FIFTH AMENDMENT TO LOAN AND SECURITY AGREEMENT

[Execution]

FIFTH AMENDMENT TO LOAN AND SECURITY AGREEMENT

THIS FIFTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (hereinafter referred to as this “Amendment”) is made and entered into as of September 28, 2007, by and between INNOTRAC CORPORATION , a Georgia corporation (“Borrower”), and WACHOVIA BANK, NATIONAL ASSOCIATION (“Bank”).

BACKGROUND STATEMENT

A.         Borrower and Bank are parties to the Third Amended and Restated Loan and Security Agreement, dated March 28, 2006, as amended by the First Amendment Agreement, dated as of July 24, 2006, the Waiver and Amendment Agreement, dated as of November 14, 2006, the Second Waiver and Amendment Agreement, dated as of April 16, 2007, and the Fourth Amendment Agreement, dated as of June 29, 2007 (as the same now exists and may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced, the “Loan Agreement”) and the other agreements, documents and instruments referred to therein or any time executed and/or delivered in connection therewith or related thereto, including this Amendment (all of the foregoing, together with the Loan Agreement, as the same now exist or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced, being collectively referred to herein as the “Loan Documents”).

B.         Borrower has requested that the Bank amend certain provisions of the Loan Agreement as hereinafter set forth, and the Bank has agreed to make such amendments, subject to the terms and conditions set forth below.

AGREEMENT

NOW, THEREFORE, in consideration of the premises and covenants set forth herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Borrower and Bank agree as follows:

(a)         Additional Definitions . The following new definitions are hereby added to Section 1.1 of the Loan Agreement in alphabetical order as follows:

“ Additional Subordinated Term Loans ” shall have the meaning given to the term “Additional Term Loans” in the Subordinated Term Loan Agreement.

“Capital Expenditures” means for any period the aggregate cost of all capital assets acquired by Borrower and its Subsidiaries during such period, as determined in accordance with GAAP.

“ Capital Lease ” means, with respect to any Person, any lease of any property (whether real, personal or mixed) by such Person as lessee which would, in accordance with GAAP, be required to be accounted for as a capital lease on the balance sheet of such Person.

“ Capital Lease Obligation ” means, with respect to any Capital Lease of any Person, the amount of the obligation of the lessee thereunder that, in accordance with GAAP, would appear on a balance sheet of such lessee in respect of such Capital Lease.

“EBITDA” means, for any applicable period, the sum of (A) consolidated net income of Borrower and its Subsidiaries for such period (computed without regard to any extraordinary items of gain or loss as determined by GAAP) plus (B) to the extent deducted from revenue in computing consolidated net income for such period, the sum of (1) interest expense, (2) income tax expense, and (3) depreciation and amortization, less (C) non-cash gains.

“ Fifth Amendment ” shall mean the Fifth Amendment to Loan and Security Agreement, dated September 28, 2007, by and among Borrower, Obligor and Bank.

“ Fifth Amendment Effective Date ” means the first date on which all of the conditions precedent to the effectiveness of the Fifth Amendment shall have been satisfied or shall have been waived by Bank.

“Fixed Charge Coverage Ratio” means, during any period of determination: (i) EBITDA for such period, plus rent expense incurred during such period, less the sum of (A) all unfinanced Capital Expenditures made in such period, and (B) any dividends and distributions paid in such period and (C) cash taxes paid in such period (without benefit of any refunds), divided by (ii) the sum of (A) the current portion of scheduled principal amortization on Funded Debt coming due in the next twelve (12) months as of the end of the most recent fiscal month (excluding the repayment of the Obligations) plus (B) cash interest payments paid in such period, plus (C) Pro-Forma Term Loan Interest, plus (D) rent expense paid during such period plus (E) all cash payments made by Borrower during such period consisting of the following ClientLogic Deferred Payments: (1) the earn-out payment due on or before April 2008, and (2) any other consideration paid in connection with the Client Logic Acquisition (other than the $800,000 deferred purchase payment due in February 2007).

“ Funded Debt ” means, with respect to any Person, without duplication, (a) all Debt for borrowed money, and (b) all Debt evidenced by notes, bonds, debentures or similar instruments, or upon which interest payments are customarily made, in each case, that by its terms matures more than one (1) year from, or is directly or indirectly renewable or extendible at such Person’s option under a revolving credit or similar agreement obligating the lender or lenders to extend credit over a period of more than one (1) year from, the date of creation thereof, and including, without limitation, Capital Lease Obligations, current maturities of long-term debt, revolving credit and short-term debt extendible beyond one (1) year at the option of the debtor, and Guaranteed Obligations in respect of Funded Debt of other Persons.

“ Guaranteed Obligations ” means, with respect to any Person, without duplication, any obligation of such Person guaranteeing, providing comfort or otherwise supporting any Indebtedness, lease, dividend, or other obligation (“primary obligation”) of any other Person (the “primary obligor”) in any manner, including any obligation or arrangement of such Person to (a) purchase or repurchase any such primary obligation, (b) advance or supply funds (i) for the purchase or payment of any such primary obligation or (ii) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency or any balance sheet condition of the primary obligor, (c) purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation, (d) protect the beneficiary of such arrangement from loss (other than product warranties given in the ordinary course of business) or (e) indemnify the owner of such primary obligation against loss in respect thereof; provided that the term Guaranteed Obligations shall not include endorsements for collection or deposit in the ordinary course of business. The amount of any Guaranteed Obligations at any time shall be deemed to be an amount equal to the lesser at such time of (x) the stated or determinable amount of the primary obligation in respect of which such Guaranteed Obligations is incurred and (y) the maximum amount for which such Person may be liable pursuant to the terms of the instrument embodying such Guaranteed Obligations, or, if not stated or determinable, the maximum reasonably anticipated liability (assuming full performance) in respect thereof.

“ Loans ” means the loans now or hereafter made by Bank to Borrower on a revolving basis pursuant to Section 2.1 hereof (involving advances, repayments and readvances).

“ Pro-Forma Term Loan Interest ” means, for any applicable period, an amount equal to (a) the principal amount of the Subordinated Term Loans multiplied by the then effective rate of interest on the Subordinated Term Loans less (b) the amount of cash interest payments paid in such period with respect to the Subordinated Term Loans.

“ Subordinated Debt ” means Debt and all other obligations owed by Borrower to any Person other than Bank which are subordinated to the Obligations.

“ Subordinated Term Loan Agent ” means Chatham Credit Management III, LLC, a Georgia limited liability company, in its capacity as agent for the Subordinated Term Loan Lenders, and any replacement or successor agent under the Subordinated Term Loan Agreement.

“ Subordinated Term Loans ” means, collectively, the Subordinated Debt consisting of the term loan made by Subordinated Term Loan Lenders to Borrower under the Subordinated Term Loan Agreement on the Fifth Amendment Effective Date in the amount equal to $5,000,000 and the Additional Subordinated Term Loans.

“ Subordinated Term Loan Agreement ” means the Second Lien Loan and Security Agreement dated as of the Fifth Amendment Effective Date, by and among Borrower, Subordinated Term Loan Agent and Subordinated Term Loan Lenders, as the same now exists or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced.

“ Subordinated Term Loan Debt ” means the Subordinated Debt consisting of the Subordinated Term Loans and all other obligations owing by Borrower to Subordinated Term Loan Agent and Subordinated Term Loan Lenders under the Subordinated Term Loan Agreement from time to time.

“ Subordinated Term Loan Documents ” means, collectively, the following (as the same now exists or may hereafter be amended, modified, supplemented, extended, renewed or replaced): (a) the Subordinated Term Loan Agreement and (b) all agreements, documents and instruments executed and delivered in connection therewith and related thereto.

“ Subordinated Term Loan Intercreditor Agreement ” means the Intercreditor Agreement, dated as of the Fifth Amendment Effective Date, between Bank and Subordinated Term Loan Agent, as acknowledged by Borrower, as the same now exists or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced.

“ Subordinated Term Loan Lenders ” means, collectively, the financial institutions from time to time party to the Subordinated Term Loan Agreement as lenders, and their respective successors and assigns; each sometimes being referred to herein individually as a “Subordinated Term Loan Lender”.

“ Subordinated Term Loan Termination Date ” means the earliest of (i) March 1, 2009, (ii) the date on which Borrower terminates the Subordinated Term Loan Agreement and the credit facilities provided hereunder pursuant to Section 2.13 hereof, and (iii) the date on which Subordinated Term Loan Lenders terminate their obligations to make loans and other extensions of credit to Borrower pursuant to Section 8.2(a) of the Subordinated Term Loan Agreement.

(i) The definition of “Revolver Commitment” set forth in Section 1.1 of the Loan Agreement is hereby amended by deleting such definition in its entirety and replacing it with the following :

“ ‘Revolver Commitment’ means the commitment of Bank, subject to the terms and conditions herein, to make Loans and issue Letters of Credit in accordance with the provisions of Section 2 hereof in an aggregate amount not to exceed $15,000,000 at any one time.”

(c)         Interpretation . Capitalized terms used herein, unless otherwise defined, shall have the meanings ascribed to them in the Loan Agreement.

(a)        Section 5.6 of the Loan Agreement is hereby amended by deleting subsection (d) thereof in its entirety and replacing it with the following:

“(d) Compliance and No Default Certificates . Together with each report required to be delivered by subsection (b) above in connection with the end of each fiscal month and required to be delivered by subsection (c) above, a compliance certificate in the form annexed hereto as Exhibit 5.6(d) and a certificate of its president or controller certifying that no Default then exists or if a Default exists, the nature and duration thereof and Borrower’s intention with respect thereto, and in addition, Borrower’s Chief Financial Officer shall deliver a copy of such compliance certificate to Borrower’s independent auditors and to the members (if any) of the audit committee of the Board of Directors of Borrower.”

(b)       Section 5.6 of the Loan Agreement is hereby further amended by deleting the first sentence of subsection (i) thereof in its entirety and replacing it with the following:

“Not later than the thirtieth (30th) day following the commencement of each fiscal year of Borrower, deliver Projections (as hereinafter defined) to Bank for Borrower for such fiscal year.”

3.          Covenants Regarding Collateral. Section 5.12 of the Loan Agreement is hereby amended by deleting subsection (e) thereof in its entirety and replacing it with the following:

“(e) except for (i) sales of Inventory in the ordinary course of business, (ii) the voluntary termination of Swap Agreement to which Borrower or such Subsidiary is a party, and (iii) Permitted Liens, will not sell, assign, lease, transfer, pledge, hypothecate or otherwise dispose of or encumber any Collateral or any interest therein;”.

4.          Debt . Section 6.1 of the Loan Agreement is hereby amended by deleting such Section in its entirety and replacing it with the following:

“6.1      Debt . Shall not create or permit to exist any Debt, including any guaranties or other contingent obligations, except the following (“Permitted Debt”):

(a) the Obligations;

(b) endorsement of checks for collection in the ordinary course of business;

(c) accounts payable to trade creditors which commencing on and after January 1, 2008, are not aged more than ninety (90) days from billing date and current operating expenses (other than for borrowed money) which are not more than thirty (30) days past due, in each case incurred in the ordinary course of business and paid within such time period, unless the same are actively being Properly Contested;

(d) purchase money Debt not exceeding $2,000,000 in aggregate principal amount at any time outstanding for Borrower and all Subsidiaries incurred to purchase Equipment, provided that the amount of such Debt shall not at any time exceed the purchase price of the Equipment purchased; and

(e) Debt for taxes not at the time due and payable or deferred taxes or which are being actively Properly Contested;

(f) the Subordinated Term Loan Debt (as in effect on the Fifth Amendment Effective Date or as permitted to be amended hereunder), provided , that , each of the following conditions is satisfied as determined by Bank:

(i) the aggregate principal amount of the Subordinated Term Loan m