Document:

pfsw-ex103_336.htm

Exhibit 10.3

SECOND AMENDMENT TO LEASE

THIS SECOND AMENDMENT TO LEASE (this “Amendment”) is entered into as of September ____, 2016 (the “Second Amendment Effective Date”), by and between BINYAN REALTY LP (“Landlord”), and PRIORITY FULFILLMENT SERVICES, INC., a Delaware corporation (“Tenant”). 

RECITALS:

A.Tenant and Landlord executed that certain Office Lease Agreement dated as of December 5, 2011 (the “Original Lease”), for space in the office building commonly known as Renaissance Tower, located at 1201 Elm Street, Dallas, Texas (the “Building”), such space containing 78,060 square feet of Agreed Rentable Area as same is more particularly described in the Original Lease (the “Existing Premises”).  

B.The Original Lease was amended by that certain First Amendment to Lease dated as of January 31, 2014 (the “First Amendment”).  The Original Lease as amended by the First Amendment is referred to herein as the “Lease.”  

C.Tenant and Landlord desire to further amend the Lease as set forth below.  Unless otherwise expressly provided herein, capitalized terms used herein shall have the same meanings as designated in the Lease.  

AGREEMENT:

In consideration of the mutual covenants and agreements contained herein and in the Lease, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant hereby amend and modify the Lease as follows:

1.Special Relocation Right.  Landlord shall have the one-time right to relocate the Existing Premises to the Relocation Premises effective as of the Relocation Effective Date pursuant to the terms set forth in this Section (such right referred to herein as the “Special Relocation Right”).  

A.The term “Relocation Premises” as used herein shall mean two (2) contiguous full floors in the Building and additional space on a floor contiguous thereto, such additional space containing a minimum of 15,000 square feet of Agreed Rentable Area and a maximum of 16,156 square feet of Agreed Rentable Area, which shall be as determined by Landlord; provided, however, that Tenant shall be able to access the entire Relocation Premises from the same elevator bank.  The term “Relocation Effective Date” as used herein shall mean the date selected by Landlord as the date on which the relocation of the Existing Premises to the Relocation Premises shall be effective (but in no event prior to the date on which Landlord has delivered the Relocation Premises to Tenant in accordance with this Agreement); provided, however, that the Relocation Effective Date must occur during one of the following periods: (i) after January 31, 2017, but no later than September 1, 2017; or (ii) after January 31, 2018, but no later than September 1, 2018.

B.Any election by Landlord to exercise the Special Relocation Right must be made by written notice to Tenant given at least 180 days prior to the Relocation Effective Date.  Such notice shall specify the location of the Relocation Premises and the Agreed Rentable Area thereof.

C.Landlord shall, at Landlord’s sole cost and expense, construct leasehold improvements, including but not limited to necessary mechanical, electrical, plumbing, ventilation, cabling and wiring, Dedicated Riser, and data center infrastructure, in the Relocation Premises to substantially the same configuration and level of finish as currently contained in the Existing Premises (and shall additionally make such improvements as reasonably required so that the restrooms on the floors on which the Relocation Premises are located are substantially consistent with the restrooms on the 3rd and 4th floors, as presently 

 

 

Exhibit 10.3

configured).  Landlord shall substantially complete all such improvements at least fifteen (15) days prior to the Relocation Effective Date.  In the event Landlord fails to substantially complete all such improvements (which for purposes hereof shall be deemed to have occurred only after Landlord has obtained a certificate of occupancy for the Relocation Premises to the extent required by applicable law, and if so required, Landlord agrees to utilize an “expeditor” to assist in obtaining same) by such date, the Relocation Effective Date shall be extended to the 15th day after such improvements are substantially completed as Tenant’s sole remedy for such failure (provided that if such extended date falls between September 2 and January 31 of any applicable year, then the Relocation Effective Date shall be extended to the following February 1).

D.Upon receipt of the building permit from the City of Dallas for the construction of improvements in the Relocation Premises, but not later than 90 days prior to the Relocation Effective Date, Tenant shall be granted access to begin improvements specific to the data center portion of the Relocation Premises.  Tenant shall be granted access to the Relocation Premises at least thirty (30) days prior to the Relocation Effective Date to conduct a staged move from the Existing Premises.  Any access to the Relocation Premises pursuant to this paragraph shall (i) be in accordance with Building Rules and Regulations, (ii) not interfere with any remaining construction work, and (iii) be subject to all terms and conditions of the Lease applicable to the Premises (including insurance requirements), excluding, however, any obligation to pay Basic Rent or Additional Rent with respect to the Relocation Premises prior to the Relocation Effective Date.  

E.Effective as of the Relocation Effective Date, (i) the term “Premises” as used in the Lease shall mean the Relocation Premises, (ii) the “Agreed Rentable Area of the Premises” shall mean the Agreed Rentable Area of the Relocation Premises, and (iii) Basic Rent shall be payable at the rates specified in the Basic Rent schedule set forth in Item 3 of the Basic Lease Provisions, on per square foot basis based on the Agreed Rentable Area of the Premises.  

F.Within thirty (30) days after the Relocation Effective Date, Tenant shall peaceably surrender the Existing Premises to Landlord in a condition as required for redelivery of space under the Lease.  Any property not removed as required shall be conclusively presumed to have been abandoned by Tenant and Landlord may, at its option, take over possession of such property and either (x) declare the same to be the property of Landlord by written notice to Tenant, or (y)  at the sole cost and expense of Tenant (not to exceed the actual, reasonable out-of-pocket cost to Landlord), remove and store and/or dispose of the same or any part thereof in any manner that Landlord shall choose without incurring liability to Tenant or any other person.  As of the Relocation Effective Date, Tenant shall have paid any and all rental and other amounts owed to Landlord with respect to the Existing Premises.  If Tenant fails to surrender the Existing Premises to Landlord in accordance with the Lease as amended by this Amendment, then Tenant shall pay, as additional Rent, Basic Rent and Additional Rent attributable to the Existing Premises on a “holdover” basis, as calculated in accordance with Section 1.4 of the Lease, from the 31st day after the Relocation Effective Date until the date of surrender (provided that payment of such holdover Rent shall not relieve Tenant of its obligation to surrender the Existing Premises in accordance with this paragraph). 

G.Landlord shall pay all actual and reasonable, out-of-pocket expenses incurred by Tenant in moving to the Relocation Premises from the Existing Premises (inclusive of Tenant’s costs to relocate its furniture and equipment, including its data center (including reasonable redundant security expenses incurred in connection with moving same, but not to exceed 110% of the cost for the same level of service if provided by a vendor selected by Landlord) and other “above standard” equipment, and to install data and telephone cabling required for Tenant’s business operations), subject to Landlord’s receipt of reasonable evidence reflecting the expenses so incurred by Tenant.  Amounts payable pursuant to this Section shall be made by Landlord within 60 days after Tenant submits a written request therefor together with the required supporting documentation.

 

 

Exhibit 10.3

H.Upon any election by Landlord to exercise the Special Relocation Right, Rider 3 to the Original Lease shall be modified as follows: (i) the term “Refusal Space” shall mean a contiguous full floor in the Building, as designated by Landlord (provided that Tenant’s rights with respect to such Refusal Space shall be subject and subordinate to the then-existing rights of other Building tenants as to such space, as well as Landlord’s right to renew any tenant then occupying such space), and (ii) the first sentence of Section 3 of such Rider shall be modified by replacing the phrase “the last day of the 66th Lease Month” with “October 1, 2021”.

I.Upon Landlord’s request, Tenant shall execute an amendment to the Lease, in reasonable form as prepared by Landlord, evidencing the relocation of the Existing Premises and the terms thereof. 

J.Notwithstanding anything to the contrary set forth herein, in the event that Landlord relocates Tenant’s entire Premises pursuant to Section 15.20 of the Lease, Landlord shall be obligated to simultaneously relocate the premises that Tenant leases from the Landlord pursuant to that certain Office Lease Agreement [Seasonal Space], by and between Tenant and Landlord, dated as of December 5, 2011, as amended by that certain First Amendment to Lease and Lease Reinstatement, dated on or about the date hereof, to the balance of any partial floor on which the Premises are so relocated.  

2.Fully Sprinklered Building.  Landlord has obtained a variance from the City of Dallas enabling Tenant to utilize a population density within the Premises that will not be limited by any lack of sprinklers within the Building (the “City Variance”).  The City Variance allows Tenant to utilize a population density within the Premises up to the maximum density allowed by applicable Law (and the restriction for Tenant’s population density not to exceed one person per 75 useable square feet as set forth in Section 4.101 of the Lease shall be inapplicable).  In the event the City Variance is hereafter rescinded, Landlord shall use commercially reasonable efforts to procure a reissued variance from the City of Dallas (or obtain an equivalency letter or other similar approval) that will permit Tenant to utilize a population density within the Premises that will not be limited by any lack of sprinklers within the Building, and if Landlord fails to obtain same within 90 days after the City Variance is rescinded, then Landlord will immediately commence installation of fire protection equipment so the building will be considered fully sprinklered and will diligently pursue such installation until completion.  If any rescission of the City Variance precludes Tenant from utilizing the population density within the Premises maintained immediately prior to such rescission, then Landlord shall provide Tenant with temporary space in the Building sufficient to accommodate any persons displaced by the reduction in permitted density (provided that the use of such temporary space shall be subject to all terms and conditions of the Lease applicable to the Premises, excluding, however, any obligation to pay Basic Rent or Additional Rent with respect to such temporary space), and Landlord shall further pay all actual and reasonable, out-of-pocket expenses incurred by Tenant in moving to such temporary space (inclusive of Tenant’s costs to relocate its furniture and equipment), subject to Landlord’s receipt of reasonable evidence reflecting the expenses so incurred by Tenant.  

3.Inapplicable Riders.  Riders 2, 4 and 5 to the Original Lease are hereby deleted in their entirety. 

4.OFAC Certification.  Tenant hereby represents and warrants to Landlord that neither Tenant nor any of its respective officers, directors, shareholders, partners, members or affiliates is or will be an entity or person: (i) that is listed in the annex to, or is otherwise subject to the provisions of, EO 13224; (ii) whose name appears on OFAC’s most current OFAC List (which list may be published from time to time in various mediums including, but not limited to, the OFAC website, http:www.treas.gov/ofac/t11sdn.pdf); (iii) who commits, threatens to commit or supports “terrorism,” as that term is defined in EO 13224; or (iv) who is otherwise affiliated with any entity or person listed above.

5.Addresses for Notice.  Landlord’s address for notices under the Lease shall be as follows:

1201 Elm Street

Suite 101

 

 

Exhibit 10.3

Dallas, TX  75270

Attention:  Property Manager

and

 

c/o The Moinian Group

3 Columbus Circle, Suite 2300

New York, NY 10019

Attn:  Harry Dreizen, Esq.

 

with a copy to: 

 

Jackson Walker L.L.P.

2323 Ross Avenue, Suite 600

Dallas, Texas  75201

Attn: Wayne F. Malecha

 

6.Binding Effect.  This Amendment shall become effective only upon full execution and delivery of this Amendment by Landlord and Tenant.  This Amendment contains the parties’ entire agreement regarding the subject matter covered by this Amendment, and supersedes all prior correspondence, negotiations, and agreements, if any, whether oral or written, between the parties concerning such subject matter.  Tenant has not relied on any warranties, representations or promises made by Landlord or Landlord’s agents (express or implied) with respect to the Premises, the Building or the Property (including, without limitation, the condition, use or suitability of the Premises, the Building or the Property) that are not expressly set forth in the Lease as amended hereby.  This Amendment may be executed in multiple counterparts, and each counterpart when fully executed and delivered shall constitute an original instrument, and all such multiple counterparts shall constitute but one and the same instrument.  As modified by this Amendment, the terms and provisions of the Lease shall remain in full force and effect, and the Lease, as modified by this Amendment, shall be binding upon and shall inure to the benefit of the parties hereto, their successors and permitted assigns.  Tenant hereby confirms that Landlord has fully performed all of its obligations under the Lease and agrees that as of the date hereof, there is no defense, setoff or counterclaim against Landlord or otherwise affecting Tenant’s obligations under the Lease.  Other than as may be expressly provided in this Amendment, there are no outstanding allowances or credits that remain owing to Tenant under the Lease.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

 

Exhibit 10.3

EXECUTED as of the day and year first above written.

LANDLORD:

BINYAN REALTY LP, a Delaware limited partnership

 

	
 
	
By:
	
Binyan Realty GP, LLC, a Delaware limited liability company,
its general partner

 

 

By: 

Name: 

Title:  

 

 

TENANT:

 

PRIORITY FULFILLMENT SERVICES, INC., a Delaware corporation

 

 

By: 

Name: 

Title:  

 

 

Exhibit 10.3

 

GUARANTOR CONSENT

 

The undersigned consents to the terms and conditions of this Amendment and the execution hereof, and acknowledges and agrees that (i) that certain Lease Guaranty dated as of December 5, 2011 and guaranteeing the obligations of Tenant under the Lease (the “Guaranty”), continues in full force and effect with regard to the Lease as modified by this Amendment, and (ii) the execution of this Amendment shall in no way diminish the liability of the undersigned under the Guaranty nor impair or affect the enforceability thereof against the undersigned.

 

GUARANTOR:

 

PFSweb, Inc.,
a Delaware corporation 

 

By:_________________________
Name:_________________________

Title:_________________________pfsw-ex104_337.htm

Exhibit 10.4

LEASE EXTENSION AND AMENDING AGREEMENT

 

 

THIS AGREEMENT made the 31st day of May, 2016.

 

 

BETWEEN:

 

M&R COMMERCIAL PROPERTIES INC.

 

(“Landlord”)

 

OF THE FIRST PART

 

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PRIORITY FULFILLMENT SERVICES OF CANADA, INC.

 

(“Tenant”)

 

OF THE SECOND PART

 

WHEREAS:

 

	
A.
	
By a lease dated July 14th, 2011 (“Lease”) between M & R Holdings a Joint Venture of Balco Developments Limited, Windley Limited, Ellendale Investments Limited and Overbank Limited as landlord (“Original Landlord”) and Tenant, Original Landlord leased to Tenant premises with a Rentable Area of approximately Thirty Three Thousand Six Hundred and Twenty One (33,621) square feet in the building municipally known as 9133 Leslie Street, Richmond Hill, Ontario(“Premises”), as more particularly described in the Lease, for a term (“Term”) of Five (5) Years and four (4) months, commencing on August 1, 2011 and expiring on November 30, 2016, with one option to extend the Term of the Lease for further term of Five (5) Years;

 

	
B.
	
Landlord is successor in title to the Original Landlord as the Original Landlord transferred the property to the Landlord by transfers registered as Instrument Numbers YR1789641 and YR1789642 on February 29, 2012;

 

	
C.
	
The Tenant did not exercise its five (5) year extension option in the Lease; however, the Landlord and Tenant have agreed to extend the Term of the Lease for a further period of Three (3) Years and Six (6) Months commencing on the 1st day of December, 2016 and expiring on the 31st day of May, 2020, all on the terms and conditions set out below;

 

NOW, THEREFORE, THIS AGREEMENT WITNESSES that in consideration of the mutual promises hereinafter set forth and other good valuable consideration, the receipt and sufficiency of which is hereby acknowledged by the parties hereto, the parties hereto agree as follows:

 

1.Confirmation of Recitals

 

The parties hereto confirm that the foregoing recitals are true in substance and in fact.

 

2.Extension of Lease

 

The Term of the Lease is hereby extended for a further period of Three (3) Years and Six (6) Months commencing on the 1st day of December, 2016 and expiring on the 31st day of May, 2020 (“Extension Term”) on the same terms and conditions as contained in the Lease, save and except the annual Basic Rent payable in Section 1(e) of the Lease shall be:

 

	
 
	
December 1, 2016 to November 30, 2017
	
$226,941.75 per annum,

	
 
	

	
$18,911.81 per month,

	
 
	

	
$6.75 per sq. ft. per annum;

 

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December 1, 2017 to November 30, 2018
	
$235,347.00 per annum,

	
 
	

	
$19,612.25 per month,

	
 
	

	
$7.00 per sq. ft. per annum.

 

	
 
	
December 1, 2018 to May 31, 2020
	
$243,752.25 per annum,

	
 
	

	
$20,312.69 per month,

	
 
	

	
$7.25 per sq. ft. per annum.

 

Tenant acknowledges that except as set out below there shall be no further right to extend or renew the Term of the Lease beyond the Extension Term.

 

All Rent (including Basic Rent and all other amounts payable pursuant to the Lease) shall be payable commencing on the 1st day of December, 2016 and shall continue thereafter at all times throughout the Extension Term without any period during which any such Rent shall not be payable.

 

3.Amendments to Lease

 

Section 3 (Option to Extend) of Schedule “C” (Special Provisions) shall be deleted and replaced as follows:

 

“OPTION TO EXTEND

 

	
 
	
(a)
	
Provided Tenant is in occupancy of the Premises and is not in default under the Lease, then, Tenant shall have the option to extend this Lease for one (1) further term of three (3) years from June 1, 2020 to May 31, 2023 (the “Second Extension Term”). Such extension shall be on the same terms and conditions as contained in this Lease, except that: (i) there shall be no further right to extend after the expiry of the Second Extension Term; (ii) the Basic Rent shall be in such amount as set out pursuant to subsection (b) of this section; and (iii) there shall be no further right of extension, or Landlord’s Work or tenant’s allowance or inducement or rent-free period for the Second Extension Term and the Premises shall be accepted by Tenant in “as is” condition at the commencement of such Second Extension Term without Landlord being required to perform any work, provided; however, that Landlord shall not be relieved of its obligations under Section 10.7 or Section 12 of the Lease. Such right to extend shall be exercisable by notice to Landlord by not later than six (6) months prior to the May 31, 2020 expiry of the Extension Term hereof, failing which such right shall be null and void and forever extinguished.

 

	
 
	
(b)
	
The Basic Rent for the Second Extension Term shall be at the then prevailing fair market rental rates for similar premises in the surrounding area, having regard to all relevant circumstances including the size, age and location of the Premises, the facilities afforded (excluding the Tenant’s trade fixtures and equipment), the terms of the Lease, the condition of the Premises and the extent and quality of the improvements therein constructed by Landlord, if any, without any regard to any improvements made by or on behalf of Tenant and disregarding any deficiencies in the condition and state of repair of the Premises as a result of Tenant’s failure to comply with its obligations hereunder or under the Lease in respect to the maintenance and repair of the Premises and the use of the Premises. Such rent shall be agreed upon between the parties not later than three (3) months prior to the May 31, 2020 expiry of the Extension Term hereof, failing which such right shall be null and void and forever extinguished.”

 

4.Security Deposit

 

The Landlord acknowledges and confirms that the Landlord currently holds Thirty Two Thousand Two Hundred and Ninety Two Dollars and Ninety Eight Cents ($32,292.98) as a Security Deposit pursuant to Section 1 of the Lease. The Tenant has agreed to increase the Security Deposit set out in Section 1 of the Lease to Thirty Six Thousand Two Hundred One Dollars and Thirty Seven Cents ($36,201.37) and the Tenant shall pay the difference of Three 

 

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Thousand Nine Hundred Eight Dollars and Thirty Nine Cents ($3,908.39) to the Landlord upon execution of this Lease Extension and Amending Agreement by the Tenant, to be held by Landlord in accordance with the provisions of the Lease.

 

5.Condition of Premises

 

Tenant shall accept the Premises in “as is” condition and Landlord shall have no obligation to perform any Leasehold Improvements or other work to the Premises and Landlord shall not be required to pay any allowance or give any inducement in respect thereof, provided; however, that Landlord shall not be relieved of its obligations under Section 10.7 or Section 12 of the Lease.

 

6.Performance of Covenants

 

Landlord and Tenant hereby mutually covenant and agree that during the Extension Term they shall perform and observe all of the covenants, provisos and obligations on their respective parts to be performed pursuant to the terms of the Lease, as amended and extended hereby.

 

7.Jurisdiction

 

This Agreement shall be governed by and interpreted in accordance with, and the parties hereto shall attorn to, the laws of the Province of Ontario. The parties agree that the Courts of Ontario shall have jurisdiction to determine any matters arising hereunder.

 

8.Miscellaneous Provisions

 

	
 
	
(a)
	
The Lease as amended by the terms of this Agreement, is hereby ratified and confirmed and remains in full force and effect in accordance with its terms.

 

	
 
	
(b)
	
This Agreement and the Lease shall be binding upon and enure to the benefit of the parties hereto and their respective successors and assigns, subject to the express restrictions contained in the Lease.

 

	
 
	
(c)
	
Landlord and Tenant shall, at all times hereafter, upon the reasonable request of the other, make or procure to be made, done or executed all such further assurances and to do all such things as may be necessary to give full force and effect to the full intent of this Agreement.

 

	
 
	
(d)
	
Capitalized expressions used herein, unless separately defined herein, have the same meaning as defined in the Lease.

 

 

EXECUTED by each of the parties hereto under seal on the date first above mentioned.

 

M&R COMMERCIAL PROPERTIES INC.

 

 

Per:          

Name

          Title:

 

Per:           c/s

Name

          Title:

 

 I/We have authority to bind the Corporation.

 

 

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PRIORITY FULFILLMENT SERVICES OF CANADA, INC.

 

 

Per:          

Name

          Title:

 

Per:           c/s

Name

          Title:

 

I/We have authority to bind the Corporation.

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