EXHIBIT 10.42
FIRST AMENDMENT TO INDUSTRIAL LEASE AGREEMENT
THIS FIRST AMENDMENT TO INDUSTRIAL LEASE AGREEMENT (this "Amendment")
is made as of the Amendment Date (as hereinafter defined) by and between NEW
YORK LIFE INSURANCE COMPANY, a New York mutual insurance company ("Landlord"),
and DAISYTEK, INC., a Delaware corporation ("Tenant") and PRIORITY FULFILLMENT
SERVICES, INC., a Delaware corporation ("Assignee").
WITNESSETH:
WHEREAS, Landlord and Tenant entered into that certain Industrial Lease
Agreement dated March 31, 1999 (the "Lease") relating to the lease of
approximately 120,000 square feet of space within Building "I" (the "Building")
of Southpark, located in Memphis, Shelby County, Tennessee (the "Original
Demised Premises"); and
WHEREAS, Landlord and Tenant desire to amend the Lease to, among other
things, expand the Original Demised Premises to include the remaining 100,100
square feet of space within the Building (the "Expansion Space"; the Original
Demised Premises and the Expansion Space being referred to hereinafter
collectively as the "Demised Premises") subject to the terms and conditions set
forth herein; and
WHEREAS, without releasing the Tenant therefrom, the Tenant wishes to
assign the Lease (as herein amended) to the Assignee, and the Assignee wishes to
accept the Lease (as so amended) and assume the obligations of the Tenant
thereunder .
NOW, THEREFORE, for and in consideration of Ten and No/100 Dollars
($10.00), the mutual covenants contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. All capitalized terms used in this Amendment shall have the
meanings ascribed thereto in the Lease unless otherwise set
forth herein.
2. As of the later of (i) the date upon which Go/Dan (as defined
below) shall vacate the Expansion Space and (ii) February 8,
2000 (such later date being herein referred to as the
"Expansion Date"), the Expansion Space shall be added to and
made a part of the Demised Premises for all purposes under the
Lease.
3. Effective as of the Expansion Date, Section 1(b) of the Lease
shall be deleted in its entirety and the following shall be
inserted in lieu thereof:
(b) Demised Premises Square Footage: approximately 220,100
sq. ft.
4. Effective as of the Expansion Date, Section 2 of the Lease
shall automatically be amended by deleting therefrom the
phrase "approximately 120,000 square feet of space,
approximately 6,000 square feet of which is office space," and
by inserting in lieu thereof the phrase "approximately 220,100
square feet of space, approximately 11,069 square feet of
which is office space."
5. Effective as of the Expansion Date, Section 1(j) of the Lease
shall be deleted in its entirety and the following shall be
inserted in lieu thereof:
(j)Tenant's Operating Expense Percentage: 100%.
6. Base Rent shall be paid pursuant to the Lease through the
Expansion Date. Notwithstanding anything in Section 1(d) of
the Lease to the contrary, from and after the Expansion Date,
the following Annual Base Rent shall be due with respect to
the Demised Premises, as expanded pursuant to the terms
hereof:
Expansion Date - March 31, 2000 $663,627.12
April 1, 2000-March 31, 2001 $663,627.12
April 1, 2001-March 31, 2002 $663,627.12
April 1, 2002-March 31, 2003 $663,627.12
April 1, 2003-March 31, 2004 $663,627.12
7. Notwithstanding anything in Section 1(e) of the Lease to the
contrary, from and after the Expansion Date, the following
Monthly Base Rent Installments shall be due with respect to
the Demised Premises, as expanded pursuant to the terms
hereof:
February 1, 2000 - March 31, 2000 $55,302.26
April 1, 2000 - March 31, 2001 $55,302.26
April 1, 2001 - March 31, 2002 $55,302.26
April 1, 2002 - March 31, 2003 $55,302.26
April 1, 2003 - March 31, 2004 $55,302.26
If the Expansion Date shall fall on a day other than the first
day of a calendar month, the Base Rent shall be apportioned
pro rata on a per diem basis for the period between the
Expansion Date and the first day of the following calendar
month, and for the last partial month of the Term.
8. Tenant shall accept and shall be deemed to have accepted the
Expansion Space AS IS, WHERE IS.
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9. Section 10 of Exhibit C to the Lease shall not apply to the
Expansion Space, but remains in full force and effect as to
the Original Demised Premises.
10. Section 12 of Exhibit C to the Lease is hereby deleted in its
entirety.
11. Tenant acknowledges that as of the date of this Amendment,
Go/Dan Industries ("Go/Dan") is the tenant currently occupying
the Expansion Space pursuant to a lease between Landlord and
Go/Dan (the "Go/Dan lease"). Upon execution of this Amendment
by both Tenant and Landlord, Landlord hereby agrees to
terminate the Go/Dan Lease effective on or before January 31,
2000 (the "Go/Dan Termination Date"). Landlord further agrees
to use reasonable good faith efforts to cause Go/Dan to vacate
the Expansion Space on or before the Go/Dan Termination Date.
To the extent that Go/Dan refuses or fails to vacate the
Expansion Space on or before the Go/Dan Termination Date, such
refusal or failure to vacate shall not in any way affect the
obligation of Tenant hereunder except that the Expansion Date
shall be postponed one day for each day that Go/Dan delays in
vacating the Expansion Space.
12. Except for Commercial Tennessee, Inc., who represents the
Tenant, Landlord and Tenant each represent and warrant to the
other than neither party has engaged or had any conversations
or negotiations with any broker, finder or other third party
concerning the matters set forth in this Amendment who would
be entitled to any commission or fee based on the execution of
this Amendment. Landlord and Tenant each hereby indemnify the
other against and from any claims for any brokerage
commissions and all costs, expenses and liabilities in
connection therewith, including, without limitation,
reasonable attorneys' fees and expenses, for any breach of the
foregoing. The foregoing indemnification shall survive the
termination of the Lease for any reason.
13. Tenant shall have the right to remove the wall which presently
separates the Original Demised Premises and the Expansion
Space and the Landlord consents thereto, provided that such
removal shall be done in accordance with the applicable
provisions of the Lease, including without limitation Section
18 of the Lease, and all legal requirements.
14. Tenant does hereby assign, convey, sell, transfer and deliver
to the Assignee, free and clear of all liens, claims and
encumbrances, all of the Tenant's right, title and interest
in, to and under the Lease, as amended herein, and (ii) the
Assignee does hereby agree to assume, discharge and perform
all obligations and responsibilities of the Tenant arising
under the Lease, as so amended, from and after the date hereof
with respect to the remaining term thereof . The Assignee
shall be directly liable to the Landlord for all obligations
of the Tenant under the Lease, as herein
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amended, from and after the date hereof with respect to the
remaining term thereof; provided, however, that the Tenant
shall not be relieved of any liability or obligation
thereunder. The Landlord hereby consents to the assignment
described herein and agrees to recognize the Assignee as the
"Tenant" under the Lease; provided, however, that such consent
and recognition shall not relieve the Tenant of any existing
or future liability or obligation under the Lease. From and
after the date hereof, all obligations of the Tenant under the
Lease, as herein amended, with respect to the remaining term
thereof shall be the joint and several obligations of the
Tenant and the Assignee. This consent shall not be deemed
Landlord's consent to any future assignment.
15. Except as amended hereby, the Lease shall be and remain in
full force and effect and unchanged. As amended hereby, the
Lease is hereby ratified and confirmed by all parties hereto.
To the extent the terms hereof are inconsistent with the terms
of the Lease, the terms hereof shall control.
16. This Amendment shall be governed by and construed in
accordance with the laws of the State of Tennessee.
17. For purposes of this Amendment, the term "Amendment Date"
shall mean the date upon which this Amendment is signed by
Landlord or Tenant and Assignee, whichever is later.
18. The submission of this Amendment to Tenant and Assignee for
examination or consideration does not constitute an offer to
amend the Lease, and this Amendment shall become effective
only upon the execution and delivery thereof by Landlord and
Tenant and Assignee.
19. Tenant and Assignee shall each cause its corporate secretary
or general partner, as applicable, to execute the certificate
attached hereto as Exhibit A and Exhibit A-1, respectively.
Each of Tenant and Assignee is authorized by all required
corporate or partnership action to enter into this Amendment
and the individual(s) signing this Amendment on behalf of
Tenant and Assignee are each authorized to bind Tenant and
Assignee to its terms.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and sealed as of the Amendment Date.
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LANDLORD:
Date:_______________
NEW YORK LIFE INSURANCE COMPANY, a
New York mutual insurance company
By:______________________________________
Name:_________________________________
Title:________________________________
[Corporate Seal]
TENANT:
Date:_______________ DAISYTEK, INC., a Delaware corporation
By:______________________________________
Name:_________________________________
Title:________________________________
Attest:__________________________________
Name:_____________________________
Title:____________________________
[CORPORATE SEAL]
ASSIGNEE:
PRIORITY FULFILLMENT SERVICES, INC., a
Delaware corporation
By: __________________________________
Name:
Title:
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EXHIBIT A
CERTIFICATE OF AUTHORITY
CORPORATION
The undersigned, Secretary of each of DAISYTEK, INC., a Delaware
corporation ("Tenant") and PRIORITY FULFILLMENT SERVICES, INC., a Delaware
corporation ("Assignee"), hereby certifies as follows to NEW YORK LIFE INSURANCE
COMPANY, a New York mutual insurance company ("Landlord"), in connection with
that FIRST AMENDMENT TO INDUSTRIAL LEASE AGREEMENT to Tenant's lease of premises
in Building "I", at Southpark, Memphis, Shelby County, Tennessee (the
"Premises"):
1. Tenant and Assignee are each duly organized, validly existing
and in good standing under the laws of the State of Delaware, and duly qualified
to do business in the State of Tennessee.
2. That the following named persons, acting individually, are
each authorized and empowered to negotiate and execute, on behalf of each of
Tenant and Assignee, the amendment to, and assignment and assumption of,
Tenant's lease of the Premises and that the signature opposite the name of each
individual is an authentic signature:
__________________ ___________________ ____________________
(name) (title) (signature)
__________________ ___________________ ____________________
(name) (title) (signature)
__________________ ___________________ ____________________
(name) (title) (signature)
3. That the foregoing authority was conferred upon the person(s)
named above by the Board of Directors of each of Tenant and Assignee pursuant to
proper corporate action taken prior to the date hereof, which authority remains
in full force and effect.
_________________________________
Secretary
[CORPORATE SEAL]