<PAGE>
                                                                EXHIBIT 10.16(b)


                       FIRST AMENDMENT TO LEASE AGREEMENT

         THIS FIRST AMENDMENT TO LEASE AGREEMENT is entered into as of the 15th
day of October 2002, by and between ProLogis-Macquarie Kentucky I LLC, a
Delaware limited liability company ("Landlord"), and Innotrac Corporation
("Tenant").

                                   WITNESSETH:

         WHEREAS, Landlord and Tenant have entered into a Lease dated as of the
23rd day of April, 2002 (such Lease, as heretofore and hereafter modified, being
herein referred to as the "Lease") pursuant to which Landlord leased to Tenant
approximately 286,000 square feet located at 1226 Aviation Blvd, Hebron, KY
41048 (the "Original Premises"); and

         WHEREAS, a scrivener's error occurred in the drafting of the Lease
whereby the Landlord's name was drafted as ProLogis Development Services
Incorporated; and

         WHEREAS, Landlord and Tenant hereby desire to correct Landlord's name
as of the date of the drafting of the Lease to reflect ProLogis Limited
Partnership-IV, a Delaware limited partnership; and

         WHEREAS, the Lease was assigned to ProLogis-Macquarie Kentucky I LLC, a
Delaware limited liability company, pursuant to that certain Bill of Sale and
Assignment of Leases, Contracts and Permits dated as of the 27th day of June,
2002; and

         WHEREAS, Landlord and Tenant desire to expand the Premises by 44,000
square feet in addition to modifying certain other terms and conditions as set
forth below.

         NOW THEREFORE, in consideration of Ten Dollars ($10.00) and other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Landlord and Tenant agree as follows:

         1.       Landlord and Tenant hereby acknowledge and agree that as of
the date of the Lease, the Landlord's name under the Lease should have been
reflected as ProLogis Limited Partnership-IV, a Delaware limited partnership.

         2.       Landlord and Tenant hereby acknowledge and agree that the
Landlord's name under the Lease as of June 27, 2002, is hereby revised to
reflect ProLogis-Macquarie Kentucky I LLC, a Delaware limited liability company.

         3.       Effective on October 1, 2002 (the "Expansion Premises
Commencement Date"), the Original Premises shall hereby be expanded to include
those certain premises consisting of approximately 44,000 rentable square feet
(the "Expansion Premises"), as more fully described on the attached Exhibit A-l.
The Premises as described in the Lease shall be revised to include the Expansion
Premises and shall further be revised to reflect a total square footage of
approximately 330,000 square feet.

         4.       The Lease Term for the Expansion Premises shall commence on
the Expansion Premises Commencement Date and shall continue through the end of
the original lease term July 31, 2007.

         5.       The total monthly Base Rent for the Original Leased Premises
and the Expansion Premises, during the Original Leased Premises Extension Term
and the Expansion Premises Lease Term as defined herein, shall be due and
payable to Landlord in accordance with Paragraph 4 of the Lease equal to the
following amount for the respective period set forth below:

<TABLE>
<CAPTION>
                  Period                                     Amount
                  ------                                     ------
         <S>                                         <C>
         October 1, 2002 through July 31, 2007       $77,000 per month
</TABLE>

         6.       Effective on the Expansion Premises Commencement Date,
Tenant's Proportionate Share of the Building and Project shall be revised to
reflect the amount for the respective periods set forth below:


<TABLE>
<CAPTION>

                                                 Tenant's Proportionate            Tenant's Proportionate
                 Period                            Share of Building                   Share of Project
                --------                         ----------------------          --------------------------
       <S>                                       <C>                             <C>
       October 1, 2002 through July 31, 2007               83%                               83%
</TABLE>

         7.       Effective on October 1, 2002, the Initial Estimated Monthly
Operating Expense Payments shall be as follows: Monthly Charge


                  Common Area Charges:            $ 4,675.00
                  Taxes:                            8,250.00
                  Insurance:                        1,650.00
                                                  ----------
                  Total                           $14,575.00


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         8.       Effective on October 1, 2002, Addendum 1 of the Lease,
captioned "Right Of First Refusal", paragraph (a) shall be replaced with the
following:

         "Offered Space shall mean the adjoining 66,000 square feet of space as
indicated on Exhibit A-l attached hereto."

         9.       Effective on October 1, 2002, Addendum 5 of the Lease,
captioned "Cancellation Option", shall be revised to reflect the following:

                  "Provided no Event of Default shall then exist and no
                  condition shall then exist which with the passage of time or
                  giving of notice, or both, would constitute an Event of
                  Default, Tenant shall have the right at any time on or before
                  the first day of the 30th month of the Lease Term to send
                  Landlord written notice (the "Termination Notice") that Tenant
                  has elected to terminate this Lease effective on the last day
                  of the 36th month of the Lease Term with respect to the
                  Premises consisting of approximately 330,000 square feet only.
                  It is the express intent of the parties that this Cancellation
                  Option shall not apply to the Offered Space as defined in
                  Addendum 1 of the Lease, as amended by Paragraph 8 under this
                  Amendment.

                  If Tenant elects to terminate this Lease pursuant to the
                  immediately preceding sentence, the effectiveness of such
                  termination shall be conditioned upon Tenant paying to
                  Landlord $1,880,760.00 contemporaneously with Tenant's deliver
                  of the Termination Notice to Landlord. Such amount is
                  consideration for Tenant's option to terminate and shall not
                  be applied to rent or any other obligation of Tenant. Landlord
                  and Tenant shall be relieved of all obligations accruing under
                  this Lease after the effective date of such termination but
                  not any obligations accruing under the Lease prior to the
                  effective date of such termination."

         10.      With the exception of those terms and conditions specifically
modified and amended herein, the Lease shall remain in full force and effect in
accordance with all its terms and conditions. In the event of any conflict
between the terms and provisions of this Amendment and the terms and provisions
of the Lease, the terms and provisions of this Amendment shall supersede and
control.

         11.      All capitalized terms used but not defined herein which are
defined in the Lease shall have the same meaning herein as in the lease.


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