Document:

EXHIBIT 10.31

 

 FIRST AMENDMENT TO AGREEMENT FOR PURCHASE AND SALE

 

THIS FIRST AMENDMENT TO AGREEMENT FOR PURCHASE AND SALE OF REAL ESTATE AND JOINT ESCROW INSTRUCTIONS (“Amendment”) is made as of February 7, 2011, by and among Citibank N.A., a national banking association (“Seller”) and PC Mall, Inc., a Delaware corporation (“Buyer”). Capitalized terms used herein and not otherwise defined herein shall have the meanings set forth in the “Agreement” described below.

 

Recitals

 

A.          Seller and Buyer, previously entered into that certain Agreement for Purchase and Sale of Real Estate and Joint Escrow Instructions, dated January 7, 2011 (the “Agreement”). Pursuant to the Agreement, Seller agreed to sell to Buyer and Buyer agreed to purchase from Seller certain real property and improvements commonly known as 1940 E. Mariposa Avenue, EI Segundo, California.

 

B.           The parties wish to extend the Closing Date and certain contingency dates as provided below.

 

Agreement

 

NOW, THEREFORE, for a good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Buyer and Seller hereby agree as follows:

 

1.           Incorporation of Recitals. The Recitals set forth above are deemed to be true and accurate in all respects and are hereby incorporated into this Amendment by this reference.

 

2. Extension of Closing Date. The definition of “Close of Escrow” or “Closing” is hereby amended and restated in its entirety to ““Close of Escrow” or “Closing” shall mean the closing of the Escrow contemplated by this Agreement which shall be the date no later than March 9, 2011.”

 

3.           Extension of Financing and Board Approval Contingencies. In Sections 5.1.7 and 5.1.8, the date of “February 7, 2011” is hereby extended to “February 23, 2011 “.

 

4.           No Other Changes. Except as modified by this Amendment, the Agreement is and shall remain unmodified and in full force and effect. In the event of any conflict between the terms of the Purchase Agreement and the terms of this First Amendment, the terms of this First Amendment shall govern and control.

 

5.           Counterparts; Facsimile Signatures. This Amendment may be executed in any number of counterparts, and each such counterpart will for all purposes be deemed an original, and all such counterparts shall constitute one and the same instrument. Facsimile signatures shall be accepted as original signatures.

 

[Signatures Follow]

 

 

IN WITNESS WHEREOF, the parties have executed this  Amendment as of the date first written above.

 

	
 
    	
SELLER:
    
	
 
    	
Citibank,   N.A.
    
	
 
    	
a   national banking association
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/Kathryn   Covert
    
	
 
    	
Name:
    	
Kathryn   Covert
    
	
 
    	
Title:
    	
Vice   President
    
	
 
    	
 
    	
 
    
	
 
    	
BUYER:
    
	
 
    	
 
    	
 
    
	
 
    	
PC   Mall, Inc.,
    
	
 
    	
a   Delaware corporation
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/Brandon   LaVerne
    
	
 
    	
Name:   
    	
Brandon   LaVerne
    
	
 
    	
Its:
    	
CFO
    
				

 

The changes to the escrow instructions set forth above are hereby acknowledged and accepted by:

 

	
 
    	
ESCROW   AGENT:
    
	
 
    	
 
    	
 
    
	
 
    	
Fidelity   National Title Company
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/Natalie   Priestley
    
	
 
    	
Print   Name:
    	
Natalie   PriestleyEXHIBIT 10.32

 

SECOND AMENDMENT TO AGREEMENT FOR PURCHASE AND SALE

 

THIS SECOND AMENDMENT TO AGREEMENT FOR PURCHASE AND SALE OF REAL ESTATE AND JOINT ESCROW INSTRUCTIONS (“Amendment”) is made as of February 22, 2011, by and among Citibank N.A., a national banking association (“Seller”) and PC Mall, Inc., a Delaware corporation (“Buyer”). Capitalized terms used herein and not otherwise defined herein shall have the meanings set forth in the “Agreement” described below.

 

Recitals

 

A.            Seller and Buyer, previously entered into that certain Agreement for Purchase and Sale of Real Estate and Joint Escrow Instructions, dated January 7, 2011 (as amended by that certain First Amendment dated February 7, 2011 , the “Agreement”). Pursuant to the Agreement, Seller agreed to sell to Buyer and Buyer agreed to purchase from Seller certain real property and improvements commonly known as 1940 E. Mariposa Avenue, EI Segundo, California.

 

B.             The parties wish to extend the Closing Date and certain contingency dates and provide for a partial release of the Deposit as provided below. Terms not otherwise defined shall have the meaning given to them in the Agreement (as modified hereby).

 

Agreement

 

NOW, THEREFORE, for a good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Buyer and Seller hereby agree as follows:

 

1.             Extension of Closing Date. The definition of “Close of Escrow” or “Closing” is hereby amended and restated in its entirety to ““Close of Escrow” or “Closing” shall mean the closing of the Escrow contemplated by this Agreement which shall be the date no later than March 25. 2011 .”

 

2.             Extension of Financing and Board Approval Contingencies. In Sections 5.1.7 and 5.1.8, the date of “February 23, 2011” is hereby extended to “March 10, 2011 “.

 

3.             Release of Deposit. In consideration of the extension of time to approve the transaction and obtain financing and to effectuate the Closing, Buyer hereby agrees to the unconditional release of $100,000 of the Deposit (the “Released Deposit Money”) on February 23, 2011 . Buyer agrees that notwithstanding anything in the Agreement to the contrary, the Released Deposit Money shall be non-refundable and immediately released to Seller. Buyer further agrees that, as of 4:01 p.m. C.S.T. on March 10, 2011 , if Buyer has not terminated the Agreement pursuant to the terms of either Sections 5.1.7 or 5.1.8 of the Agreement, the remaining $400,000 of the Deposit will be immediately released to Seller, which amount shall be non-refundable as provided for in the Agreement. Buyer and Seller agree that the Deposit (including that portion constituting the Released Deposit Money) shall be applied to the “Purchase Price” at the Closing in accordance with the Purchase Agreement if Buyer purchases the Property as provided for in the Agreement.

 

4.             No Other Changes. Except as modified by this Amendment, the Agreement is and shall remain unmodified and in full force and effect.

 

 

5.             Counterparts; Facsimile Signatures. This Amendment may be executed in any number of counterparts, and each such counterpart will for all purposes be deemed an original, and all such counterparts shall constitute one and the same instrument. Facsimile signatures shall be accepted as original signatures.

 

[Signatures on following page(s)]

 

 

IN WITNESS WHEREOF, the parties have executed this Amendment as of the date first written above.

 

	
 
    	
SELLER:
    
	
 
    	
 
    	
 
    
	
 
    	
Citibank,   N.A.,
    
	
 
    	
a   national banking association
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/Kathryn   Covert
    
	
 
    	
Name:
    	
Kathryn   Covert
    
	
 
    	
Title:
    	
Vice   President
    
	
 
    	
 
    	
 
    
	
 
    	
BUYER:
    
	
 
    	
 
    	
 
    
	
 
    	
PC   Mall, Inc.,
    
	
 
    	
a   Delaware corporation
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/Brandon   LaVerne
    
	
 
    	
Name:
    	
Brandon   LaVerne
    
	
 
    	
Its:
    	
CFO
    
						

 

The changes to the escrow instructions set forth above are hereby acknowledged and accepted by:

 

	
 
    	
ESCROW   AGENT:
    
	
 
    	
 
    	
 
    
	
 
    	
Fidelity   National Title Company
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/Natalie   Priestley
    
	
 
    	
Print   Name:
    	
Natalie   PriestleyEXHIBIT 10.35

 

Summary of Executive Bonus Plan

(adopted March 22, 2011)

 

On March 22, 2011, the Compensation Committee of our Board of Directors approved, effective March 27, 2011, increases to the base salary annual rates of pay for our executive officers and adopted new executive incentive bonus plans for our executive officers to be effective for the fiscal year ending December 31, 2011 in replacement of prior executive bonus plans, previously adopted on August 18, 2010 for fiscal year ending December 31, 2010. The base salary rate increases include an increase for Frank Khulusi, Brandon LaVerne, Kristin Rogers, Robert Newton and Joseph Hayek, respectively, from $807,919, $279,414, $339,414, $304,414 and $255,194, to $833,000, $317,500, $350,000, $317,500 and $263,000.

 

The new executive incentive bonus plans were adopted by the Compensation Committee after consideration by the Committee of our compensation philosophies, principles and processes as described in our Annual Report on Form 10-K/A for the fiscal year ended December 31, 2009 filed with the Securities and Exchange Commission on April 30, 2010. These philosophies, principles and processes provide for periodic review by the Committee of the performance of our executive officers, the components of their compensation and the effectiveness of our compensation programs in rewarding the contributions of our executive officers towards enhancing our specific business goals while retaining and motivating high quality individuals. In adopting the new executive incentive bonus plan for the fiscal year ending December 31, 2011, the Committee considered a report from an independent third party compensation consultant, Towers Watson, together with other recent competitive market data.

 

The general executive incentive bonus plan covers the following executive officers, with applicable incentive targets under the plan indicated as a percentage of base salary for each as follows: Frank F. Khulusi, Chairman, President and Chief Executive Officer — 50% of base salary; Brandon H. LaVerne, Chief Financial Officer — 40% of base salary; Kristin M. Rogers, Executive Vice President of Sales and Marketing — 40% of base salary; and Joseph B. Hayek, Executive Vice President of Corporate Development and Investor Relations — 40% of base salary. Additionally, the Compensation Committee approved an increase to Mr. Newton’s annual contractual bonus opportunity of $120,000 to an annual bonus opportunity of $127,000. Mr. Newton does not participate in the general executive incentive bonus plan based on an agreement between the Company and Mr. Newton, which was originally entered into in June of 2004 in an effort to avoid any conflict of interest in the outcome of his legal advice to the Company.

 

The general plan will be funded at the above amounts if the company achieves 100% of a target of adjusted EBITDA for the 2011 calendar year, excluding the results of its new OnSale segment. Adjusted EBITDA is defined under the plan as earnings before interest, taxes, depreciation and amortization, and adjusted for stock-based compensation and non-recurring special charges, if any, to be excluded from the calculation of EBITDA in the discretion of the Compensation Committee.

 

The plan also has a minimum adjusted EBITDA for any incentive bonuses to be paid under the plan and contains incentive bonus decelerators based on performance below the performance target. If the company’s performance falls below the performance target, but is at least 90% of the performance target, the incentive bonuses may be reduced by a percentage of the incentive bonus target equal to two times the percentage points by which adjusted EBITDA falls below the performance target. For example, if the company achieves 90% of the performance target, incentive bonuses under the plan may be funded at 80% of the target incentive bonus amounts described above.

 

Additional decelerators will apply if the company’s performance is between 80% and 90% of the performance target.  In such event, in addition to the first decelerator described above for performance between 90% and 100% of the performance target, the incentive bonus amounts may be further decreased by an additional eight times the percentage points by which adjusted EBITDA falls below 90% of the performance target.  For example, if the company achieves 85% of the performance target, incentive bonuses under the plan may be funded at 40% of the incentive bonus amounts described above.  If the company achieves less than 80% of the performance target, the plan will not be funded, and no incentive bonuses will be paid under the plan.

 

The plan also contains accelerators under which the incentive bonus amounts can exceed the above described target incentive bonus amounts. If the company’s performance is between 100% and 110% of the performance target, the incentive bonuses may be increased at a rate of two times the percentage points by which adjusted EBITDA exceeds 100% of the performance target.  For example, if the company achieves 110% of the performance target, the incentive bonuses may be paid at 120% of the above described incentive bonus target amounts.

 

 

Additional accelerators are available if the company’s performance is between 111% and 130% of the performance target. In such event, in addition to the first accelerator described above for performance between 100% and 110% of the performance target, the incentive bonus amounts may be further increased by an additional four times the percentage points by which the performance target exceeds 110%, with a maximum funding of 200% of the incentive bonus targets. For example, if the company achieves 120% of the performance target, the plan may be funded and incentive bonuses paid at 160% of the above described incentive bonus target amounts. If the company achieves 130% or more of the performance target, the plan may be funded and incentive bonuses paid at 200% of the above described incentive bonus target amounts.

 

All amounts funded may be reduced at the sole discretion of the Compensation Committee based upon qualitative or quantitative factors. In addition to participation in the executive incentive bonus plan, as described above, all of our executive officers are eligible for discretionary bonuses as determined from time to time by our Compensation Committee.

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