Exhibit
10.3


 


FIRST LEASE
MODIFICATION AGREEMENT


 


THIS FIRST
LEASE MODIFICATION AGREEMENT, made this 27th day of August, 2009 by and between 500 PLAZA DRIVE CORP., a New Jersey corporation, having an
office at 400 Plaza Drive, Secaucus, New Jersey 07096-1515 (hereinafter
referred to as “Landlord”) and THE CHILDREN’S PLACE
SERVICES COMPANY, LLC, a Delaware limited liability company, having
an office at 915 Secaucus Road, Secaucus, New Jersey (hereinafter referred to
as “Tenant”).


 


WITNESSETH:


 


WHEREAS, by Agreement of Lease dated March 12,
2009, as amended and/or supplemented by (i) that certain Guaranty (the “Guaranty”)
of The Children’s Place Retail Stores, Inc. (the “Guarantor”) dated March 12,
2009, (ii) that certain Letter Agreement among Landlord, Tenant and
Guarantor dated February 19, 2009, and (iii) that certain letter from
Landlord to Tenant dated May 5, 2009 (such agreements collectively
referred to as the “Lease”), Landlord leased to Tenant and Tenant hired from
Landlord 119,979 square feet of Floor Space (hereinafter referred to as the “Original
Demised Premises”) located at 500 Plaza Drive in Secaucus, New Jersey
(hereinafter referred to as the “Building”); and


 


WHEREAS, Landlord and Tenant wish to modify the
Lease to reflect, inter alia, Tenant’s lease of
additional space in the Building, and to amend the Lease accordingly;


 


NOW,
THEREFORE, for
and in consideration of the Lease, the mutual covenants herein contained and
the consideration set forth herein, the parties agree as follows:


 


1.             Same Meaning.  Except as otherwise expressly set forth
herein, capitalized terms referenced in this First Lease Modification Agreement
shall have the meanings ascribed in the Lease.


 


2.             Additional Premises/Rights
to Install Generator:  Landlord
hereby leases to Tenant, and Tenant hereby hires from Landlord 17,544 square
feet of Floor Space representing a portion of the fifth (5th) floor of the Building (hereinafter referred to as the
“Additional Premises”). The Additional Premises are outlined in bold on the
floor plan attached hereto as Exhibit A. Except as expressly provided
herein, effective upon the Additional Premises Commencement Date (as that term
is defined below), the Demised Premises will be deemed to include (and any
reference in the Lease to the term “Demised Premises” shall be deemed to
incorporate) the Original Demised Premises and the Additional Premises. Effective
upon the Additional Premises Commencement Date, the Demised Premises will, in
the aggregate, contain 137,523 square feet of Floor Space. Article 1.01 M.
of the Lease shall be deemed so amended. Landlord further agrees to grant
Tenant the right to use the existing generator located on the grade level of
the Building subject to and in accordance with the terms and conditions of that
certain Tri-Party Agreement (the “Tri-Party Agreement”) among Landlord, Tenant
and AXA Equitable Life Insurance Co. (“AXA”); provided, however, in the event
the Tri-Party Agreement is not so executed among Landlord, Tenant and AXA, 


 


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Tenant shall have the
right to install a new generator (the “New Generator”) under the Building at a
location mutually agreed upon by Landlord and Tenant (provided the same shall
be within the area of one or more of Tenant’s exclusive parking spaces under
the Building). The installation of the New Generator shall be deemed an
alteration requiring Landlord’s consent under the Lease, which consent shall
not be unreasonably withheld or delayed, and Tenant shall be obligated to
deliver for Landlord’s approval complete plans and specifications for the New
Generator (as well as the related fuel tanks, connective wiring and means and
method of enclosing the New Generator) prior to installation thereof.  Tenant shall be solely responsible for all costs
associated with the installation, maintenance and repair of the New Generator
(as well as any fuel storage tank attendant thereto) as well as all mechanical
connections related thereto.  Tenant
shall also be responsible for the cost of all repairs to the areas immediately
surrounding the New Generator (and attendant fuel tank) as a result of the
installation, maintenance and operation of the New Generator and attendant fuel
tank.  Tenant shall indemnify and hold Landlord
any all Superior Lessors and Superior Mortgagees harmless from all loss,
damage, cost, liability and expense arising out of or related to the
installation, maintenance and operation of the New Generator or any fuel tank
attendant thereto and for all equipment related thereto. In no event shall
Landlord be responsible for any damages or abatements arising out of the
failure or inoperability of such systems or equipment. Tenant shall not be
obligated to remove the New Generator upon the expiration or earlier
termination of the Lease so long as the New Generator is in good working
condition upon the expiration or earlier termination of the Lease.  If the New Generator is not in good working
condition upon the expiration or earlier termination of the Lease, Tenant shall
be obligated to remove same upon the expiration or earlier termination of the
Lease at Tenant’s sole cost and expense and in accordance with applicable Legal
Requirements.


 


3.             Additional Premises
Commencement Date:  The Term
of the lease of the Additional Premises shall commence on February 1, 2010
(said date, the “Additional Premises Commencement Date”). Tenant’s obligation
to pay Fixed Rent, Real Estate Taxes, Operating Expenses, and all other charges
due under the Lease with respect to the Additional Premises shall commence on
the Additional Premises Commencement Date. Article 1.01 K. of the Lease
shall be deemed so amended.


 


4.             Expiration Date of the
Demised Premises:  The
Term of the Lease of the Additional Premises shall expire on May 31, 2024.
The “Tenant’s Termination Right,” referenced in Article 1.01 P. of the
Lease, shall not apply with respect to the Additional Premises. Article 1.01
P. of the Lease shall be deemed so amended.


 


5.             Fixed Rent:  Commencing on the Additional Premises
Commencement Date, Tenant shall pay Fixed Rent with respect to the Additional
Premises as follows: For the period from the Additional Premises Commencement
Date until the day prior to the fifth (5th)
anniversary of the Additional Premises Commencement Date, the Fixed Rent for the
Additional Premises shall be an amount at the annual rate of Twenty Seven and 50/100
($27.50) Dollars multiplied by the Floor Space of the Additional Premises; for
the period from the fifth (5th)
anniversary of the Additional Premises Commencement Date until the day prior to
the tenth (10th) anniversary of the Additional Premises
Commencement Date, the Fixed Rent for the Additional Premises shall be an
amount at the annual rate of Twenty Eight and 50/100 ($28.50) Dollars
multiplied by the Floor Space of the


 


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Additional Premises; and
for the period from the tenth (10th)
anniversary of the Additional Premises Commencement Date until the Expiration
Date, the Fixed Rent for Additional Premises shall be an amount at the annual
rate of Thirty and 00/100 ($30.00) Dollars multiplied by the Floor Space of
Demised Premises. Article 1.01 Q. of the Lease shall be deemed so amended.


 


6.             Base Year for the
Additional Premises:  The
Base Year for the Additional Premises shall be Calendar Year 2010. Accordingly,
when, in Articles 6.01 and 6.02 of the Lease, Landlord is calculating Tenant’s
Fraction of Operating Expenses and Real Estate Taxes, a separate calculation
shall be made for the Additional Premises (as
distinguished from the Original Demised Premises),
wherein the Base Year shall be Calendar Year 2010. Articles 1.01 D., 6.01 and
6.02 of the Lease shall be deemed so amended.


 


7.             Tenant’s Fraction:  Tenant’s Fraction with respect to the
Additional Premises shall be 3.94%. Accordingly, when, in Articles 6.01 and
6.02 of the Lease, Landlord is calculating Tenant’s Fraction of Operating
Expenses and Real Estate Taxes, a separate calculation shall be made for the Additional Premises (as distinguished from the
Original Demised Premises), wherein the
Tenant’s Fraction shall be 3.94%. Articles 1.01 OO., 6.01 and 6.02 of the Lease
shall be deemed so amended.


 


8.             Option to Extend Term:
 In the event Tenant does not exercise
Tenant’s Termination Right referenced in Article 1.01 P. of the Lease with
respect to the Original Demised Premises, Tenant shall have two (2) options
to extend the Term of the Lease with respect to the Additional Premises from
the date(s) upon which the lease of the Additional Premises would
otherwise expire for two (2) periods of five (5) years each; such
rights to be exercised in accordance with and subject to the provisions of Article 38
of the Lease except that the Fixed Rent to be paid by Tenant during the first
five (5) year option period with respect to the Additional Premises shall
be at the annual rate of Thirty Three and 50/100 Dollars ($33.50) multiplied by
the square footage of Floor Space of the Additional Premises. The Fixed Rent
for the Additional Premises during the second five (5) year option period,
if such right is so exercised, shall be at FMV as that term is defined pursuant
to and determined in accordance with Article 38 of the Lease.


 


9.             Security Deposit:
 On or prior to the Additional Premises
Commencement Date, Tenant shall deliver the Landlord an additional Security
Deposit (in the form of a new Letter of Credit, an additional Letter of Credit,
or an amendment to the Letter of Credit posted with respect to the Original
Demised Premises) in the amount of $50,527.00 Article 1.01 HH. of the
Lease shall be deemed so amended.


 


10.           Floor Space:
 Reference is made to Article 1.01
R. of the Lease. For purposes of determining the Floor Space of the Additional
Premises, the Loss Factor shall be 17.00 %. Article 1.01 R. of the Lease
shall be deemed so amended.


 


11.           Landlord’s Work:  Landlord shall perform the following work in
and to the Additional Premises (hereinafter referred to as the “Additional
Premises Landlord’s Work”) at Landlord’s sole cost and expense: Landlord shall
demise the Additional Premises from the balance of 


 


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the fifth floor of the Building, and furnish all demising walls to the
underside of the roof with metal studs and gypsum board on both sides of the
studs [such gypsum board to maintain a one (1) hour fire rating if
required by applicable Legal Requirements (or higher as required by applicable
Legal Requirements)], and taped and spackled, smooth and ready for paint, and
Landlord shall install a building standard common corridor, as depicted on the
attached Exhibit A, in compliance with applicable Legal Requirements.


 


Except as expressly provided herein, the Additional Premises will be
delivered to Tenant, and Tenant agrees to accept the same, in “AS IS” condition.
Further, reference is made to Article 5.01 (a) of the Lease. It is
expressly agreed and acknowledged by the parties hereto that the first and last
sentences of Article 5.01 (a) shall not apply to the Additional
Premises. In addition, and with reference to Article 5.01 (a) of the
Lease and that certain letter from Landlord to Tenant dated May 5, 2009,
Tenant hereby releases Landlord from any obligation to remove the staircase
between the fourth (4th) and fifth (5th) floors of the Building.


 


Within forty five (45) days of the substantial completion of Landlord’s
Work, Tenant shall provide Landlord with notice of any incomplete or
unsatisfactory items of Landlord’s Work (such items creating the “Punch List”).
Landlord shall complete any such Punch List items within thirty (30) days of
Landlord’s receipt thereof. If Landlord shall fail to complete such Punch List
Items within such thirty (30) day period, Tenant shall be entitled to complete
such Punch List Items and Landlord shall reimburse Tenant for such costs within
ten (10) days of receipt of an invoice therefore.


 


12.           Landlord’s
Contribution:  So long as Tenant shall not be in
monetary or other material default of the Lease beyond the applicable notice
and cure period, if any, Landlord agrees that it shall contribute up to the sum
of Twenty Eight and 83/100 Dollars ($28.83) per square foot of Floor Space of
the Additional Premises (“Landlord’s Additional Premises Contribution”) towards
the cost of Tenant’s work with respect to the Additional Premises (the “Additional
Premises Tenant’s Work”) on the terms set forth below:


 


(A)          Landlord shall not be required to make
Landlord’s Additional Premises Contribution if this Lease is not then in full
force and effect or if the Additional Premises are not free of all liens,
claims or encumbrances created by Tenant or its contractors.


 


(B)           Landlord’s Contribution shall be paid within
thirty (30) days of the later of (x) completion of the Additional Premises
Tenant’s Work and (y) satisfaction of the conditions set forth in
subparagraph (C) below.


 


(C)           Prior to and as a condition precedent to
Landlord’s obligation to make such payment, Tenant shall deliver to Landlord:


 


(i)  a signed statement by an officer of Tenant
stating that all material and all property constituting the Additional Premises
Tenant’s Work has been fully paid for and the same are free and clear of all
encumbrances, liens or charges;


 


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(ii)  an
affidavit sworn to by Tenant’s general contractor to the effect that it has
been paid all sums due to it and containing a statement that all
subcontractors, materialmen and suppliers and all costs of labor, including
payroll taxes and charges, have been paid; said affidavit shall contain the
names of all subcontractors;


 


(iii)  lien waivers executed by Tenant’s
general contractor and all subcontractors;


 


(iv)  a permanent (and/or continuing as may
be applicable) certificate of occupancy for the Additional Premises and such
other approvals of the Additional Premises Tenant’s Work or which may be
necessary for the conduct of Tenant’s business in the Additional Premises as
may be required of any governmental authority;


 


(v)  an
affidavit from the architect having supervision over the Additional Premises
Tenant’s Work, to the effect that the Additional Premises Tenant’s Work has
been substantially completed in accordance with the plans and specifications
reasonably and previously approved by Landlord and in compliance with all
applicable Legal Requirements; and


 


(vi)  a
cost breakdown, in reasonable detail, certified by Tenant, detailing the items
comprising the Additional Premises Tenant’s Work.


 


(E)           Tenant shall not mortgage, pledge, assign
or hypothecate Tenant’s right to receive Landlord’s Additional Premises
Contribution.


 


13.           Electric:  Reference is made to Article 18.01 of
the Lease.  The parties hereto
acknowledge and agree that Article 18.01 of the Lease shall apply with
respect to the Additional Premises; provided, however, Tenant shall be
obligated to install either a direct meter or sub-meter to measure electric
consumption in the Additional Premises the cost of which shall be at Tenant’s
sole cost and expense. If such consumption is measured by sub-meter, said sub-meter
shall be tied into Tenant’s electric metering system for the Original Demised Premises.


 


14.           HVAC:  Reference is made to Article 19.01 of the
Lease.  The parties hereto acknowledge
and agree that Article 19.01 of the Lease shall apply with respect to the
Additional Premises, it being the agreement and understanding of the parties
that the current overtime HVAC Charge for the Additional Premises (see the last
sentence of Article 19.02) shall be $50.00 per hour (same being subject to
change upon written notice to Tenant). Further, notwithstanding anything
contained in the Lease to the contrary, Landlord agrees, in concept, that
Tenant shall be permitted to install supplemental HVAC capacity and systems in
the Building; same, however, is to be performed as an alteration requiring
Landlord’s consent pursuant to and in accordance with the terms and conditions
of Article 15 of the Lease, including, but not limited to, compliance with
applicable Legal Requirements.


 


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15.           Parking:  Reference is made to Article 7.04 of
the Lease.  Effective upon the Additional
Premises Commencement Date, Tenant shall be entitled to an additional four (4) parking
spaces per 1000 square feet of Floor Space of the Additional Space. Such
parking shall be located in the parking deck(s) and grade level parking
serving the Building and shall be provided on a non-exclusive basis.


 


16.           Broker.  Each party represents to the other that no
broker except the Broker was instrumental in bringing about or consummating
this First Lease Modification Agreement and that neither party had any
conversations or negotiations with any broker except the Broker concerning the
leasing of the Additional Premises.  Each
party agrees to indemnify and hold harmless the other party against and from
any claims for any brokerage commissions and all costs, expenses and
liabilities in connection therewith, including, without limitation, attorneys’
fees and expenses, arising out of any conversations or negotiations had by such
party with any broker other than the Broker with respect to the leasing of the
Additional Premises.  Landlord shall pay
any brokerage commissions due the Broker with respect to the leasing of the
Additional Premises by Tenant pursuant to a separate agreement between Landlord
and the Broker.


 


17.           Lease Effectiveness.
 Except as provided herein, all of
the terms and conditions of the Lease are in full force and effect and are
confirmed as if fully set forth herein.


 


18.           Authority.  Each party represents and warrants that it has
the power and authority to execute this First Lease Modification Agreement.


 


19.           Headings.  The section headings set forth herein shall
have absolutely no legal significance and are used solely for convenience of
reference.


 


20.           Counterparts.  This First Lease Modification Agreement may
be executed in counterparts, each of which will be deemed an original, and both
of which together shall be deemed to constitute one and the same
instrument.  Each of the parties hereto
shall be entitled to rely upon a counterpart of the instrument executed by the
other party and sent by facsimile transmission.


 


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IN
WITNESS WHEREOF,
the parties hereto have caused this First Lease Modification Agreement to be
duly executed as of the day and year first above written.


 


	
   

  	
   

  	
  500 PLAZA DRIVE CORP.

  
	
   

  	
   

  	
  (“Landlord”)

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Irwin A. Horowitz

  
	
   

  	
   

  	
  Irwin A. Horowitz

  
	
   

  	
   

  	
  Executive Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  	
  THE CHILDREN’S PLACE SERVICE

  
	
   

  	
   

  	
  COMPANY, LLC

  
	
   

  	
   

  	
  (“Tenant”)

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Charles Crovitz

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Charles Crovitz

  
	
   

  	
   

  	
  Title:

  	
  Interime Chief Executive
  Officer

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Susan J. Riley

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Susan J. Riley

  
	
   

  	
   

  	
  Title:

  	
  Executive Vice
  President, Finance & Administration

  



 


 


Copyright © Hartz
Mountain Industries, Inc. 2003. All Rights Reserved. No portion of this
document may be reproduced without the express written consent of Hartz
Mountain Industries, Inc.


 


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