Document:

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                                                                   EXHIBIT 10.20

                       NINTH AMENDMENT TO LEASE AGREEMENT

         THIS NINTH AMENDMENT TO LEASE AGREEMENT (this "Amendment") is entered
into as of the 13th day of November, 2001 (the "Effective Date"), by and between
AGBRI ATRIUM, L.P., a Delaware limited partnership ("Landlord"), and PRIORITY
FULFILLMENT SERVICES, INC., a Delaware corporation ("Tenant").

                                   WITNESSETH:

         WHEREAS, AmWest Savings Association, a Texas savings and loan
association ("AmWest"), and Daisytek Incorporated, a Texas corporation
("Daisytek"), entered into that certain Lease Agreement (Office) (the "Original
Lease") dated as of September 30, 1991, covering premises in the building (the
"Building") commonly known as The Atrium at Collin Ridge located at 500 N.
Central Expressway, Plano, Texas;

         WHEREAS, AmWest and Daisytek entered into that certain Modification and
Ratification of Lease (the "First Amendment") dated January 7, 1992;

         WHEREAS, AmWest sold the Building to Atrium Associates, L.P., a Texas
limited partnership, d/b/a The Atrium at Collin Ridge ("Atrium"), and assigned
to Atrium all of its rights under the Original Lease, as amended by the First
Amendment;

         WHEREAS, Atrium and Daisytek entered into that certain Modification and
Ratification of Lease (the "Second Amendment") dated July 22, 1992;

         WHEREAS, Atrium and Daisytek entered into that certain Modification of
Lease No. 3 (the "Third Amendment") dated November 12, 1992;

         WHEREAS, Atrium and Daisytek entered into that certain Modification of
Lease No. 4 (the "Fourth Amendment") dated April 26, 1993;

         WHEREAS, Atrium and Daisytek entered into that certain Modification of
Lease No. 5 (the "Fifth Amendment") dated as of November 1, 1994;

         WHEREAS, Atrium and Daisytek entered into that certain Sixth
Modification to Lease Agreement (the "Sixth Amendment") dated November 30, 1995,
pursuant to which, among other things, Daisytek leased from Atrium, and Atrium
leased to Daisytek, a certain 13,056 rentable square foot space on the 1st floor
of the Building (such space together with any other space hereafter leased by
Tenant on the 1st floor of the Building is herein referred to as the "First
Floor Space"), which 13,056 rentable square foot space is more particularly
described on the Exhibit B of the Sixth Amendment;

         WHEREAS, Atrium and Daisytek entered into that certain Seventh
Modification to Lease Agreement (the "Seventh Amendment") dated July 31, 1996;

         WHEREAS, Atrium and Daisytek entered into that certain Eighth Amendment
to Lease (the "Eighth Amendment") dated effective as of February 20, 1998 (the
First Amendment, the Second Amendment, the Third Amendment, the Fourth
Amendment, the Fifth Amendment, the Sixth Amendment, the Seventh Amendment and
the Eighth Amendment are herein collectively called the "Amendments" and the
Original Lease, as amended by the Amendments, is herein called the "Lease");

         WHEREAS, Landlord has purchased the Building from Atrium;

         WHEREAS, the lease currently covers approximately 65,419 rentable
square feet of space (the "Premises");

         WHEREAS, Daisytek assigned its rights under the Lease to Tenant
pursuant to that certain Assignment of Lease dated as of February 1, 2000, and,
in connection therewith, Landlord, Tenant and Daisytek entered into that certain
Consent to Assignment which was attached to such Assignment of Lease;

         WHEREAS, Tenant exercised its renewal right pursuant to the Lease by
delivering to Landlord written notice thereof, a copy of which is attached
hereto as Exhibit B; and

         WHEREAS, Landlord and Tenant desire to modify the terms and provisions
of the Lease as set forth herein;

         NOW, THEREFORE, for and in consideration of the mutual terms and
conditions set forth herein and for Ten Dollars ($10.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Landlord and Tenant agree as follows:

         1. Defined Terms. All capitalized terms used herein and not otherwise
defined herein shall have the meanings given to those terms in the Lease.

<PAGE>

         2. Extension of Term of the Lease. The term of the Lease is hereby
extended until, and the Lease is hereby renewed through, March 15, 2007 (such
date of expiration is herein referred to as the "Scheduled Expiration Date"). As
used herein or in the Lease and all exhibits attached hereto or thereto, the
term "Lease Term" shall mean the period beginning on December 16, 1991, and
ending on the Scheduled Expiration Date, unless sooner terminated in accordance
with the Lease. As used herein, the term "2002 Renewal Term" shall mean the
period of time beginning on March 16, 2002, and ending on the Scheduled
Expiration Date.

         3. Base Rental for the Premises. Tenant shall pay to Landlord as Base
Rental for the Premises in lawful money of the United States of America as
follows:

                  (a) Prior to March 15, 2002, Tenant shall pay Base Rental for
         the Premises as provided in the Lease;

                  (b) Commencing March 16, 2002, through November 15, 2003,
         Tenant shall pay $92,676.92 per month for the Premises (i.e., $17.00
         per rentable square foot on an annual basis for the Premises);

                  (c) Commencing November 16, 2003, through July 15, 2005,
         Tenant shall pay $98,128.50 per month for the Premises (i.e., $18.00
         per rentable square foot on an annual basis for the Premises); and

                  (d) From and after July 16, 2005 through the Scheduled
         Expiration Date, Tenant shall pay $103,580.08 per month for the
         Premises (i.e., $19.00 per rentable square foot on an annual basis for
         the Premises).

         4. Base Expense Amount Adjustment. During the 2002 Renewal Term, the
term "Base Expense Amount" shall mean the actual Operating Expenses for the
calendar year 2002 subject to adjustment as provided below in this paragraph. In
the event that during all or any portion of any calendar year the rentable area
of the Building is not fully rented, fully occupied and/or being completely
provided with Building standard services, Landlord may make an appropriate
adjustment of Operating Expenses for such year, employing sound accounting and
management principles, to determine the Operating Expenses that would have been
paid or incurred by Landlord had the rentable area of the Building been fully
rented, fully occupied and/or completely provided with Building standard
services during such period of time and the amount so determined shall be deemed
to have been the Operating Expenses for such year. As a result, the last
sentence of Section 4.(d) of the Lease is hereby deleted in its entirety.

         5. Leasehold Improvements. Tenant is currently occupying the Premises
and hereby accepts the same in its "as is" condition and Landlord shall have no
obligation to perform any work therein and shall not be obligated to reimburse
Tenant or provide an allowance for any costs related to the demolition or
construction of improvements therein except for the $322,916.00 refurbishment
allowance provided pursuant to the Rider No. 102 attached to the Lease (i.e.,
$5.50 per usable square feet of space in the Premises).

         6. Renewal Option; Waiver of Rights of First Offer. Tenant shall have
the right to renew the 2002 Renewal Term in accordance with the terms and
provisions set forth in Exhibit A attached hereto. This renewal right is the
only such right available to Tenant after the Effective Date, and any other such
rights are hereby deleted from the Lease and/or the Amendments and shall be of
no further force or effect. Notwithstanding anything to the contrary contained
in the Lease, Tenant hereby agrees and acknowledges that Tenant has no expansion
rights, first offer or first refusal or similar rights under the Lease or any of
the Amendments. Any and all such provisions contained in the Lease or any of the
Amendments regarding Tenant's expansion rights, first offer or first refusal or
similar rights, if any (including, without limitation, Paragraph 8 of the Sixth
Amendment), are hereby deleted from the Lease and/or the Amendments and shall be
of no further force or effect.

         7. Brokers. Tenant represents and warrants to Landlord that it has
dealt directly with (and only with) Jones Lang LaSalle Americas, Inc.
("Landlord's Broker") and Cushman & Wakefield ("Tenant's Broker") as brokers in
connection with this Amendment, and that insofar as Tenant knows, no other
broker negotiated or participated in the negotiations of this Amendment, or is
entitled to any commission in connection therewith. Tenant hereby agrees to
indemnify, save and hold Landlord harmless from and against any and all claims
or demands made upon Landlord for any commissions, fees or other compensation by
any broker, agent or salesman (other than Landlord's Broker and Tenant's Broker)
in connection with this Amendment. Landlord agrees to pay Landlord's Broker and
Tenant's Broker each a commission pursuant to separate written agreements
between Landlord's Broker and Landlord and Tenant's Broker and Landlord, and
Landlord hereby agrees to indemnify, save and hold Tenant harmless from and
against any and all claims or demands made upon Tenant for any commissions, fees
or other compensation by Landlord's Broker and Tenant's Broker. The provisions
of this paragraph shall survive the expiration or any earlier termination of the
Lease.

         8. Tenant Certification. By its execution of this Amendment, Tenant
hereby certifies that as of the date of such execution, and to the best of
Tenant's knowledge, Landlord is not in default in the performance of any its
obligations under the Lease, and Tenant has no offsets, claims against Landlord
or the rent payable by

                                       2
<PAGE>

Tenant under the Lease and no defenses with respect to the Lease. By its
execution of this Amendment, Landlord hereby certifies that as of the date of
such execution, and to the best of Landlord's knowledge, Tenant is not in
default in the performance of any of its obligations under the Lease.

         9. Continuing Effect; References to this Amendment. The Lease, as
amended herein, are hereby ratified and confirmed and shall continue in full
force and effect. Any reference to "this Amendment" shall include all of the
provisions set forth in all exhibits attached hereto.

         10. Counterparts. This Amendment may be executed in multiple
counterparts with the same effect as if all parties hereto had signed the same
document. All such counterparts shall be construed together and shall constitute
one and the same instrument.

         11. Authority. Tenant hereby warrants and represents that it has the
requisite authority and ability to enter into this Amendment and to fully
perform all obligations of Tenant hereunder. Landlord hereby warrants and
represents that it has the requisite authority and ability to enter into this
Amendment and to fully perform all obligations of Landlord hereunder.

         12. Conflicts. In the event of any conflict between the terms of this
Amendment and either the Lease or the Amendments, the terms of this Amendment
shall control.

         13. Confidentiality. Except as hereinafter provided, Tenant covenants
and agrees, for itself and its officers, partners, employees, attorneys,
consultants and agents (including, without limitation, Tenant's Broker), to keep
the terms, conditions and provisions of this Amendment strictly confidential and
not disclose the terms, conditions and provisions hereof except as follows: (a)
to the extent disclosure of some or all of such terms, conditions or provisions
may be required by law including the filing of this Amendment as an exhibit to
any SEC filing of Tenant; (b) the financial terms of this Amendment to the
extent that the disclosure of the same is required in connection with any
financing sought by Tenant; and (c) in connection with the enforcement of
Tenant's rights hereunder or under the Lease. The covenants of Tenant in this
paragraph have been given by Tenant as a material inducement to Landlord to
enter into this Amendment and grant the rights to Tenant contained herein. In
the event of any disclosure by Tenant or any of the parties described above,
Landlord shall be entitled to recover from Tenant any and all damages resulting
therefrom and to otherwise pursue any and all other rights and remedies
available to Landlord at law, in equity or otherwise.

         14. Effect of Submission. Submission of this Amendment for examination
does not constitute an offer, right of first refusal, reservation of, or option
for, any premises at the Building. This Amendment shall become effective only
upon the execution and delivery by both Landlord and Tenant.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

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         IN WITNESS WHEREOF, the parties hereto have executed this Amendment
effective for all purposes as of the Effective Date.

                        LANDLORD:

                        AGBRI ATRIUM, L.P., a Delaware limited partnership

                        By: SWSG II, L.P., a Delaware limited partnership,
                            its Authorized Agent

                             By: SWSG II, Inc., a Delaware corporation, its
                                 general partner

                                 By:
                                   --------------------------------------------
                                 Name:
                                      -----------------------------------------
                                 Title:
                                       ----------------------------------------

                        TENANT:

                        PRIORITY FULFILLMENT SERVICES, INC., a Delaware
                        corporation

                        By:
                           ----------------------------------------------------
                        Name:
                             --------------------------------------------------
                        Title:
                              -------------------------------------------------

                        By:
                           ----------------------------------------------------
                        Name:
                             --------------------------------------------------
                        Title:
                              -------------------------------------------------

                                       4

<PAGE>

                                    EXHIBIT A

                                 RENEWAL OPTION

         AGBRI ATRIUM, L.P., a Delaware limited partnership ("Landlord"), and
PRIORITY FULFILLMENT SERVICES, INC., a Delaware corporation ("Tenant") have
entered into that certain Ninth Amendment to Lease Agreement (the "Amendment")
dated as of November 13, 2001. This Exhibit A (this "Exhibit") is attached to
the Amendment. Except to the extent otherwise indicated herein, the initially
capitalized terms used in this Exhibit shall have the meanings assigned to them
in the Amendment.

         1. Tenant shall have the right to renew and extend the 2002 Renewal
Term with respect to the Premises then subject to the Lease for the Extension
Term (as hereinafter defined) upon and subject to the following terms and
conditions.

         2. Tenant shall have one (1) option (the "Renewal Option") to extend
the Lease Term and Scheduled Expiration Date for a period (the "Extension Term")
of five (5) years, commencing upon the then-current Scheduled Expiration Date
upon the same terms and conditions previously applicable, except for the grant
of the exercised Renewal Option and the amount of Base Rental payable under the
Lease (which amount shall be determined as set forth below). Not earlier than
twelve (12) months or later than nine (9) months prior to the expiration of the
2002 Renewal Term, Tenant shall have the right to deliver to Landlord written
notice (a "Notice of Intent to Renew") of Tenant's intent to extend the 2002
Renewal Term on the terms and conditions set forth herein. In such event,
Landlord shall, within ninety (90) days after its receipt of a Notice of Intent
to Renew, notify Tenant in writing of the Fair Market Value Rate (as defined in
Paragraph 5 below) as determined by Landlord for the Premises during the
Extension Term (such determination is herein referred to as the "Landlord's
Assessment"). Landlord's Assessment shall reflect the fact that Landlord will
provide to Tenant in connection with Tenant's exercise of the Renewal Option a
refurbishment allowance (the "Refurbishment Allowance") in an amount equal to
$7.00 per usable square foot of space then comprising the Premises. Tenant shall
have the right, within fifteen (15) days after its receipt of written notice of
the Landlord's Assessment, to either (i) accept in writing such Landlord's
Assessment and exercise the Renewal Option (the "Notice of Exercise"), or (ii)
reject such Landlord's Assessment but nevertheless elect to exercise the
applicable Renewal Option by, in either instance, delivering written notice
thereof to Landlord within such fifteen (15) day period; provided, however, that
the Renewal Option may be validly exercised only if no uncured Tenant default
exists as of the date of exercise. If Tenant timely delivers to Landlord written
notice that Tenant is exercising the Renewal Option but that Tenant does not
accept Landlord's Assessment ("Tenant's Objection Notice"), the Fair Market
Value Rate shall be determined as provided in Paragraph 6 below. Tenant's
Objection Notice must identify Tenant's determination of the Fair Market Value
Rate ("Tenant's Assessment") to trigger the appraisal process set forth in
Paragraph 6 below.

         3. If Tenant does not either timely (i) accept Landlord's Assessment,
or (ii) deliver to Landlord Tenant's Objection Notice, Tenant will be deemed to
have elected to not exercise the Renewal Option. In no event shall Landlord have
any obligation to provide Tenant with the Refurbishment Allowance in the event
Tenant elects not to exercise the Renewal Option or is deemed to have elected
not to exercise the Renewal Option. The Extension Term shall commence
immediately upon the expiration of the 2002 Renewal Term, and upon Tenant's
exercise of the renewal option set forth in this Exhibit, the date of expiration
of the 2002 Renewal Term shall automatically become the last day of the
Extension Term.

         4. The exercise by Tenant of the Renewal Option must be made, if at
all, by written notice (i.e., the Notice of Exercise or Tenant's Objection
Notice, as applicable) executed by Tenant and delivered to Landlord within the
fifteen (15) day period set forth in the preceding paragraph. Once Tenant shall
exercise the Renewal Option, Tenant may not thereafter revoke such exercise.
Tenant's failure, for any reason whatsoever, to exercise the Renewal Option in
strict accordance with the provisions of this Exhibit shall conclusively be
deemed a waiver of the same.

         5. Base Rental for the Extension Term shall be equal to 100% of either
(y) the product of the Landlord's Assessment received by Tenant prior to
Tenant's exercise of the Renewal Option multiplied by the number of rentable
square feet of space then comprising the Premises if Tenant has accepted such
Landlord's Assessment, or (z) if Tenant has timely delivered to Landlord
Tenant's Objection Notice in which Tenant's Assessment has been identified, the
product of the Fair Market Value Rate determined as provided in Paragraph 6
below multiplied by the number of rentable square feet of space comprising the
Premises. As used herein, the term "Fair Market Value Rate" shall mean the base
rent payable during the applicable lease period to a willing landlord by a
willing tenant (neither having a compulsion to lease and Landlord having
sufficient time to locate a replacement tenant), for the lease of non-sublease,
non-equity and renewal space in an office building comparable in quality to the
Building, which space is of like size to the Premises, of like and comparable
quality to the Premises, and which comparable office building is located in the
Richardson/Plano Telecom Corridor (as hereinafter defined), taking into
consideration the terms of the Lease (including, without limitation, the
available parking being made available to Tenant) and, as applicable, the
following: (1) the location and floor level within the Building; (2) the
condition of the existing improvements in the Premises and the premises covered
by such renewed leases; (3) parking charges or the inclusion of the same in
rental; (4) the extent of services to be provided by Landlord to Tenant and such
renewal tenants; (5) the base year or dollar amount, if any, for escalation
purposes; (6) credit rating and financial condition and stature of such renewal
tenants as of the date of

                                      A-1
<PAGE>

the exercise of the applicable lease renewal, and the credit rating and
financial condition and stature of Tenant as of the date of the Landlord's
Assessment; (7) the length of the lease renewal; (8) whether any broker's
commission is payable; (9) the date on which the Extension Term will commence;
and (10) any other appropriate term or condition. Notwithstanding the foregoing,
in calculating the Fair Market Value Rate, no consideration shall be given to
(i) any period of rental abatement, if any, granted to tenants in comparable
transactions in connection with the design, permitting and construction of
improvements for such comparable property, and (ii) any portion of leasehold
improvement allowances in excess of the Refurbishment Allowance. As used herein,
the term "Richardson/Plano Telecom Corridor" shall mean the area located within
portions of the Cities of Richardson and Plano, Texas generally recognized by
real estate professionals as the "Telecom Corridor".

         6. If Tenant timely delivers to Landlord Tenant's Objection Notice in
which Tenant's Assessment has been identified, Landlord shall have the right to
accept Tenant's Assessment by giving Tenant written notice thereof within ten
(10) business days after Landlord's receipt of Tenant's Objection Notice. If
Landlord does not so accept Tenant's Assessment, then Landlord and Tenant shall,
within fifteen (15) days after the expiration of such ten (10) business day
period, jointly appoint an independent real estate broker or other person with
at least ten (10) years' commercial real estate experience in Dallas, Texas (an
"Appraiser") to determine the Fair Market Value Rate. If the parties are unable
to agree upon an Appraiser within such fifteen (15) day period, either party may
request that the Dallas office of the American Arbitration Association
designate, within ten (10) days of such request, a broker with at least ten (10)
years' commercial real estate experience in Dallas, Texas to be the Appraiser
for the purposes of this subparagraph; provided, however, in no event shall such
designated Appraiser be employed, or have been employed, by either Landlord or
Tenant or their respective affiliates; and provided further, however, that such
broker must also have experience with lease transactions in the Richardson/Plano
Telecom Corridor. Such designation shall be binding on Landlord and Tenant.
Within ten (10) business days after the selection of an Appraiser, each of
Landlord and Tenant shall submit to the Appraiser such party's assessment of the
Fair Market Value Rate (revised, if applicable, from any earlier assessment),
together with such supporting data used to make such assessment (each such
assessment is herein referred to as an "Assessment"). Within fifteen (15) days
after the Appraiser's receipt Landlord's and Tenant's respective Assessments of
the Fair Market Value Rate and the aforementioned supporting data, the Appraiser
shall determine his or her assessment of the Fair Market Value Rate for the
Extension Term and shall provide Landlord and Tenant with written notice thereof
together with such supporting data used to make such assessment). The Fair
Market Value Rate for the Extension Term shall be the Assessment of either
Landlord or Tenant which is closest to the Appraiser's assessment of the Fair
Market Value Rate; provided, however, if either Landlord or Tenant fails within
such ten (10) business day period to supply the Appraiser with such party's
assessment of the Fair Market Value Rate and/or the applicable supporting data,
then the Fair Market Value Rate for the Extension Term shall be the Fair Market
Value Rate submitted to the Appraiser by the party that has submitted to the
Appraiser its assessment of the Fair Market Value Rate and the applicable
supporting data. The entire cost for the Appraiser's services shall be borne
equally by Landlord and Tenant.

         7. Except as set forth in this Exhibit, the leasing of the Premises for
the Extension Term shall be upon the same terms and conditions as are applicable
for the Premises under the Lease for the term thereof as extended by the
Amendment, and shall be upon and subject to all of the provisions of the Lease
and the Amendment. Additionally, the Refurbishment Allowance will paid to Tenant
in the same manner as the refurbishment allowances described in the third
paragraph of the Rider No. 102 attached to the Lease and will only be used for
the same work described in such paragraph. Any portion of the Refurbishment
Allowance not used by Tenant on or before the twelfth (12th) full calendar month
of the Extension Term will be forfeited by Tenant and Landlord shall have no
further obligation to disburse the same to Tenant notwithstanding anything to
the contrary contained in this Exhibit.

         8. Once the Fair Market Value Rate for the Extension Term has been
established following a valid exercise by Tenant of the Renewal Option, Landlord
and Tenant will, within fifteen (15) days thereafter, enter into an amendment
(the "Lease Amendment") to the Lease reflecting (i) the extension of the 2002
Renewal Term, (ii) any change in Base Rental payable by Tenant as provided by
this Exhibit, (iii) any change in the Base Year operating expenses, and (iv)
such other amendments to the Lease as are necessary. Notwithstanding Landlord's
and Tenant's obligation to execute and deliver the Lease Amendment within the
time period provided above, Tenant's leasing of the Premises during the
Extension Term is not conditioned on any such execution and delivery as the
Lease Amendment is being executed merely to memorialize the terms and conditions
of Tenant's leasing of the Premises during the Extension Term pursuant to this
Exhibit after Landlord's receipt of the Notice of Exercise or Tenant's Objection
Notice, as applicable.

         9. If, on the date of Landlord's receipt of Tenant's Notice of Intent
to Renew, all or any portion of the First Floor Space is covered by a sublease,
Landlord shall have the right, but not any obligation, to in its sole discretion
elect in writing to recapture, effective as of the Scheduled Expiration Date,
all of the First Floor Space or such portion thereof as Landlord may identify in
such written election notice. Such written election must be delivered to Tenant
on or before the date of Landlord's delivery to Tenant of written notice of the
Landlord's Assessment. If Landlord so elects to recapture such First Floor
Space, the Lease Amendment shall contain such provisions as are necessary to
document (i) the decrease in the size of the Premises as of the Scheduled
Expiration Date, and (ii) the fact that the premises in the Building to be
leased by Tenant during the Extension Term will not include all or the
applicable portion(s) of the First Floor Space.

                                       A-2

<PAGE>

         10 8. Tenant's rights under this Exhibit shall terminate following the
occurrence of any of the following events: (a) Tenant's right to possess all or
any of the Premises is terminated; (b) Tenant assigns any of its interest in the
Lease or sublets any portion of the Premises located on the 5th floor of the
Building; and/or (c) any termination of the Lease.

                                      A-3
<PAGE>

                                    EXHIBIT B

                              RENEWAL OPTION NOTICE

                                      B-1<PAGE>
                                                                   EXHIBIT 10.21

                             STOCK OPTION AGREEMENT

                  THIS AGREEMENT is made by and between PFSWEB, INC., a Delaware
corporation (hereinafter referred to as "COMPANY") and the individual whose name
and signature appear on the signature page hereof (hereinafter referred to as
"HOLDER"):

                  WHEREAS, the Company wishes to evidence the issuance to the
Holder of the Options set forth herein; and

                  WHEREAS, in addition to the terms and provisions set forth
herein, this Option shall be subject to, and governed in accordance with, the
terms and provisions of the Company's Stock Option Plan (the "PLAN") (the terms
of which are hereby incorporated by reference and made a part of this
Agreement);

                  NOW, THEREFORE, in consideration of the mutual covenants
herein contained and other good and valuable consideration, receipt of which is
hereby acknowledged, the parties hereto do hereby agree as follows:

I. DEFINITIONS

                  Except as otherwise defined herein, terms defined in the Plan
shall have the same meaning when used herein.

II. GRANT OF OPTION

                  2.1 GRANT OF OPTION. For good and valuable consideration,
effective as of the date set forth on the signature page hereof as the "Date of
Grant" (the "DATE OF GRANT"), the Company hereby grants to the Holder the option
to purchase any part or all of the number of shares of the Company's Common
Stock, $.001 par value (the "COMMON STOCK") set forth on the signature page
hereof, subject to and upon the terms and conditions set forth in the Plan and
this Agreement.

                  2.2 PURCHASE PRICE. The purchase price per share of the shares
of Common Stock covered by the Option shall be the Purchase Price set forth on
the signature page hereof, without commission or other charge.

                  2.3 CONSIDERATION TO COMPANY. In consideration of the granting
of this Option by the Company, the Holder agrees to render faithful and
efficient services to the Company, a Parent Corporation or a Subsidiary, with
such duties and responsibilities as the Company shall from time to time
prescribe. Nothing in this Agreement or in the Plan shall confer upon the Holder
any right to continue in the employ of the Company, any Parent Corporation or
any Subsidiary or shall interfere with or restrict in any way the rights of the
Company, its Parent Corporation and its Subsidiaries, which are hereby expressly
reserved, to discharge the Holder at any time for any reason whatsoever, with or
without cause.

<PAGE>

                  2.4 ADJUSTMENTS IN OPTION. In the event that the outstanding
shares of Common Stock subject to the Option are increased, decreased, changed
into or exchanged for a different number or kind of shares of the Company or
other securities of the Company by reason of merger, consolidation,
recapitalization, reclassification, stock split up, spin-off, stock dividend or
combination of shares or other recapitalization or reorganization, the Committee
shall make an appropriate and equitable adjustment in the number and kind of
shares as to which the Option, or portions thereof then unexercised, shall be
exercisable. Such adjustment in the Option shall be made without change in the
total price applicable to the unexercised portion of the Option (except for any
change in the aggregate price resulting from rounding-off of share quantities or
prices) and with any necessary corresponding adjustment in the Option price per
share. Any such adjustment made by the Committee shall be final and binding upon
the Holder, the Company and all other interested persons.

                  2.5 NON-QUALIFIED STOCK OPTION. This Option shall be deemed a
non-qualified stock option under the Code.

III. PERIOD OF EXERCISABILITY

                  3.1      COMMENCEMENT OF EXERCISABILITY.

                           (a) Except as otherwise set forth in any authorized
appendix to the signature page hereto, the Option shall vest and become
exercisable as follows:

                           (i) on the Date of Grant, the Option shall not be
vested and shall not be exercisable as to any of the Shares subject hereto;

                           (ii) on the 91st day from the Date of Grant, the
Option shall be fully vested and exercisable as to 25% of the original Shares
subject hereto;

                           (iii) on the 181st day from the Date of Grant, the
Option shall be fully vested and exercisable as to an additional 25% of the
original Shares subject hereto;

                           (iv) on the 271st day from the Date of Grant, the
Option shall be fully vested and exercisable as to an additional 25% of the
original Shares subject hereto; and

                           (v) on the date which is one year from the Date of
Grant, the Options shall be fully vested and exercisable as to all of the
original Shares subject hereto.

                           (b) Except as otherwise set forth in the Plan, no
portion of the Option which is unexercisable at Termination of Employment shall
thereafter become exercisable.

                  3.2 DURATION OF EXERCISABILITY. The installments provided for
in Section 3.1 are cumulative. Each such installment which becomes exercisable
pursuant to Section 3.1 shall remain exercisable until it becomes unexercisable
under Section 3.3.

                                      -2-

<PAGE>

                  3.3 EXPIRATION OF OPTION. Subject to the terms and provisions
of the Plan, the Option may not be exercised to any extent by anyone after the
first to occur of the following events:

                           (i) The expiration of ten (10) years from the Date of
Grant;

                           (ii) The date of the Holder's Termination of
Employment for any reason, other than death or disability (within the meaning of
Section 22(e)(3) of the Code), unless the Committee otherwise elects to permit
the exercise of such Option for a period of time thereafter; provided, however
(a) such period of time shall end no later than ten years from the Date of
Grant, and (b) the Committee may make such elections in such manner as it deems
appropriate, which may be non-uniform and selective, and based upon such factors
as it deems relevant;

                           (iii) With respect to an Option held by an Holder who
is disabled (within the meaning of Section 22(e)(3) of the Code), the expiration
of one year from the date of the Holder's Termination of Employment for any
reason other than death, unless the Holder dies within said one-year period;

                           (iv) The expiration of one year from the date of the
Holder's death with respect to all Options held by such Holder; and

                           (v) With respect to all Options, and notwithstanding
any other provision contained herein, the date of the Holder's Termination of
Employment in the event such Termination is for "cause".

                  3.4 ACCELERATION OF EXERCISABILITY. In the event of the merger
or consolidation of the Company with or into another corporation, or the
acquisition by another corporation or person of all or substantially all of the
Company's assets or eighty percent (80%) or more of the Company's then
outstanding voting stock, or the liquidation or dissolution of the Company, the
Committee may, in its absolute discretion and upon such terms and conditions as
it deems appropriate, provide by resolution, adopted prior to such event, that
at some time prior to the effective date of such event this Option shall be
exercisable as to all or a portion of the shares covered hereby, notwithstanding
that this Option may not yet have become fully exercisable under Section 3.1(a);
provided, however, that the Committee may, in its sole discretion, forego such
acceleration of exercisability if:

                           (i) This Option becomes unexercisable under Section
3.3 prior to said effective date; or

                           (ii) In connection with such an event, provision is
made for an assumption of this Option or a substitution therefor of a new option
by an employer corporation or a parent or subsidiary of such corporation, so
that such assumption or substitution complies with the provisions of Section
424(a) of the Code.

                                      -3-

<PAGE>

                           The Committee may make such determinations and adopt
such rules and conditions as it, in its absolute discretion, deems appropriate
in connection with such acceleration of exercisability, including, but not by
way of limitation, provisions to ensure that any such acceleration and resulting
exercise shall be conditioned upon the consummation of the contemplated
corporate transaction, and determinations regarding whether provisions for
assumption or substitution have been made as defined in clause (ii) above.

IV. EXERCISE OF OPTION

                  4.1 PERSON ELIGIBLE TO EXERCISE. During the lifetime of the
Holder, only he or she may exercise the Option or any portion thereof. After the
death of the Holder, any exercisable portion of the Option may, prior to the
time when the Option becomes unexercisable under Section 3.3, be exercised by
his or her personal representative or by any person empowered to do so under the
Holder's will or under the then applicable laws of descent and distribution.
Notwithstanding the foregoing, the Committee may, in its sole discretion, permit
the transfer of this Option, in whole or in part, and the exercise thereof by
any transferee thereof.

                  4.2 PARTIAL EXERCISE. Any exercisable portion of the Option or
the entire Option, if then wholly exercisable, may be exercised in whole or in
part at any time prior to the time when the Option or portion thereof becomes
unexercisable under Section 3.3; provided, however, that each partial exercise
shall be for not less than one-hundred (100) shares (or the minimum installment
set forth in Section 3.1, if a smaller number of shares) and shall be for whole
shares only.

                  4.3 MANNER OF EXERCISE. The Option, or any exercisable portion
thereof, may be exercised solely by delivery to the Secretary or his office of
all of the following (except as otherwise waived by such officer) prior to the
time when the Option or such portion becomes unexercisable under Section 3.3:

                           (a) Notice in writing signed by the Holder or the
other person then entitled to exercise the Option or portion, stating that the
Option or portion is thereby exercised, such notice complying with all
applicable rules established by the Committee; and

                           (b) (i) Full payment (in cash or by check) for the
shares with respect to which such Option or portion is exercised; or

                                    (ii) With the consent of the Committee, (A)
shares of the Company's Common Stock owned by the Holder duly endorsed for
transfer to the Company or (B) subject to the requirements of Section 5.4 of the
Plan, shares of the Company's Common Stock issuable to the Holder upon exercise
of the Option, in each case, with a fair market value (as determined under
Section 4.2(b) of the Plan) on the date of Option exercise equal to the
aggregate Option price of the shares with respect to which such Option or
portion is thereby exercised; or

                                      -4-
<PAGE>

                                    (iii) With the consent of the Committee, a
promissory note duly executed and delivered by the Holder in the principal
amount of the exercise price thereof, or any portion thereof, in each case upon
such terms and conditions (including without limitation, terms regarding rates
of interest, payment schedule, collateral or other security) as the Committee
may establish in its sole and absolute discretion; or

                                    (iv) With the consent of the Committee, any
combination of the consideration provided in the foregoing subsections (i), (ii)
and (iii);

                           (c) A bona fide written representation and agreement,
in a form satisfactory to the Committee, signed by the Holder or other person
then entitled to exercise such Option or portion, stating that the shares of
stock are being acquired for his own account, for investment and without any
present intention of distributing or reselling said shares or any of them except
as may be permitted under the Securities Act and then applicable rules and
regulations thereunder, and that the Holder or other person then entitled to
exercise such Option or portion will indemnify the Company against, and hold it
free and harmless from, any loss, damage, expense or liability resulting to the
Company if any sale or distribution of the shares by such person is contrary to
the representation and agreement referred to above. The Committee may, in its
absolute discretion, take whatever additional actions it deems appropriate to
insure the observance and performance of such representation and agreement and
to effect compliance with the Securities Act and any other federal or state
securities laws or regulations. Without limiting the generality of the
foregoing, the Committee may require an opinion of counsel acceptable to it to
the effect that any subsequent transfer of shares acquired upon exercise of an
Option does not violate the Securities Act, and may issue stop-transfer orders
covering such shares. Share certificates evidencing stock issued on exercise of
this Option shall bear an appropriate legend referring to the provisions of this
subsection (c) and the agreements herein. The written representation and
agreement referred to in the first sentence of this subsection (c) shall,
however, not be required if the shares to be issued pursuant to such exercise
have been registered under the Securities Act, and such registration is then
effective in respect of such shares; and

                           (d) Full payment to the Company (or other employer
corporation) of all amounts which, under federal, state or local tax law, it is
required to withhold upon exercise of the Option; provided, however, with the
consent of the Committee, any combination of the consideration provided in the
foregoing subsections (i), (ii) and (iii) of the preceding paragraph (b) may be
used to make all or part of such payment; and

                           (e) In the event the Option or portion shall be
exercised pursuant to Section 4.1 by any person or persons other than the
Holder, appropriate proof of the right of such person or persons to exercise the
Option.

                  4.4 CONDITIONS TO ISSUANCE OF STOCK CERTIFICATES. The shares
of stock deliverable upon the exercise of the Option, or any portion thereof,
may be either previously authorized but unissued shares or issued shares which
have then been reacquired by the Company. Such shares shall

                                      -5-

<PAGE>

be fully paid and nonassessable. The Company shall not be required to issue or
deliver any certificate or certificates for shares of stock purchased upon the
exercise of the Option or portion thereof prior to fulfillment of all of the
following conditions (except as otherwise waived by the Committee):

                           (a) The admission of such shares to listing on all
stock exchanges on which such class of stock is then listed; and

                           (b) The completion of any registration or other
qualification of such shares under any state or federal law or under rulings or
regulations of the Securities and Exchange Commission or of any other
governmental regulatory body, which the Committee shall, in its absolute
discretion, deem necessary or advisable; and

                           (c) The obtaining of any approval or other clearance
from any state or federal governmental agency which the Committee shall, in its
absolute discretion, determine to be necessary or advisable; and

                           (d) The payment to the Company (or other employer
corporation) of all amounts which, under federal, state or local tax law, it is
required to withhold upon exercise of the Option; and

                           (e) The lapse of such reasonable period of time
following the exercise of the Option as the Committee may from time to time
establish for reasons of administrative convenience.

                  4.5 RIGHTS AS A SHAREHOLDER. The holder of the Option shall
not be, nor have any of the rights or privileges of, a shareholder of the
Company in respect of any shares purchasable upon the exercise of any part of
the Option unless and until certificates representing such shares shall have
been issued by the Company to such holder.

V. OTHER PROVISIONS

                  5.1 ADMINISTRATION. The Committee shall have the power to
interpret the Plan and this Agreement and to adopt such rules for the
administration, interpretation and application of the Plan as are consistent
therewith and to interpret or revoke any such rules. All actions taken and all
interpretations and determinations made by the Committee in good faith shall be
final and binding upon the Holder, the Company and all other interested persons.
No member of the Committee shall be personally liable for any action,
determination or interpretation made in good faith with respect to the Plan or
the Option.

                  5.2 OPTION NOT TRANSFERABLE. Neither the Option nor any
interest or right therein or part thereof shall be liable for the debts,
contracts or engagements of the Holder or his successors in interest or shall be
subject to disposition by transfer, alienation, anticipation, pledge,
encumbrance, assignment or any other means whether such disposition be voluntary
or involuntary or by operation of

                                      -6-

<PAGE>

law by judgment, levy, attachment, garnishment of any other legal or equitable
proceedings (including bankruptcy), and any attempted disposition thereof shall
be null and void and of no effect; provided, however, that this Section 5.2
shall not prevent transfers by will or by the applicable laws of descent and
distribution. Notwithstanding the foregoing, the Committee may, in its
discretion, permit the holder of this Option to transfer such Option, or any
portion thereof, to such holder's spouse, lineal descendent or trust established
for the benefit thereof or any other person or entity.

                  5.3 SHARES TO BE RESERVED. The Company shall at all times
during the term of the Option reserve and keep available such number of shares
of stock as will be sufficient to satisfy the requirements of this Agreement.

                  5.4 NOTICES. Any notice to be given under the terms of this
Agreement to the Company shall be addressed to the Company in care of its
Secretary, and any notice to be given to the Holder shall be addressed to him or
her at the address given beneath his or her signature hereto. By a notice given
pursuant to this Section 5.4, either party may hereafter designate a different
address for notices to be given to such party. Any notice which is required to
be given to the Holder shall, if the Holder is then deceased, be given to the
Holder's personal representative if such representative has previously informed
the Company of his status and address by written notice under this Section 5.4.
Any notice shall be deemed duly given upon receipt and shall be delivered by
hand, reputable overnight courier or deposited (with postage prepaid) in a post
office or branch post office regularly maintained by the United States Postal
Service.

                  5.5 TITLES. Titles are provided herein for convenience only
and are not to serve as a basis for interpretation or construction of this
Agreement.

                  5.6 TERMS OF THE PLAN. All of the terms and provisions of the
Plan are incorporated herein by reference as if fully set forth at length
herein, and the Holder acknowledges receipt and review of the Plan. In the event
of any conflict or inconsistency between the Plan and the terms set forth
herein, the same shall be determined and interpreted by the Committee, whose
determination and interpretation shall be final and binding in all respects and
upon all interested persons.

                  5.7 NOTIFICATION OF DISPOSITION. The Holder shall give prompt
notice to the Company of any disposition or other transfer of any shares of
stock acquired upon exercise of this Option if such disposition or transfer is
made (a) within two (2) years from the date of grant of the Option with respect
to such shares so exercised or (b) within one (1) year after the exercise of the
Option with respect to such shares. Such notice shall specify the date of such
disposition or other transfer and the amount realized, in cash, other property,
assumption of indebtedness or other consideration, by the Holder in such
disposition or other transfer.

                                   ***********

                                      -7-
<PAGE>

                           STOCK OPTION SIGNATURE PAGE

         In Witness Whereof, effective as of the Date of Grant, the Company and
the undersigned Holder have executed and delivered this Option.

Date of Grant:                                  December 5, 2001
Name of Holder:                                 Mark C. Layton
Number of Shares:                               180,587
Exercise Price Per Share:                       $0.91
Option Certificate Number:                      NP2-100

HOLDER:                                    PFSWEB, INC.

By:                                        By:
   ---------------------------------          ---------------------------------
   Signature of Holder                        Its: Secretary

-----------------------------------
        Address of Holder

                                      -8-

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