**EXHIBIT 10.47**

 

**FIRST AMENDMENT TO LOAN AND SECURITYAGREEMENT AND OTHER FINANCING AGREEMENTS**

 

 

THIS FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENTAND OTHER FINANCING AGREEMENTS (this "Amendment"), dated as of August 23,2002, is entered into among CONGRESS FINANCIAL CORPORATION (WESTERN), aCalifornia corporation ("Lender"), and PC MALL, INC., a Delawarecorporation formerly known as IdeaMall, Inc. ("PC Mall"), PC MALL SALES,INC., a California corporation formerly known as Creative Computers, Inc. ("PCMall Sales") ECOST.COM, INC., a Delaware corporation ("ecost"),ELINUX.COM, INC., a Delaware corporation ("eLinux"), CREATIVE COMPUTERSINTEGRATED TECHNOLOGIES, INC., a Delaware corporation ("CCIT"),COMPUTABILITY LIMITED, a Delaware corporation ("Computability" andtogether with PC Mall, PC Mall Sales, ecost, eLinux and CCIT, collectivelyreferred to herein as "Existing Borrowers"), and WF ACQUISITION SUB,INC., a Delaware corporation ("WF Sub" and together with ExistingBorrowers, collectively referred to herein as "Borrowers").

RECITALS

A.       Existing Borrowers and Lender have previously entered into that certain Loan andSecurity Agreement dated March 7, 2001 (the "Loan Agreement"), pursuantto which Lender has made certain loans and financial accommodations available toExisting Borrowers.  Terms used herein without definition shall have themeanings ascribed to them in the Loan Agreement.

B.         In connectionwith the Loan Agreement, PC Mall and Lender have previously entered into thatcertain Stock Pledge Agreement dated March 7, 2001 (the "Pledge Agreement"),covering the capital stock of the other Existing Borrowers.

C.        WF Subpreviously entered into that certain Guaranty and Security Agreement dated July8, 2002 (the "WF Sub Guaranty") with respect to the obligations andliabilities of the Existing Borrowers to Lender.

D.        Borrowers nowdesire that WF Sub be added as a co-borrower under the Loan Agreement, andLender is willing to add WF Sub as a co-borrower thereunder upon the terms andconditions set forth below.

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing andthe mutual covenants herein contained, and for other good and valuableconsideration, the receipt and sufficiency of which are hereby acknowledged, theparties hereby agree as follows: 

1.                  Amendments and Agreements.

(a)                Loan Agreement.  WF Sub is hereby added as a co-borrower under theLoan Agreement with the same force and effect as if WF Sub had duly executed anddelivered the Loan Agreement as a Borrower thereunder in addition to theExisting Borrowers.  Without limiting the foregoing:

(i)                  The definitions of "Borrower" and "Borrowers" in the preamble of the LoanAgreement are hereby amended to include WF Sub in addition to the ExistingBorrowers.

(ii)                WF Sub and each of the Existing Borrowers shall be jointly and severallyliable for all Obligations.

(iii)               To secure payment and performance of all Obligations, WF Sub herebygrants to Lender a continuing security interest in, a lien upon, and a right ofset off against, and hereby assigns to Lender as security, all Collateral,whether now owned or hereafter acquired or existing, and wherever located.

(iv)              The Information Certificate of WF Sub attached hereto as Exhibit A ishereby included in Exhibit A to the Loan Agreement in addition to theInformation Certificates of the Existing Borrowers.

(v)                WF Sub hereby represents and warrants to Lender the truth and accuracy ofall representations and warranties applicable to Borrowers in the Loan Agreement(after giving effect to the inclusions of WF Sub and its Information Certificateas set forth in clauses (i) and (iv) above).

(vi)              WF Sub hereby agrees to perform all of the covenants and agreementsapplicable to Borrowers in the Loan Agreement.

(vii)             Lender shall have all of the rights, remedies, interests and powers asagainst WF Sub as provided to Lender in relation to Borrowers in the LoanAgreement.

(b)               Pledge Agreement.  Recital B of the Pledge Agreement is herebyamended by adding immediately after the reference to "eLinux" the words ", WFACQUISITION SUB, INC., a Delaware corporation".

2.                  Termination of WF Sub Guaranty.  Upon this Amendment becomingeffective, the WF Sub Guaranty shall be deemed terminated and of no force oreffect.

3.                  Effectiveness of this Amendment.  Lender must have received thefollowing items, in form and content acceptable to Lender, before this Amendmentis effective.

(a)                This Amendment fully executed in a sufficient number of counterparts fordistribution to all parties.

(b)               An Amended and Restated Term Promissory Note duly executed and deliveredby Borrowers to replace that certain Term Promissory Note of Existing Borrowersin the original principal sum of $2,000,000.

(c)                The certificate(s) evidencing all of the issued and outstanding shares ofcapital stock of WF Sub, together with stock powers duly executed and deliveredby PC Mall therefor in blank.

(d)               A certificate of the corporate secretary of WF Sub certifying theresolutions of its board of directors with respect to the transactionscontemplated hereby.

(e)                Evidence of insurance and loss payable endorsements with respect to theinsurance policies of WF Sub.

(f)                 Favorable opinion letter of counsel to WF Sub with respect to thetransactions contemplated hereby.

(g)                A Consent and Agreement duly executed and delivered by DFS.

(h)               Consents and Amendments duly executed and delivered by LaSalle Business Credit,Inc. and Fleet Capital Business Finance Division as Participants.

(i)                  All other documents and legal matters in connection with the transactionscontemplated by this Amendment shall have been delivered or executed or recordedand shall be in form and substance satisfactory to Lender.

4.                  Representations and Warranties.  Each Borrower represents andwarrants as follows:

(a)                Authority.  Such Borrower has the requisite corporate power andauthority to execute and deliver this Amendment, and to perform its obligationshereunder and under the Financing Agreements (as amended or modified hereby) towhich it is a party.  The execution, delivery and performance by such Borrowerof this Amendment have been duly approved by all necessary corporate action andno other corporate proceedings are necessary to consummate such transactions.

(b)               Enforceability.  This Amendment has been duly executed anddelivered by such Borrower.  This Amendment and each Financing Agreement (asamended or modified hereby) is the legal, valid and binding obligation of suchBorrower, enforceable against such Borrower in accordance with its terms, and isin full force and effect.

(c)                Representations and Warranties.  The representations andwarranties contained in each Financing Agreement (other than any suchrepresentations or warranties that, by their terms, are specifically made as ofa date other than the date hereof) are correct on and as of the date hereof asthough made on and as of the date hereof.

(d)               Due Execution.  The execution, delivery and performance of thisAmendment are within the power of such Borrower, have been duly authorized byall necessary corporate action, have received all necessary governmentalapproval, if any, and do not contravene any law or any contractual restrictionsbinding on such Borrower.

(e)                No Default.  No event has occurred and is continuing thatconstitutes an Event of Default.

5.                  Choice of Law.  The validity of this Amendment, its construction,interpretation and enforcement, the rights of the parties hereunder, shall bedetermined under, governed by, and construed in accordance with the internallaws of the State of California governing contracts only to be performed in thatState.

6.                  Counterparts.  This Amendment may be executed in any number ofcounterparts and by different parties and separate counterparts, each of whichwhen so executed and delivered, shall be deemed an original, and all of which,when taken together, shall constitute one and the same instrument.  Delivery ofan executed counterpart of a signature page to this Amendment by telefacsimileshall be effective as delivery of a manually executed counterpart of thisAmendment.

7.                  Reference to and Effect on the Financing Agreements.

(a)                Upon and after the effectiveness of this Amendment, each reference in theLoan Agreement to "this Agreement", "hereunder", "hereof" or words of likeimport referring to the Loan Agreement, and each reference in the otherFinancing Agreements to "the Loan Agreement", "thereof" or words of like importreferring to the Loan Agreement, shall mean and be a reference to the LoanAgreement as modified and amended hereby.

(b)               Except as specifically provided above, the Loan Agreement and all otherFinancing Agreements, are and shall continue to be in full force and effect andare hereby in all respects ratified and confirmed and shall constitute thelegal, valid, binding and enforceable obligations of Borrowers to Lender.

(c)                The execution, delivery and effectiveness of this Amendment shall notoperate as a waiver of any right, power or remedy of Lender under any of theFinancing Agreements, nor constitute a waiver of any provision of any of theFinancing Agreements.

(d)               To the extent that any terms and conditions in any of the FinancingAgreements shall contradict or be in conflict with any terms or conditions ofthe Loan Agreement or the Pledge Agreement, after giving effect to thisAmendment, such terms and conditions are hereby deemed modified or amendedaccordingly to reflect the terms and conditions of the Loan Agreement and thePledge Agreement as modified or amended hereby.

8.                  Ratification.  Each Borrower hereby restates, ratifies andreaffirms each and every term and condition set forth in the Loan Agreement andthe Pledge Agreement, as amended hereby, and the other Financing Agreementseffective as of the date hereof.

 

IN WITNESS WHEREOF, the parties have entered intothis Amendment as of the date first above written.

| LENDER:
BORROWERS:
 
CONGRESS FINANCIAL    CORPORATION (WESTERN)
PC MALL, INC.
By:  /s/ Randy J.    Bowman                                     Name:  Randy J. Bowman                                    Title:  Executive Vice President                         
By:  /s/ Frank F.    Khulusi                                       Name:  Frank F. Khulusi                                       Title:  President                                                 
 
 
PC MALL SALES, INC.
 
 
By:  /s/ Rory K. Zaks                                               Name:  Rory K. Zaks                                           Title:  President                                                 
 
 
ECOST.COM, INC.
 
 
By:  /s/ Gary    Guy                                                  Name:  Gary Guy                                                 Title:  President                                                 
 
 
ELINUX.COM, INC.
 
 
By:  /s/ Frank F.    Khulusi                                       Name:  Frank F. Khulusi                                       Title:  President                                                 
 
 
CREATIVE COMPUTERS    INTEGRATED TECHNOLOGIES, INC.
 
 
By:  /s/ Richard    Lepow                                            Name:  Richard Lepow                                            Title:  President                                                 
 
     
    COMPUTABILITY LIMITED
 
By:  /s/ Frank F.    Khulusi                                       Name:  Frank F. Khulusi                                       Title:  President                                                 
 
 
    WF ACQUISITION SUB, INC.
     
 
By:  /s/ William    Neary                                           Name:  William Neary                                          Title:  President & Treasurer                             
 
 
     
 
 
 
 
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