THIRD AMENDMENT TO EMPLOYMENT AGREEMENT
THIS THIRD AMENDMENT TO EMPLOYMENT AGREEMENT is made this 7th
day of June, 1999, effective as of July 1, 1999, between SED
INTERNATIONAL, INC., a Georgia corporation (the "Subsidiary") and a
wholly-owned subsidiary of SED INTERNATIONAL HOLDINGS, INC., a Georgia
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, effective July 1, 1998, Employee and the Subsidiary
entered into the Second Amendment to the Employment Agreement,
modifying certain terms and conditions of Employee's employment with
the Subsidiary; 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 with 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 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:
(h) 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:
(1) 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 or Assistant Secretary of the
Subsidiary that he is exercising his rights hereunder
and requests payment of the amounts provided for under
this Section 3(h); or
(2) the Employee gives written notice of his termination of
employment for any reason concurrently with the time a
Change of Control occurs or any time within thirty (30)
days after the date the Change of Control becomes
effective to the Secretary or Assistant Secretary of
the Subsidiary, he may exercise his rights hereunder
and request payment of the amounts provided for under
this Section 3(h) (the notice provided pursuant to
Subsection 3(h)(1) or Subsection 3(h)(2) is referred to
as 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, immediately upon the
Subsidiary's receipt of the Notice of Exercise, a single
cash
payment for damages suffered by the Employee by reason of
the Change in Control (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 any
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; and further 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 Articles of Incorporation, Bylaws or
similar policies, plans or agreements relating to
indemnification of directors and officers of SEC and the
Subsidiary under certain circumstances. The Executive
Payment shall not be reduced by any present value
calculations.
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.
2. 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.
IN WITNESS WHEREOF, the parties have duly executed and delivered
this Third Amendment to Employment Agreement as of the day and year
first indicated above.
SED INTERNATIONAL, INC.
By: _______________________________________
Name: XXX X. XXXXXX
Title: PRESIDENT AND COO
_____________________________________(SEAL)
Xxxxxx Xxxxxxx (Employee)
