**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**WASHINGTON,
      D.C. 20549**




**FORM
      10-K/A**


**Amendment
      No. 1**




**FOR
      ANNUAL AND TRANSITION REPORTS**


**PURSUANT
      TO SECTIONS 13 OR 15(d) OF THE**


**SECURITIES
      EXCHANGE ACT OF 1934**




**(Mark
      One)**


**x**
            **ANNUAL
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934**





**For
      the fiscal year ended December 31, 2006**


**OR**





**TRANSITION
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934**





**For
      the transition period from __________ to __________.**







**MERISEL,
      INC.**





**(Exact
      name of registrant as specified in its charter)**





**Delaware**
            **01-17156**
            **95-4172359**(State
                or other jurisdiction of incorporation)
            (Commission
                File Number)
            (I.
                R. S. Employer identification No.)**127
                W. 30****th****Street, 5****th****Floor**
            
            **10001****New
                York, NY**
            
            (Zip
                Code)(Address
                of principal executive offices)




Registrant‘s
      telephone number, including area code: (212)
      594-4800





Securities
      registered pursuant to Section 12(b) of the Act: None





Securities
      registered pursuant to Section 12(g) of the Act: common
      stock, $0.01 Par Value








Indicate
      by check mark if the registrant is a well-known seasoned issuer, as defined
      in
      Rule 405 of the Securities Act. Yes  ̈ No þ





Indicate
      by check mark if the registrant is not required to file reports pursuant to
      Section 13 or Section 15(d)of the Exchange Act. Yes  ̈ No þ





Indicate
      by check mark whether the registrant: (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
      the
      preceding 12 months (or for such shorter period that the registrant was required
      to file such reports), and (2) has been subject to such filing requirements
      for
      the past 90 days. Yes þ No  ̈





Indicate
      by check mark if disclosure of delinquent filers pursuant to Item 405 of
      Regulation S-K is not contained herein, and will not be contained, to the best
      of registrant’s knowledge, in definitive proxy or information statements
      incorporated by reference in Part III of this Form 10-K or any amendment to
      this
      Form 10-K. þ





Indicate
      by check mark whether the registrant is a large accelerated filer, an
      accelerated filer, or a non-accelerated filer. See definition of “accelerated
      filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check
      one):





Large
      accelerated filer  ̈  Accelerated filer  ̈  Non-accelerated filer þ





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act). Yes  ̈  No þ





As
      of
      June 30, 2006, the aggregate market value of voting stock held by non-affiliates
      of the registrant based on the last sales price as reported by the National
      Quotation Service Bureau was $16,634,537 (2,661,526 shares at a closing price
      of
      $6.25).





As
      of
      March 30, 2007 the registrant had outstanding 8,013,638 **** shares
      of
      common stock, par value $0.01 per share (the only class of common stock of
      the
      registrant outstanding).




**Documents
      Incorporated By Reference**


None


**TABLE
                OF CONTENTS**Explanatory
                NoteItem
                10.
            Directors,
                Executive Officers and Corporate GovernanceInformation
                Regarding Executive Officers and DirectorsArrangements
                for Nomination as Directors and Changes in Procedures for
                NominationCertain
                Legal ProceedingsSection
                16(A) Beneficial Ownership Reporting ComplianceCode
                of Business ConductAudit
                CommitteeCompensation
                Committee Interlocks and Insider ParticipationItem
                11.
            Executive
                CompensationCompensation
                Discussion and AnalysisExecutive
                Compensation TablesGrants
                of Plan Based Awards for 2006Outstanding
                Equity Awards at December 31, 2006Options
                Exercised and Stock Vested in 2006Pensions
                BenefitsNonqualified
                Defined Contribution and Other Nonqualified Deferred Compensation
                PlansExecutive
                Employment, Termination and Change of Control
                ArrangementsCompensation
                of DirectorsItem
                12.
            Security
                Ownership of Certain Beneficial Owners and Management and Related
                Stockholder Matters.Item
                13.
            Certain
                Relationships and Related Transactions, and Director
                Independence.Item
                14.
            Principal
                Accountant Fees and ServicesItem
                5.
            Market
                for the Registrant’s Common Equity: Stock Price
                PerformanceItem
                15.
            Exhibits. 
 **EXPLANATORY
      NOTE**





This
      Amendment No. 1 (the “Amendment”) to the Annual Report on Form 10-K for the year
      ended December 31, 2006 (the “Annual Report”) of Merisel, Inc. (the “Company”)
      filed with the Securities and Exchange Commission (the “SEC”) on April 17, 2007
      (the “Original Filing”) is being filed to add the disclosures required in Part
      III, Items 10, 11, 12, 13 and 14 of Form 10-K, all of which are incorporated
      into the Original Filing by reference, along with the stock performance table
      required as part of Item 5. All other material in the Original Filing remains
      in
      effect.





**Item
      10. Directors, Executive Officers and Corporate
      Governance.**





The
      following table sets forth the names, ages and positions of those individuals
      who served as executive officers and directors of the Company as of March 30,
      2007.





**Name**
            **Age**
            **Position**Donald
                R. Uzzi
            54
            Chairman
                of the Board, Chief Executive Officer and PresidentJon
                H. Peterson (1)
            60
            Executive
                Vice President, Chief Financial OfficerRajiv
                Garg
            47
            Executive
                Vice President of Merisel Americas, Inc.John
                Sheehan
            52
            Executive
                Vice President, ImagingKen
                Wasserman
            47
            Executive
                Vice President, PrototypesAlbert
                J. Fitzgibbons III (3) (4)
            61
            DirectorRonald
                P. Badie (3) (5) (6)
            64
            DirectorBradley
                J. Hoecker (3) (4)
            45
            DirectorEdward
                A. Grant (2) (4)
            56
            DirectorLawrence
                J. Schoenberg (2) (3) (4)
            74
            Director





(1)
            Mr.
                Peterson was named Chief Financial Officer of the Company effective
                May 1,
                2006. Allyson Vanderford served as Chief Financial Officer from May
                1,
                2005 through April 30, 2006. Her compensation for the year ended
                December
                31, 2006 is included in the tables
                below.





(2)
            Member
                of Audit Committee. Mr. Grant has served as a member of the Audit
                Committee since his election to the Board of Directors on May 31,
                2006.




(3)
            Member
                of Nominating Committee





(4)
            Member
                of Compensation Committee





(5)
            Lead
                Director







**For
      each
      Director of the Company, the following sets forth the name, age as of March
      30,
      2007, principal occupation for at least the past five years, and the names
      of
      any other public companies for which the Director currently serves in
      directorship capacity:**




Donald
      R.
      Uzzi, 54, has served as Chief Executive Officer and President
      since November 2004 and as a member of the Board of Directors since December
      2004. He was elected Chairman of the Board of Directors in April 2005. From
      December 2002 to November 2004, Mr. Uzzi provided consulting services for
      various companies on marketing, corporate strategy and communications. From
      July
      1999 to December 2002, Mr. Uzzi was Senior Vice President of Electronic Data
      Systems Corporation. From July 1998 to July 1999, Mr. Uzzi was a principal
      officer of Lighthouse Investment Group. From August 1996 to April 1998, Mr.
      Uzzi
      served as Executive Vice President at Sunbeam Corporation. Prior to 1996, Mr.
      Uzzi held the position of President of the Gatorade North America division
      of
      Quaker Oats.




Albert
      J.
      Fitzgibbons III, 61, has been a member of the Board of Directors since December
      1997. Mr. Fitzgibbons is a Partner and Director of Stonington Partners, Inc.
      and
      a Partner and Director of Stonington Partners, Inc.,II, positions that he has
      held since 1994. He served as a Director of Merrill Lynch Capital Partners,
      Inc., a private investment firm associated with Merrill Lynch & Co., from
      1988 to 1994 and as a Consultant to Merrill Lynch Capital Partners from 1994
      to
      December 2000. He was a Partner of Merrill Lynch Capital Partners from 1993
      to
      1994 and Executive Vice President of Merrill Lynch Capital Partners from 1988
      to
      1993. Mr. Fitzgibbons was also a Managing Director of the Investment Banking
      Division of Merrill Lynch & Co. from 1978 to July 1994. Mr. Fitzgibbons is
      also currently a Director of Obagi Medical Products, Inc.




Ronald
      P.
      Badie, 64, has been a member of the Board of Directors since October 2004.
      In
      March 2002, Mr. Badie retired from Deutsche Bank after 35 years of service.
      At
      the time of his retirement, he was Vice Chairman of Deutsche Bank Alex. Brown
      (now Deutsche Bank Securities), the firm’s investment banking subsidiary. Over
      the years, Mr. Badie has held a variety of management positions with the firm
      and its predecessor, Bankers Trust Company, in both New York and Los Angeles.
      Mr. Badie is also currently a Director of Amphenol Corporation, Nautilus, Inc.,
      and Obagi Medical Products, Inc.




Bradley
      J.
      Hoecker, 45, has been a member of the Board of Directors since December 1997.
      Mr. Hoecker has been a Partner and Director of Stonington Partners and a Partner
      and Director of Stonington Partners, Inc. II since 1997. Prior to being named
      partner in 1997, Mr. Hoecker was a Principal of Stonington Partners since 1993.
      He was a Consultant to Merrill Lynch Capital Partners from 1994 to December
      2000
      and was an Associate in the Investment Banking Division of Merrill Lynch Capital
      Partners from 1989 to 1993. Mr. Hoecker is also currently a Director of Obagi
      Medical Products, Inc.




Lawrence
      J.
      Schoenberg, 74, has been a member of the Board of Directors since 1990. From
      1967 through 1990, Mr. Schoenberg served as Chairman of the Board and Chief
      Executive Officer of AGS Computers, Inc., a computer software company. From
      January to December 1991, Mr. Schoenberg served as Chairman and as a member
      of
      the executive committee of the Board of Directors of AGS. Mr. Schoenberg retired
      from AGS in 1992. Mr. Schoenberg is also a Director of Government Technology
      Services, Inc., a reseller and integrator of information systems for the federal
      government, and a Director of Cellular Technology Services, Inc., a software
      company.




Edward
      A.
      Grant, 56, has been a member of the Board of Directors since May 2006. Mr.
      Grant
      is a principal and practice director at Arthur Andersen LLP. He has been a
      partner and professional at Andersen for more than thirty years, serving in
      a
      number of management functions. He was an audit partner with the firm for
      sixteen years, serving as the auditor on numerous public companies. Mr. Grant
      is
      a Director of Obagi Medical Products, Inc. and is the Chair of its Audit
      Committee. Mr. Grant has a bachelor’s and two master’s degrees from the
      University of Wisconsin-Madison and became a Certified Public Accountant in
      1976. He is a past member of the American Institute of Certified Public
      Accountants and the Illinois Certified Public Accountants Society and has served
      on several civic boards.


**Arrangements
        for Nomination as Directors and Changes in Procedures for
        Nomination**




Mr.
      Hoecker
      and Mr. Fitzgibbons serve as Directors as a result of their nomination by
      Stonington Partners, which, through its affiliates, is the owner of the
      Company’s Preferred Stock and more than 50% of the common stock and holds the
      contractual right to nominate three Directors. No other arrangement or
      understanding exists between any Director or nominee and any other persons
      pursuant to which any individual was or is to be selected or serve as a
      Director. No Director has any family relationship with any other Director or
      with any of the Company’s executive officers. Mr. Uzzi is an executive officer
      of the Company.




The
      Company
      has not changed its procedures for the identification, nomination and election
      of directors since they were described in the Proxy Statement with respect
      to
      its Annual Meeting dated May 31, 2006. ****




**The
      following individuals are the Company’s Named Executive Officers for 2006 and at
      March 30, 2007**




Jon
      Peterson,
      60, has served as Executive Vice President and Chief Financial Officer of the
      Company since May 2006. From 2001 until he joined the Company as Vice
      President-Finance on March 1, 2006, Mr. Peterson served as Vice President of
      the
      Jacob Group, a boutique executive search firm, where he headed the finance,
      accounting and consumer package goods search practice. Mr. Peterson has
      previously held positions as Vice President of Finance, Treasurer and General
      Manager with consumer package goods organizations such as PepsiCo and Cott
      Beverages.




Rajiv
      Garg,
      47, has served as Executive Vice President of Merisel Americas, Inc. (“Merisel
      Americas”) since March 2005. Between November 2002 and March 2005, Mr. Garg
      served as Chief Financial Officer and Managing Partner of Color Edge. Between
      1994 and 2000, Mr. Garg served as the head of Global Market Risk Management
      for
      Credit Suisse First Boston.




John
      Sheehan,
      52, has served as Merisel’s Executive Vice President of Sales and Marketing,
      Imaging, since July 2006. Mr. Sheehan joined Merisel in March 2005 as President
      of Color Edge, LLC. From December 2002 to March 2005, Mr. Sheehan served as
      the
      Managing Partner and Chief Operating Officer of Color Edge, Inc. From March
      1999
      to December 2002, he served as Managing Director of the New York City office
      of
      the London-based Photobition Group from which Color Edge was formed.




Kenneth
      Wasserman, 47, has served as Merisel’s Executive Vice President, Prototypes,
      since June 2006. Mr. Wasserman served as the President of Comp24, LLC from
      the
      time that it was acquired by Merisel on March 1, 2005. Mr. Wasserman was the
      founder and, since 1986, President of the predecessor entity to Comp 24, LLC.





**Certain
      Legal Proceedings**




On
      May 15,
      2001, the SEC filed a civil action ( *SEC
      v. Dunlap* ,
      S.D.
      Fla. (Case No. 01-8437) (Middlebrooks)) against Mr. Uzzi alleging violations
      of
      the federal securities laws in connection with his role as executive vice
      president of Sunbeam Corporation. On January 23, 2003, Mr. Uzzi entered into
      a
      consent and undertaking (the “Consent and Undertaking”) with the SEC. Pursuant
      to the Consent and Undertaking, Mr. Uzzi agreed, without admitting or denying
      the allegations in the SEC’s complaint, to the entry of a judgment (1)
      permanently enjoining him from violating Section 17(a) of the Securities Act
      of
      1933 and from violating or aiding and abetting violations of Sections 10(b),
      13(a), 13(b)(2)(A), 13(b)(2)(B) and 13(b)(5) of the Exchange Act of 1934 and
      Rules 10b-5, 12b-20, 13a-1, 13a-13 and 13b2-1 thereunder and (2) pursuant to
      Section 20(d) of the Securities Act and Section 21(d)(3) of the Exchange Act,
      the payment of a $100,000 civil penalty. The final judgment was entered on
      January 27, 2003 (the “Final Judgment”).




As
      previously
      disclosed in a Current Report on Form 8-K filed with the SEC on December 22,
      2004, the Board of Directors of the Company carefully reviewed the Consent
      and
      Undertaking and the Final Judgment prior to hiring Mr. Uzzi, and determined
      that
      Mr. Uzzi did not admit or deny liability in the Consent and Undertaking or
      the
      Final Judgment, and that the terms of the Consent and Undertaking and Final
      Judgment did not present a legal obstacle to the Company’s hiring Mr. Uzzi. The
      Board of Directors further determined that Mr. Uzzi was fit for office.




There
      are no
      other proceedings to which any of our directors or executive officers or any
      of
      their associates is a party adverse to the Company or any of its subsidiaries,
      or has a material interest adverse to the Company or any of its
      subsidiaries.


**Section
        16(A) Beneficial Ownership Reporting Compliance**




Section
      16(a)
      of the Exchange Act requires that the Company’s executive officers, directors
      and beneficial owners of more than 10% of the Company’s common stock file
      reports of ownership and changes in ownership with the SEC and to furnish the
      Company with copies of all such reports they file. Based solely on its review
      of
      the copies of such reports received by it, or on written representations from
      such persons, the Company believes that, during 2006, it was in compliance
      with
      all Section 16(a) filing requirements applicable to its executive officers,
      directors and 10% owners.




**Code
      Of Business Conduct**




The
      Board of
      Directors has adopted and approved the Company’s Code of Business Conduct, a
      copy of which has been filed with the Commission. All of the Company’s
      directors, officers and employees are subject to the standards and requirements
      set forth in the
      Code of Business Conduct and are required to sign a certificate of compliance.
      The Code of Business Conduct can be found on the Company’s website www.merisel.com .





**Committees
      of the Board of Directors**




**Name
                of Committee and Members**
            **Primary
                Responsibilities**
            **Number
                of Meetings**
              **in
                2006****Audit
                Committee**
              
              
              Edward
                A. Grant (Chair and Financial Expert effective May 31, 2006)
              Ronald
                P. Badie (resigned March 2007)
              Lawrence
                J. Schoenberg
            ·Reviews
                the Company’s annual and quarterly financial statements and the results of
                each audit and quarterly review by the Company’s independent
                accountants.
              
              ·Consults
                and meets with the Company’s independent accountants, Chief Financial
                Officer and other finance and accounting personnel concerning various
                matters, including the adequacy of internal controls.
              
              ·Selects,
                determines the compensation of, evaluates and, when appropriate,
                replaces
                the Company’s independent accountants.
              
              ·Monitors
                the qualifications and independence of the independent accountants
                and
                performance of the Company’s independent auditors.
              
              ·Reviews
                potential conflict of interest situations.
            10**Compensation
                Committee**
              
              Lawrence
                J. Schoenberg (Chair)
              Albert
                J. Fitzgibbons III
              Edward
                A. Grant
              Bradley
                Hoecker
            ·Establishes
                policies relating to the compensation of the Company’s executive officers
                and other key employees.
              
              ·Administers
                the Company’s compensation plans, including employee stock option plans,
                and makes recommendations to the Board of Directors concerning other
                compensation matters.
              
              ·Annually
                reviews and makes recommendations to the Board of Directors concerning
                the
                compensation of the Chief Executive Officer.
              
              ·Determines
                the compensation of the Company’s other executive officers and key members
                of management.
              
              ·Annually
                approves the Company’s management bonus plan and makes grants of stock
                options and other stock-related incentive compensation awards.
            3**Nominating
                Committee**
              
              Lawrence
                J. Schoenberg (Chair)
              Albert
                J. Fitzgibbons III
              Bradley
                J. Hoecker
            ·Assists
                the Board of Directors in identifying, evaluating and recommending
                candidates for election to the Board of Directors and each
                committee.
              
              ·Establishes
                procedures and provides oversight for evaluating the Board of Directors
                and management.
              
              ·Evaluates
                the size, structure and composition of the Board of Directors and
                its
                committees.
            1





**Audit
      Committee**





The
      Board
      of Directors maintains an Audit Committee that is currently comprised of Mr.
      Grant, who chairs the Committee, and Mr. Schoenberg. The Board of Directors
      has
      determined that Messrs. Grant and Schoenberg, both independent Directors as
      defined in Item 13, are “audit committee financial experts,” as defined by SEC
      rules. Mr. Badie served as a member of the Audit Committee through 2006 until
      March 2007, when he resigned from the Committee due to other
      obligations.





The
      Board
      of Directors has adopted a written charter for the Audit Committee setting
      forth
      it s
      roles
      and responsibilities. The Audit Committee Charter was filed as an Exhibit to
      the
      Company’s Proxy Statement for its May 31, 2006 Annual Meeting.




The
      Board
      has not adopted charters for the Compensation and Nomination
      Committees.




**Compensation
      Committee Interlocks and Insider Participation**




During
      2006, Mr. Grant, Mr. Fitzgibbons, Mr. Hoecker and Mr. Schoenberg (and until
      May
      2006, Dr. Arnold Miller) served on the Compensation Committee. No Committee
      member (i) was an officer or employee of Merisel, (ii) was formerly an officer
      or employee of Merisel, or (iii) had any relationship requiring disclosure
      under
      the SEC’s rules governing disclosure of related person transactions (Item 404 of
      Regulation S-K). No executive officer of Merisel served as a director or member
      of the compensation committee of another entity, one of whose directors or
      executive officers served as a member of our Board of Directors or a member
      of
      the Compensation Committee.





**Item
      11. ExecutiveCompensation.**




**Compensation
      Discussion and Analysis**




This
      Compensation Discussion and Analysis (“CD&A”) addresses our compensation
      programs and policies for fiscal year 2006 and how they affected our principal
      executives, including those executives whose compensation is disclosed in the
      tables beginning on page 16. These principal executive positions
      include:




President
      and
      Chief Executive Officer




Executive
      Vice President and Chief Financial Officer




Former
      Chief
      Financial Officer, through April 30, 2006




Executive
      Vice President, Merisel Americas




Executive
      Vice President, Sales and Marketing, Imaging




Executive
      Vice President, Prototypes




Together,
      the
      incumbents of these six positions represent our Named Executive Officers
      (“NEOs”) for 2006. In this CD&A we discuss executive compensation broadly
      applicable to Company executives as well as how those programs and policies
      specifically affect our NEOs.




We
      believe
      that our employees provide a sustainable long-term competitive advantage. We
      compete with companies for which graphic arts products are important parts
      of
      their businesses to attract and retain executive and employee talent, and the
      compensation programs and policies we have developed and implemented enable
      us
      to compete for such executives and employees.




Executive
      compensation programs and policies include the following:


·
            Base
                salary; 
 ·
            Annual
                cash incentive compensation; 
 ·
            Equity-based
                awards; and 
 ·
            Perquisite
                payments (cash payments for relocation and other
                expenses).




Our
      executives also participate in benefit plans, such as the Company’s 401(k),
      health and life insurance plans, which are generally available to our salaried
      employees. In special circumstances, such as newly-hired executives or for
      special retention or recognition, we also provide compensation outside of these
      regular executive-compensation programs. We discuss in this CD&A special
      awards that have been made to our NEOs.





**Oversight
      of Executive Compensation**




The
      Compensation Committee of the Board of Directors determines compensation for
      all
      executive officers. The Compensation Committee makes recommendations to the
      Board of Directors concerning the compensation of the Company’s Chief Executive
      Officer, determines the compensation of the Company’s President, Chief Operating
      Officer, Chief Financial Officer and other executive officers, approves on
      an
      annual basis the Company’s management bonus plan and makes grants of
      stock-related incentive compensation awards. In addition, the Compensation
      Committee also reviews other aspects of compensation, such as deferred
      compensation plans and health and welfare plans. During 2006, the Compensation
      Committee consisted of the following Directors: Laurence J. Schoenberg (Chair),
      Albert J. Fitzgibbons III, Bradley Hoecker and Edward A. Grant. Former Director
      Dr. Arnold Miller served on the Compensation Committee during the first five
      months of 2006. Membership on the Committee is determined by the Board. The
      Committee Chair reports on Committee actions and makes recommendations at Board
      meetings.




We
      describe
      the responsibilities and functions of the Compensation Committee more fully
      under the heading “Committees of the Board of Directors” beginning on page 8.




**Use
      of Consultants and Other Advisors**




The
      Compensation Committee has the authority to engage the services of outside
      advisors, experts and others to assist it in performing its responsibilities.
      No
      outside experts were utilized in 2006.




Also,
      the
      Compensation Committee looks to a group of comparable companies that it believes
      to be similar to the Company in terms of business characteristics and economics,
      including companies focusing on graphics services, and which are similarly
      sized. The Compensation Committee reviews this comparator group periodically,
      and obtains from their proxy statements data on compensation levels and award
      practices.




In
      addition
      to the compensation data for these comparator companies, the Compensation
      Committee relies upon data from various leading compensation surveys as an
      additional market reference point. The Compensation Committee believes that
      this
      survey data, together with the data from the comparator group, accurately
      defines competitive market compensation levels for executive talent.




The
      Compensation Committee reviews compensation and incentives to determine whether
      they are aligned with the Company’s compensation philosophy and to link the
      financial interests of our executives with the interests of our shareholders.
      This involves reviewing the mix of short- and long-term incentive opportunities
      as they relate to base salaries, our competitive environment and our overall
      philosophy of having a significant amount of pay at risk.




**Executive
      Compensation Philosophy**




Our
      compensation philosophy emphasizes pay for performance by targeting base salary
      midpoints for executives at or below the market median. We target short-term
      incentive opportunities and equity-based awards at or above the market median.
      Our goal is to provide an opportunity for total direct compensation that is
      competitive with the market median. By setting base salaries at or below market
      median, we believe salaries are sufficient to attract and retain executives
      but
      low enough to provide more emphasis on variable compensation.




Our
      executive
      compensation philosophy is designed to:





·
            Provide
                a competitive compensation opportunity to allow us to attract, retain
                and
                appropriately motivate key talent;





·
            Provide
                a significant portion of at-risk pay (incentive compensation), so
                that the
                actual compensation paid will vary up and down with performance.
                The
                portion of pay that is at risk increases for the more senior executive
                positions; and





·
            Align
                executive and shareholder interests by linking incentive compensation
                primarily to attaining internal strategic objectives and qualitative
                financial results. We further enhance the alignment by using equity-based
                grants. The value that participating executives realize from such
                grants
                depends upon the Company’s share price.





**Components
      of the Executive Compensation Program**




**Base
      Salary** :  Base
      salaries provide executives with fixed compensation. We set base salaries by
      starting with salary midpoints which are at or below the competitive market
      median, and then make adjustments based upon an executive’s individual
      performance, length and nature of experience, and the performance of the areas
      for which the executive is responsible. The compensation of newly-hired
      executives is generally determined based upon the individual’s previous
      experience and industry standards for compensation paid to employees with
      comparable responsibilities.




The
      base
      salary levels of executive officers in 2006 were not increased as part of any
      across-the-board salary increase; however, certain executives received salary
      increases consisting primarily of merit increases.




The
      Compensation Committee evaluates the performance of the CEO and his attainment
      of the specific strategic targets and earnings objectives set forth in his
      employment contract, and then makes a recommendation to the Board of Directors.
      The CEO has responsibility for recommending salary levels of executives other
      than the CEO and for evaluating their performance under their individualized
      bonus plan. Senior executives recommend salaries for other personnel and the
      CEO
      approves these recommendations before providing them to the Compensation
      Committee for review.




**Short-Term
      Incentive Plans** :  Merisel’s
      bonus plan provides for the payment of cash bonuses based upon the Company’s
      performance in relation to predetermined financial targets established by the
      Compensation Committee at the beginning of the year. In addition, all of the
      Company’s executives have received individualized bonus plans, in which their
      bonuses are based upon their attaining specific goals that have been
      pre-established by the Board of Directors. The NEOs’ bonus potential in 2006
      ranged between 50% and 100% of their base salaries. The amounts reported in
      the
“Non-Equity Incentive Plan Compensation” column of the summary Executive
      Compensation Table represent the exact amounts that the NEOs earned under our
      2006 short-term incentive plans (“STIPs”).




In
      addition,
      certain management-level employees (with the exclusion of field sales employees,
      who participate in sales incentive or commission plans) also participate in
      STIPs. Each year, the Compensation Committee establishes, as part of the
      Company’s annual operating plan, a potential pool for management STIPs. In 2006,
      the amount set aside for these STIPs was $2 million. The Committee establishes
      performance measures and goals applicable to individual employees. While
      individual plans may have different measures and goals, all of the plans include
      objective and quantifiable measures, which are reviewed and approved annually
      by
      the Compensation Committee.




At
      the
      conclusion of each fiscal year, the Compensation Committee reviews the extent
      to
      which actual performance satisfied the defined performance goals contained
      in
      each individual STIP. The Company typically pays STIP awards once the prior
      year’s financial statement audit has been completed and the Compensation
      Committee has approved amounts to be awarded.





**Individualized
      STIP** :  Messrs.
      Uzzi, Garg, Sheehan, Wasserman and other key employees participated in
      individualized performance-based bonus plans during 2006. The Compensation
      Committee approved earnings before interest, taxes, depreciation and
      amortization (“EBITDA”) goals for Merisel Americas, the Company’s primary
      operating subsidiary, as the Company-wide performance criterion for the 2006
      STIP formulas. In addition, executives who supervised specific subsidiaries
      had
      the opportunity to earn bonuses if their subsidiaries reached specific sales
      and
      profit targets, irrespective of the Company’s overall profitability.




There
      will
      not be any bonuses awarded to NEOs based upon the Company’s or individual
      sectors’ 2006 performance. However, executives who supervised certain divisions
      of the Company did receive 2006 bonuses.




**Long-term
      Incentive Plan**:  The
      Compensation Committee believes that equity-based long-term incentives (“LTIs”)
      should be a key component of the total compensation paid to eligible executives
      because they: (i) focus key executives and employees on the Company’s long-term
      financial growth and success, while providing perspective and balance to the
      Company’s annual goals; and (ii) promote the alignment of shareholder and
      employee interests. The Compensation Committee also believes that stock-based
      LTIs serve as a valuable tool in attracting and retaining key
      employees.




The
      Company provides LTIs through its shareholder-approved 1997 Stock Award and
      Incentive Plan (the “Plan”), which provides the Company with flexibility in
      awarding equity instruments, such as stock options, stock appreciation rights,
      restricted stock awards and restricted stock units. The Company reviews and
      evaluates its options in terms of equity awards, taking into consideration
      the
      competitive practices and emerging trends in the marketplace.




The
      Compensation Committee and Board of Directors determined that, with respect
      to
      the 2006 fiscal year, restricted stock awards vesting over a period of time
      would be preferable to option awards. While the Company historically granted
      stock option awards, the Compensation Committee determined, based upon, among
      other things, a market trend in favor of granting restricted stock awards,
      that
      restricted stock awards would incentivized executives and key employees and
      promote their retention. In 2006, the Company granted restricted stock awards
      to
      eighteen executives, including NEOs, and key employees employed in the Company’s
      various subsidiaries.




The
      Company
      is using, in connection with its 2007 equity grants, the closing price of the
      Company’s stock on the grant date to determine the value of restricted stock
      awards.


·
            **Stock
                Options**:
                After a cost-benefit analysis, which began in 2005, about stock options
                versus restricted stock grants, the Compensation Committee decided
                that it
                would not award stock options for 2006. 
 ·
            **Restricted
                Stock**:****The
                Compensation Committee determined that competitive market practices
                have
                continued to shift in favor of restricted stock awards. As a result,
                all
                2006 LTIs were made in the form of restricted stock
                awards.




Under
      restricted stock awards, executives and key employees receive shares of the
      Company’s common stock, but  only earn the stock once restrictions on the
      awards lapse (if, for example, the recipient remains an employee as of a
      pre-determined date).




The
      annual
      restricted stock awards made to executives and key employees in 2006 will be
      fully vested at the end of three years. However, recipients of restricted stock
      awards have the potential to vest their shares early if the Company undergoes
      a
“change of control,” as defined in the Plan.




In
      addition
      to group awards, restricted stock awards are also used in special circumstances,
      such as recruiting, for special recognition, and for retaining employees, and
      may have different vesting conditions. On December 15, 2006, Mr. Jon
      Peterson received 7,500 shares vesting on May 1, 2007 in connection with his
      joining the Company as CFO.


**Benefits** :  The
        Company provides other benefits to executives and employees, including medical
        and dental plans, death benefits, deferred compensation plans, retirement
        plans,
        an employee savings plan, and certain other limited perquisites. The goal
        of
        these programs is to provide benefits that are competitive in the marketplace
        in
        which we compete for executives and employees. In general, there were no
        material changes to these benefits during 2006.




**Medical
      and Dental Benefits**:  The Company provides medical and dental
      benefit plans in which substantially all of the Company’s employees are invited
      to participate.  The Company does not provide any supplemental medical or
      dental benefits to its NEOs.




**Employee
      Savings Plans**:  The Company has qualified Section 401(k) savings
      plans for employees that are believed to be competitive with those offered
      by
      similar companies.  Eligible participants are permitted to make
      contributions up to IRS limits and the Company matches these contributions
      up to
      50% of the employees contribution up to a maximum contribution of 3%.  The
      Company’s contributions vest 25% per year.




**Perquisites
      and Other Compensation**:  The Company provides perquisites
      consisting of payments that are negotiated on a case-by-case basis.  In
      connection with Mr. Uzzi’s hiring, the Company provided a $100,000 relocation
      allowance in 2005 for his relocation to New York City upon the acquisition
      of
      Color Edge.  Upon the acquisition of Color Edge in 2005, the Company
      provided Messrs. Garg and Sheehan with buyout payments or $40,000 and $25,000
      respectively for their predecessor-entity employment contracts. In 2006, Mr.
      Peterson received a relocation allowance in connection with his
      hiring.





Additional
        Executive Compensation Policies and Agreements




In
      addition to the compensation programs described above, we have adopted a number
      of policies and agreements to promote the goals of the executive compensation
      program and strengthen the alignment of shareholder and executive long-term
      interests. We have employment contracts with Messrs. Uzzi, Sheehan, Garg,
      Wasserman and Peterson that specify specific salaries, incentive compensation
      and other compensation and benefits, and which are described in detail under
      the
      heading “Termination and Change-of-Control Arrangements.”




**Compensation
      Following Executive Termination or Change in Control**





In
      addition to the provisions of their employment agreements, each of the NEOs
      received, on December 15, 2006, shares of restricted stock that vest over three
      years, and which are subject to the Restricted Stock Agreement utilized for
      substantially all executives and key employees.




To
      the
      extent that the stock is unvested, and provided that the recipient remains
      continuously employed with the Company, the recipient will have the rights
      of a
      stockholder with respect to the unvested shares of stock, including without
      limitation, the right to vote the stock and receive any dividends declared
      thereon, but will be restricted in his or her ability to transfer the stock.
      In
      addition, the stock will be forfeited if the recipient leaves the
      Company.




Vesting
      will accelerate in the event of a Change of Control, as defined in the Plan.
      In
      the event of a Change of Control, any consideration paid for the Company’s
      common stock as part of the Change-of-Control transaction will also be paid
      for
      the unvested stock, but such consideration will be held in escrow by the Company
      for up to 180 days after the Change of Control. The recipient will forfeit
      the
      consideration if he or she resigns or his or her employment is terminated,
      other
      than without cause, during that time period.




For
      additional details about the CEO’s and NEOs’ employment agreements and benefits,
      please see the section entitled “Executive Compensation, Termination or Change
      of Control Arrangements,” which follows the Executive Compensation Tables.




**Consideration
      of Tax and Accounting Treatment on Compensation**




To
      the
      extent readily determinable, and as one of the factors in its consideration
      of
      compensation matters, the Compensation Committee considers
      the anticipated tax treatment to the Company and executives of various
      compensation arrangements. S ome
      types
      of compensation and their deductibility depend upon the timing of an executives
      vesting or exercise of previously-granted rights. Furthermore, interpretations
      of, and changes in, the tax laws effect the deductibility of compensation.
      To
      the extent reasonably practicable and within the Committee’s control, the
      Committee intends to limit executive compensation in ordinary circumstances
      to
      that deductible under Section 162(m) of the IRC of 1986. In doing so, the
      Committee may use alternatives, such as deferring compensation, to qualify
      executive compensation for deductibility, and may rely upon grandfathering
      provisions with respect to existing contractual commitments.




**Compensation
      Committee Report**




The
      Compensation Committee of the Board of Directors has furnished the following
      report:




The
      Committee has reviewed and discussed the Compensation Discussion and Analysis
      (CD&A) with the company’s management. Based on that review and discussion,
      the Committee has recommended to the Board of Directors that the CD&A be
      included in the company’s Annual Report on Form 10-K for 2006.




Lawrence
                J. Schoenberg (Chair)Albert
                J. Fitzgibbons IIIBradley
                J. Hoecker**April
                30, 2007**
            Edward
                A. Grant





**Executive
      Compensation Tables**




The
      following table sets forth the compensation paid by the Company to the Chief
      Executive Officer, Chief Financial Officer (current and predecessor) and each
      of
      the other three most highly compensated executive officers for services in
      all
      capacities to the Company in 2006, except as otherwise indicated.




**Name
                and**
              **Principal
                Position**
            
            **Year**
            
            **Salary
                ($)**
            
            **Bonus
                ($) (1)**
            
            **Stock
                Awards**
              **($)
                (2)**
            
            **Option
                Awards**
              **($)
                (3)**
            
            **Non-Equity
                Incentive Plan Compensation**
              **($)
                (1)**
            
            **Changes
                in Pension Value & Non-Qualified Deferred
                Compensation**
              **Earnings
                ($)**
            
            **All
                Other**
              **Compensation
                ($) (4)**
            
            **Total**
              **($)**Donald
                R. Uzzi
              Chief
                Executive Officer and
              President
            
            
            2006
            
            
            392,308
            
            
            -
            
            
            178,008
            
            
            183,617
            
            
            400,000
            
            
            -
            
            
            6,600
            
            
            1,160,533Jon
                H. Peterson (5)
              Executive
                Vice President and
              Chief
                Financial Officer
            
            
            2006
            
            
            168,000
            
            
            -
                (7
            )
            
            35,963
            
            
            -
            
            
            -
            
            
            -
            
            
            25,395
            
            
            229,358Allyson
                Vanderford (6)
              Former
                Chief Financial
              Officer
            
            
            2006
            
            
            77,537
            
            
            -
            
            
            -
            
            
            -
            
            
            97,500
            
            
            -
            
            
            122,369
            
            
            297,406John
                Sheehan
              Executive
                Vice President
              President
                Color Edge
            
            
            2006
            
            
            300,000
            
            
            -
            
            
            963
            
            
            -
            
            
            150,411
            
            
            -
            
            
            6,600
            
            
            457,974Rajiv
                Garg
              Executive
                Vice President
            
            
            2006
            
            
            325,000
            
            
            -
            
            
            963
            
            
            -
            
            
            162,945
            
            
            -
            
            
            6,600
            
            
            495,508Kenneth
                Wasserman,
              Executive
                Vice President
              President
                Comp 24
            
            
            2006
            
            
            287,500
            
            
            -
            
            
            963
            
            
            -
            
            
            144,144
            
            
            -
            
            
            6,600
            
            
            438,244





(1)
            The
                cash bonuses paid were based upon the Company’s performance for 2005 in
                relation to the predetermined financial targets established at the
                beginning of the year by the Compensation Committee. In accordance
                with
                SEC requirements, these amounts are reported in the Non-Equity Incentive
                Plan Compensation column.





(2)
            The
                dollar amount represents the amount recognized in 2006 for
                financial-statement reporting purposes in accordance with SFAS No.
                123R.
                The weighted average grant date fair value of the shares was $4.31
                and the
                weighted average period over which that cost is expected to be recognized
                is 2.4 years.





(3)
            The
                dollar amount represents the amount recognized in 2006 for
                financial-statement reporting purposes in accordance with SFAS No.
                123R.
                Under SFAS No. 123R, an issuer recognizes the grant date fair value
                of an
                award over the requisite service period. For purposes of this calculation,
                the impact of forfeitures is excluded until they actually occur.
                None of
                the Company’s NEOs forfeited options during 2006. We based the fair value
                of stock awards on the market price of the shares awarded on the
                date of
                the determination of eligibility. The weighted average grant date
                fair
                value of the shares was $8.33 and the weighted average period over
                which
                that cost is expected to be recognized is 1
                year.





(4)
            The
                following table sets forth the compensation elements of the “All Other
                Compensation” column





**Executive**
            
            **Company
                Contribution to 401(k) Plan ($)**
            
            **Relocation
                Allowance ($)**
            
            **Severance
                Payment ($)**Donald
                R. Uzzi
            
            
            6,600
            
            
            -
            
            
            -Jon
                H. Peterson
            
            
            5,209
            
            
            20,186
            
            
            -Allyson
                Vanderford
            
            
            6,600
            
            
            -
            
            
            115,769John
                Sheehan
            
            
            6,600
            
            
            -
            
            
            -Rajiv
                Garg
            
            
            6,600
            
            
            -
            
            
            -Kenneth
                Wasserman
            
            
            6,600
            
            
            -
            
            
            -





(5)
            Mr.
                Peterson became Chief Financial Officer effective May 1,
                2006.





(6)
            Ms.
                Vanderford terminated her employment with the Company effective May
                12,
                2006.





(7)
            Mr.
                Peterson was guaranteed a bonus of 30% of his base salary for 2006.
                A
                bonus of $47,250 will bee paid in
                2007




**Grants
      of Plan Based Awards for 2006**





**All
                Other Stock Awards: Number of Shares of Stock or Unit
                (#)(1)**
            
            **All
                other Option Awards: Number of Securities Underlying Option
                (#)(2)**
            
            **Exercise
                or Base Price of Option Awards ($/sh) (2)**
            
            **Grant
                Date Fair Value of Stock and Option Awards ($/sh)****Estimated
                Possible Payouts Under Non-Equity Incentive Plan
                Awards**
            
            **Estimated
                Future Payouts Under Equity Incentive Plan Awards****Name**
            
            **Grant
                Date**
            
            **Threshold
                ($)**
            
            **Target
                ($)**
            
            **Maximum
                ($)**
            
            **Threshold
                (#)**
            
            **Target
                (#)**
            
            **Maximum
                (#)**Donald
                R. Uzzi
            
            
            12/15/06
            
            
            -
            
            
            400,000
            
            
            400,000
            
            
            -
            
            
            -
            
            
            -
            
            
            80,000
            
            
            -
            
            
            -
            
            
            3.85Jon
                H. Peterson
            
            
            5/1/06
            
            
            -
            
            
            94,500
            
            
            94,500
            
            
            -
            
            
            -
            
            
            -
            
            
            7,500
              
              15,000
            
            
            -
            
            
            -
            
            
            7.00
              
              3.85Allyson
                Vanderford
            
            
            12/15/06
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Rajiv
                Garg
            
            
            12/15/06
            
            
            -
            
            
            195,000
            
            
            195,000
            
            
            -
            
            
            -
            
            
            -
            
            
            15,000
            
            
            -
            
            
            -
            
            
            3.85John
                Sheehan
            
            
            12/15/06
            
            
            -
            
            
            180,000
            
            
            180,000
            
            
            -
            
            
            -
            
            
            -
            
            
            15,000
            
            
            -
            
            
            -
            
            
            3.85Kenneth
                Wasserman
            
            
            12/15/06
            
            
            -
            
            
            172,500
            
            
            172,500
            
            
            -
            
            
            -
            
            
            -
            
            
            15,000
            
            
            -
            
            
            -
            
            
            3.85




(1)
            Under
                the Company’s 1997 Stock Incentive Plan, the Company granted restricted
                shares of its common stock. NEOs earn the shares when their restrictions,
                but only if they remain employees of the Company at that time, or
                certain
                other circumstances apply. Except for the special award of 7,500
                shares
                granted to Mr. Peterson during 2006, the restricted stock award that
                were
                granted fully vest at the end of three
                years.




(2)
            Stock
                options were not granted to any Company personnel during 2006.





Outstanding
        Equity Awards at December 31, 2006


**Option
                Awards**
            
            **Stock
                Awards****Name**
            
            **Number
                of Securities Underlying Unexercised Options Exercisable
                (#)**
            
            **Number
                of Securities Underlying Unexercised Options Unexercisable (#) (1)**
            
            **Equity
                Incentive Plan Awards: Number of Securities Underlying Unexercised
                Unearned Options (#)**
            
            **Option
                Exercise Price ($)**
            
            **Option
                Expiration Date**
            
            **Number
                of Shares or Units of Stock That Have Not Vested (#)
                (2)**
            
            **Market
                Value of Shares or Units of Stock That Have Not Yet Vested
                ($)**
            
            **Equity
                Incentive Plan Awards: Number of Unearned Shares, Units or Other
                Rights
                That Have Not Vested (#)**
            
            **Equity
                Incentive Plan Awards: Market or Payout Value of Unearned Shares,
                Units or
                Other Rights That Have Not Vested ($)**Donald
                R. Uzzi
            
            
            75,000
              
              75,000
              
              75,000
            
            
            25,000
              
              25,000
              
              25,000
            
            
            -
            
            
            5.00
              
              8.00
              
              12.00
            
            
            11/22/2014
              
              11/22/2014
              
              11/22/2014
            
            
            117,500
            
            
            424,175
            
            
            -
            
            
            -Jon
                H. Peterson
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            22,500
            
            
            81,225
            
            
            -
            
            
            -Allyson
                Vanderford
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Rajiv
                Garg
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            15,000
            
            
            54,150
            
            
            -
            
            
            -John
                Sheehan
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            15,000
            
            
            54,150
            
            
            -
            
            
            -Kenneth
                Wasserman
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            15,000
            
            
            54,150
            
            
            -
            
            
            -




(1)          
      Mr. Uzzi’s stock options vest on November 22, 2007.




(2)          
      Except for the special award of 7,500 shares granted to Mr. Peterson during
      2006, which fully vest in one year, the restricted stock awards granted during
      during 2006  vest over three years.


**Options
        Exercised and Stock Vested in 2006**




The
      following table sets forth, for the year ended December 31, 2006, for each
      NEO,
      the number of securities for which options were exercised, the aggregate dollar
      value realized upon the exercise of these options, the number of shares of
      stock
      that have vested, and the aggregate dollar value realized upon vesting of the
      stock, or upon the transfer of an award for value. There were no options
      exercised with respect to NEOs during 2006.


**Name**
            **Number
                of Shares Acquired on Exercise (#)**
            **Value
                Realized on Exercise ($)**
            **Number
                of Shares Acquired on Vesting (#)**
            **Value
                Realized on Vesting ($)**Donald
                R. Uzzi
            -
            -
            37,500
            127,500Jon
                H. Peterson
            -
            -
            -
            -Allyson
                Vanderford
            -
            -
            -
            -John
                Sheehan
            -
            -
            -
            -Rajiv
                Garg
            -
            -
            -
            -Kenneth
                Wasserman
            -
            -
            -
            -





**Pension
      Benefits**




The
      Company does not offer pension benefits to its executive officers.




**Non-qualified
      Defined Contribution and other Nonqualified Deferred Compensation
      Plans**




The
      Company does not offer non-qualified defined contribution or other deferred
      compensation plans to its executive officers.




**Executive
      Employment, Termination and Change-of-Control Arrangements**




**Compensation,
      Termination and Change-of-Control Arrangements for the Company’s
      CEO**




In
      November
      2004, Donald R. Uzzi was hired to serve as the Company’s Chief Executive Officer
      and President of the Company under an employment agreement that was amended
      in
      March 2006. The
      employment agreement provides for a three-year term that continuously renews
      for
      additional one-year terms unless either party gives written notice of
      non-renewal at least 90 days prior to the expiration of the then-effective
      term.




In
      March
      2005, Mr. Uzzi’s base salary increased from $200,000 to $400,000 per year as a
      result of the acquisitions of Color Edge, Inc., Color Edge Visual, Inc. and
      Comp
      24, LLC. Mr. Uzzi’s base salary will increase to $450,000 when the Company
      achieves earnings before taxes of at least $12,000,000 on a rolling four-quarter
      basis, and to $500,000 when the Company achieves earnings before taxes of at
      least $15,000,000 on a rolling four-quarter basis.




Mr.
      Uzzi is
      also eligible for an annual bonus targeted at 100% of his base salary, which
      will be awarded when the Company achieves the EBITDA forecasted in the financial
      plan approved by the Board of Directors and other goals determined by the Board
      of Directors or
      Compensation Committee.




If
      Mr. Uzzi’s
      employment is terminated by the Company without “cause,” or by Mr. Uzzi’s
      resignation for “good reason,” as these terms are defined in the employment
      agreement, during the one-year period following a change of control of the
      Company, Mr. Uzzi will be entitled to a lump-sum payment of 24 months of his
      base salary. If Mr. Uzzi’s employment is terminated due to death or disability,
      Mr. Uzzi will be entitled to receive his base salary for 60 days following
      his
      termination.




Mr.
      Uzzi will
      be entitled to a pro-rata portion of his annual bonus, which will be awarded
      if
      the Company satisfies applicable criteria up until the date of termination,
      for
      the year in which the termination occurs, if he is: (i) terminated by the
      Company without cause, (ii) terminated by the Company without cause or resigns
      for good reason within one year following a change in control; (iii) terminated
      following the Company’s delivery of a notice of non-renewal, or (iv) terminated
      due to his death or disability.




Under
      the
      employment agreement, Mr. Uzzi was granted 150,000 restricted shares of the
      Company’s common stock, along with options to purchase 300,000 shares of the
      Company’s common stock, the terms and status of which are described in the
      compensation tables.




If
      Mr. Uzzi’s
      employment is terminated by the Company without cause or due to his death or
      disability, a pro-rata portion of the unvested restricted shares and options
      that were scheduled to vest on the next scheduled vesting date following the
      date of termination will become immediately vested. If Mr. Uzzi’s employment is
      terminated by the Company without cause or Mr. Uzzi resigns for good reason
      within one year following a change in control, all outstanding unvested
      restricted stock options shall fully vest. If Mr. Uzzi’s employment is
      terminated for cause prior to November 24, 2007, Mr. Uzzi will forfeit all
      unvested and vested restricted stock and options.




The
      employment agreement also contains customary confidentiality, non-compete and non-solicitation provisions.





**Compensation,
      Termination and Change of Control Agreements for the Company’s Other
      NEOs**




In
      March
      2005, Merisel Americas, a Delaware corporation and the Company’s wholly-owned
      subsidiary, entered into an employment agreement with Rajiv Garg, under which
      he
      is to serve as Merisel Americas’ Executive Vice President. The employment
      agreement provides for a three-year term that continuously renews for additional
      one-year terms unless either party gives written notice of non-renewal at least
      60 days prior to the expiration of the then-effective term.




Under
      the
      employment agreement, Mr. Garg receives a base salary of $325,000 per year.
      Mr.
      Garg is also eligible for an annual bonus targeted at 60% of his base salary,
      which will be awarded when Merisel Americas achieves the EBITDA forecasted
      in
      the financial plan approved by the Board of Directors and other goals determined
      by the Board of Directors or Compensation Committee.




If
      Mr. Garg’s
      employment is terminated by the Company without cause or if he terminates his
      employment for “good reason,” as defined in the employment agreement, he will be
      entitled to receive his base salary for the remainder of his three-year
      employment term, any accrued and unpaid bonus for the year of termination
      pro-rated through the date of termination, and any other amounts owed to him
      through the date of termination. If Mr. Garg is terminated for “cause,” as
      defined in the employment agreement, he will be entitled to his earned and
      unpaid base salary through the date of termination. If Mr. Garg is terminated
      due to his death or disability, as defined in the employment agreement, he
      will
      be entitled to: (i) a pro-rata portion of his annual bonus for the calendar
      year
      in which the termination occurs, based upon the attainment of the applicable
      criteria up to the date of termination, plus an annual bonus for a completed
      calendar year, which has accrued but has not yet paid at the time of such
      termination; and (ii) a continuation of his base salary for 30 days commencing
      on the date of termination.




The
      employment agreement also contains customary confidentiality, non-compete and non-solicitation provisions.




In
      March
      2005, Merisel Americas entered into an employment agreement with John Sheehan,
      under which he is to serve as President of Color Edge, LLC, an indirect
      wholly-owned subsidiary. The employment agreement provides for a five-year
      term
      that continuously renews for additional one-year terms unless either party
      gives
      written notice of non-renewal at least 60 days prior to the expiration of the
      then-effective term




Under
      the
      employment agreement, Mr. Sheehan receives a base salary of $300,000 per year,
      which may be increased to $322,500 per year if Merisel Americas attains EBITDA
      of at least $16,500,000 on a rolling, four-quarter basis, and to $346,688 per
      year if Merisel Americas attains EBITDA of at least $18,000,000 on a rolling
      four-quarter basis. Mr. Sheehan also is eligible for an annual bonus targeted
      at
      60% of his base salary, which will be awarded when the Company achieves the
      EBITDA forecasted in the financial plan approved by the Board of Directors
      and
      other goals determined by the Board of Directors or
      Compensation Committee.




Except
      insofar as his agreement is based upon a five-year fixed term, the remaining
      terms of Mr. Sheehan’s employment agreement are substantially identical to the
      terms of Mr. Garg’s employment agreement, including customary confidentiality, non-compete and non-solicitation provisions.




In
      March
      2005, Merisel Americas entered into an employment agreement with Kenneth
      Wasserman, under which he is to serve as President of Comp 24, LLC, an indirect
      wholly-owned subsidiary. The employment agreement provides for a five-year
      term
      that continuously renews for additional one-year terms unless either party
      gives
      written notice of non-renewal at least 60 days prior to the expiration of the
      then-effective term.




Under
      the
      employment agreement, Mr. Wasserman receives a base salary of $287,500 per
      year,
      which may be increased to $309,063 per year if Merisel Americas attains EBITDA
      of at least $16,500,000 on a rolling, four-quarter basis, and to $332,243 per
      year if Merisel Americas attains EBITDA of at least $18,000,000 on a rolling
      four-quarter basis. Mr. Wasserman also is eligible for an annual bonus targeted
      at 60% of his base salary, which
      will be awarded when Merisel Americas achieves the EBITDA forecasted in the
      financial plan approved by the Board of Directors and other goals determined
      by
      the Board of Directors or Compensation Committee.




The
      remaining
      terms of Mr. Wasserman’s employment agreement are substantially identical to the
      terms of Mr. Sheehan’s employment agreement.




On
      May 1,
      2006, the Company entered into an employment agreement with Jon H. Peterson,
      under which he is to serve as Executive Vice President and Chief Financial
      Officer of the Company.




Under
      the
      employment agreement, Mr. Peterson receives a base salary of $210,000 per year,
      and is eligible for an annual bonus targeted at 60% of his base salary, subject
      to achievement of performance criteria determined by the Company’s Compensation
      Committee in its sole discretion, such as the Company’s achieving the EBIDTA
      forecasted in the financial plan approved by the Company’s Compensation
      Committee, provided that the amount of Mr. Peterson’s bonus for 2006 will be at
      least 30% of his base salary.




Mr.
      Peterson
      also received a grant of 7,500 restricted shares of the Company’s common stock
      that will vest on May 1, 2007. If Mr. Peterson is terminated by the Company,
      other than for cause, as defined in the employment agreement, after a change
      in
      control, he will be entitled to a severance payment equal to six (6) months’
base salary.





**Compensation
      of Directors**




The
      following table sets forth, for the year ended December 31, 2006, information
      relating to the compensation of each Director of the Company who served during
      the fiscal year who was not a NEO. Compensation received by, or accrued for
      Mr.
      Don Uzzi, Chief Executive Officer of the Company and Chairman of the Board
      of
      Directors, is fully reflected in the tables set forth above.




**Name**
            
            **Fees
                Earned or Paid in Cash ($)**
            
            **Stock
                Awards ($)**
            
            **Option
                Awards ($)**
            
            **Non-Equity
                Incentive Plan Compensation**
            
            **Change
                in Pension Value and Nonqualified Deferred Compensation
                Earnings**
            
            **All
                Other Compensation**
            
            **Total**Edward
                A. Grant
            
            
            16,500
            
            
            16,334
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            32,834Dr.
                Arnold Miller
            
            
            45,500
            
            
            46,670
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            92,170Lawrence
                Schoenberg
            
            
            51,000
            
            
            35,003
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            86,003Ronald
                A. Badie
            
            
            47,000
            
            
            35,003
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            82,003Albert
                J. Fitzgibbons III
            
            
            37,500
            
            
            35,003
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            72,503Bradley
                Hoecker
            
            
            37,000
            
            
            35,003
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            72,003





**Narrative
      to Director Compensation Table**




Beginning
      in
      2006, non-employee directors are entitled to receive: a $30,000 annual retainer
      fee; $1,500 for each Board of Directors meeting attended (or $500 for each
      telephonic meeting additional to the four telephonic meetings per year included
      in the annual retainer); $2,000 per quarter for acting as the Chairman of the
      Audit Committee; $1,000 per quarter for acting as the Chairman of any other
      Committee; $1,250 per quarter for acting as Lead Director (a position created
      in
      the third quarter of 2005); $500 for each Committee meeting attended; plus
      reimbursement for travel expenses incurred in attending Board of Directors
      and
      Committee meetings.




In
      addition,
      non-employee directors were entitled to receive 4,000 shares of fully vested
      stock for service in 2005. After 2005, non-employee directors were entitled,
      upon election, to an annual grant of restricted stock with a fair market value
      of $28,000, as determined as of the date of the Compensation Committee meeting,
      which will vest on the first anniversary of the grant. If a director leaves
      for
      any reason, other than change of control, prior to vesting, all unvested shares
      are forfeited. New or substituted securities or other property will be
      substituted for unvested shares in the event of a consolidation, merger or
      sale
      of all, or substantially all, of the assets of the Company.




Non-employee
      directors are also permitted to elect to be compensated for up to 25 percent
      of
      their annual retainer fee in shares of the Company’s common stock, the value of
      which will be determined with reference to the market price of the Company’s
      common stock as of the first day of the quarter following each annual
      shareholder meeting.




The
      Company
      does not have a uniform policy or agreement concerning payments to directors
      upon their departure from the Board. Dr. Arnold Miller retired from the Board
      of
      Directors effective May 31, 2006, and, on April 26, 2006, the Board voted to
      award him 4,198 shares of Common stock, with a market value of $28,000 as of
      the
      date of the meeting, a $45,500 fee, and a $50,000 consulting contract for the
      2007 calendar year.





**Item
      12. SecurityOwnership of Certain Beneficial Owners and
      Management**




Information
      regarding the Company’s stock-based compensation plans was included in Item 12
      of the Form 10-K filed on April 17, 2007.




The
      following
      table sets forth, as of March 30, 2007, certain information regarding the
      beneficial ownership of the Company’s common stock by each stockholder known by
      the Company to be the beneficial owner of 5% or
      more of the outstanding common stock as of such date, each director, each NEO,
      and all directors and executive officers as a group. Unless otherwise indicated,
      the stockholders have sole voting and investment power, subject to community
      property laws, where applicable, with respect to shares beneficially owned
      by
      them.




**Shares
                Beneficially Owned****Name**
            
            **Number**
            
            **Percentage**Phoenix
                Acquisition Company II, L.L.C. (1) (14)
            
            
            6,440,920
            
            
            66.33
            %540
                Madison Avenue, 25thFloorNew
                York, NY 10022Gary
                Furukawa (2)
            
            
            771,071
            
            
            7.94
            %1191
                Second Avenue, Suite 2100Seattle,
                WA 98101Ronald
                P. Badie (4)
            
            
            9,689
            
            
            *Albert
                J. Fitzgibbons III (3)(5)
            
            
            9,689
            
            
            *Edward
                Grant (6)
            
            
            4,198
            
            
            *Bradley
                J. Hoecker (3) (7)
            
            
            9,689
            
            
            *Lawrence
                J. Schoenberg (8)
            
            
            45,847
            
            
            *Donald
                R. Uzzi (9)
            
            
            455,000
            
            
            4.69
            %Jon
                H. Peterson (10)
            
            
            22,500
            
            
            *Rajiv
                Garg (11)
            
            
            15,000
            
            
            *John
                J. Sheehan (12)
            
            
            15,000
            
            
            *Kenneth
                Wasserman (13)
            
            
            15,000
            
            
            *All
                Directors and Executive Officers as a Group
              (10
                Persons)
            
            
            601,612
            
            
            6.20
            %




*Represents
      less than 1%




(1)
            All
                information regarding share ownership is taken from, and furnished
                in
                reliance upon, the Schedule 13D filed by Phoenix Acquisition Company
                II,
                L.L.C. (“Phoenix”) pursuant to Section 13(d) of the Securities Exchange
                Act of 1934. Stonington Capital Appreciation 1994 Fund, L.P. (the
“Fund”)
                is the sole member of Phoenix. Stonington Partners, L.P. (“Stonington LP”)
                is the general partner of the Fund, and Stonington Partners, Inc.
                II
                (“Stonington II”) is the general partner of Stonington LP. The Fund is
                managed by Stonington. The following individuals are the directors
                and/or
                officers of Stonington and Stonington II and have shared voting and
                dispositive powers with respect to the common stock held by Phoenix:
                Alexis P. Michas, James J. Burke, Jr., Albert J. Fitzgibbons III,
                and
                Bradley J. Hoecker. Stonington LP, Stonington II, Stonington and
                each of
                the directors and officers of Stonington II and Stonington disclaim
                beneficial ownership of these shares. The business address of Phoenix,
                Stonington and their directors and officers is 540 Madison Avenue,
                25th
                Floor, New York, New York 10022.


(2)
            All
                information regarding share ownership is taken from, and furnished
                in
                reliance upon, the Schedule 13D filed by Mr. Furukawa pursuant to
                Section
                13(d) of the Securities Exchange Act of
                1934.


(3)
            Messrs.
                Fitzgibbons and Hoecker are directors or partners of certain affiliates
                of
                Phoenix and, therefore, may be deemed to beneficially own the 6,440,920
                shares of common stock beneficially owned by Phoenix. Both Messrs.
                Fitzgibbons and Hoecker disclaim such beneficial ownership. The address
                of
                Messrs. Fitzgibbons and Hoecker is the same as that given for Phoenix.


(4)
            Includes
                5,491 shares of common stock and 4,198 shares of unvested restricted
                stock
                issued on December 15, 2006.


(5)
            Includes
                5,491 shares of common stock and 4,198 shares of unvested restricted
                stock
                issued on December 15, 2006.


(6)
            Includes
                4,198 shares of unvested restricted stock issued on December 15,
                2006.


(7)
            Includes
                5,491 shares of common stock and 4,198 shares of unvested restricted
                stock
                issued on December 15, 2006.


(8)
            Includes
                41,549 shares of common stock, 4,198 shares of unrestricted stock
                issued
                on December 15, 2006, and 100 shares issuable with respect to stock
                options exercisable within 60 days after March 30,
                2007.


(9)
            Includes
                150,000 shares issuable with respect to stock options exercisable
                within
                60 days of March 30, 2007.


(10)
            Includes
                22,500 shares of unvested restricted stock issued on December 15,
                2006.


(11)
            Includes
                15,000 shares of unvested restricted stock issued on December 15,
                2006.


(12)
            Includes
                15,000 shares of unvested restricted stock issued on December 15,
                2006.


(13)
            Includes
                15,000 shares of unvested restricted stock issued on December 15,
                2006.


(14)
            Includes
                1,440,920 shares of common stock into which the convertible preferred
                stock beneficially owned by Phoenix is convertible within 60 days
                of March
                30, 2007.





**Item
      13. CertainRelationships, Related Transactions and
      Director Independence**




There
      are no
      family relationships among any of the directors or executive officers of the
      company.




In
      March 2006
      the Company entered into indemnity agreements (the “Indemnity Agreements”) with
      all of its directors, Mr. Uzzi and Mr. Peterson. The Indemnity Agreements
      provide that the Company will indemnify each party (the “Indemnitee”) against
      expenses and damages in connection with claims relating to the Indemnitee’s
      service to the Company, to the fullest extent permitted by the Company’s bylaws
      and Delaware’s General Corporation Law (“DGCL”)




The
      Indemnity
      Agreements provide that the Company will pay the expenses of the Indemnitee
      incurred in any such proceedings prior to final disposition of the claim,
      without regard to Indemnitee’s ability to repay the expenses or ultimate
      entitlement to indemnification under other provisions of the Indemnity
      Agreements. However, by executing and delivering the Indemnity Agreement, the
      Indemnitee undertakes to repay an advance to the extent it is ultimately
      determined that the Indemnitee was not entitled to indemnification.




The
      Indemnity
      Agreements specify certain procedures and assumptions that will apply in
      connection with requests for indemnification and advancement of expenses, and
      require that the Company maintain fiduciary liability insurance for directors,
      officers, employees and other agents of the Company. The rights provided to
      the
      Indemnitees under the Indemnity Agreements are additional to any other rights
      they may have under the Company‘s certificate of incorporation, bylaws,
      agreements, applicable laws, vote of stockholders or resolution of the
      directors, and so forth.




Certain
      members of the Company’s Board of Directors currently serve on boards of other
      public and private companies, including Obagi Medical Products, Inc., which
      are
      also under the control of Stonington Partners or its affiliates. These entities
      may be considered to be under “common control” with the Company.




**Director
      Independence**




The
      Board
      of Directors has determined that the Company is a “controlled company” under the
      NASD’s rules because more than 50% of the Company’s common stock is held by one
      entity, Phoenix Acquisition Company II, L.L.C., an affiliate of Stonington
      Partners, Inc. Accordingly, the Company is not required to, and, in fact, does
      not have a majority of independent directors on its Board, nor does it have
      compensation or nominating committees comprised solely of independent directors.
      The Board of Directors has determined that Messrs. Badie, Grant and Schoenberg
      meet the independence requirements of the SEC and NASD.


**Item
      14. PrincipalAccountant Fees and
      Services.**




The
      following table presents fees billed for professional audit services rendered
      by
      BDO, the Company’s current principal accounting firm, for the audit of the
      Company’s annual financial statements for 2006 and 2005, review of the quarterly
      financial statements for 2006 and 2005 and fees billed for other services
      rendered by BDO in 2006 and 2005.





**2006**
            
            **2005**Audit
                fees (1)
            
            $
            204,000
            
            $
            275,000Audit-related
                fees (2)
            
            
            102,000
            
            
            145,000Tax
                fees (3)
            
            
            -
            
            
            15,000All
                other fees
            
            
            -
            
            
            -Total
            
            $
            306,000
            
            $
            435,000




(1)
      Audit
      fees for 2005 are only related to services provided by BDO. Certain amounts
      paid
      related to work performed by the Company’s former accounting firm, Deloitte
& Touche, LLP, during 2004 are not reflected in the table.


(2)
            The
                2006 billings relate to the 2005 audit of the employee benefit plan
                and
                review of comment letters received from the SEC. The 2005 billings
                relate
                to the 2004 audit of the employee benefit plan. The 2005 billings
                relate
                to audits performed in connection with the acquisitions of Color
                Edge,
                Comp 24 and Crush Creative.


(3)
            Tax
                fees relate to various tax consulting and planning
                services.




In
      accordance
      with existing audit committee policy and the more recent requirements of the
      Sarbanes-Oxley Act, all services to be provided by BDO are subject to
      pre-approval by the Audit Committee. This includes audit services, audit-related
      services, tax services and other services. In some cases, pre-approval is
      provided by the full audit committee for up to a year, and relates to a
      particular category or group of services and is subject to a specific budget.
      In
      other cases, the audit committee has delegated authority to Mr. Edward A.
      Grant **** to
      pre-approve additional services, which then is to be communicated to the full
      audit committee. All of the fees listed above have been approved by the Audit
      Committee.





**Item
      5.Market for the Registrant’s Common Equity and Related
      Stockholder Matters and Issuer Purchases of Equity Securities: Stock
      Performance**




The
      following
      graph compares the total cumulative stockholder return on the Company’s common
      stock for the five-year period ended December 31, 2006 to that of the Russell
      2000 Index, a broad-based market index representing small-cap stocks, and a
      peer
      group (the “Peer Group”) of common stocks that includes the Company and three
      other companies selected because their businesses are comparable. The Company
      intends to continue to evaluate and identify companies that are appropriate
      for
      including in the Peer Group.




In
      this
      graph, Schawk, Inc., Consolidated Graphics, Inc., Multi-Color Corporation and
      the Company comprise the Peer Group. The graph assumes that the value of an
      investment in common stock and in each such index was $100 on December 31,
      2001,
      and that all dividends have been reinvested. Cumulative total stockholder return
      consists of change in stock price and cumulative dividends, assuming dividend
      reinvestment.




The
      relative
      performance of the Company’s common stock, the Russell 2000 Index, and the Peer
      Group is as follows:











**NAME**
            **200****1**
            **2002**
            **2003**
            **2004**
            **2005**
            **2006****MERISEL,
                INC.**
            100.00
            115.15
            358.18
            363.64
            460.61
            218.79**RUSSELL
                2000 INDEX**
            100.00
            78.42
            114.00
            133.38
            137.81
            161.24**PEER
                GROUP**
            100.00
            103.65
            156.74
            201.73
            238.33
            265.97





**SIGNATURES**








Pursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
      1934, the Registrant has duly caused this report to be signed on its behalf
      by
      the undersigned, thereunto duly authorized.


**MERISEL,
              INC.**Date: April
              30, 2007
            By:
            /s/ Donald
              R.
              UzziDonald R. UzziTitle:
              Chairman, Chief Executive Officer and
              President





**INDEX
      OF EXHIBITS**





31.1
            Certification
                of the Chief Executive Officer pursuant to Section 302 of the
                Sarbanes-Oxley Act of 2002.
            Filed
                herewith31.2
            Certification
                of the Chief Financial Officer pursuant to Section 302 of the
                Sarbanes-Oxley Act of 2002.
            Filed
                herewith