Document:

Form of Registration Rights Agreement between us and Frank F. Khulusi

 EXHIBIT 10.11 
  
 FORM OF 
 REGISTRATION RIGHTS AGREEMENT 
  
 THIS
REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is entered into on             , 2004, by and between eCost.com, Inc., a Delaware corporation (“eCost”), and
Frank F. Khulusi (the “Stockholder”). 
  
 WHEREAS, eCost
is currently a subsidiary of PC Mall, Inc., a Delaware corporation (“PC Mall”); 
  
 WHEREAS, eCost is considering an initial public offering of its Common Stock (“IPO”); 
  
 WHEREAS, PC Mall will own not less than eighty percent (80%) of the issued and outstanding shares of eCost’s common stock (the “Retained
Shares”) following the IPO; 
  
 WHEREAS, subject to the terms
and conditions set forth in that certain Master Separation and Distribution Agreement (the “Master Separation and Distribution Agreement”), by and between PC Mall and eCost, dated as of the date hereof, PC Mall intends to distribute to its
stockholders, approximately six months following the closing of the IPO, all of the Retained Shares in a tax-free distribution (the “Distribution”); and 
  
 WHEREAS, the Stockholder currently owns an aggregate of
[                ] of the issued and outstanding shares of PC Mall’s common stock, constituting approximately
[            ] percent (    %) of the issued and outstanding shares of PC Mall’s common stock and, accordingly, based on that ownership, would be
entitled to receive approximately                  (    %) of the Retained Shares in the Distribution; and 
  
 WHEREAS, eCost and the Stockholder desire to establish terms and conditions
for the registration for public resale after the Distribution of the Stockholder’s Retained Shares. 
  
 NOW, THEREFORE, in consideration of the premises and mutual promises and representations contained herein, and other good and valuable consideration, the
sufficiency of which is hereby acknowledged, the parties hereto do mutually covenant, stipulate and agree as follows: 
  
 Section 1. Definitions. 
  
 The following terms shall have the following meanings unless the context otherwise indicates: 
  
 “Act” means the Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder. 
  
 “Business
Day” means a day on which The Nasdaq Stock Market is open for business. 
  
 “Demand Registration” means registration under the Act pursuant to a Registration Request given under Section 2 hereof. 

 “Indemnified Persons” shall have the meaning given in Section 9 hereof. 
  
 “Maximum Amount” shall have the meaning given in Section 6 hereof.

  
 “NASDAQ” means the Nasdaq National Market of The
Nasdaq Stock Market. 
  
 “Piggyback Registration” means
registration under the Act pursuant to Section 3 hereof. 
  
 “Piggyback Request” means a written request to eCost pursuant to Section 3 hereof for the registration of Registrable Shares pursuant to the Act. 
  
 “Priority” shall have the meaning given in Section 6 hereof. 
  
 “Registration Expenses” shall have the meaning given in Section 5
hereof. 
  
 “Registration Request” means a written
request to eCost pursuant to Section 2 hereof for Demand Registration of Registrable Shares pursuant to the Act. 
  
 “Registrable Shares” means all Shares received by the Stockholder in the Distribution, including any Shares issuable upon exercise of options to
purchase eCost common stock received in the Distribution, such number to be equitably adjusted in the event of a stock split, stock dividend, combination or reclassification of Shares. 
  
 “Selling Expenses” shall have the meaning given in Section 5 hereof. 
  
 “Stockholder” shall have the meaning given in the heading of this
Agreement. 
  
 “Shares” means shares of the Common
Stock, $0.001 par value, of eCost. 
  
 “SEC” means the
Securities and Exchange Commission. 
  
 Section 2. Demand
Registration. 
  
 (a) At any time at least one hundred
eighty (180) days following the Distribution, the Stockholder may submit a Registration Request for Demand Registration covering all or part of his Registrable Shares, which request must request registration of at least
                 (        ) Shares. The Registration Request shall state the number of Registrable Shares to be
registered and the intended plan of distribution thereof. eCost shall be obligated to register Registrable Shares pursuant to this Section 2 on a total of only two (2) occasions. A request withdrawn pursuant to Subsection 2(c) hereof or deemed to be
a Piggyback Registration pursuant to Subsection 2(d) hereof shall be ignored for this purpose. eCost shall be deemed to have satisfied its obligation under this Section 2 with respect to a Registration Request if a registration statement filed
pursuant to a Registration Request becomes effective under the Act and remains effective for the period required hereby, or if the failure of such a registration statement to become or remain effective results primarily from any action or inaction
of the Stockholder. 
  
 Subject to the conditions and limitations
of Section 4 hereof, eCost will use commercially reasonable efforts to file a registration statement under the Act registering the Registrable Shares covered by a Registration Request within forty-five (45) days after it receives such Registration
Request unless such Registration Request is withdrawn as permitted by Subsection 2(c) hereof.  
  

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 (b) The right to Demand Registration is subject to the procedures in Section 4 hereof and the following
additional conditions and limitations: 
  
 (i) Any individual
Stockholder joining a Registration Request may withdraw such Stockholder’s Registrable Shares from the Registration Request at any time prior to the time the registration statement becomes effective, provided that eCost may ignore a notice of
withdrawal made within twenty-four (24) hours of the time the registration statement becomes effective. Following such a withdrawal, eCost shall not take any further action to register the withdrawn Registrable Shares, and shall not be obligated to
register any Registrable Shares if the number of non-withdrawn Registrable Shares is less than              (        ) Shares. However,
except as otherwise provided in Subsection 2(c) or (d) hereof, a Registration Request, once made, shall count as having been made for purposes of Subsection 2(a), unless it is withdrawn by all Stockholder making such request within fifteen (15) days
after having been made or it is withdrawn before eCost devotes any significant efforts to the preparation of the registration statement. 
  
 (ii) Unless otherwise agreed to by eCost, any Demand Registration must relate to a firm commitment underwriting for which the managing underwriter shall
be reasonably satisfactory to eCost (such satisfaction not to be withheld unreasonably) or a non-underwritten offering on a “shelf” basis in accordance with Rule 415 under the Act. 
  
 (iii) eCost shall be permitted to use any registration form available to it
for the registration of Registrable Shares, and shall not be obligated to include in the prospectus any information that may be incorporated by reference or that is not required to be included therein by the applicable registration form. 

 
 (iv) No Registration Request may be made by a Stockholder if the amount of
shares proposed to be sold could be sold by such Stockholder without limitation under Rule 144 under the Act. 
  
 (c) Notwithstanding the foregoing, if eCost is aware at the time it receives a Registration Request that a registered public sale of Shares is
being contemplated or is in the process of being prepared (except as provided in Section 7 hereof), it will notify the Stockholder of the relevant facts, and any Stockholder who joined such Registration Request shall have the right to withdraw the
request by written notice given to eCost within ten (10) days after eCost’s notice under this Subsection 2(c), in which case such Registration Request will be deemed not to have been made for purposes of Subsection 2(a). 
  
 (d) For an additional ninety (90) days following the date on which the
Stockholder may first submit a Registration Request for Demand Registration, eCost will be entitled to include Shares in any Demand Registration and to reduce the number of Shares to be sold by the Stockholder thereunder to a minimum of twenty
percent (20%), collectively, of the total offering plus any underwriters’ over-allotment option. If, as a result of this cutback procedure, the number of Shares sold by the Stockholder in such offering constitutes less than the number of Shares
requested to be registered by the Stockholder, the registration would be treated as a Piggyback Registration under Section 3 below, and a Registration Request will be deemed not to have been made for purposes of Subsection 2(a) hereof. 

 

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 Section 3. Piggyback Registration. If at any time following the Distribution eCost proposes
to register any Shares under the Act for sale to the public by eCost or any other person (except as provided in Section 7 hereof), eCost shall, not less than fifteen (15) days prior to the proposed date of filing of a registration statement under
the Act, give written notice to the Stockholder of its intention to do so. A Piggyback Request from any such Stockholder shall state the number of Registrable Shares to be registered and the intended plan of distribution thereof. If eCost receives a
Piggyback Request from any Stockholder given within fifteen (15) days after eCost’s notice under this Section 3, eCost, subject to the conditions and limitations of Section 4 hereof, will use commercially reasonable efforts to cause the
Registrable Shares covered by Piggyback Request to be so registered under the Act in the proposed registration statement if the proposed registration statement becomes effective, but eCost shall have no obligation to cause, or use any efforts to
cause, any such registration statement to become effective. Registrable Shares covered by a Piggyback Request shall be sold pursuant to the same plan of distribution that applies to the majority of the other Shares covered by such registration
statement, except to the extent that eCost otherwise agrees in writing. The rights to Piggyback Registration granted by this Section 3 may be exercised an unlimited number of occasions following the Distribution. No Piggyback Request may be made by
a Stockholder if the amount of Shares proposed to be sold could be sold by such Stockholder without limitation under Rule 144 under the Act. 
  
 Section 4. Registration Procedures. 
  
 (a) If eCost is required by the provisions of Section 2 to effect Demand Registration of any Registrable Shares, eCost will promptly: 
  
 (i) To the extent required by Section 2, prepare and file with the SEC a
registration statement (which shall be on Form S-3, unless eCost does not qualify for use of Form S-3 in such registration, in which case such registration statement shall be on any other available form selected by eCost) with respect to such
Registrable Shares and thereafter use commercially reasonable efforts to cause such registration statement to become effective promptly. 
  
 (ii) Prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection therewith as may
be necessary to keep such registration statement effective for the period of one hundred twenty (120) days (excluding any days during which the right to sell shares is suspended pursuant to Subsection 4(b) hereof) or such lesser period as may be
necessary to comply with the provisions of the Act with respect to the disposition of all Registrable Shares covered by such registration statement in accordance with the plan of distribution set forth in such registration statement; 
  
 (iii) Comply with Rule 424 under the Act relating to filing of
prospectuses and furnish to each seller and to each underwriter such number of copies of the registration statement and the prospectus included therein (including each preliminary prospectus) as such persons reasonably may request in order to
facilitate the public sale of the Registrable Shares covered by such registration statement; 
  

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 (iv) If the offering is to be underwritten, eCost and the Stockholder shall enter into a written
agreement with any managing underwriter selected in the manner herein provided in such form and containing such provisions as are satisfactory to eCost and the Stockholder (such satisfaction not to be withheld unreasonably), and as are customary in
the securities business for such an arrangement between such underwriter, such seller and corporations of eCost’s size and investment stature and eCost shall take such other actions as the Stockholder shall reasonably request in order to
expedite or facilitate the disposition of such Registrable Shares; 
  
 (v) Furnish, at the request of the Stockholder, on the date that the underwriting agreement is signed and on the date that Registrable Shares are delivered to the underwriters for sale pursuant to such registration: (A) an opinion of
counsel representing eCost for the purposes of such registration, dated such dates, respectively, addressed to the underwriters and to the Stockholder, stating that such registration statement has become effective under the Act and that (I) to the
best knowledge of such counsel, no stop order suspending the effectiveness thereof has been issued and no proceedings for that purpose have been instituted or are pending or contemplated under the Act, and (II) the registration statement, the
related prospectus and each amendment or supplement thereof comply as to form in all material respects with the requirements of the Act (except that such counsel need not express any opinion as to the financial statements or any other financial
statements, notes thereto and related schedules and other financial and statistical data contained or incorporated by reference therein), and (III) to such other effects as reasonably may be requested by counsel for the underwriters or by the
Stockholder or their respective counsel, and (B) a “comfort letter” in customary form dated such dates from the independent public accountants retained by eCost, addressed to the underwriters and to the Stockholder, stating that they are
independent public accountants within the meaning of the Act and that, in the opinion of such accountants, the financial statements of eCost included or incorporated by reference in the registration statement or the prospectus, or any amendment or
supplement thereof, comply as to form in all material respects with the applicable accounting requirements of the Act, and such letter shall additionally cover such other financial matters as are customary to cover in such a letter (including
information as to the period ending no more than five business days prior to the date of such letter) with respect to the registration statement in respect of which such letter is being given as such underwriters reasonably may request; 

 
 (vi) Upon receipt of such confidentiality agreements as eCost may
reasonably request, make available for inspection by the Stockholder, any underwriter participating in any distribution pursuant to such registration statement, and any attorney, accountant or other agent retained by the Stockholder or underwriter,
all financial and other records, pertinent corporate documents and properties of eCost, and cause eCost officers, directors and employees to supply all information reasonably requested by the Stockholder, underwriter, attorney, accountant or agent
in connection with such registration statement, in each case in order to confirm disclosures contained in the registration statement or incorporated therein by reference; 
  
 (vii) Give the Stockholder two (2) days’ advance notice of its anticipated filing date of the registration statement
and amendments thereto; 
  
 (viii) Use commercially reasonable
efforts to cause the Registrable Shares covered by such registration statement to be registered with or approved by such other governmental agencies or authorities as may be necessary to enable the Stockholder thereof to consummate the disposition
of such Registrable Shares; 
  

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 (ix) Comply with all applicable rules and regulations of the SEC, and make generally available to its
security holders, as soon as reasonably practicable no later than the date the Form 10-Q or Form 10-K, as the case may be, covering the fourth fiscal quarter of eCost commencing after the effective date of the registration statement, is required to
be filed with the SEC, an earnings statement covering the period of at least twelve (12) consecutive months beginning with the first day of eCost’s first calendar quarter commencing after the effective date of the registration statement, which
earnings statement shall satisfy the provisions of Section 11(a) of the Act and Rule 158 thereunder; 
  
 (x) Provide a transfer agent and registrar, which may be the same entity as the transfer agent, for all the Registrable Shares covered by such
registration statement not later than the effective date of such registration statement; 
  
 (xi) Permit any Stockholder who, in the sole judgment of such Stockholder, exercised in good faith, might be deemed to be a controlling person of eCost, to participate through counsel reasonably acceptable to eCost in
the preparation of such registration statement and, if specifically requested by such counsel, in discussions between eCost and the SEC or its staff with respect to such registration statement, and to include in such registration statement material,
furnished to eCost in writing, which in the written opinion of such counsel is necessary to include in order to avoid potential liability for such Stockholder; 
  

(xii) Use commercially reasonable efforts to cause all such Registrable Shares covered by such registration statement to be listed or quoted on the
principal securities exchange (including NASDAQ) on which similar securities issued by eCost are then listed or quoted, if the listing or quoting of such Registrable Shares is then permitted under the rules of such exchange; 
  
 (xiii) If there is a stop order relating to or suspension of the
effectiveness of the registration statement, use commercially reasonable efforts to have the stop order or suspension of effectiveness withdrawn as promptly as practicable; 
  
 (xiv) Use commercially reasonable efforts to comply with all applicable rules and regulations of the SEC, and make generally
available to its security holders an earnings statement satisfying the provisions of Section 11(a) of the Act, no later than forty-five (45) days after the end of any twelve (12) month period (or ninety (90) days, if such period is a fiscal year)
(A) commencing at the end of any fiscal quarter in which the Registrable Shares are sold to underwriters in a firm or best efforts underwritten offering, or (B) if not sold to underwriters in such an offering, beginning with the first month of the
first fiscal quarter of eCost commencing after the effective date of the registration statement, which statements shall cover such twelve (12) month period; and 
  

(xv) Use commercially reasonable efforts to register or qualify the Registrable Shares covered by such registration statement under the securities or
blue sky laws of such jurisdictions as the sellers of Registrable Shares or the managing underwriter reasonably shall request; provided, however, that eCost shall not for any such purpose be required to qualify generally to transact
business as a foreign corporation in any jurisdiction where it is not so qualified or to consent to general service of process or taxation in any such jurisdiction. 
  

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 (b) Notwithstanding the foregoing, eCost may delay filing a registration statement otherwise required to
be filed pursuant to this Agreement and may withhold efforts to cause a registration statement covering Registrable Shares to become effective, for up to 60 days in the aggregate during any 12-month period, if eCost determines in good faith
that such registration statement might (1) interfere with or affect the negotiation or completion of any transaction that is being contemplated by eCost (whether or not a final decision has been made to undertake such transaction) at the time the
right to delay is exercised, or (2) involve initial or continuing disclosure obligations that might not be in the best interest of eCost’s stockholders. If, after a registration statement becomes effective, eCost notifies the holders of
Registrable Shares covered by such registration statement that eCost considers it appropriate for the registration statement to be amended or supplemented, the holders of such Registrable Shares shall suspend any further sales of their Registrable
Shares until eCost advises them that the registration statement has been amended or supplemented. eCost may give such advice if there exists at any time material non-public information relating to eCost that, in the reasonable opinion of
eCost’s Board of Directors, would be prejudicial to eCost or its stockholders to disclosed at that time. eCost agrees with the Stockholder that it will use commercially reasonable efforts to amend or supplement the registration statement, as
required to permit sales of the Registrable Shares covered thereby to resume within ninety (90) days as promptly as is practicable after it has given the notice referred to in the preceding sentence. The ninety (90)-day time period referred to in
Subsection 4(a)(ii) hereof during which the registration statement must be kept current after its effective date shall be extended for an additional number of Business Days equal to the number of Business Days during which the rights to sell shares
was suspended pursuant to the preceding sentence, but in no event will eCost be required to update the registration statement after the date that its obligation to register Registrable Shares terminates pursuant to Section 8 hereof. 
  
 (c) The provisions of Subsections 4(a)(iii), (iv) and (vii) and 4(b) (except
that eCost will have no obligation to amend or supplement the registration statement), and 4(d) hereof shall also apply to Piggyback Registrations pursuant to Section 3 hereof. 
  
 (d) In connection with each registration hereunder, the Stockholder will (i) furnish promptly to eCost in writing such
information with respect to themselves and the proposed distribution by the Stockholder as reasonably shall be requested by eCost in order to assure compliance with federal and applicable state securities laws, and (ii) comply with all applicable
rules promulgated by the SEC or any securities exchange (including NASDAQ). 
  
 (e) Before filing a registration statement covering Registrable Shares, a prospectus constituting a part thereof or amendments or supplements thereto, shall be furnished to counsel for the Stockholder, including in
such registration statement copies of all such documents proposed to be filed, all of which shall be subject to the approval of such counsel in the exercise of such counsels’ reasonable judgment. 
  
 (f) If any registration statement covering Registrable Shares refers to any
Stockholder by name or otherwise as the holder of any securities of eCost, then such Stockholder shall have the right to require (i) the insertion therein of language, in form and substance satisfactory to eCost 
  

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 (such satisfaction not to be withheld unreasonably), to the effect that such Stockholder’s holding of Shares is not
to be construed as a recommendation by such Stockholder of the investment quality of the Shares covered thereby and that such holding does not imply that such Stockholder will assist in meeting any future financial requirements of eCost, or (ii) in
the event that such reference to such Stockholder by name or otherwise is not in the judgment of eCost, as advised by counsel, required by the Act or any similar federal statute or any state “blue sky” or securities law then in force, the
deletion of the reference to such Stockholder. 
  
 Section 5.
Expenses. 
  
 (a) All expenses incurred by eCost in
complying with Section 2 hereof, including without limitation all registration and filing fees, printing expense, fees and disbursements of counsel and independent public accountants for eCost, fees and expenses (including counsel fees) incurred in
connection with complying with state securities or “blue sky” laws (other than those which by law must be paid by the selling security holders), fees of securities exchanges or the National Association of Securities Dealers, Inc., fees of
transfer agents and registrars, but excluding any Selling Expenses, are called “Registration Expenses.” All underwriting discounts, selling commissions and transfer taxes applicable to the sale of outstanding shares and any legal fees and
expenses of counsel or other advisers and agents of the holders of Registrable Shares being registered are called “Selling Expenses.” eCost will pay all Registration Expenses, to a maximum of $200,000 for the first Demand Registration and
a maximum of $100,000 for the second Demand Registration. All Selling Expenses shall be borne by the participating sellers, in proportion to the number of Registrable Shares sold by each unless they otherwise agree among themselves. 
  
 (b) All expenses incurred by eCost in complying with Section 3 hereof,
including without limitation all registration and filing fees, printing expense, fees and disbursements of counsel and independent public accountants for eCost, fees and expenses (including counsel fees) incurred in connection with complying with
state securities or “blue sky” laws (other than those which by law must be paid by the selling security holders), fees of securities exchanges or the National Association of Securities Dealers, Inc., fees of transfer agents and registrars,
but excluding any Selling Expenses, are called “Registration Expenses.” All underwriting discounts, selling commissions and transfer taxes applicable to the sale of outstanding shares and any legal fees and expenses of counsel or other
advisers and agents of the holders of Registrable Shares being registered are called “Selling Expenses.” eCost will pay all Registration Expenses. All Selling Expenses shall be borne by the participating sellers, in proportion to the
number of Registrable Shares sold by each unless they otherwise agree among themselves. 
  
 Section 6. Marketing Arrangements 
  
 (a) Except as otherwise provided in Section 2(d), (i) any Stockholder requests registration of Registrable Shares, (ii) the offering proposed to be made is to be an underwritten public offering, and (iii) the managing
underwriter of such public offering furnishes a written opinion that the total amount of securities to be included in such offering would exceed the maximum amount of securities (the “Maximum Amount”) (as specified in such opinion) which
can be marketed at a price reasonably related to the then-current market value of such securities (or the anticipated market price, if no trading market then exists) and without materially and adversely affecting such offering or the trading market
for Shares, then eCost and each Stockholder desiring 
  

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 to register his Shares by such registration shall have a right to participate in such offering in the following order of
priority (a “Priority”) until the number of Shares included in the offering reaches the Maximum Amount, and no additional Shares will be included in the registration statement: 
  
 First Priority shall be to eCost for Shares to be sold for the account of eCost, except to the extent that Shares (i) are
registered pursuant to a Registration Request for Demand Registration pursuant to Section 2 hereof and (ii) do not qualify for the priority provisions of Section 2(d), in which case the Second Priority shall be followed. 
  
 Second Priority shall be to a Stockholder who has made a Registration Request
for Demand Registration pursuant to Section 2 hereof (subject to the cutback provisions of Section 2(d)). 
  
 Third Priority shall be to eCost for Shares to be sold for the account of eCost that do not qualify for First Priority. 
  
 Fourth Priority shall be to holders of Shares who have a contractual right
granted to such holders prior to the date hereof to have Shares registered pursuant to a registration statement initiated on their request or demand on terms comparable to Section 2 hereof. 
  
 Fifth Priority shall be to holders of Shares who have a contractual right
granted to such holder on or prior to the date hereof to have their Shares registered pursuant to piggyback or incidental rights on terms comparable to Section 3 hereof (in a registration statement that such holders do not have a right to initiate),
including a Stockholder who has Piggyback Rights under this Agreement. 
  
 Sixth Priority shall be to all other holders of Shares in any sequence that may be agreed upon among the holders of such Shares and/or eCost. 
  
 To the extent that some but not all of the Shares owned by persons within any of the Priorities listed above are not included within the Maximum Amount,
the Shares to be included in the registration statement shall be allocated pro rata to holders in such Priority in proportion to the respective numbers of Shares each such person in such Priority wishes to include in the registration
statement. 
  
 (b) eCost represents and warrants that it has not
granted any registration rights or entered into any agreements obligating it to register any of its securities under the Act that are inconsistent with the foregoing priorities. 
  
 (c) eCost agrees that it will not incur any future obligations to register Shares under the Act that are inconsistent with
the Priorities in this Section 6. 
  
 Section 7. Exceptions
to eCost’s Obligations. The right to Demand Registration and Piggyback Registration shall not apply if, in the opinion of counsel for eCost, such registration would jeopardize the tax-free status of the Distribution. In addition, the
right to Piggyback Registration and the provisions of Subsection 2(c) hereof shall not apply, unless eCost otherwise agrees in writing, to any registration statement: 
  

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 (a) To be filed on a registration form which is unavailable for the registration of Registrable Shares;

  
 (b) Relating primarily to Shares to be offered pursuant to (i)
an employee benefit plan, or (ii) a dividend or interest reinvestment plan (including such a plan that has an open enrollment or cash investment feature); 
  
 (c) Relating to Shares to be issued in the acquisition of another business, through a merger, consolidation, exchange of securities or otherwise;

  
 (d) Relating to eCost securities to be issued for a
consideration other than solely cash; 
  
 (e) Relating to eCost
securities to be offered primarily to existing security holders of eCost, through a “rights offering” or otherwise; 
  
 (f) Relating primarily to eCost securities to be issued on the exercise of options, warrants and similar rights, or on the conversion or exchange of other
securities, issued by eCost or any other person; 
  
 (g) Relating
primarily to debt securities of eCost, including debt securities that are convertible or exchangeable for equity securities of eCost; or 
  
 (h) That may become effective automatically upon filing with the SEC pursuant to Rule 462 under the Act or otherwise. 
  
 Section 8. Termination of Registration Rights. Notwithstanding
the foregoing provisions, eCost’s obligation to register Registrable Shares under this Agreement shall terminate as to any particular Registrable Shares (a) on the fifth anniversary date of the Distribution, (b) when such Registrable Shares
have been sold in an offering registered under the Act or in a sale exempt from registration under the Act, (c) when such Registrable Shares shall have been effectively registered under the Act for a period of at least ninety (90) days, or (d) when
a written opinion, to the effect that such Registrable Shares may be sold without registration under the Act or applicable state law and without restriction as to the quantity and manner of such sales, shall have been received from counsel for eCost
which counsel is reasonably acceptable to the owner of such Registrable Shares (which satisfaction shall not be withheld unreasonably). 
  
 Section 9. Indemnification. 
  
 (a) In the event of any registration of Registrable Shares under the Act pursuant to this Agreement, eCost will, and hereby does, indemnify and hold
harmless, to the fullest extent permitted by law, the seller of any Registrable Shares covered by such registration statement, each person or entity that participates as an underwriter or qualified independent underwriter/pricer (“independent
underwriter”), if any, in the offering or sale of such securities, each officer, director or partner of such underwriter or independent underwriter, and each other person, if any, who controls such seller or any such underwriter within the
meaning of the Act (collectively, the “Indemnified Persons”), against any and all losses, claims, damages or liabilities, joint or several, and expenses (including fees of counsel and any amounts paid in any settlement effected with

  

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 eCost’s consent, which consent shall not be unreasonably withheld) to which such Indemnified Persons may become
subject under the Act, common law or otherwise, insofar as such losses, claims, damages or liabilities (or actions or proceedings, whether commenced or threatened, in respect thereof), or expenses arise out of or are based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in any registration statement under which Registrable Shares were registered under the Act or the omission or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, (ii) any untrue statement or alleged untrue statement of a material fact contained in any preliminary, final or
summary prospectus, together with the documents incorporated by reference therein (as amended or supplemented if eCost shall have filed with the SEC any amendment thereof or supplement thereto), or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or (iii) any violation by eCost of any federal or state rule or
regulation applicable to eCost and relating to action required of or inaction by eCost in connection with any such registration. eCost will reimburse Indemnified Persons for any reasonable legal or any other expenses reasonably incurred by any of
them in connection with investigating or defending any such loss, claim, damage, liability, action or proceeding. Notwithstanding the foregoing, eCost shall not be liable to any Indemnified Person to the extent that any such loss, claim, damage,
liability (or action or proceeding, whether commenced or threatened, in respect thereof) or expense arises out of or is based upon (i) any untrue statement or alleged untrue statement or omission or alleged omission made in reliance upon and in
conformity with written information furnished to eCost by or on behalf of any such Indemnified Person, for use in the preparation of the registration statement or (ii) the failure of any such Indemnified Person to comply with any legal requirement
applicable to any such Indemnified Person to deliver a copy of a prospectus or any supplements or amendments thereto after eCost has made such documents available to such persons, and it is established that delivery of such prospectus, supplement or
amendment would have cured the defect giving rise to such loss, claim, damage, liability or expense. Such indemnity and reimbursement of expenses shall remain in full force and effect following the transfer of Registrable Shares by such seller.

  
 (b) eCost, as a condition to including any Registrable Shares
in any registration statement filed in accordance with this Agreement, shall have received an undertaking reasonably satisfactory to it from the prospective seller of such Registrable Shares and any underwriter or independent underwriter, to
indemnify and hold harmless (in the same manner and to the same extent as set forth in Subsection 9(a)) eCost and its directors and officers and each person controlling eCost within the meaning of the Act and all other prospective sellers and their
directors, officers, general and limited partners and respective controlling persons with respect to any statement or alleged statement in or omission from such registration statement, any preliminary, final or summary prospectus contained therein,
or any amendment or supplement thereto, if such statement or alleged statement or omission or alleged omission was made in reliance upon and in conformity with written information furnished to eCost or its representatives by or on behalf of such
seller or underwriter for use in the preparation of such registration statement; provided, however, that the aggregate amount which any such seller or prospective seller shall be required to pay pursuant to such undertaking shall be
limited to the amount of the net proceeds received by such person upon the sale of the Registrable Shares pursuant to the registration statement giving rise to such claim. 
  

 11 

 (c) Promptly after receipt by an indemnified party hereunder of written notice of the commencement of any
action or proceeding with respect to which a claim for indemnification may be made pursuant to this Section 9, such indemnified party will, if a claim in respect thereof is to be made against an indemnifying party, give written notice to the latter
of the commencement of such action; provided, however, that the failure of any indemnified party to give notice as provided herein shall not relieve the indemnifying party of its obligations under this Section 9, except to the extent
that the indemnifying party is actually prejudiced by such failure to give notice. If any such claim or action shall be brought against an indemnified party, and it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein, and, to the extent that it wishes, jointly with any other similarly notified indemnifying party, to assume the defense thereof with counsel reasonably satisfactory to the indemnified party; and provided,
further that the indemnifying party shall not be entitled to so participate or so assume the defense if, in the indemnified party’s reasonable judgment, a conflict of interest between the indemnified party and the indemnifying party
exists in respect of such claim. After notice from the indemnifying party to such indemnified party of its election to assume the defense of such claim or action, the indemnifying party shall not be liable to the indemnified party under this Section
9 for any legal or other expenses subsequently incurred by the indemnified party in connection with the defense thereof unless the indemnifying party has failed to assume the defense of such claim or to employ counsel reasonably satisfactory to such
indemnified party; and provided, further, that the indemnified parties shall have the right to employ one counsel to represent such indemnified parties if, in such indemnified parties’ reasonable judgment, a conflict of interest
between the indemnified parties and the indemnifying parties exists in respect of such claim, and in that event the fees and expenses of such separate counsel shall be paid by the indemnifying party; and provided, further, that if, in
the reasonable judgment of any of the indemnified parties, a conflict of interest between such indemnified parties and any other indemnified parties exists in respect of such claims, such indemnified parties shall be entitled to additional counsel
or counsels and the indemnifying party shall be obligated to pay the fees and expenses of such additional counsel or counsels. No indemnified party will consent to entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimants or plaintiffs to such indemnified party of a release from all liability in respect to such claim or litigation. No indemnifying party will be liable for any settlement effected without its prior
written consent. 
  
 (d) If the indemnification provided for in
this Section 9 is unavailable or insufficient to hold harmless an indemnified party under Subsections 9(a) and (b), then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in Subsections 9(a) and (b) in such proportion as is appropriate to reflect the relative fault of the indemnifying party on the one hand and the indemnified party on the other hand in connection with
statements or omissions which resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the indemnifying party or the indemnified party and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such 
  

 12 

 untrue statement or omission. The parties hereto agree that it would not be just and equitable if contributions pursuant
to this Section 9 were to be determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the first sentence of this Section 9. The amount paid by an
indemnified party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this Section 9 shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim (which shall be limited as provided in Subsection 9(c) if the indemnifying party has assumed the defense of any such action in accordance with the provisions thereof which is the subject of this Section
9). No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. Notwithstanding anything in this Section
9 to the contrary, no indemnifying party (other than eCost) shall be required pursuant to this Section 9 to contribute any amount in excess of the proceeds received by such indemnifying party from the sale of Registrable Shares in the offering to
which the losses, claims, damages or liabilities of the indemnified parties relate. 
  
 (e) The provisions of this Section 9 shall be in addition to any other rights to indemnification or contribution which any indemnified party may have pursuant to law or contract and shall remain in full force and
effect following the transfer of the Registrable Shares by any such party. 
  
 Section 10. Compliance with Rule 144. 
  
 (a) At the request of the Stockholder and if the Stockholder proposes to sell Registrable Shares in compliance with Rule 144 under the Act, or any similar Rule, eCost shall (a) forthwith furnish to the Stockholder a
written statement as to its compliance with the filing requirements of the SEC as set forth in such Rule and (b) make such additional filings with the SEC as will enable PC Mall to make sales of Registrable Shares pursuant to such Rule. 

 
 (b) With a view to making available to the Stockholder the benefits of
Rule 144 under the Securities Act or any other similar rule or regulation of the Commission that may at any time permit the Stockholder to sell securities of eCost to the public without registration (“Rule 144”), eCost agrees to (i) comply
with the provisions of paragraph (c)(1) of Rule 144; and (ii) file with the Commission in a timely manner all reports and other documents required to be filed with the Commission pursuant to Section 13 or 15(d) under the Exchange Act by companies
subject to either of such sections, irrespective of whether eCost is then subject to such reporting requirements. 
  
 Section 11. Miscellaneous. 
  
 (a) Binding and Benefit. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, personal
representatives, successors and assigns, except that no party may assign or transfer its rights or obligations under this Agreement without the prior written consent of the other parties hereto; provided, however, that the obligation
to register Registrable Shares shall be enforceable by direct or remote transferees of Registrable Shares now owned by the Stockholder only if the transfer results from the death of any person, a gift made without consideration or the transfer of
all or substantially all of the assets of an entity, by merger, consolidation, asset sale or otherwise. Without limiting the foregoing, any transferee of Registrable Shares must agree in writing to be bound by the provisions of Subsection 6(c)
hereof. 
  

 13 

 (b) Communications from Stockholder. If Shares are owned of record jointly by two or more persons,
eCost may rely on any communication signed by one such person. eCost may ignore communications given by persons who purport to own Registrable Shares beneficially unless such communications are confirmed by a record owner, and it may ignore any
communications from a record owner that conflict with previously received communications from another person who is at the relevant time also a record owner of the same Registrable Shares. 
  
 (c) Governing Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of California, without reference to choice of law principles, including matters of construction, validity and performance. 
  
 IN WITNESS WHEREOF, the parties have executed this Agreement on the date first above written. 
  

					
	ECOST.COM, INC.
		
	 By:
	 	  

	 	 	 Name:
	 	

	 	 	 Title:
	 	

	
	STOCKHOLDER:
	
	

	 Frank F. Khulusi

  

 14eCost.com, Inc. 2004 Stock Incentive Plan

 EXHIBIT 10.13 
  
 eCOST.COM, INC. 
  
 2004 STOCK INCENTIVE PLAN 
  
 1. Purposes of the Plan. The purposes of this Plan are to attract and retain the best available personnel, to provide additional incentives to
Employees, Directors and Consultants and to promote the success of the Company’s business. 
  
 2. Definitions. The following definitions shall apply as used herein and in the individual Award Agreements except as defined otherwise in an
individual Award Agreement. In the event a term is separately defined in an individual Award Agreement, such definition shall supercede the definition contained in this Section 2. 
  
         (a) “Administrator” means the Board or any of the
Committees appointed to administer the Plan. 
  
         (b) “Affiliate” and “Associate” shall have the respective meanings ascribed to such terms in Rule 12b-2 promulgated under the Exchange Act. 
  
         (c) “Applicable
Laws” means the legal requirements relating to the Plan and the Awards under applicable provisions of federal securities laws, state corporate and securities laws, the Code, the rules of any applicable stock exchange or national market
system, and the rules of any non-U.S. jurisdiction applicable to Awards granted to residents therein. 
  
         (d) “Assumed” means that pursuant to a Corporate Transaction either (i) the Award is
expressly affirmed by the Company or (ii) the contractual obligations represented by the Award are expressly assumed (and not simply by operation of law) by the successor entity or its Parent in connection with the Corporate Transaction with
appropriate adjustments to the number and type of securities of the successor entity or its Parent subject to the Award and the exercise or purchase price thereof which at least preserves the compensation element of the Award existing at the time of
the Corporate Transaction as determined in accordance with the instruments evidencing the agreement to assume the Award. 
  
         (e) “Award” means the grant of an Option, SAR, Dividend Equivalent Right, Restricted
Stock, Restricted Stock Unit or other right or benefit under the Plan. 
  
         (f) “Award Agreement” means the written agreement evidencing the grant of an Award executed by the Company and the Grantee, including any amendments thereto. 
  
         (g) “Board”
means the Board of Directors of the Company. 
  
         (h) “Cause” means, with respect to the termination by the Company, a member of the PC Mall Group or a Related Entity of the Grantee’s Continuous Service, that such
termination is for “Cause” as such term is expressly defined in a then-effective written agreement between the Grantee and the Company, such member of the PC Mall Group or such Related Entity, or in the absence of such then-effective
written agreement and definition, is based on, in 
  

 1 

 the determination of the Administrator, the Grantee’s: (i) performance of any act or failure to perform any act in
bad faith and to the detriment of the Company, a member of the PC Mall Group or a Related Entity; (ii) dishonesty, intentional misconduct or material breach of any agreement with the Company, a member of the PC Mall Group or a Related Entity; or
(iii) commission of a crime involving dishonesty, breach of trust, or physical or emotional harm to any person. 
  
         (i) “Change in Control” means a change in ownership or control of the Company after the
Registration Date effected through either of the following transactions other than any such transaction also constituting the Separation: 
  
                 (i) the direct or indirect acquisition by any person or
related group of persons (other than an acquisition from or by the Company or by a Company-sponsored employee benefit plan or by a person that directly or indirectly controls, is controlled by, or is under common control with, the Company) of
beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities pursuant to a tender or exchange offer
made directly to the Company’s stockholders which a majority of the Continuing Directors who are not Affiliates or Associates of the offeror do not recommend such stockholders accept, or 
  
                 (ii) a change in the composition of the Board over a period of thirty-six (36) months or less such that a majority of the Board members (rounded
up to the next whole number) ceases, by reason of one or more contested elections for Board membership, to be comprised of individuals who are Continuing Directors. 
  
         (j) “Code” means the Internal Revenue Code of 1986, as
amended. 
  
         (k)
“Committee” means any committee composed of members of the Board appointed by the Board to administer the Plan. 
  
         (l) “Common Stock” means the common stock of the Company. 
  
         (m)
“Company” means eCOST.com, Inc., a Delaware corporation, or any successor corporation that adopts the Plan in connection with a Corporate Transaction. 
  
         (n) “Consultant” means any person (other than an Employee
or a Director, solely with respect to rendering services in such person’s capacity as a Director) who is engaged by the Company, any member of the PC Mall Group or any Related Entity to render consulting or advisory services to the Company,
such member of the PC Mall Group or such Related Entity. 
  
         (o) “Continuing Directors” means members of the Board who either (i) have been Board members continuously for a period of at least thirty-six (36) months or (ii) have been
Board members for less than thirty-six (36) months and were elected or nominated for election as Board members by at least a majority of the Board members described in clause (i) who were still in office at the time such election or nomination was
approved by the Board. 
  

 2 

         (p) “Continuous Service” means that the
provision of services to the Company, a member of the PC Mall Group or a Related Entity in any capacity of Employee, Director or Consultant is not interrupted or terminated. In jurisdictions requiring notice in advance of an effective termination as
an Employee, Director or Consultant, Continuous Service shall be deemed terminated upon the actual cessation of providing services to the Company, a member of the PC Mall Group or a Related Entity notwithstanding any required notice period that must
be fulfilled before a termination as an Employee, Director or Consultant can be effective under Applicable Laws. A Grantee’s Continuous Service shall be deemed to have terminated either upon an actual termination of Continuous Service or upon
the entity for which the Grantee provides services (other than a member of the PC Mall Group) ceasing to be a Related Entity. Continuous Service shall not be considered interrupted in the case of (i) any approved leave of absence, (ii) transfers
among the Company, any member of the PC Mall Group, any Related Entity, or any successor, in any capacity of Employee, Director or Consultant, or (iii) any change in status as long as the individual remains in the service of the Company, a member of
the PC Mall Group or a Related Entity in any capacity of Employee, Director or Consultant (except as otherwise provided in the Award Agreement). An approved leave of absence shall include sick leave, military leave, or any other authorized personal
leave. For purposes of each Incentive Stock Option granted under the Plan, if such leave exceeds ninety (90) days, and reemployment upon expiration of such leave is not guaranteed by statute or contract, then the Incentive Stock Option shall be
treated as a Non-Qualified Stock Option on the day three (3) months and one (1) day following the expiration of such ninety (90) day period. 
  
         (q) “Corporate Transaction” means any of the following transactions other than any such
transaction also constituting the Separation, provided, however, that the Administrator shall determine under parts (iv) and (v) whether multiple transactions are related, and its determination shall be final, binding and conclusive: 
  
                 (i) a merger or consolidation in which the Company is not the surviving entity, except for a transaction the principal purpose of which is to
change the state in which the Company is incorporated; 
  
                 (ii) the sale, transfer or other disposition of all or substantially all of the assets of the Company; 
  
                 (iii) the complete liquidation or dissolution of the Company; 
  
                 (iv) any reverse merger or
series of related transactions culminating in a reverse merger (including, but not limited to, a tender offer followed by a reverse merger) in which the Company is the surviving entity but (A) the shares of Common Stock outstanding immediately prior
to such merger are converted or exchanged by virtue of the merger into other property, whether in the form of securities, cash or otherwise, or (B) in which securities possessing more than forty percent (40%) of the total combined voting power of
the Company’s outstanding securities are transferred to a person or persons different from those who held such securities immediately prior to such merger or the initial transaction culminating in such merger, but excluding any such transaction
or series of related transactions that the Administrator determines shall not be a Corporate Transaction; or 
  

 3 

                 (v)
acquisition in a single or series of related transactions by any person or related group of persons (other than the Company or by a Company-sponsored employee benefit plan) of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange
Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities but excluding any such transaction or series of related transactions that the Administrator determines shall
not be a Corporate Transaction. 
  
         (r) “Covered Employee” means an Employee who is a “covered employee” under Section 162(m)(3) of the Code. 
  
         (s)
“Director” means a member of the Board or the board of directors of any member of the PC Mall Group or any Related Entity. 
  
         (t) “Disability” means as defined under the long-term disability policy of the Company,
the member of the PC Mall Group or the Related Entity to which the Grantee provides services regardless of whether the Grantee is covered by such policy. If the Company, the member of the PC Mall Group or the Related Entity to which the Grantee
provides service does not have a long-term disability plan in place, “Disability” means that a Grantee is unable to carry out the responsibilities and functions of the position held by the Grantee by reason of any medically determinable
physical or mental impairment for a period of not less than ninety (90) consecutive days. A Grantee will not be considered to have incurred a Disability unless he or she furnishes proof of such impairment sufficient to satisfy the Administrator in
its discretion. 
  
         (u) “Dividend Equivalent Right” means a right entitling the Grantee to compensation measured by dividends paid with respect to Common Stock. 
  
         (v)
“Employee” means any person, including an Officer or Director, who is in the employ of the Company, any member of the PC Mall Group or any Related Entity, subject to the control and direction of the Company, any member of the PC
Mall Group or any Related Entity as to both the work to be performed and the manner and method of performance. The payment of a director’s fee by the Company, a member of the PC Mall Group or a Related Entity shall not be sufficient to
constitute “employment” by the Company. 
  
         (w) “Exchange Act” means the Securities Exchange Act of 1934, as amended. 
  
         (x) “Fair Market Value” means, as of any date, the value of Common Stock determined as
follows: 
  
                 (i) If the Common Stock is listed on one or more established stock exchanges or national market systems, including without limitation The Nasdaq
National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on the principal exchange or system on which
the Common Stock is listed (as determined by the Administrator) on the date of determination (or, if no closing sales price or closing bid was reported on that date, as applicable, on the last trading date such closing sales price or closing bid was
reported), as reported in The Wall Street Journal or such other source as the Administrator deems reliable; 
  

 4 

                 (ii) If
the Common Stock is regularly quoted on an automated quotation system (including the OTC Bulletin Board) or by a recognized securities dealer, its Fair Market Value shall be the closing sales price for such stock as quoted on such system on the date
of determination, but if selling prices are not reported, the Fair Market Value of a share of Common Stock shall be the mean between the high bid and low asked prices for the Common Stock on the date of determination (or, if no such prices were
reported on that date, on the last date such prices were reported), as reported in The Wall Street Journal or such other source as the Administrator deems reliable; or 
  
                 (iii) In the absence of an
established market for the Common Stock of the type described in (i) and (ii), above, the Fair Market Value thereof shall be determined by the Administrator in good faith. 
  
         (y) “Grantee” means an Employee, Director or Consultant who
receives an Award under the Plan. 
  
         (z) “Incentive Stock Option” means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code 
  
         (aa) “Non-Qualified
Stock Option” means an Option not intended to qualify as an Incentive Stock Option. 
  
         (bb) “Officer” means a person who is an officer of the Company, a member of the PC Mall Group or a Related Entity within the meaning of Section 16 of
the Exchange Act and the rules and regulations promulgated thereunder. 
  
         (cc) “Option” means an option to purchase Shares pursuant to an Award Agreement granted under the Plan. 
  
         (dd) “Parent” means a “parent corporation”,
whether now or hereafter existing, as defined in Section 424(e) of the Code. 
  
         (ee) “PC Mall Group” means PC Mall, Inc. or any Parent or Subsidiary of PC Mall, Inc. 
  
         (ff) “Performance-Based Compensation” means compensation
qualifying as “performance-based compensation” under Section 162(m) of the Code. 
  
         (gg) “Plan” means this 2004 Stock Incentive Plan. 
  
         (hh) “Registration Date” means the first to occur of (i) the closing of the first sale to
the general public pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission under the Securities Act of 1933, as amended, of (A) the Common Stock or (B) the same class of securities of a
successor corporation (or its Parent) issued pursuant to a Corporate Transaction in exchange for or in substitution of the Common Stock; and (ii) in the event of a Corporate Transaction, the date of the consummation of the Corporate Transaction if
the same class of securities of the successor corporation (or its Parent) issuable in such Corporate Transaction shall have been sold to the general public 
  

 5 

 pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission under
the Securities Act of 1933, as amended, on or prior to the date of consummation of such Corporate Transaction. 
  
         (ii) “Related Entity” means any Parent or Subsidiary of the Company and any business,
corporation, partnership, limited liability company or other entity in which the Company or a Parent or a Subsidiary of the Company holds a substantial ownership interest, directly or indirectly. 
  
         (jj)
“Replaced” means that pursuant to a Corporate Transaction the Award is replaced with a comparable stock award or a cash incentive program of the Company, the successor entity (if applicable) or Parent of either of them which
preserves the compensation element of such Award existing at the time of the Corporate Transaction and provides for subsequent payout in accordance with the same (or a more favorable) vesting schedule applicable to such Award. The determination of
Award comparability shall be made by the Administrator and its determination shall be final, binding and conclusive. 
  
         (kk) “Restricted Stock” means Shares issued under the Plan to the Grantee for such
consideration, if any, and subject to such restrictions on transfer, rights of first refusal, repurchase provisions, forfeiture provisions, and other terms and conditions as established by the Administrator. 
  
         (ll) “Restricted
Stock Units” means an Award which may be earned in whole or in part upon the passage of time or the attainment of performance criteria established by the Administrator and which may be settled for cash, Shares or other securities or a
combination of cash, Shares or other securities as established by the Administrator. 
  
         (mm) “Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act or any successor thereto. 
  
         (nn) “SAR”
means a stock appreciation right entitling the Grantee to Shares or cash compensation, as established by the Administrator, measured by appreciation in the value of Common Stock. 
  
         (oo) “Separation” means the distribution of all or
substantially all of the shares of capital stock of the Company held by PC Mall, Inc. to the stockholders of PC Mall, Inc. 
  
         (pp) “Share” means a share of the Common Stock. 
  
         (qq) “Spin-off
Transaction” means a distribution by the Company to its stockholders of all or any portion of the securities of any Subsidiary of the Company. 
  
         (rr) “Subsidiary” means a “subsidiary corporation”, whether now or hereafter
existing, as defined in Section 424(f) of the Code. 
  

 6 

 3. Stock Subject to the Plan. 
  
         (a) Subject to the provisions of Section 10, below, the maximum
aggregate number of Shares which may be issued pursuant to all Awards (including Incentive Stock Options) is 6,300,000 Shares, plus an annual increase to be added on the first business day of each calendar year beginning in 2005 equal to three
percent (3%) of the number of Shares outstanding as of December 31 of the immediately preceding calendar year or such lesser number of Shares as may be determined by the Administrator. Notwithstanding the foregoing, subject to the provisions of
Section 10, below, of the number of Shares specified above, the maximum aggregate number of Shares available for grant of Incentive Stock Options shall be 6,300,000 Shares. The Shares to be issued pursuant to Awards may be authorized, but
unissued, or reacquired Common Stock. 
  
         (b) Any Shares covered by an Award (or portion of an Award) which is forfeited, canceled or expires (whether voluntarily or involuntarily) shall be deemed not to have been issued for purposes
of determining the maximum aggregate number of Shares which may be issued under the Plan. Shares that actually have been issued under the Plan pursuant to an Award shall not be returned to the Plan and shall not become available for future issuance
under the Plan, except that if unvested Shares are forfeited, or repurchased by the Company at the lower of their original purchase price or their Fair Market Value at the time of repurchase, such Shares shall become available for future grant under
the Plan. To the extent not prohibited by Section 422(b)(1) of the Code (and the corresponding regulations thereunder), the listing requirements of The Nasdaq National Market (or other established stock exchange or national market system on which
the Common Stock is traded) and Applicable Law, any Shares covered by an Award which are surrendered (i) in payment of the Award exercise or purchase price or (ii) in satisfaction of tax withholding obligations incident to the exercise of an Award
shall be deemed not to have been issued for purposes of determining the maximum number of Shares which may be issued pursuant to all Awards under the Plan, unless otherwise determined by the Administrator. 
  
 4. Administration of the Plan. 
  
         (a) Plan
Administrator. 
  
                 (i) Administration with Respect to Directors and Officers. With respect to grants of Awards to Directors or Employees who are also
Officers or Directors of the Company, the Plan shall be administered by (A) the Board or (B) a Committee designated by the Board, which Committee shall be constituted in such a manner as to satisfy the Applicable Laws and to permit such grants and
related transactions under the Plan to be exempt from Section 16(b) of the Exchange Act in accordance with Rule 16b-3. Once appointed, such Committee shall continue to serve in its designated capacity until otherwise directed by the Board.

  
                 (ii) Administration With Respect to Consultants and Other Employees. With respect to grants of Awards to Employees or Consultants who are
neither Directors nor Officers of the Company, the Plan shall be administered by (A) the Board or (B) a Committee designated by the Board, which Committee shall be constituted in such a manner as to satisfy the 
  

 7 

 Applicable Laws. Once appointed, such Committee shall continue to serve in its designated capacity until otherwise
directed by the Board. The Board may authorize one or more Officers to grant such Awards and may limit such authority as the Board determines from time to time. 
  
                 (iii) Administration With
Respect to Covered Employees. Notwithstanding the foregoing, as of and after the date that the exemption for the Plan under Section 162(m) of the Code expires, as set forth in Section 18 below, grants of Awards to any Covered Employee
intended to qualify as Performance-Based Compensation shall be made only by a Committee (or subcommittee of a Committee) which is comprised solely of two or more Directors eligible to serve on a committee making Awards qualifying as
Performance-Based Compensation. In the case of such Awards granted to Covered Employees, references to the “Administrator” or to a “Committee” shall be deemed to be references to such Committee or subcommittee. 
  
                 (iv) Administration Errors. In the event an Award is granted in a manner inconsistent with the provisions of this subsection (a), such
Award shall be presumptively valid as of its grant date to the extent permitted by the Applicable Laws. 
  
         (b) Powers of the Administrator. Subject to Applicable Laws and the provisions of the Plan
(including any other powers given to the Administrator hereunder), and except as otherwise provided by the Board, the Administrator shall have the authority, in its discretion: 
  
                 (i) to select the Employees,
Directors and Consultants to whom Awards may be granted from time to time hereunder; 
  
                 (ii) to determine whether and to what extent Awards are granted hereunder; 
  
                 (iii) to determine the number of Shares or the amount of other consideration to be covered by each Award granted hereunder; 
  
                 (iv) to approve forms of Award Agreements for use under the Plan; 
  
                 (v) to determine the terms
and conditions of any Award granted hereunder; 
  
                 (vi) to amend the terms of any outstanding Award granted under the Plan, provided that (A) any amendment that would adversely affect the
Grantee’s rights under an outstanding Award shall not be made without the Grantee’s written consent, (B) the reduction of the exercise price of any Option awarded under the Plan shall be subject to stockholder approval and (C) canceling an
Option at a time when its exercise price exceeds the Fair Market Value of the underlying Shares, in exchange for another Option, Restricted Stock, or other Award shall be subject to stockholder approval, unless the cancellation and exchange occurs
in connection with a Corporate Transaction; 
  

 8 

                 (vii) to
construe and interpret the terms of the Plan and Awards, including without limitation, any notice of award or Award Agreement, granted pursuant to the Plan; 
  
                 (viii) to grant Awards to Employees, Directors and
Consultants employed outside the United States on such terms and conditions different from those specified in the Plan as may, in the judgment of the Administrator, be necessary or desirable to further the purpose of the Plan; 
  
                 (ix) to take such other action, not inconsistent with the terms of the Plan, as the Administrator deems appropriate. 
  
         (c) Indemnification.
In addition to such other rights of indemnification as they may have as members of the Board or as Officers or Employees of the Company or a Related Entity, members of the Board and any Officers or Employees of the Company or a Related Entity to
whom authority to act for the Board, the Administrator or the Company is delegated shall be defended and indemnified by the Company to the extent permitted by law on an after-tax basis against all reasonable expenses, including attorneys’ fees,
actually and necessarily incurred in connection with the defense of any claim, investigation, action, suit or proceeding, or in connection with any appeal therein, to which they or any of them may be a party by reason of any action taken or failure
to act under or in connection with the Plan, or any Award granted hereunder, and against all amounts paid by them in settlement thereof (provided such settlement is approved by the Company) or paid by them in satisfaction of a judgment in any such
claim, investigation, action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such claim, investigation, action, suit or proceeding that such person is liable for gross negligence, bad faith or intentional
misconduct; provided, however, that within thirty (30) days after the institution of such claim, investigation, action, suit or proceeding, such person shall offer to the Company, in writing, the opportunity at the Company’s expense to defend
the same. 
  
 5. Eligibility. Awards other than Incentive
Stock Options may be granted to Employees, Directors and Consultants. Incentive Stock Options may be granted only to Employees of the Company or a Parent or a Subsidiary of the Company. An Employee, Director or Consultant who has been granted an
Award may, if otherwise eligible, be granted additional Awards. Awards may be granted to such Employees, Directors or Consultants who are residing in non-U.S. jurisdictions as the Administrator may determine from time to time. 
  
 6. Terms and Conditions of Awards. 
  
         (a) Types of Awards.
The Administrator is authorized under the Plan to award any type of arrangement to an Employee, Director or Consultant that is not inconsistent with the provisions of the Plan and that by its terms involves or might involve the issuance of (i)
Shares, (ii) cash or (iii) an Option, a SAR, or similar right with a fixed or variable price related to the Fair Market Value of the Shares and with an exercise or conversion privilege related to the passage of time, the occurrence of one or more
events, or the satisfaction of performance criteria or other conditions. Such awards include, without limitation, Options, SARs, sales or bonuses of Restricted Stock, Restricted Stock Units or Dividend Equivalent Rights, and an Award may consist of
one such security or benefit, or two (2) or more of them in any combination or alternative. 
  

 9 

         (b) Designation of Award. Each Award shall be
designated in the Award Agreement. In the case of an Option, the Option shall be designated as either an Incentive Stock Option or a Non-Qualified Stock Option. However, notwithstanding such designation, to the extent that the aggregate Fair Market
Value of Shares subject to Options designated as Incentive Stock Options which become exercisable for the first time by a Grantee during any calendar year (under all plans of the Company or any Parent or Subsidiary of the Company) exceeds $100,000,
such excess Options, to the extent of the Shares covered thereby in excess of the foregoing limitation, shall be treated as Non-Qualified Stock Options. For this purpose, Incentive Stock Options shall be taken into account in the order in which they
were granted, and the Fair Market Value of the Shares shall be determined as of the grant date of the relevant Option. 
  
         (c) Conditions of Award. Subject to the terms of the Plan, the Administrator shall determine the
provisions, terms, and conditions of each Award including, but not limited to, the Award vesting schedule, repurchase provisions, rights of first refusal, forfeiture provisions, form of payment (cash, Shares, or other consideration) upon settlement
of the Award, payment contingencies, and satisfaction of any performance criteria. The performance criteria established by the Administrator may be based on any one of, or combination of, the following: (i) increase in share price, (ii) earnings per
share, (iii) total stockholder return, (iv) operating margin, (v) gross margin, (vi) return on equity, (vii) return on assets, (viii) return on investment, (ix) operating income, (x) net operating income, (xi) pre-tax profit, (xii) cash flow, (xiii)
revenue, (xiv) expenses, (xv) earnings before interest, taxes and depreciation, (xvi) economic value added, (xvii) market share and (xviii) personal management objectives. The performance criteria may be applicable to the Company, Related Entities
and/or any individual business units of the Company or any Related Entity. Partial achievement of the specified criteria may result in a payment or vesting corresponding to the degree of achievement as specified in the Award Agreement. 

 
         (d) Acquisitions and
Other Transactions. The Administrator may issue Awards under the Plan in settlement, assumption or substitution for, outstanding awards or obligations to grant future awards in connection with the Company or a Related Entity acquiring another
entity, an interest in another entity or an additional interest in a Related Entity whether by merger, stock purchase, asset purchase or other form of transaction. 
  
         (e) Deferral of Award Payment. The Administrator may establish one or
more programs under the Plan to permit selected Grantees the opportunity to elect to defer receipt of consideration upon exercise of an Award, satisfaction of performance criteria, or other event that absent the election would entitle the Grantee to
payment or receipt of Shares or other consideration under an Award. The Administrator may establish the election procedures, the timing of such elections, the mechanisms for payments of, and accrual of interest or other earnings, if any, on amounts,
Shares or other consideration so deferred, and such other terms, conditions, rules and procedures that the Administrator deems advisable for the administration of any such deferral program. 
  

 10 

         (f) Separate Programs. The Administrator may
establish one or more separate programs under the Plan for the purpose of issuing particular forms of Awards to one or more classes of Grantees on such terms and conditions as determined by the Administrator from time to time.  
  
         (g) Individual
Limitations on Awards. Following the date that the exemption from application of Section 162(m) of the Code described in Section 18 (or any exemption having similar effect) ceases to apply to Awards, the following limitations shall apply.

  
                 (i) Individual Limit for Options and SARs. The maximum number of Shares with respect to which Options and SARs may be granted to any
Grantee in any fiscal year of the Company shall be 500,000 Shares. In connection with a Grantee’s commencement of Continuous Service, a Grantee may be granted Options or SARs for up to an additional 500,000 Shares which shall not count against
the limit set forth in the previous sentence. The foregoing limitations shall be adjusted proportionately in connection with any change in the Company’s capitalization pursuant to Section 10, below. To the extent required by Section 162(m) of
the Code or the regulations thereunder, in applying the foregoing limitations with respect to a Grantee, if any Option or SAR is canceled, the canceled Option or SAR shall continue to count against the maximum number of Shares with respect to which
Options and SARs may be granted to the Grantee. For this purpose, the repricing of an Option (or in the case of a SAR, the base amount on which the stock appreciation is calculated is reduced to reflect a reduction in the Fair Market Value of the
Common Stock) shall be treated as the cancellation of the existing Option or SAR and the grant of a new Option or SAR. 
  
                 (ii) Individual Limit for Restricted Stock and
Restricted Stock Units. For awards of Restricted Stock and Restricted Stock Units that are intended to be Performance-Based Compensation, the maximum number of Shares with respect to which such Awards may be granted to any Grantee in any fiscal
year of the Company shall be 500,000 Shares. The foregoing limitation shall be adjusted proportionately in connection with any change in the Company’s capitalization pursuant to Section 10, below. 
  
                 (iii) Deferral. If the vesting or receipt of Shares under an Award is deferred to a later date, any amount (whether denominated in Shares
or cash) paid in addition to the original number of Shares subject to such Award will not be treated as an increase in the number of Shares subject to the Award if the additional amount is based either on a reasonable rate of interest or on one or
more predetermined actual investments such that the amount payable by the Company at the later date will be based on the actual rate of return of a specific investment (including any decrease as well as any increase in the value of an investment).

  
         (h) Early
Exercise. The Award Agreement may, but need not, include a provision whereby the Grantee may elect at any time while an Employee, Director or Consultant to exercise any part or all of the Award prior to full vesting of the Award. Any unvested
Shares received pursuant to such exercise may be subject to a repurchase right in favor of the Company or a Related Entity or to any other restriction the Administrator determines to be appropriate. 
  
         (i) Term of Award.
The term of each Award shall be the term stated in the Award Agreement, provided, however, that the term of an Incentive Stock Option shall be no 
  

 11 

 more than ten (10) years from the date of grant thereof. However, in the case of an Incentive Stock Option granted to a
Grantee who, at the time the Option is granted, owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary of the Company, the term of the Incentive Stock Option shall
be five (5) years from the date of grant thereof or such shorter term as may be provided in the Award Agreement. Notwithstanding the foregoing, the specified term of any Award shall not include any period for which the Grantee has elected to defer
the receipt of the Shares or cash issuable pursuant to the Award. 
  
         (j) Transferability of Awards. Incentive Stock Options may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised, during the lifetime of the Grantee, only by the Grantee. Other Awards shall be transferable (i) by will and by the laws of descent and distribution and (ii) during the lifetime of the Grantee, to the
extent and in the manner authorized by the Administrator. Notwithstanding the foregoing, the Grantee may designate one or more beneficiaries of the Grantee’s Award in the event of the Grantee’s death on a beneficiary designation form
provided by the Administrator. 
  
         (k) Time of Granting Awards. The date of grant of an Award shall for all purposes be the date on which the Administrator makes the determination to grant such Award, or such other date
as is determined by the Administrator. 
  
 7. Award Exercise
or Purchase Price, Consideration and Taxes. 
  
         (a) Exercise or Purchase Price. The exercise or purchase price, if any, for an Award shall be as follows: 
  
                 (i) In the case of an
Incentive Stock Option: 
  
                         (A) granted to an Employee who, at the time of the grant of such Incentive Stock Option owns
stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary of the Company, the per Share exercise price shall be not less than one hundred ten percent (110%) of the Fair
Market Value per Share on the date of grant; or 
  
                         (B) granted to any Employee other than an Employee described in the preceding paragraph, the per
Share exercise price shall be not less than one hundred percent (100%) of the Fair Market Value per Share on the date of grant. 
  
                 (ii) In the case of a Non-Qualified Stock Option, the per
Share exercise price shall be not less than eighty-five percent (85%) of the Fair Market Value per Share on the date of grant unless otherwise determined by the Administrator. 
  
                 (iii) In the case of Options
or SARs intended to qualify as Performance-Based Compensation, the exercise or base appreciation amount shall be not less than one hundred percent (100%) of the Fair Market Value per Share on the date of grant. 
  

 12 

                 (iv) In
the case of other Awards, such price as is determined by the Administrator. 
  
                 (v) Notwithstanding the foregoing provisions of this Section 7(a), in the case of an Award issued pursuant to
Section 6(d), above, the exercise or purchase price for the Award shall be determined in accordance with the provisions of the relevant instrument evidencing the agreement to issue such Award. 
  
         (b) Consideration.
Subject to Applicable Laws, the consideration to be paid for the Shares to be issued upon exercise or purchase of an Award including the method of payment, shall be determined by the Administrator (and, in the case of an Incentive Stock Option,
shall be determined at the time of grant). In addition to any other types of consideration the Administrator may determine, the Administrator is authorized to accept as consideration for Shares issued under the Plan the following, provided that the
portion of the consideration equal to the par value of the Shares must be paid in cash or other legal consideration permitted by the Delaware General Corporation Law: 
  
                 (i) cash; 
  
                 (ii) check; 
  
                 (iii) if the exercise or purchase occurs on or after the
Registration Date, surrender of Shares or delivery of a properly executed form of attestation of ownership of Shares as the Administrator may require which have a Fair Market Value on the date of surrender or attestation equal to the aggregate
exercise price of the Shares as to which said Award shall be exercised, provided, however, that Shares acquired under the Plan or any other equity compensation plan or agreement of the Company must have been held by the Grantee for a period of more
than six (6) months (and not used for another Award exercise by attestation during such period); 
  
                 (iv) with respect to Options, if the exercise occurs on or
after the Registration Date, payment through a broker-dealer sale and remittance procedure pursuant to which the Grantee (A) shall provide written instructions to a Company designated brokerage firm to effect the immediate sale of some or all of the
purchased Shares and remit to the Company sufficient funds to cover the aggregate exercise price payable for the purchased Shares and (B) shall provide written directives to the Company to deliver the certificates for the purchased Shares directly
to such brokerage firm in order to complete the sale transaction; or 
  
                 (v) any combination of the foregoing methods of payment. 
  
 The Administrator may at any time or from time to time, by adoption of or by amendment to the standard forms of Award Agreement described in
Section 4(b)(iv), or by other means, grant Awards which do not permit all of the foregoing forms of consideration to be used in payment for the Shares or which otherwise restrict one or more forms of consideration. 
  
         (c) Taxes. No Shares
shall be delivered under the Plan to any Grantee or other person until such Grantee or other person has made arrangements acceptable to the Administrator for the satisfaction of any non-U.S., federal, state, or local income and 
  

 13 

 employment tax withholding obligations, including, without limitation, obligations incident to the receipt of Shares or
the disqualifying disposition of Shares received on exercise of an Incentive Stock Option. Upon exercise of an Award the Company shall withhold or collect from Grantee an amount sufficient to satisfy such tax obligations. 
  
 8. Exercise of Award. 
  
         (a) Procedure for
Exercise; Rights as a Stockholder. 
  
                 (i) Any Award granted hereunder shall be exercisable at such times and under such conditions as determined by the Administrator under the terms
of the Plan and specified in the Award Agreement. 
  
                 (ii) An Award shall be deemed to be exercised when written notice of such exercise has been given to the Company in accordance with the terms of
the Award by the person entitled to exercise the Award and full payment for the Shares with respect to which the Award is exercised, including, to the extent selected, use of the broker-dealer sale and remittance procedure to pay the purchase price
as provided in Section 7(b)(iv). 
  
         (b) Exercise of Award Following Termination of Continuous Service. 
  
                 (i) An Award may not be exercised after the termination
date of such Award set forth in the Award Agreement and may be exercised following the termination of a Grantee’s Continuous Service only to the extent provided in the Award Agreement. 
  
                 (ii) Where the Award Agreement permits a Grantee to exercise an Award following the termination of the Grantee’s Continuous Service for a
specified period, the Award shall terminate to the extent not exercised on the last day of the specified period or the last day of the original term of the Award, whichever occurs first. 
  
                 (iii) Any Award designated
as an Incentive Stock Option to the extent not exercised within the time permitted by law for the exercise of Incentive Stock Options following the termination of a Grantee’s Continuous Service shall convert automatically to a Non-Qualified
Stock Option and thereafter shall be exercisable as such to the extent exercisable by its terms for the period specified in the Award Agreement. 
  
 9. Conditions Upon Issuance of Shares. 
  
         (a) Shares shall not be issued pursuant to the exercise of an Award unless the exercise of such Award and
the issuance and delivery of such Shares pursuant thereto shall comply with all Applicable Laws, and shall be further subject to the approval of counsel for the Company with respect to such compliance. 
  
         (b) As a condition to the
exercise of an Award, the Company may require the person exercising such Award to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment and without any present intention to sell or distribute
such Shares if, in the opinion of counsel for the Company, such a representation is required by any Applicable Laws. 
  

 14 

 10. Adjustments Upon Changes in Capitalization. Subject to any required action by the stockholders
of the Company, the number of Shares covered by each outstanding Award, and the number of Shares which have been authorized for issuance under the Plan but as to which no Awards have yet been granted or which have been returned to the Plan, the
exercise or purchase price of each such outstanding Award, the maximum number of Shares with respect to which Awards may be granted to any Grantee in any fiscal year of the Company, as well as any other terms that the Administrator determines
require adjustment shall be proportionately adjusted for (i) any increase or decrease in the number of issued Shares resulting from a stock split, reverse stock split, stock dividend, combination or reclassification of the Shares, or similar
transaction affecting the Shares, (ii) any other increase or decrease in the number of issued Shares effected without receipt of consideration by the Company, or (iii) as the Administrator may determine in its discretion, any other transaction with
respect to Common Stock including a corporate merger, consolidation, acquisition of property or stock, separation (including a spin-off or other distribution of stock or property), reorganization, liquidation (whether partial or complete) or any
similar transaction; provided, however that conversion of any convertible securities of the Company shall not be deemed to have been “effected without receipt of consideration.” Such adjustment shall be made by the Administrator and its
determination shall be final, binding and conclusive. Except as the Administrator determines, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by
reason hereof shall be made with respect to, the number or price of Shares subject to an Award. In the event of a Spin-off Transaction, the Administrator may in its discretion make such adjustments and take such other action as it deems appropriate
with respect to outstanding Awards under the Plan, including but not limited to: (i) adjustments to the number and kind of shares, the exercise or purchase price per share and the vesting periods of outstanding Awards, (ii) prohibit the exercise of
Awards during certain periods of time prior to the consummation of the Spin-off Transaction, or (iii) the substitution, exchange or grant of Awards to purchase securities of the Subsidiary; provided that the Administrator shall not be obligated to
make any such adjustments or take any such action hereunder. 
  
 11. Corporate Transactions and Changes in Control. 
  
         (a) Termination of Award to Extent Not Assumed in Corporate Transaction. Effective upon the consummation of a Corporate Transaction, all outstanding Awards under the Plan shall
terminate. However, all such Awards shall not terminate to the extent they are Assumed in connection with the Corporate Transaction. 
  
         (b) Acceleration of Award Upon Corporate Transaction or Change in Control. Except as provided
otherwise in an individual Award Agreement, in the event of any Corporate Transaction or Change in Control, there will not be any acceleration of vesting or exercisability of any Award. 
  
 12. Effective Date and Term of Plan. The Plan shall become effective upon the earlier to occur of its adoption by the
Board or its approval by the stockholders of the Company. It shall continue in effect for a term of ten (10) years unless sooner terminated. Subject to Section 17, below, and Applicable Laws, Awards may be granted under the Plan upon its becoming
effective. 
  

 15 

 13. Amendment, Suspension or Termination of the Plan. 
  
         (a) The Board may at any
time amend, suspend or terminate the Plan; provided, however, that no such amendment shall be made without the approval of the Company’s stockholders to the extent such approval is required by Applicable Laws, or if such amendment would change
any of the provisions of Section 4(b)(vi) or this Section 13(a). 
  
         (b) No Award may be granted during any suspension of the Plan or after termination of the Plan. 
  
         (c) No suspension or termination of the Plan (including termination of the Plan under Section 12, above)
shall adversely affect any rights under Awards already granted to a Grantee. 
  
 14. Reservation of Shares. 
  
         (a) The Company, during the term of the Plan, will at all times reserve and keep available such number of Shares as shall be sufficient to satisfy the requirements of the Plan. 
  
         (b) The inability of the
Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in
respect of the failure to issue or sell such Shares as to which such requisite authority shall not have been obtained. 
  
 15. No Effect on Terms of Employment/Consulting Relationship. The Plan shall not confer upon any Grantee any right with respect to the
Grantee’s Continuous Service, nor shall it interfere in any way with his or her right or the right of the Company, any member of the PC Mall Group or any Related Entity to terminate the Grantee’s Continuous Service at any time, with or
without Cause, and with or without notice. The ability of the Company, any member of the PC Mall Group or any Related Entity to terminate the employment of a Grantee who is employed at will is in no way affected by its determination that the
Grantee’s Continuous Service has been terminated for Cause for the purposes of this Plan. 
  
 16. No Effect on Retirement and Other Benefit Plans. Except as specifically provided in a retirement or other benefit plan of the Company, a member
of the PC Mall Group or a Related Entity, Awards shall not be deemed compensation for purposes of computing benefits or contributions under any retirement plan of the Company, a member of the PC Mall Group or a Related Entity, and shall not affect
any benefits under any other benefit plan of any kind or any benefit plan subsequently instituted under which the availability or amount of benefits is related to level of compensation. The Plan is not a “Retirement Plan” or “Welfare
Plan” under the Employee Retirement Income Security Act of 1974, as amended. 
  
 17. Stockholder Approval. The grant of Incentive Stock Options under the Plan shall be subject to approval by the stockholders of the Company within twelve (12) months before or after the date the Plan is
adopted excluding Incentive Stock Options issued in substitution for outstanding Incentive Stock Options pursuant to Section 424(a) of the Code. Such stockholder 
  

 16 

 approval shall be obtained in the degree and manner required under Applicable Laws. The Administrator may grant Incentive
Stock Options under the Plan prior to approval by the stockholders, but until such approval is obtained, no such Incentive Stock Option shall be exercisable. In the event that stockholder approval is not obtained within the twelve (12) month period
provided above, all Incentive Stock Options previously granted under the Plan shall be exercisable as Non-Qualified Stock Options. 
  
 18. Effect of Section 162(m) of the Code. Following the Registration Date, the Plan, and all Awards issued thereunder, are intended to be exempt
from the application the stockholder approval requirements of Section 162(m) of the Code, which restricts under certain circumstances the Federal income tax deduction for compensation paid by a public company to named executives in excess of $1
million per year. The exemption is based on Treasury Regulation Section 1.162-27(f)(4)(iii), in the form existing on the effective date of the Plan, with the understanding that such regulation generally exempts from the application of the
stockholder approval requirements of Section 162(m) of the Code compensation paid pursuant to a plan of a subsidiary of a public company that becomes publicly held. Under Treasury Regulation Section 1.162-27(f)(4)(iii), and in the event of a
Registration Date, this exemption is available to the Plan for the duration of the period that lasts until the first regularly scheduled meeting of the stockholders of the Company that occurs more than 12 months after the Registration Date. The
Committee may, without stockholder approval, amend the Plan retroactively and/or prospectively to the extent it determines such amendment is necessary in order to comply with any subsequent clarification of Section 162(m) of the Code required to
preserve the Company’s Federal income tax deduction for compensation paid pursuant to the Plan. To the extent that the Administrator determines as of the date of grant of an Award that (i) the Award is intended to qualify as Performance-Based
Compensation and (ii) the exemption described above is no longer available with respect to such Award, such Award shall not be effective until any stockholder approval required under Section 162(m) of the Code has been obtained. 
  
 19. Unfunded Obligation. Grantees shall have the status of general
unsecured creditors of the Company. Any amounts payable to Grantees pursuant to the Plan shall be unfunded and unsecured obligations for all purposes, including, without limitation, Title I of the Employee Retirement Income Security Act of 1974, as
amended. Neither the Company nor any Related Entity shall be required to segregate any monies from its general funds, or to create any trusts, or establish any special accounts with respect to such obligations. The Company shall retain at all times
beneficial ownership of any investments, including trust investments, which the Company may make to fulfill its payment obligations hereunder. Any investments or the creation or maintenance of any trust or any Grantee account shall not create or
constitute a trust or fiduciary relationship between the Administrator, the Company or any Related Entity and a Grantee, or otherwise create any vested or beneficial interest in any Grantee or the Grantee’s creditors in any assets of the
Company or a Related Entity. The Grantees shall have no claim against the Company or any Related Entity for any changes in the value of any assets that may be invested or reinvested by the Company with respect to the Plan. 
  
 20. Construction. Captions and titles contained herein are for
convenience only and shall not affect the meaning or interpretation of any provision of the Plan. Except when otherwise indicated by the context, the singular shall include the plural and the plural shall include the singular. Use of the term
“or” is not intended to be exclusive, unless the context clearly requires otherwise. 
  

 17 

 eCOST.COM, INC. 
  
 2004 NON-EMPLOYEE DIRECTOR OPTION PROGRAM 
  
 ARTICLE I 
 ESTABLISHMENT AND PURPOSE OF THE PROGRAM 
  
 1.01 Establishment
of Program 
  
 The eCOST.com, Inc. 2004 Non-Employee Director Option Program
(the “Program”) is adopted pursuant to the eCOST.com, Inc. 2004 Stock Incentive Plan (the “Plan”) and, in addition to the terms and conditions set forth below, is subject to the provisions of the Plan. 
  
 1.02 Purpose of Program 
  
 The purpose of the Program is to enhance the ability of the Company to attract and retain directors who are not Employees
(“Non-Employee Directors”) through a program of automatic Option grants. 
  
 1.03 Effective Date of the Program 
  
 The Program is effective
as of the Registration Date. 
  
 ARTICLE II 
 DEFINITIONS 
  
 Capitalized terms in this Program, unless otherwise defined herein, have the meaning given to them in the Plan. 
  
 ARTICLE III 
 OPTION TERMS 
  
 3.01 Date of Grant and Number of Shares 
  
 A Non-Qualified Stock
Option to purchase 30,000 shares of Common Stock shall be granted (the “Initial Grant”) to each Non-Employee Director, such Initial Grant to be made to Non-Employee Directors elected or appointed to the Board after the Registration Date on
the first business day after each such Non-Employee Director first becomes a Non-Employee Director. In addition, on the first business day after each annual meeting of the Company’s stockholders commencing with the annual meeting of the
Company’s stockholders in 2005, each Non-Employee Director who continues as a Non-Employee Director following such annual meeting shall be granted a Non-Qualified Stock Option to purchase 10,000 shares of Common Stock (a “Subsequent
Grant”); provided that no Subsequent Grant shall be made to any Non-Employee Director who has not served as a director of the Company, as of the time of such annual meeting, for at least six (6) months. 
  

 1 

 3.02 Vesting 
  
 Each Initial Grant under the Program shall vest and become exercisable as to one-twelfth (1/12th) of the shares of Common Stock subject to the Option on each quarterly anniversary of the grant date, such that the Option will be fully exercisable three (3)
years after its date of grant. Each Subsequent Grant under the Program shall vest and become exercisable as to one-fourth (1/4th) of the shares of Common Stock subject to the Option on each quarterly anniversary of the grant date, such that the Option will be fully exercisable one (1) years after its date of grant. 
  
 3.03 Exercise Price 
  
 The exercise price per share of Common Stock of each Initial Grant and Subsequent Grant shall be one hundred percent (100%) of the Fair
Market Value per Share on the date of grant. 
  
 3.04 Corporate
Transaction/Change in Control 
  
 (a) Termination of Award
to Extent Not Assumed in Corporate Transaction. Effective upon the consummation of a Corporate Transaction, all outstanding Options under the Program shall terminate. However, all such Options shall not terminate to the extent they are Assumed
in connection with the Corporate Transaction. 
  
 (b)
Acceleration of Award Upon Corporate Transaction or Change in Control. 
  
         (i) Corporate Transaction. In the event of a Corporate Transaction and irrespective of whether the Option is Assumed or Replaced, each Option which is at the time
outstanding under the Program automatically shall become fully vested and exercisable, immediately prior to the specified effective date of such Corporate Transaction, for all of the Shares at the time represented by such Option, provided that the
Grantee’s Continuous Service has not terminated prior to such date. The portion of the Option that is not Assumed shall terminate under subsection (a) of this Section 3.04 to the extent not exercised prior to the consummation of such Corporate
Transaction. 
  
       (ii)
Change in Control. In the event of a Change in Control (other than a Change in Control which also is a Corporate Transaction), each Option which is at the time outstanding under the Program automatically shall become fully vested and
exercisable, immediately prior to the specified effective date of such Change in Control, for all of the Shares at the time represented by such Option, provided that the Grantee’s Continuous Service has not terminated prior to such date.

  
 3.05 Other Terms 
  
 The Administrator shall determine the remaining terms and conditions of the Options awarded
under the Program. 
  
 3.06 Amendment, Suspension or Termination of the Program

  
 The Board may at any time amend, suspend or terminate the Program without
the approval of the Company’s stockholders. 
  

 2

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