Sublease Agreement (2004)Full Document 

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                               SUBLEASE AGREEMENT

         This Sublease Agreement ("Sublease") is entered as of May 22, 2003,
between Holdings, Inc., a Delaware corporation ("Sublandlord") and
Blue Nile, Inc., a Delaware corporation ("Subtenant").

                                R E C I T A L S:

         A., Inc., a Delaware corporation ("Original Tenant")
and Opus Union Station, L.L.C. ("Original Landlord") are parties to a
Multi-Tenant Office Lease Agreement dated as of August 23, 1999, as amended by
that certain Amendment 1 to the Multi-Tenant Office Agreement dated as of May
21, 2001 (the "First Amendment") (as amended from time to time, the "Prime
Lease"), Original Tenant's interest in which is now held by Sublandlord.
Effective June 12, 2001, Original Landlord's interest in the Prime Lease was
transferred to Seattle Union Station II, LLC, a Washington limited liability
company ("Landlord'). Pursuant to the Prime Lease, Sublandlord leases 253,769
square feet of Rentable Area (as defined in the Prime Lease) (the "Leased
Premises") from Landlord at the Opus Center South Building (the "Building"). The
Leased Premises and the Building are more fully described in the Prime Lease
attached as EXHIBIT A to this Sublease.

         B.       Subtenant wishes to acquire from Sublandlord the right to
occupy part of the 9th floor of the Building (as depicted on the illustration
attached hereto as EXHIBIT B and consisting of 21,135 square feet of Rentable
Area of a total of 24,184 square feet of Rentable Area on the 9th floor), as
determined in this Sublease for such floor as set forth in the First Amendment)
(the "Subleased Premises").


In consideration of the mutual promises of the parties and for other good and
valuable consideration, the receipt and sufficiency of which are acknowledged,
the parties agree as follows:


         1.1      INITIAL SUBLEASED PREMISES. Sublandlord subleases to
Subtenant, and Subtenant subleases from Sublandlord, the Subleased Premises,
subject and pursuant to the terms and conditions of this Sublease. Within 10
business days after completion of the Subtenant's Improvements (defined in
Section 6.1 below) in the Subleased Premises, or after any space is added to the
Subleased Premises under the terms of Sections 1.2, 1.3 or 1.4 of this Sublease,
Subtenant and Sublandlord shall measure the Subleased Premises, or, as
applicable, any area(s) hereafter added to the Subleased Premises, by such
person as shall be reasonably acceptable to Subtenant, Sublandlord and Landlord,
and the Rentable Area shall be determined by such person using the standards set
forth in the Prime Lease. Sublandlord and Subtenant shall each pay one half of
the cost of such measurement. If Sublandlord, Subtenant or Landlord disputes the
measurement provided by the designated architect, the parties will jointly agree
upon a second person to perform the measurements and the results of this second
measurement will be final and binding upon the parties hereto for all purposes
hereunder, including, without limitation, the


determination of the total Basic Rent and Subtenant's Share (both as defined in
this Sublease). If the Rentable Area determined by any such measurement should
differ from that set forth in this Sublease, the parties shall jointly execute
an amendment to this Sublease setting forth the Rentable Area of the Subleased
Premises, the Basic Rent, Subtenant's Share and such other matters herein (if
any) that vary with the size of the Subleased Premises; provided, however, any
failure to execute such amendment shall not affect the results of such
remeasurement. Until such measurement occurs, the approximate Rentable Area of
the Subleased Premises set forth in Recital B above will be binding.

         1.2      OPTION TO EXPAND. Commencing on the Sublease Commencement Date
and for a period of eight (8) months thereafter, Subtenant shall have the right
to exercise an option ("Expansion Option") to expand into the balance of the 9th
floor of the Building ("Expansion Space") by providing written notice to
Sublandlord. If Subtenant timely exercises its Expansion Option, then the
balance of the 9th floor of the Building shall be added to the Subleased
Premises effective 120 days from the effective date of Subtenant's notice
("Expansion Effective Date"). The parties will promptly sign an amendment to
this Sublease adding the Expansion Space to the Subleased Premises as of the
Expansion Effective Date. Subtenant's sublease of the Expansion Space will be
co-terminous with its sublease of the initial Subleased Premises. The amendment
will provide for the Expansion Space to be included as part of the Subleased
Premises and all terms and conditions of this Sublease will apply to the
Expansion Space, except that (a) the Subtenant Improvement Allowance for the
Expansion Space will be a prorated portion of the Subtenant Improvement

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