Exhibit 10.23

PC CONNECTION, INC.

Route 101A (730 Milford Road)

Merrimack, NH 03054

Dated as of: August 31, 2011

RBS Citizens, National Association

28 State Street

Boston, MA 02109

 

  Re: Limited Waiver and Amendment No. 4 to Second Amended and Restated Credit
and Security Agreement and related Documents

Ladies and Gentlemen:

We refer to the Second Amended and Restated Credit and Security Agreement, dated
as of June 29, 2005 (as amended by that certain Amendment No. 1, dated as of
August 12, 2005, Amendment No. 2, dated as of January 3, 2007 and Amendment
No. 3 dated as of October 15, 2007 the “Credit Agreement”), by and among PC
Connection, Inc., a Delaware corporation (the “Borrower”), certain subsidiary
guarantors party thereto, and RBS Citizens, National Association, successor by
merger to Citizens Bank of Massachusetts, as the lender (in such capacity, the
“Lender”) and agent (together with its successors and assigns in such capacity,
the “Agent”).

We have requested that the Agent and Lender agree to make certain amendments to
the Credit Agreement and we have been advised that the Agent and Lender are
prepared and would be pleased to make the amendments to the Credit Agreement
upon the terms and subject to the conditions set forth below.

Accordingly, in consideration of the premises, promises, mutual covenants and
agreements set forth below, and fully intending to be legally bound hereby, the
parties hereto agree as follows:

ARTICLE I

LIMITED WAIVER

In reliance upon the representations and warranties made by the Borrower in
favor of the Agent and Lenders set forth in Article IV below and subject to the
prior satisfaction of the conditions to effectiveness set forth in Article III
below, the Agent and the Required Lenders hereby waive the Event of Default
arising under Section 10.1(d) of the Credit Agreement as a result of Additional
Guarantor’s (as defined below) failure to expressly join the Credit Agreement as
a Guarantor pursuant to Section 7.11(a) of the Credit Agreement (the “Specified
Event of Default”).

The waiver set forth above is limited solely to the specific matter listed above
and shall not be deemed to be a waiver of any Default or Event of Default (other
than the Specified Event

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of Default) or an amendment of any other provision of the Credit Agreement.
Furthermore, except as specifically waived herein, nothing contained in this
Amendment shall directly or indirectly in any way whatsoever either: (a) impair,
prejudice, or otherwise adversely affect the rights of the Lenders or the Agent
at any time to exercise any right, privilege or remedy in connection with the
Credit Agreement or the Other Documents; or (b) constitute any course of
conduct, course of dealing, or other basis for altering any obligation of the
Borrower under the Credit Agreement or the Other Documents.

ARTICLE II

AMENDMENTS TO CREDIT AGREEMENT

Effective as of the date hereof (the “Amendment Date”), and subject to the
fulfillment of the conditions contained in Article III of this amendment (this
“Amendment”), the Credit Agreement is hereby amended in each of the following
respects:

(a) The term, “Documents” shall, wherever used in the Credit Agreement or Other
Documents, be deemed to also mean and include this Amendment. All capitalized
terms used but not defined herein shall have the meanings given to such terms in
the Credit Agreement.

(b) The Credit Agreement is amended as follows:

(i) Section 7.6(a) Section 7.6(a) of the Credit Agreement is amended by
replacing “$10,000,000” with “$15,000,000”.

(ii) Exhibit 2.1(a). Exhibit 2.1(a) of the Credit Agreement is amended and
restated as set forth on Exhibit B to this Amendment.

(iii) Professional Computer Center, Inc., an Illinois corporation (the
“Additional Guarantor”), hereby joins in and is made a Guarantor party to the
Credit Agreement for all purposes thereof, and grants to the Agent, pursuant to
Section 4.1 of the Credit Agreement, a continuing security interest in its
Collateral, whether now owned or existing or hereafter acquired or arising and
wheresoever located, to secure the prompt payment and performance of the
Obligations, and hereby acquires all other rights and assumes all other
obligations and covenants of a Guarantor thereunder, as fully as if a direct
signatory party thereto.

ARTICLE III

CONDITIONS PRECEDENT TO AMENDMENT

The Lender’s and Agent’s agreement herein to further amend the Credit Agreement
as of the Amendment Date is subject to the fulfillment, to the satisfaction of
the Agent on the date hereof, of the following conditions precedent:

(a) The Borrower, Additional Guarantor and Lender shall have executed this
Amendment and delivered the same to the Agent;

 

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(b) The Guarantors shall have executed a Consent of Guarantors in the form
attached as Exhibit A to this Amendment;

(c) All representations and warranties contained herein shall be true and
correct in all material respects;

(d) No Material Adverse Effect shall have occurred since June 30, 2011;

(e) The Additional Guarantor shall have executed and delivered to the Agent a
Joinder to Amended and Restated Guaranty, in the form attached hereto as Exhibit
C; and

(f) Each condition precedent set forth in subsequent subsection (b), (e),
(f) and (g) of Section 8.1 of the Credit Agreement shall have been satisfied
with respect to the Additional Guarantor.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

The Borrower represents and warrants to the Lenders and Agent as follows:

(a) Representations in Agreement. Each of the representations and warranties
made by the Borrower and each of its Subsidiaries to the Lender in the Credit
Agreement and other Documents was true and correct in all material respects when
made and is true and correct in all material respects on and as of the Amendment
Date with the same full force and effect as if each of such representations and
warranties had been made by the Borrower and each of its Subsidiaries on the
Amendment Date and in this Amendment, except to the extent that such
representations and warranties relate solely to a prior date.

(b) No Default of Events of Default. Other than the Specified Event of Default,
no Default or Event of Default exists on the Amendment Date.

(c) Binding Effect of Documents. This Amendment has been duly executed and
delivered by the Borrower and is in full force and effect as of the date hereof,
and the agreements and obligations of the Borrower contained herein constitute
legal, valid and binding obligations of the Borrower enforceable against the
Borrower in accordance with their respective terms.

ARTICLE V

MISCELLANEOUS

This Amendment may be executed in any number of counterparts, each of which when
executed and delivered shall be deemed an original, but all of which together
shall constitute one instrument. Telecopied signatures hereto shall be of the
same force and effect as an original of a manually signed copy. In making proof
of this Amendment, it shall not be necessary to produce or account for more than
one counterpart thereof signed by each of the parties hereto. Except to the
extent specifically amended and supplemented hereby, all of the terms,
conditions and the provisions of the Credit Agreement and each of the other
Documents shall otherwise remain unmodified, and the Credit Agreement and each
of the other Documents, as amended and supplemented by this Amendment, are
confirmed as being in full force and effect.

 

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If you are in agreement with the foregoing, please sign the form of acceptance
on the enclosed counterpart of this Amendment, and return the counterpart to the
undersigned, whereupon this Amendment, as so accepted by you, shall become a
binding agreement between the undersigned, the Agent and the Lender.

 

Very truly yours, PC CONNECTION, INC. By:  

/S/ JACK FERGUSON

  Name: Jack Ferguson   Title: Executive VP, Treasurer and CFO PROFESSIONAL
COMPUTER CENTER, INC. By  

/S/ GLYNN W. SCHULZE

  Name: Glynn W. Schulze   Title: Secretary

The foregoing Amendment is hereby accepted by the undersigned as of the date
hereof.

RBS CITIZENS, NATIONAL ASSOCIATION, as Agent and Lender

 

By:  

/S/ MARC LUBELCZYK, SVP

  Name: Marc Lubelczyk   Title: Senior Vice President

 

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EXHIBIT A

See attached.

 

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CONSENT OF GUARANTORS

GovConnection, Inc., a Maryland limited liability company, Merrimack Services
Corporation, a Delaware corporation, PC Connection Sales Corporation, a Delaware
corporation, and More Direct, Inc., a Florida corporation (collectively, the
“Guarantors”), have each guaranteed the Obligations of PC Connection, Inc., a
Delaware corporation (the “Borrower”), under that certain Second Amended and
Restated Credit and Security Agreement, dated as of June 29, 2005 (as amended by
that certain Amendment No. 1, dated as of August 12, 2005, Amendment No. 2,
dated as of January 3, 2007, Amendment No. 3 dated as of October 15, 2007 and
Amendment No. 4 (the “Amendment”), dated as of even date herewith, the “Credit
Agreement”), by and among the Borrower, the Guarantors and RBS Citizens,
National Association, successor by merger to Citizens Bank of Massachusetts, as
the lender and agent. By executing this consent, each of the Guarantors hereby
absolutely and unconditionally reaffirms to the Lender that each such
Guarantor’s guaranty of the Obligations remains in full force and effect. Each
of the undersigned Guarantors acknowledges and agrees to the terms and
conditions of the Amendment and the Credit Agreement as amended thereby.

IN WITNESS WHEREOF, the undersigned have executed this Consent of Guarantors
this 31 day of August, 2011.

 

GUARANTORS: GOVCONNECTION, INC. By  

/S/ GARY ANDERSON

Name: Gary Anderson Title: Treasurer MERRIMACK SERVICES CORPORATION By  

/S/ JACK FERGUSON

Name: Jack Ferguson Title: Executive VP, Treasurer and CFO PC CONNECTION SALES
CORPORATION By  

/S/ GARY ANDERSON

Name: Gary Anderson Title: Treasurer

 

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PC CONNECTION EXPRESS, INC.

By

 

/S/ WILLIAM COOPER

Name: William Cooper Title: President MORE DIRECT, INC.

By

 

/S/ GARY ANDERSON

Name: Gary Anderson Title: Treasurer

 

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EXHIBIT B

See attached.

 

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THIRD AMENDED AND RESTATED REVOLVING CREDIT NOTE

 

$50,000,000.00   October 15, 2007        

FOR VALUE RECEIVED, the undersigned PC CONNECTION, INC., a corporation organized
under the laws of the State of Delaware (hereinafter, together with its
successors in title and assigns, collectively called the “Borrower”), by this
promissory note (hereinafter, called “this Note”), absolutely and
unconditionally promises to pay to the order of RBS CITIZENS, NATIONAL
ASSOCIATION, successor by merger to Citizens Bank of Massachusetts (hereinafter,
together with its successors in title and assigns, called the “Lender”), the
principal sum of FIFTY MILLION DOLLARS ($50,000,000.00) or so much thereof as
shall have been advanced by the Lender to the Borrower by way of Revolving
Advances under the Loan Agreement (as hereinafter defined) and shall remain
outstanding, such payment to be made as hereinafter provided, and to pay
interest on the principal sum outstanding hereunder from time to time from the
date hereof until the said principal sum or the unpaid portion thereof shall
have become due and payable as hereinafter provided.

Capitalized terms used herein without definition shall have the meanings set
forth in the Loan Agreement.

The unpaid principal (not at the time overdue) under this Note shall bear
interest at the rate or rates from time to time in effect under the Loan
Agreement. Accrued interest on the unpaid principal under this Note shall be
payable on the dates specified in the Loan Agreement.

On October 15, 2012, the date of the final maturity of this Note, there shall
become absolutely due and payable by the Borrower hereunder, and the Borrower
hereby promises to pay to the Lender, the balance (if any) of the principal
hereof then remaining unpaid, all of the unpaid interest accrued hereon and all
(if any) other amounts payable on or in respect of this Note or the indebtedness
evidenced hereby.

The Borrower authorizes the Lender to make or cause to be made at or about the
time of any Revolving Advance or at the time of receipt of any payment of
principal of this Note, an appropriate notation on the Schedule annexed hereto
reflecting the making of such Revolving Advance or the receipt of such payment.
The outstanding amount of the Revolving Advance set forth on the Schedule
annexed hereto shall be prima facie evidence of the principal amount thereof
owing and unpaid to the Lender, but the failure to record, or any error in so
recording, any such amount on the Schedule shall not limit or otherwise affect
the obligations of the Borrower hereunder or under the Loan Agreement to make
payments of principal of and interest on this Note when due.

Each overdue amount (whether of principal, interest or otherwise) payable on or
in respect of this Note or the indebtedness evidenced hereby shall (to the
extent permitted by applicable law) bear interest at the rates and on the terms
provided by the Loan Agreement.

 

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Each payment of principal, interest or other sum payable on or in respect of
this Note or the indebtedness evidenced hereby shall be made by the Borrower in
United States Dollars, for the account of the Lender as set forth in the Loan
Agreement, on the due date of such payment, and in immediately available and
freely transferable funds. All payments on or in respects of this Note or the
indebtedness evidenced hereby shall be made without set-off or counterclaim and
free and clear of and without any deductions, withholdings, restrictions or
conditions of any nature.

This Note is made by the Borrower to the Lender pursuant to the Second Amended
and Restated Credit and Security Agreement, dated as of June 29, 2005, among the
Borrower, as borrower, GovConnection, Inc., a corporation organized under the
laws of the State of Maryland, Merrimack Services Corporation, a corporation
organized under the laws of the State of Delaware, PC Connection Sales
Corporation, a corporation organized under the laws of the State of Delaware,
MoreDirect, Inc., a corporation organized under the laws of the State of
Florida, PC Connection Express, Inc., a corporation organized under the laws of
the State of Delaware and Professional Computer Center, Inc., a corporation
organized under the laws of the State of Illinois (each a “Guarantor” and
collectively the “Guarantors”), Citizens Bank of Massachusetts, as lender and
agent, and the financial institutions which are or hereafter become a party
thereto (collectively, the “Lenders”) and is entitled to the benefits of said
Second Amended and Restated Credit and Security Agreement (hereinafter, as
originally executed, and as now or hereafter amended, modified, varied,
supplemented or amended and restated called the “Loan Agreement”). This Note
evidences the obligation under the Loan Agreement of the Borrower (a) to repay
the principal amount of the Revolving Advances made by the Lender to the
Borrower; (b) to pay interest on the principal amount hereof remaining unpaid
from time to time; and (c) to pay other amounts which may become due and payable
thereunder. This Note has been issued by the Borrower in replacement of the
Second Amended and Restated Revolving Credit Note, dated June 29, 2005 (the
“Original Note”), by the Borrower to the order of Citizens Bank of Massachusetts
in the stated principal amount of $50,000,000. The Borrower confirms that the
indebtedness outstanding under and evidenced by the Original Note on the date
hereof has not been repaid, satisfied or discharged but for all purposes has
been continued as provided herein and that the indebtedness evidenced by this
Note includes all indebtedness outstanding under the Original Note on the date
hereof.

The Borrower will have an obligation to prepay principal of this Note from time
to time if and to the extent required under, and upon the terms contained in,
the Loan Agreement.

Pursuant to and upon the terms contained in the Loan Agreement, the entire
unpaid principal of this Note, all of the interest accrued on the unpaid
principal of this Note and all (if any) other amounts payable on or in respect
of this Note or the indebtedness evidenced hereby may be declared to be
immediately due and payable.

This Note and the obligations of the Borrower hereunder shall be governed by and
interpreted and determined in accordance with the laws of the Commonwealth of
Massachusetts. The Borrower hereby irrevocably waives notice of acceptance,
presentment, notice of nonpayment, protest, notice of protest, suit and all
other conditions precedent in connection with the delivery, acceptance,
collection and/or enforcement of this Note, except for notice expressly provided
for in the Loan Agreement. The Borrower hereby absolutely and irrevocably
consents

 

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and submits to the jurisdiction of the courts of the Commonwealth of
Massachusetts and of any federal court located in Boston, Massachusetts in
connection with any actions or proceedings brought against the Borrower by the
holder hereof arising out of or relating to this Note.

IN WITNESS WHEREOF, this Third Amended and Restated Revolving Credit Note has
been duly executed under seal by the undersigned on the day and in the year
first above written.

 

PC CONNECTION, INC. By  

/S/ JACK FERGUSON

Name: Jack Ferguson Title: Executive VP, Treasurer and CFO

 

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SCHEDULE TO THIRD AMENDED AND RESTATED REVOLVING CREDIT NOTE

 

DATED

  

AMOUNT OF LOAN

  

INTEREST RATE

  

AMOUNT PAID

  

NOTATION MADE BY

 

 

 

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EXHIBIT C

See attached.

 

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JOINDER TO AMENDED AND RESTATED GUARANTY AGREEMENT

JOINDER TO AMENDED AND RESTATED GUARANTY AGREEMENT, dated as of August 31, 2011
(the “Joinder Agreement”), by and between PROFESSIONAL COMPUTER CENTER, INC., an
Illinois corporation (the “Additional Guarantor”), and RBS CITIZENS, NATIONAL
ASSOCIATION, successor by merger to Citizens Bank of Massachusetts, as agent (in
capacity, the “Agent”) for itself and the Lenders (as defined below).

W I T N E S S E T H:

WHEREAS, PC Connection, Inc., a Delaware corporation (the “Borrower”), is party
to that certain Second Amended and Restated Credit and Security Agreement, dated
as of June 29, 2005 (as amended by that certain Amendment No. 1, dated as of
August 12, 2005, Amendment No. 2, dated as of January 3, 2007, Amendment No. 3,
dated as of October 15, 2007 and Amendment No. 4 (“Amendment No. 4”), dated as
of even date herewith, and as the same may be further amended, restated,
supplemented or otherwise modified from time to time, the “Credit Agreement”),
by and among the Borrower, GovConnection, Inc., a Maryland limited liability
company, Merrimack Services Corporation, a Delaware corporation, PC Connection
Sales Corporation, a Delaware corporation, PC Connection Express, Inc., a
Delaware corporation and More Direct, Inc., a Florida corporation (the
immediately preceding five entities, collectively, the “Existing Guarantors”),
the Agent and the lenders from time to time party thereto (the “Lenders”),
pursuant to which the Lenders and the Agent have agreed to make certain loans
and other extensions of credit (collectively, the “Loans”) to the Borrower upon
the terms and subject to the conditions set forth therein;

WHEREAS, to induce the Lenders and Agent to make the Loans, the Existing
Guarantors have entered into the certain Amended and Restated Guaranty, dated as
of May 31, 2002 (as amended, restated, supplemented or otherwise modified from
time to time, the “Guaranty Agreement”), pursuant to which the Existing
Guarantors have, inter alia, guaranteed the punctual payment and performance of
all Obligations;

WHEREAS, the Additional Guarantor is a wholly-owned subsidiary of the Borrower,
dependent upon the Borrower for financial and other needs, and shall benefit
directly and indirectly from the Loans;

WHEREAS, it is a condition precedent to the efficacy of Amendment No. 4 that the
Additional Guarantor enter into this Joinder Agreement, and guarantee the prompt
payment and performance of the Obligations in accordance with the terms of the
Guaranty Agreement;

NOW, THEREFORE, in order to induce the Lenders to enter into Amendment No. 4 and
to make the Loans pursuant to the Credit Agreement and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Additional Guarantor and the Agent hereby agrees as follows:

1 Joinder. Effective as of the date hereof, the Additional Guarantor hereby
joins in and is made a Guarantor party to the Guaranty Agreement for all
purposes thereof, and guarantees the prompt payment and performance of the
Obligations in accordance with the terms thereof, and shall have all of the
rights and obligations of an Guarantor thereunder, as fully as if listed as a
Guarantor directly therein and a direct signatory thereto.

 

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2 Counterparts. This Joinder Agreement may be executed in any number of
counterparts, and by each of the parties hereto on the same or separate
counterparts, each of which shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement. Telecopied
signatures hereto shall be of the same force and effect as an original of a
manually signed copy.

3 Assignment. This Joinder Agreement is binding upon the Additional Guarantor,
the Agent and their respective successors and assigns and shall inure to the
benefit of the Agent and its successors and assigns. The Additional Guarantor
may not assign its rights or obligations hereunder without the prior written
consent of the Agent, and any such purported assignment shall be void.

4 Amendment. No provisions of this Joinder Agreement shall be waived, amended,
supplemented or otherwise modified except by a written instrument executed by
the Agent and the Additional Guarantor.

5 Governing Law; Jurisdiction. This Joinder Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of Massachusetts
applied to contracts to be performed wholly within the Commonwealth of
Massachusetts. Any judicial proceeding brought by or against the Additional
Guarantor with respect to this Joinder Agreement, the Documents or any Other
Documents may be brought in any court of competent jurisdiction in the
Commonwealth of Massachusetts, United States of America, and, by execution and
delivery of this Agreement, the Additional Guarantor accepts for itself and in
connection with its properties, generally and unconditionally, the non-exclusive
jurisdiction of the aforesaid courts, and irrevocably agrees to be bound by any
judgment rendered thereby in connection with this Joinder Agreement. The
Additional Guarantor hereby waives personal service of any and all process upon
it and consents that all such service of process may be made by registered mail
(return receipt requested) directed to the Borrower at its address set forth in
Section 15.6 of the Credit Agreement and service so made shall be deemed
completed five (5) days after the same shall have been so deposited in the mails
of the United States of America. Nothing herein shall affect the right to serve
process in any manner permitted by law or shall limit the right of Agent or any
Lender to bring proceedings against the Additional Guarantor in the courts of
any other jurisdiction. The Additional Guarantor waives any objection to
jurisdiction and venue of any action instituted hereunder and shall not assert
any defense based on lack of jurisdiction or venue or based upon forum non
conveniens. The Additional Guarantor waives the right to remove any judicial
proceeding brought against the Additional Guarantor in any state court to any
federal court. Any judicial proceeding by the Additional Guarantor against Agent
or any Lender involving, directly or indirectly, any matter or claim in any way
arising out of, related to or connected with this Joinder Agreement, the
Documents or any Other Documents, shall be brought only in a federal or state
court located in the County of Suffolk, Commonwealth of Massachusetts.

 

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6 Headings. The descriptive headings of the various provisions of this Joinder
Agreement are inserted for convenience of reference only and shall not affect
the meaning or construction of any of the provisions of this Joinder Agreement.

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IN WITNESS WHEREOF, the Additional Guarantor and the Agent have duly executed
and delivered this Joinder Agreement as of the date first above written.

 

PROFESSIONAL COMPUTER CENTER, INC. By  

/S/ Glynn W. Schulze

  Name: Glynn W. Schulze   Title: Secretary

 

ACCEPTED BY: RBS CITIZENS, NATIONAL ASSOCIATION,
in its capacity as Agent By:  

/S/ Marc Lubelczyk, SVP

  Name: Marc Lubelczyk   Title: Senior Vice President

 

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