform Tenant's

Work.

Environmental Laws: means all requirements of environmental,

ecological, health, or industrial hygiene laws or

regulations or rules of common law related to the

Property, including all requirements imposed by

any law. rule, order, or regulation of any

federal, state, or local executive, legislative,

judicial, regulatory, or administrative agency,

board, or authority which relate to (i) noise;

(ii) pollution or protection of the air, surface

water, ground water, or land; (iii) solid,

gaseous, or liquid waste generation, treatment,

storage, disposal, or transportation; (iv)

exposure to Hazardous Materials; or (v) regulation

of the manufacture, processing, distribution and

commerce. use, or storage of Hazardous Materials.

Force Majeure: shall mean the occurrence of one of the

following listed events which prevents, delays or

hinders the performance of any act required

hereunder: strikes, lockouts, inability to procure

materials, failure of power, restrictive

governmental laws or regulations, riots,

insurrection, war, or any other reason of a like

nature not the fault of the party delayed in

performing work or doing any act required under

the terms of this Lease.

Gross Leasable Area: shall mean the number of square feet of

the Building.

Ground Lease: shall mean that certain lease for the Premises

entered into by and between Landlord and Duke-

Weeks Realty Limited Partnership ("Ground Lessor')

dated October 14, 1999.

CONFIDENTIAL

Ground Lease Rent: shall mean all rents, penalties and fees due

and payable under the Ground Lease.

Hazardous Materials: means any of the following as defined by

the Environmental Laws: solid wastes; medical or

nuclear waste or materials; toxic or hazardous

substances; natural gas, liquefied natural gas or

synthetic fuel gas; petroleum products or

derivatives, wastes or contaminants (including,

without limitation, polychlorinated biphenyls);

paint containing lead; urea-formaldehyde foam

insulation; asbestos (including, without

limitation, fibers and friable asbestos); ex-

plosives, and discharges of sewage or effluent.

Increase Date: fifth (5th) anniversary of the Commencement

Date, and every five (5) years thereafter,

including renewal terms.

Increase Percentage: ten percent (10%).

Initial Term: twenty (20) years, commencing on the

Commencement Date.

Interest on Overdue Amounts: shall mean interest

at a per annum rate equal to the "prime rate" (or

substantial equivalent) announced from time to

time (as adjusted monthly) by Comerica Bank,

Detroit, Michigan, plus 2%; provided, however,

that if such rate shall exceed the lawful rate of

interest which Landlord is entitled to charge

under applicable law, then the per annum rate of

interest on any such overdue amounts shall be the

maximum rate permitted by applicable law.

Landlord: Captec Ster Aurora, L.L.C.

24 Frank Lloyd Wright Drive

Lobby L 4th Floor, P. 0. Box 544

Ann Arbor, Michigan 48106-0544

FAX: (734) 994-1376

Landlord's Work: shall mean the work to be performed by or at

the direction of Landlord in constructing the

Premises and related improvements as more

particularly specified in Article 15 below and

Exhibit C.

Late Charge: shall mean an amount equal to 4% of the

overdue amount.

Lease Year: shall mean a period of twelve (12) consecutive

calendar months during the Term, the first of

which shall begin on the first day of February

next following the Commencement Date, (unless the

Commencement Date shall be the first day of

February, in which event the first lease year

shall begin on the Commencement Date) and ending

on the following January 31.

Market Condition: shall mean that any portion of the Shopping

Center, or any additions thereto, other than the

Premises, are used or occupied for the Permitted

Use or if any sales area therein is designated for

the Permitted Use.

CONFIDENTIAL

Minimum Monthly

Rent: 13% of the. Premises Cost (as detailed on Exhibit

E) divided by twelve, subject to proration and

adjustment as provided in Article 2.3.

Permitted Hazardous

Material: means any Hazardous Material which is necessary

and commercially reasonable for the provision of

any good or service related to the Permitted Use.

Permitting Period: shall mean the 60 days immediately following

the date Landlord executes this Lease.

Permitted Use: shall mean the display and sale, at retail,

of gold, silver, diamonds, colored gemstones and

other fine jewelry, watches, and clocks, crystal,

porcelain and related items normally sold in

Tenant's other stores and, as incidental thereto,

the repair and/or appraisal of the same and any

other use permitted by the Ground Lease.

Plans and Specifications: shall mean the plans and specifications

for the construction of the Premises, in the form

of Exhibit "C", as the same may be modified by

written agreement by and between Landlord and

Tenant.

Premises: that certain real property located within the

Shopping center consisting of space having

approximately square feet of Gross Leasable Area,

together with all improvements located thereon,

commonly known as the Meridian Shopping Center

located at the northwest corner of Route 59 and

Meridian Parkway, Aurora, Illinois 60504 and more

particularly described in Exhibit "A" attached

hereto.

Premises Cost: shall mean the cost to perform Landlord's

Work, which cost is computed on Exhibit "E"

attached hereto and made a part hereof, subject to

adjustment as provided in Article 2.3.

Premises Site: shall mean the land described on Exhibit A.

Renewal Terms: 4 terms of 5 year(s) each.

Shopping Center: shall mean the Meridian Shopping Center

located at Aurora,

Illinois, consisting of all buildings including

the Premises and other improvements located upon

the Shopping Center site.

Shopping Center Site: shall mean the land described on

Exhibit" A" on which the Shop- ping Center is

located.

Sign Drawings: shall mean the plans and specifications for

Tenant's exterior sign(s) on the Premises, in the

form of Exhibit 'D", as the same may be modified

by written agreement by and between Landlord and

Tenant.

Substitute Rent: shall mean only the amounts due for Taxes and

Common Area Costs, if any, in lieu of the Minimum

Monthly Rent required to be paid hereunder.

CONFIDENTIAL

Taxes: shall include:

(a) any form of real estate tax or assessment, ad

valorem tax or gross receipts tax, imposed by any

authority having the direct or indirect power to

tax, including any city, county, state, or federal

government, or any school, agricultural, sanitary,

fire, street, drainage, or other improvement

district thereof, on, against or with respect to

the Premises, this Lease, any legal or equitable

interest of Landlord or any superior landlord in

the Premises or in the real property of which the

Premises are a part, Landlord's right to rent or

other income therefrom and Landlord's business of

leasing the Premises;

(b) any tax, fee, levy, assessment, penalty,

interest or other charge (i) in substitution of,

partially or totally, any tax, fee, levy,

assessment, or charge included within this

definition of Taxes, or (ii) any tax or increase

in any tax which is imposed as a result of a

transfer, either partial or total, of Landlord's

interest in the Premises to Tenant, or (iii) which

is imposed by reason of this transaction, any

modifications or changes hereto, or any transfers

hereof; and

certificates, assessments and sales, use, property

or other taxes, fees or tolls of any nature

whatsoever (together with any related interest or

penalties) now or hereafter imposed against

Landlord or Tenant by any federal, state, county

or local governmental authority upon or with

respect to the Premises or the use thereof or upon

the possession, leasing, use operation or other

disposition thereof or upon the rents receipts or

earnings arising therefrom or upon or with respect

to this Lease; and

(d) taxes assessed against and levied upon trade

fixtures, furnishings, equipment, and all other

personal property of Tenant contained in the

Premises or elsewhere, which Tenant shall cause to

be separately assessed and billed directly to

Tenant.

Notwithstanding the foregoing, the term "Taxes"

shall not Include any general income taxes,

inheritance taxes, and estate taxes im- posed upon

Landlord.

Tenant: Sterling Jewelers Inc. 375 Ghent Road

Akron, Ohio 44333

FAX: (330) 668-5050

Tenant's Work: shall mean the work, if any, to be performed

by or at the direction of Tenant in finishing the

Premises as provided in the Plans and

Specifications, and as more specifically

identified on Exhibit C-1, attached hereto.

CONFIDENTIAL

Unamortized Premises

Cost: shall mean the Premises Cost, adjusted based on a

twenty (20) year straight line depreciation basis.

ARTICLE 2

TERM AND RENT

2.1 Term. The Initial Term of this Lease shall be as set

forth in the Fundamental Lease Provisions. Provided Tenant is not

then in default under this Lease, Tenant shall have the option to

extend the Initial Term by the number of successive Renewal Terms

described in the Fundamental Lease Provisions by giving Landlord

written notice of its election to extend the term of this Lease

by the succeeding Renewal Term not less than 90 days prior to

expiration of the Initial Term or the then-running Renewal Term,

as the case may be. Excepting the amount of the Minimum Monthly

Rent, as adjusted, the terms and conditions of this Lease shall

apply during each Renewal Term. The Initial Term, as it may be

extended by one or more Renewal Terms shall be hereinafter

referred to as the "Lease Term."

2.2 Interim Monthly Rent During the Construction Period

Tenant shall pay to Landlord Interim Monthly Rent. The Interim

Monthly Rent payment shall be equal to an interest rate of prime

plus one percent (1%) per annum, payable monthly, on Landlord's

outstanding construction loan amount. Tenant's final Interim

Monthly Rent payment shall be due on the Delivery Date and shall

include a fee of one percent (1%) of the construction costs

outlined on Exhibit E. Tenant's obligation to pay Interim Monthly

Rent shall terminate as of the earlier of i) the Delivery Date,

or ii) the last day of the Construction Period. Thereafter,

Tenant shall pay the Minimum Monthly Rent described below.

2.3 Monthly Rent Payments

2.3.1 Minimum Monthly Rent. For the use and

occupancy of the Premises, Tenant shall pay Landlord the

Minimum Monthly Rent, in advance, commencing on the

Commencement. Date and continuing on the first day of each

calendar month thereafter during the Lease Term, without any

offset or deduction except as specifically provided for

herein. The Minimum Monthly Rent payable under this Lease

shall increase by the Increase Percentage on each Increase

Date. Should the Lease Term commence on a day other than the

first day of a calendar month, then the rental for such

first fractional month shall be computed on a daily basis

for the period from the Commencement Date to the end of such

calendar month at an amount equal to 1/30th of the Minimum

Monthly Rent for each day. Should the Lease Term end on a

day other than the last day of a calendar month, then the

rental for such fractional month shall be computed on a

daily basis at an amount equal to 1/30th of the Minimum

Monthly Rent for each day. Tenant shall pay Landlord the

Minimum Monthly Rent in lawful money of the United States at

the address for Landlord set forth in the Fundamental Lease

Provisions, or to such other persons or at such other places

as Landlord may designate in writing to Tenant. Landlord and

Tenant acknowledge that the Premises Cost computation on

Exhibit E is an estimate, and agree to supplement and/or

amend Exhibit E after the Premises Cost is actually

determined. Landlord and Tenant shall retroactively adjust

the Minimum Monthly Rental payments once the computation of

Exhibit E has been finalized.

2.3.2 Ground Lease Rent. In addition to any other

rental obligations hereunder, Tenant shall pay directly to

Ground Lessor all Ground Lease Rent required to be paid

pursuant to the terms of the Ground Lease.

2.4 Additional Rent. In addition to the Minimum Monthly

Rent, as increased, Tenant shall pay to the parties respectively

entitled thereto all Additional Rent. Tenant shall furnish to

CONFI DENTIAL

Landlord, promptly after payment of any Taxes or insurance

premiums (and at least ten (10) days before the date when the

Additional Rent would become delinquent), and, with respect to

any other Additional Rent, promptly upon request of Landlord,

official receipts or other satisfactory proof evidencing payment

of such Additional Rent. Upon Tenant's failure to pay such

Additional Rent on more than one occasion during any twelve month

period, where after written notice thereof from Landlord to

Tenant such second event of failure shall continue for a period

of 15 days, Landlord shall have the option to require Tenant to

deposit with Landlord (i) funds sufficient for the payment of the

current Additional Rent required to be paid by Tenant hereunder,

and (ii) one-twelfth of the current annual or annualized

Additional Rent, as the case may be (or those of the preceding

years if the current amounts thereof have not been fixed), in

advance and on the same day upon which the Minimum Monthly Rent

is due.

2.5 Late Charge. If any installment of the Monthly Minimum

Rent or any other payment provided for under this Lease which is

payable by Tenant is not received by Landlord by the date when

due, Tenant shall, within 10 days after written notice from

Landlord to Tenant, pay Landlord the Late Charge. Landlord and

Tenant agree that the Late Charge represents a fair and

reasonable estimate of the costs that Landlord will incur because

of any such late payment by Tenant. Acceptance of the Late Charge

by Landlord shall not constitute a waiver of Tenant's default, if

any, with respect to the overdue amount, nor prevent Landlord

from exercising any other rights and remedies available to

Landlord under this Lease.

2.6 Interest on Overdue Amounts. The Minimum Monthly Rent,

the Additional Rent and all other amounts due Landlord under this

Lease which are not paid when due shall bear Interest as defined

in the Fundamental Lease Provisions from the date due until paid.

2.7 Net Lease: Appointment of Tenant as Attornev-in-Fact

Solelv for Operational Matters. This Lease is what is commonly

called a triple net lease, it being understood that Landlord

shall receive the Minimum Monthly Rent free and clear of any and

all Taxes, other Additional Rent, liens, charges, liabilities or

expenses of any nature whatsoever incurred in connection with the

ownership or operation of the Premises.

The parties acknowledge and agree that this Lease is a "pass-

through" lease, meaning that all of the rights granted to, and

all the obligations and duties imposed on, Landlord as lessee

under the Ground Lease shall bind and burden, and inure to the

benefit of, Tenant hereunder. Tenant hereby accepts such rights

and benefits and hereby agrees to perform all such duties and

obligations. Without limiting the foregoing, the parties

acknowledge that Tenant need not obtain Landlord's prior approval

and consent to perform such duties and obligations under the

Ground Lease that are directly related to Tenant's ordinary, day-

to-day business operations and do not affect adversely Landlord

or the Ground Lease leasehold. The parties further acknowledge

and agree that, in the event of an emergency, Tenant shall be

authorized to, and shall perform such actions as are reasonably

necessary under the circumstances to protect and/or preserve

Landlord and Tenant's leasehold interests, and shall notify

Landlord of the same as soon as practicable thereafter.

Subject to the terms and provisions set forth below,

Landlord hereby irrevocably appoints Tenant as its attorney-in-

fact for the sole purpose of pursuing, in Landlord's place and

stead, enforcement of Ground Lessor's obligations under the

Ground Lease with respect only to the following operational

matters and no other: (i) maintenance and repair of the Leased

Premises and common areas, (ii) co-tenancy, (iii) Tenant's

exclusive use rights, and (iv) insurance. Tenant shall give

Landlord five (5) days prior written notice of its intention to

act as Landlord's attorney-in-fact. Tenant's notice shall set

forth with particularity the nature of Ground Lessor's failure to

perform and the nature of the relief Tenant is seeking. If

Landlord notifies Tenant within said five (5) day period that

Landlord has commenced, or will commence within said five (5) day

period, enforcement of Ground Lessor's obligations, then Tenant

shall not be

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authorized to do so in Landlord's place and stead. In such event,

Landlord shall pursue such enforcement with all due diligence and

in good faith, and the parties shall cooperate fully with each

other. If within said five (5) day period, however, Landlord

fails either to respond to Tenant's written notice, or gives

Tenant notice of its election to permit Tenant to pursue such

enforcement in Landlord's place and stead, then Tenant shall

undertake such enforcement with all due diligence and in good

faith, and the parties shall cooperate fully with each other.

Tenant acknowledges the fiduciary obligations imposed on

Tenant when acting as Landlord's attorney-in-fact. Tenant agrees

to indemnify, defend and hold Landlord harmless from and against

any and all loss, cost or damage resulting from Tenant's actions

or inaction as Landlord's attorney-in-fact, including, but not

limited to, Landlord's expenses, including reasonable attorneys'

fees, if any, in connection therewith. Tenant shall have no

authority to enter into a compromise and settlement, nor to act

in Landlord's place and stead as it's attorney- in-fact if: (i)

Tenant is in default under this Lease or the Ground Lease; (ii)

Tenant is in anticipatory default of this Lease or the Ground

Lease; (iii) Landlord's obligations under this Lease or the

Ground Lease have been terminated; (iv) this Lease has been

terminated without the concurrent termination of the Ground

Lease; (v) Landlord has notified Tenant that it has or will

commence enforcement within said five (5) day period as

hereinbefore provided; and (vi) the obligation of Ground Lessor

being enforced involves matters other than the operational

matters specified above, in which case Landlord shall pursue

enforcement with all due diligence and in good faith. In the

event of an occurrence of any event set forth subsections (i)

through (iv) of this paragraph, the appointment of Tenant as

Landlord's attorney-in-fact shall automatically terminate and be

of no further force or effect.

2.8 Additional Ground Lease Payments. The parties

acknowledge that certain other payments in addition to rent may,

from time to time, become due and payable by Landlord in its

capacity as Ground Lessee under the Ground Lease. Except as

otherwise provided herein, all such items shall be the

responsibility of Tenant, who shall make these payments to or on

behalf of Ground Lessor or Landlord, as the case may be, in a

timely manner.

ARTICLE 3

USE OF THE PREMISES

3.1. Tenant shall use the Leased Premises solely for

the Permitted Use, or any other lawful purpose as long as such

use does not diminish the value of the Premises or violate any

existing exclusive uses then in effect with respect to the

Premises.

3.2 Condition of Premises. Subject to Section 6.2.1, and as

may otherwise be pro- vided in this Lease, Tenant accepts the

Premises in its "as is" condition and acknowledges that Landlord

makes no warranty with respect to the Premises.

3.3 Compliance With Law.

3.3.1 At Tenant's sole expense, Tenant shall comply

in all material respects with the Ground Lease, all

applicable laws, ordinances, orders, rules, regulations, of

any governmental authorities and with any directive of any

public officer imposing any violation, order or duty upon

Landlord or Tenant with respect to the Premises, the use or

occupation thereof or signage thereon, including, without

limitation, any governmental law or statute, rule,

regulation, ordinance, code, policy or rule of common law

now or hereafter in effect relating to the environment,

health or safety .

3.3.2 Tenant shall not use or permit the Premises

to be used in any manner which will result in waste,

reasonable wear and tear and casualty excepted, or the

creation of a

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nuisance, or shall violate the terms of the Ground Lease and

Tenant shall maintain the Premises free of any objectionable

noises, odors, or disturbances.

3.4 Environmental Compliance. The terms of this

provision shall be governed by Article 21 of the Ground Lease.

Excepting pre-existing conditions, acts or omissions of Landlord

or its agents, or acts or omissions of any third parties, for

which Tenant shall have no 1iability, Tenant acknowledges the

following:

3.4.1 At its sole cost and expense at all times during

the Term, Tenant shall comply in all respects with the

Environmental Laws in its use and operation of the Premises.

3.4.2 Tenant shall not use the Premises for the purpose

of storing Hazardous Materials except in full compliance with the

Environmental Laws and other applicable law, and shall not cause

the release of any Hazardous Material.

3.4.3 Tenant shall notify Landlord promptly and in

reasonable detail should Tenant become aware of or suspect (i)

the presence of any Hazardous Material on the Premises (other

than any Permitted Hazardous Materials ), or (ii) a violation of

the Environmental Laws on the Premises.

3.4.4 If Tenant uses or permits the Premises to be used

so as to subject Tenant, Landlord or any occupant of the Premises

to a claim of violation of the Environmental Laws (unless

contested in good faith by appropriate proceedings), Tenant

shall, at its sole cost and expense, immediately cease or cause

cessation of such use or operations and shall remedy and fully

cure any conditions arising therefrom.

3.4.5 At its sole cost and expense, Tenant shall (i)

immediately pay, when due, the cost of compliance with the

Environmental Laws within the Premises required as a result of

any acts or omissions of Tenant, or as otherwise required by this

Lease, and (ii) keep the Premises free of any liens imposed

pursuant to the Environmental Laws. At all times Tenant shall

use, handle and dispose of any Permitted Hazardous Material in a

commercially reason- able manner and in compliance with the

Environmental Laws and applicable industry standards. Tenant

shall cooperate with Landlord in any program between Landlord and

any governmental entity for proper disposal and/or recovery of

any Permitted Hazardous Material.

3.4.6 Tenant shall indemnify, save and hold Landlord

harmless from and against any claim, liability, loss, damage or

expense (including, without limitation, reasonable attorneys'

fees and disbursements) arising out of any violation by Tenant of

the covenants contained in this Section, or out of any violation

of the Environmental Laws by Tenant, its owners, employees,

agents, contractors, customers, guests and invitees. This

indemnity obligation shall survive the expiration or termination

of this Lease.

3.4.7 In the event that Tenant fails to comply with the

any of the foregoing requirements of this Section, after the

expiration of the cure period permitted under the Environ- mental

Laws, if any, Landlord may, but shall not be obligated to (i)

elect that such failure constitutes a default under this Lease;

and/or (ii) take any and all actions, at Tenant's sole cost and

expense, that Landlord deems necessary or desirable to cure such

noncompliance. Tenant shall reimburse Landlord for any costs

incurred by Landlord in exercising its options under this

Subsection within 5 days after receipt of a bill therefor.

3.4.8 Existing Conditions. Notwithstanding anything

herein or in the Ground Lease to the contrary, in no event shall

Tenant have any liability resulting from any conditions existing,

or events occurring, or any Hazardous Substances existing or

generated at in, on,

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under or in connection with the Premises prior to the

Commencement Date of this Lease except to the extent Tenant

caused the same.

3.4.9 Landlord acknowledges and covenants that in the

event that, through no fault of Tenant, Tenant's use, occupancy

and enjoyment of ("Occupancy") in the Premises shall be

materially interfered with by the existence or remediation of any

Hazardous Material located on, in or under the Shopping Center or

Shopping Center Site (except for any Hazardous Material used by

Tenant), then (i) throughout such period of interference, a fair

and just proportion of the rents and other charges payable

hereunder taking into account the nature of the interference to

Tenant's Occupancy, shall be abated, and (ii) if Tenant's

occupancy shall be substantially impaired for a period of three

(3) months or more, then Tenant shall have the right to terminate

this Lease by giving written notice to Landlord of its election

to do so, whereupon this Lease shall automatically terminate and

end effective as of the date of such notice and neither party

shall have any further obligations hereunder. However, Landlord

may nullify Tenant's notice of termination if, at the time such

notice is given, Landlord is diligently prosecuting the

rectification of such Hazardous Material interference and

thereafter completes the rectification in accordance with all

applicable governmental laws, codes, regulations and requirements

within one (1) year after the date of Tenant's termination

notice, whereupon this Lease shall continue in full force and

effect in accordance with its terms, it being understood and

agreed that the abatement provided in clause (i) of this

paragraph shall continue throughout the period of such

rectification by Landlord. Should Tenant terminate this Lease as

provided in this Section 3.4.9, Tenant shall pay to Landlord the

Unamortized Premises Cost.

3.4.10 The provisions of this Section shall survive the

expiration or termination of the Lease Term.

3.5 Permits and Licenses. After Tenant's acceptance of

Landlord's delivery of the Premises, Tenant shall be solely

responsible for applying for and securing any building permit or

permission of any duly constituted authority for the purpose of

doing any of the things Tenant is required or permitted to do

under the provisions of this Lease.

3.6 Termination Payment. Tenant acknowledges that, pursuant

to the Ground Lease, Tenant shall be obligated to make certain

additional payments to Landlord in the event the Ground Lease,

and in turn, this Lease, is terminated pursuant to the rights

granted to Ground Lessor or Landlord in Sections 3.01 and 3.04 of

the Ground Lease.

Tenant agrees to pay Landlord a sum computed based upon

Landlord's internal rate of return (the "IRR') for the Premises

Cost (as detailed on Exhibit "E" hereto) plus a Landlord's

development fee of One Hundred Eighty Thousand Dollars and 00/100

($180,000.00) (the "Land- lord's Development Fee"); which IRR

shall be based on the following formula:

(a) Landlord's IRR shall be computed at the commencement of

the Lease Term and shall be included in the Commencement

Agreement. For purposes of this provision, the IRR shall be

determined based on the following criteria:

(i) the Premises Cost;

(ii) a capitalization rate of 13.5% for the first Lease

Year and 14.2% for each following Lease Year;

(iii) the Minimum Monthly Rental for the Initial Term,

as adjusted; (iv) the Initial Term (i.e., a twenty (20)

year term);

(b) In the event of an early termination of the Ground

Lease as provided in this Section 3.8, the remaining Minimum

Monthly Rental owed by Tenant under this Lease shall be

calculated by Landlord and Tenant. Once so determined, said sum

shall be discounted to the date

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of the Ground Lease termination at the IRR determined in

subsection (a) above. The sum determined by said calculation (the

"Termination Payment') shall be due and payable by Tenant to

Landlord, subject to further adjustment as provided herein.

obligated to pay a leasehold mortgagee any sum due as a result of

the early termination of the Ground Lease or this Lease (the

"Lender's Payment'), Tenant also agrees to pay said sums to

Landlord upon being presented with an appropriate invoice. Tenant

understands that said Lender's Payment may include, but may not

be limited to, a prepayment penalty, additional interest or

charges, and attorney's fees. The Termination Payment and the

Lender's Payment are collectively referred to as the "Termination

Fee".

In the event Ground Lessor is obligated to make any payments to

Landlord as a result of the termination of the Ground Lease, any

and all of said payments shall be applied first, to the

Termination Fee due Landlord, and the balance thereafter

remaining shall be payable by Tenant to Landlord. The Termination

Fee, as the same may be reduced, shall be payable to Landlord

within ten (10) days of receipt of an appropriately detailed

invoice from Landlord. The failure of Tenant to pay the

Termination Fee shall be deemed an automatic default under this

Lease entitling Landlord to immediately proceed to exercise any

and all of its rights and remedies hereunder without further

notice to Tenant.

3. 7 Exclusive Use. Pursuant to the terms of Section

12.13 of the Ground Lease, Tenant is granted an exclusive right

at the Shopping Center to operate under its Permitted Use. The

terms and conditions of such exclusive shall be governed by

Article 12 of the Ground Lease.

ARTICLE 4

TAXES AND UTILITIES

4.1 Payment of Taxes. Tenant shall pay the Taxes applicable

to the Premises during the Lease Term: Landlord shall provide

Tenant with copies of any tax bills applicable to the Premises

promptly after receipt of such bills. All such payments shall be

made at least 10 days prior to the delinquency date of such

payment. Tenant shall indemnify and hold Landlord harmless from

and against any Taxes and shall promptly furnish Landlord with

satisfactory evidence that such Taxes have been paid. If any

Taxes paid by Tenant shall cover any period prior to, or after

the expiration of, the Lease Term, Landlord shall reimburse

Tenant to the extent required. If Tenant shall fail to pay any

such Taxes, Landlord shall have the right (but not the

obligation) to pay the same, in which case Tenant shall repay

such amount plus any penalties and interest resulting therefrom

to Landlord within 5 days after receipt of a bill therefor.

4.2 Intentionally omitted.

4.3 Tenant's Right to Contest Taxes.

4.3.1 At its sole cost and expense, Tenant shall have

the right to contest the amount or validity, in whole or in part,

of any Taxes by appropriate proceedings diligently conducted in

good faith, but no such contest shall be carried on or maintained

by Tenant after the time limit for the payment of any Taxes

unless Tenant shall (i) pay the amount involved under protest as

required by the Ground Lease; (ii) procure and maintain a stay of

all proceedings to enforce any collection of any Taxes, together

with all penalties, interest, costs and expenses, by a deposit of

a sufficient sum of money, or by such undertaking, as may be

required or permitted by law to accomplish such stay; or (iii)

deposit with Landlord, as security for the performance by Tenant

of its obligations hereunder with respect to such Taxes, 120% of

such contested amount or such other reasonable security as may be

reasonably demanded by Landlord to insure payment of

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such contested Taxes and all penalties, interest , costs and

expenses which may accrue during the period of the contest. Upon

the termination of any such proceedings, Tenant shall pay the

amount of such Taxes or part thereof, as finally determined in

such proceedings, together with any costs, fees (including all

reasonable attorneys' fees and expenses), penalties or other

liabilities in connection therewith. However, if Tenant has

deposited cash or cash equivalents with Landlord as security

under clause (iii) above, then, so long as no default exists

under this Lease, Landlord shall arrange to pay such Taxes (or

part thereof) together with the applicable costs, fees and

liabilities as described above out of such cash or cash

equivalents and return any unused balance, if any, to Tenant.

Otherwise, Landlord shall return to Tenant all amounts, if any,

held by or on behalf of Landlord which were deposited by Tenant

in accordance with such clause (iii).

4.3.2 At its cost and expense, Tenant shall have the

right to seek a reduction in the valuation of the Premises as

assessed for tax purposes and to prosecute any action or

proceeding in connection therewith. Provided it is not in default

hereunder, Tenant is authorized to retain any refund of any Taxes

paid by Tenant.

4.3.3 Landlord agrees that whenever Landlord's

cooperation is required in any proceeding brought by Tenant to

contest any tax, Landlord will reasonably cooperate therein,

provided the same shall not entail any cost, liability or expense

to Landlord. Tenant shall pay, indemnify and save Landlord

harmless of and from, any and all liabilities, losses, judgments,

decrees, costs and expenses (including all reasonable attorneys'

fees and expenses) in connection with such contest and shall,

promptly after the final settlement, fully pay and discharge the

amounts which shall be levied, assessed, charged or imposed or be

determined to be payable therein or in connection therewith, and

Tenant shall perform and observe all acts and obligations, the

performance of which shall be ordered or decreed as a result

thereof. No such contest shall subject Landlord to the risk of

any civil liability or the risk of any criminal liability, and

Tenant shall give such reasonable indemnity or security to

Landlord as may reasonably be demanded by Landlord to insurer

compliance with the foregoing provisions of this Section.

4.4 Payment of Utilities. Tenant shall pay to the utility

companies or other parties entitled to payment the cost of all

water, heat, air conditioning, gas, electricity, telephone, and

other utilities and services provided to or for the Premises,

including, without limitation, connection fees and taxes thereon.

ARTICLE 5

INSURANCE AND INDEMNIFICATION

5.1 Tenant's Insurance. From and after taking possession of

the Premises, Tenant shall carry and maintain, at its sole cost

and expense, the following types and amounts of insurance, unless

greater or more inclusive insurance is required by the terms of

the Ground Lease. In such event, the terms of the Ground Lease

shall control Tenant's insurance requirements:

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Insurance Tvpe Amount of Coverage

Risks Covered

Commercial General $1,000,000 per occurrence and

bodily injury, property damage Liability $2,000,000

in the aggregate and contractual liability

Property Damage full replacement value "all

risk", including sprinkler

damage

Business Interruption not less than 12 installments of

loss of earnings by at least the Minimum

Monthly Rent perils of fire and

lightning,

extended coverage,

vandalism, malicious

mischief and sprink-

ler leakage

Worker's compensation as required by law

5.2 Policy Form

5.2.1 Tenant shall obtain all policies of insurance

required by Section 5.1 from insurance companies having an

A. M. Best rating of A+ or better which are qualified to do

business in the jurisdiction where the Premises are

situated. All such policies shall be issued in the names of

Landlord and Tenant, and if requested by Landlord, any

mortgagee or beneficiary of Landlord, as additional

insureds. In addition, all such policies providing coverage

for physical damage shall include loss payee and mortgagee

endorsement in favor of Landlord and Land- lord's mortgagee

or beneficiary, respectively and as applicable

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