EXHIBIT 10.48
SECOND AMENDMENT TO EMPLOYMENT AGREEMENT
THIS SECOND AMENDMENT TO EMPLOYMENT AGREEMENT is made this 29th day of
June, 1998, effective as of July 1, 1998, between SED INTERNATIONAL, INC.,
a Delaware corporation (the "Subsidiary") and a wholly-owned subsidiary of
SED INTERNATIONAL HOLDINGS, INC., a Delaware corporation, and Xxxxxx
Xxxxxxx, an individual resident of the State of Georgia (the "Employee").
W I T N E S S E T H:
WHEREAS, on November 7, 1989, Employee and the Subsidiary entered into
an Employment Agreement (the "Agreement") setting forth the terms and
conditions of Employee's employment with the Subsidiary; and
WHEREAS, effective July 1, 1991, Employee and the Subsidiary entered
into the First Amendment to the Employment Agreement, modifying certain
terms and conditions of Employee's employment with the Subsidiary; and
WHEREAS, the term of the Agreement is currently considered to be five
(5) years, with automatic one (1) year extensions of the Termination Date
of the Agreement, unless the Agreement and Employee's employment thereunder
are sooner terminated in accordance with the terms of the Agreement; and
WHEREAS, the Subsidiary and Employee wish to extend the term of the
Agreement and Employee's employment thereunder from said five (5) year term
to a seven (7) year term with the continuation thereafter to provide for
automatic one (1) year extensions of the Termination Date of the Agreement;
and
WHEREAS, the Subsidiary and Employee agree that it is in the best
interest of both parties to make certain further modifications to the terms
and conditions of Employee's employment the Subsidiary.
NOW, THEREFORE, in consideration of the foregoing, the continued
employment of the Employee, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:
1. Amendment to Section 4(a) of the Agreement. Pursuant to Section
15(d) of the Agreement, Section 4(a) of the Agreement is hereby deleted in
its entirety and replaced by the following paragraph:
(a) The term of this Agreement, and of Employee's employment
hereunder, shall commence as of July 1, 1998 and shall continue
for a period of seven (7) years (the "Initial Term") unless
earlier terminated as provided in Section 4(b) of this Agreement.
The Initial Term of this Agreement, and of Employee's employment
hereunder, shall automatically be extended for an additional one
(1) year period following the expiration of each year of
employment under this Agreement without further action by
Employee or the Subsidiary, unless notice not to renew for an
additional one (1) year period is given by either Subsidiary or
Employee to the other not less than six (6) months prior to the
expiration of any year of employment under this Agreement. In
the event a notice not to renew is given by one party to the
other as provided in the immediately preceding sentence, then the
automatic extension of the term of employment under this
Agreement shall
thereafter be of no further force and effect, and the Agreement
shall expire at the end of the then current seven (7) year term.
2. Amendment to Section 3(d) of the Agreement. Pursuant to Section
15(d) of the Agreement, Section 3(d) is hereby modified so as to increase
Employee's annual paid vacation from four (4) weeks to six (6) weeks per
fiscal year. The words "four (4) weeks" in said Section 3(d) shall be
deleted and the words "six (6) weeks" shall be replaced in its stead.
3. Amendment to Section 3(h) of the Agreement. Pursuant to Section
15(d) of the Agreement, Section 3(h) is hereby deleted in its entirety and
replaced by the following paragraphs:
(b) If a Change of Control occurs while the Employee is employed
by the Subsidiary during the term of this Agreement, or during
any extension thereof, and if the Employee's employment is
terminated involuntarily, or voluntarily by the Employee based on
(i) material changes in the nature or scope of the Employee's
duties or employment, (ii) a reduction in compensation of the
Employee made without the Employee's consent, (iii) a relocation
of the Subsidiary's executive offices other than in compliance
with the provisions of Section 2(b) of this Agreement, or (iv) a
good faith determination made by the Employee, upon consultation
with the Board of Directors of the Subsidiary, that it is
necessary or appropriate for the Employee to relocate from the
Atlanta, Georgia Metropolitan Area to enable Employee to perform
his duties hereunder, the Employee may, in his sole discretion,
give written notice within thirty (30) days after the date of
termination of employment to the Secretary of the Subsidiary that
he is exercising his rights hereunder and requests payment of the
amounts provided for under this subsection (h) (the "Notice of
Exercise").
If the Employee gives a Notice of Exercise to receive the
payments provided for hereunder, the Subsidiary shall pay to or
for the benefit of the Employee, within thirty (30) days after
the Subsidiary's receipt of the Notice of Exercise, a single cash
payment for damages suffered by the Employee by reason of a
Change in Control causing the Subsidiary's breach of this
Agreement (the "Executive Payment") in an amount equal to (as
determined in accordance with Section 280G(d) (4) of the Code)
all annual salary, Bonuses and other benefits owing to Employee
for the period from Employee's date of termination hereunder
through the remainder of the Initial Term of this Agreement, as
may be extended; provided, however, in the event the period from
the date of Employee's termination hereunder through the
remainder of the Initial Term of this Agreement, as may be
extended, is less than twelve (12) months, then the Employee
shall receive an Executive Payment equal to the sum of (as
determined in accordance with Section 280G(d)(4) of the Code) (i)
the current annual salary and the value of all other benefits
payable to the Employee annualized for a twelve (12) month
period, and (ii) an amount equal to the Bonus that would have
been paid for such period of less than twelve (12) months based
on an extrapolation of SEC's Pretax Adjusted Annual Income for
the full quarterly periods from the end of the most recent fiscal
year to the date of termination; provided, however, if Employee's
termination of employment hereunder occurs in the first fiscal
quarter of a fiscal year, then the Bonus shall be based on SEC's
Pretax Adjusted Annual Income for the immediately preceding
fiscal year.
The Executive Payment shall be in addition to and shall not be
offset or reduced by (i) any other amounts that have been earned
or accrued or that have otherwise become payable or will become
payable to the Employee or his beneficiaries, but have not been
paid by SEC or the Subsidiary at the time the Employee gives the
Notice of Exercise including, without limitation, salary,
bonuses, severance pay, consulting fees, disability benefits,
termination benefits, retirement benefits, life and health
insurance benefits or any other compensation or benefit payment
that is part of any previous, current or future contract, plan or
agreement, written or oral, and (ii) any indemnification payments
that may have accrued but not paid or that may thereafter become
payable to the Employee pursuant to the provisions of SEC's and
the Subsidiary's Certificates of Incorporation, Bylaws or similar
policies, plans or agreements relating to indemnification of
directors and officers of SEC and the Subsidiary under certain
circumstances.
In the event the Employee dies during the term of this Agreement,
the Employee's legal representative shall be
entitled to receive the Executive Payment, provided that the
Notice of Exercise has been or is given either by the Employee or
his legal representative, as the case may be.
4. Amendment to Section 3 of the Agreement. Pursuant to Section
15(d) of the Agreement, Section 3 is hereby amended by inserting the
following paragraph:
(i) The Employee shall be entitled to an additional death
benefit ("Salary Continuance"), payable to his surviving spouse,
if any, upon his death. Said surviving spouse shall receive an
annual payment equal to Employee's annual base salary at the time
of said death. The term of said Salary Continuance shall be
equal to number of years of employment remaining under the terms
of this Agreement at the time of Employee's death, or the death
of the surviving spouse, whichever shall come earlier. At the
time of execution of this Amendment, it is the intent of the
parties that the Salary Continuance be funded through a "key man"
life insurance policy having the Employee as the Insured and the
Subsidiary as the Beneficiary.
5. Other Provisions of the Agreement. Except as otherwise provided
herein, all other provisions of the Agreement shall remain in full force
and effect and Employee's employment thereunder shall continue on the terms
described therein throughout the term of the Agreement, as amended hereby.
[SIGNATURES ARE FOUND ON THE FOLLOWING PAGE]
IN WITNESS WHEREOF, the parties have duly executed and delivered this
Second Amendment to Employment Agreement as of the day and year first
indicated above.
SED INTERNATIONAL, INC.
By: /s/ Xxx X. Xxxxxx
Name: Xxx X. Xxxxxx
Title: President and COO
/s/ Xxxxxx Xxxxxxx (SEAL)
Xxxxxx Xxxxxxx (Employee)
