Exhibit 10.1

THIS AGREEMENT IS SUBJECT TO ARBITRATION PURSUANT TO S.C. CODE

ANN. § 15-48-10, et seq., THE SOUTH CAROLINA UNIFORM ARBITRATION ACT

Mr. Gerald Lyons

August 23, 2017

Dear Gerry:

The Compensation Committee (the “Compensation Committee”) of the Board of
Directors (the “Board”) of ScanSource, Inc. (the “Company”) has determined that
it would be appropriate to formalize certain terms and conditions of your
employment with the Company through the terms and conditions of this employment
letter agreement (the “Letter Agreement”), which Letter Agreement will be
effective as of the date stated above (the “Effective Date”). As the Chairman of
the Compensation Committee, I am pleased to extend to you the offer to continue
your employment with the Company on the terms and conditions stated in this
Letter Agreement.

1. Certain Employment Terms. You will be our Chief Financial Officer and
Executive Vice President of the Company and may serve as an officer and/or
director of one or more of the Company’s subsidiaries or other affiliates if and
as directed by the Board. Your position is a full-time position and you will be
expected to continue to devote your full business time and attention to the
performance of your duties and responsibilities in the position(s) described
above. You will report to the Chief Executive Officer, and/or the Board. Your
employment will be for no set duration. You will be an at-will employee, which
means that either the Company or you may terminate the employment relationship
at any time, for any reason or no reason, with or without cause, subject to the
severance plan benefit opportunities referenced in Section 5 of this Letter
Agreement. Although your position will require travel, your principal place of
employment will be at the Company’s headquarters in Greenville, South Carolina,
and you will be expected to continue to reside in the Greenville, South Carolina
area. You are authorized to join up to a total of two non-competing public
and/or private corporation boards of directors, subject to prior notice to and
approval by the Board.

2. Base Salary. Your annual base salary as of the Effective Date in your role as
Chief Financial Officer and Executive Vice President will be $350,000, paid in
accordance with the Company’s payroll practices (every two weeks by direct
deposit) pro-rated for any partial year, and less applicable taxes and
withholdings. Your salary will be subject to annual review by the Compensation
Committee but shall not be subject to decrease without your consent.

3. Variable Cash Incentive Awards. You will be eligible to participate in the
Company’s cash-based variable compensation incentive plan (the “Bonus Plan”).
Your target annual bonus opportunity for fiscal 2018 shall be equal to 70% of
base salary, and your maximum annual bonus opportunity shall not exceed 140% of
your base salary (2 times target). Thereafter, your target and maximum
short-term incentive opportunities shall be subject to periodic review by the
Compensation Committee, provided that you will be eligible to participate in the
Bonus Plan at a level commensurate with the level of participation of other
senior executive officers of the Company. Bonuses, if any, may be pro rated for
any partial years, based on actual performance. The performance measures and
goals applicable to your annual bonus opportunity (for any year) shall be
established by the Compensation Committee, and the Compensation Committee shall
have the discretion to determine if, and the extent to which, any such measures
and goals have been met and the bonus has been earned. While it is generally
anticipated that your annual short-term incentive opportunities will be
maintained, your participation in the Bonus Plan does not constitute a promise
of payment. Your actual incentive payout, if any, will depend on the Company’s
financial and business performance and/or the Compensation Committee’s
assessment of your individual performance, and will be subject to the terms and
conditions of the Bonus Plan. Any bonus payment made to you under the Bonus Plan
will be paid to you in accordance with Treasury Reg. Section 1.409A-1(b)(4) or
shall otherwise be made in a manner intended to be exempt from, or to comply
with, Section 409A of the Internal Revenue Code of 1986, as amended (the
“Code”).

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4. Long-Term Incentive Awards. You will be eligible to participate in and
receive awards under any long-term incentive plan or program of the Company that
is in place from time to time in which other senior executive officers of the
Company participate. The amount, form and vesting and other terms and conditions
of such awards will be reviewed and established periodically by the Compensation
Committee, but it is expected that you will be granted equity awards in the
normal course of business at a level commensurate with the level of equity
awards granted to other senior executive officers of the Company. Your long-term
incentive awards shall be of a type(s) determined by the Compensation Committee
(e.g., restricted stock units, options, performance awards, other equity awards
or any combination of the foregoing) and shall be subject to the terms of the
Company’s 2013 Long-Term Incentive Plan (as it may be amended, and any successor
plan thereto, the “Stock Plan”) and award agreement(s) in form(s) established by
the Compensation Committee.

5. Severance Benefits; Restrictive Covenants. You will be designated to
participate in the ScanSource, Inc. Executive Severance Plan (the “Severance
Plan”), such designation to occur on or as soon as practicable following the
Effective Date, which Severance Plan shall include such terms and conditions as
may be established by the Compensation Committee and/or the Board. Subject to
the terms of the Severance Plan, it is currently anticipated that you will be
eligible for severance benefits equal to 1.5 times your three-year average
annual (a) base salary and (b) variable compensation (as defined in the
Severance Plan) upon termination by the Company without cause or by you for good
reason (as such terms are defined in the Severance Plan), or 2.0 times your
three-year average annual base salary and variable compensation in the event of
a non-cause termination by the Company or your termination for good reason
within 12 months after or prior to and otherwise in contemplation of a change in
control (as defined in the Severance Plan). Without limiting the effect of the
foregoing, the treatment of any equity awards upon such a qualifying termination
will be subject to the terms of the Stock Plan and related award agreements. In
addition, you will be subject to certain non-competition, non-solicitation,
confidentiality and other restrictive covenants (collectively, the “Restrictive
Covenants”), as provided in the Severance Plan or other applicable plan or
arrangement (with such Restrictive Covenants to apply during employment and for
such period(s) following termination of employment as may be provided in the
Severance Plan or other applicable plan or arrangement), and your entitlement to
benefits under the Severance Plan and the Letter Agreement shall be subject to
your compliance with such Restrictive Covenants. Notwithstanding the foregoing,
(i) nothing in this Letter Agreement or other agreement prohibits you from
reporting possible violations of law or regulation to any federal, state or
local governmental agency or entity, including but not limited to the Department
of Justice, the Securities and Exchange Commission, the Congress and any agency
Inspector General (the “Government Agencies”), or communicating with Government
Agencies or otherwise participating in any investigation or proceeding that may
be conducted by Government Agencies, including providing documents or other
information, (ii) you do not need the prior authorization of the Company to take
any action described in (i), and you are not required to notify the Company that
you have taken any action described in (i); and (iii) the Letter Agreement does
not limit your right to receive an award for providing information relating to a
possible securities law violation to the Securities and Exchange Commission.
Further, notwithstanding the foregoing, you will not be held criminally or
civilly liable under any federal, state or local trade secret law for the
disclosure of a trade secret that (i) is made (A) in confidence to a federal,
state or local government official, either directly or indirectly, or to an
attorney, and (B) solely for the purpose of reporting or investigating a
suspected violation or law; or (ii) is made in a complaint or other document
filed in a lawsuit or other proceeding, if such filing is made under seal.
Additionally, an individual suing an employer for retaliation based on the
reporting of a suspected violation of law may disclose a trade secret to his or
her attorney and use the trade secret information in the court proceeding, so
long as any document containing the trade secret is filed under seal and the
individual does not disclose the trade secret except pursuant to court order.

 

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6. Health and Welfare Benefits. The Company provides a comprehensive package of
benefits, including medical and prescription drug coverage, dental coverage,
vision coverage, life insurance, short- and long-term disability insurance and
other offerings. Provided you remain an eligible employee as defined under each
of the Company’s health and welfare benefits plan(s), you will continue to be
eligible to participate in such plan(s), subject to the applicable terms of such
plan(s) and the Company’s right to modify or terminate such plans.

7. 401(k) Savings Plan. You will continue to be eligible to participate in the
Company-sponsored 401(k) savings plan, subject to the terms of such plan and the
Company’s right to modify or terminate such plan. The Company may in its
discretion match a portion of your contributions in accordance with the
applicable plan provisions. Eligibility requirements and conditions of
enrollment and coverage are subject to change and are set forth in the
applicable plan documents.

8. Deferred Compensation. You will continue to be eligible to participate in the
Company’s Nonqualified Deferred Compensation Plan, subject to the plan’s terms
and conditions and the Company’s right to modify or terminate such plan.

9. Vacation. You will be entitled to no less than twenty (20) vacation days. The
Company also offers eight (8) paid holidays.

10. Business Travel; Reimbursements. You will be expected to travel in
connection with your employment. The Company will reimburse you for reasonable
business expenses incurred in connection with your employment, upon presentation
of documentation in accordance with the Company’s applicable expense
reimbursement policies for senior management. All expenses eligible for
reimbursements in connection with your employment with the Company must be
incurred by you during the term of your employment or service to the Company.
The amount of reimbursable expenses incurred in one taxable year shall not
affect the expenses eligible for reimbursement in any other taxable year. In no
event shall any reimbursement be paid after the last day of your taxable year
following the taxable year during which the expense was incurred. No right to
reimbursement is subject to liquidation or exchange for other benefits.

 

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11. Withholding and Taxes. All amounts payable or that become payable under this
Letter Agreement will be subject to any deductions and withholdings previously
authorized by you or required by law. You will be responsible for any and all
taxes resulting from the benefits provided under the Letter Agreement. The
Company makes no undertakings regarding, and has no obligation to achieve, any
certain tax results for you related to the benefits provided herein.

12. Waiver and Release. You acknowledge and agree that the Company may at any
time require, as a condition to receipt of certain benefits payable under this
Letter Agreement, the Severance Plan or other plan, agreement or arrangement,
that you (or a representative of your estate) execute a waiver and release
discharging the Company and its subsidiaries, and their respective affiliates,
and its and their officers, directors, managers, employees, agents and
representatives and the heirs, predecessors, successors and assigns of all of
the foregoing, from any and all claims, actions, causes of action or other
liability, whether known or unknown, contingent or fixed, arising out of or in
any way related to your employment, or the ending of your employment with the
Company or the benefits thereunder, including, without limitation, any claims
under this Letter Agreement or other related instruments. The waiver and release
will be in a form determined by the Company and shall be executed prior to the
expiration of the time period provided for payment of such benefits.

13. Amendment and Termination; Entire Agreement; Consideration. This Letter
Agreement may be amended or terminated by a written agreement between you and
the Company, with the Chairman of the Compensation Committee (or another
designee of the Compensation Committee) acting on behalf of the Company. Except
for the Executive Severance Plan and Stock Plan (and related participation and
award agreements), this Letter Agreement contains the entire agreement of you
and the Company related to the subject matter hereof and supersedes all prior
verbal or written discussion, agreements and understandings with respect to such
subject matter, and you and the Company have made no agreements, representations
or warranties related to the subject matter of this Letter Agreement that are
not set forth herein. Without in any way limiting the effect of the foregoing,
you and the Company hereby acknowledge and agree that that certain Employment
Agreement dated as of July 1, 2014, as amended pursuant to that First Amendment
to Amended and Restated Employment Agreement effective as of June 15, 2017 (such
agreement, as amended and/or restated to date, the “2014 Employment Agreement”),
between you and the Company shall be terminated as of the Effective Date and
that you shall have no further rights or benefits under such 2014 Employment
Agreement as of the Effective Date. Your entering into this Letter Agreement
does not violate any other agreements or obligations. As a condition to the
effectiveness of this Letter Agreement, you will be required to sign a mutual
agreement to arbitrate claims in form acceptable to the Company. You further
acknowledge that you are receiving valuable consideration in exchange for
agreeing to the terms of this Letter Agreement.

 

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14. Compliance with Code Section 409A; Recoupment, Ownership and Other Policies
or Agreements. You and the Company agree that you both will cooperate in good
faith so that no compensation paid to you by the Company under this Letter
Agreement will violate Code Section 409A and the regulations promulgated
thereunder. In case any one or more provisions of this Letter Agreement fail to
comply with the provisions of Code Section 409A, the remaining provisions of
this Letter Agreement shall remain in effect, and this Letter Agreement shall be
administered and applied as if the non-complying provisions were not part of
this Letter Agreement. The parties in that event shall endeavor to agree upon a
reasonable substitute for the non-complying provisions, to the extent that a
substituted provision would not cause this Letter Agreement to fail to comply
with Code Section 409A, and, upon so agreeing, shall incorporate such
substituted provisions into this Letter Agreement. A termination of your
employment hereunder shall not be deemed to have occurred for purposes of any
provision of this Letter Agreement providing for the payment of any amount or
benefit constituting “deferred compensation” under Code Section 409A upon or
following a termination of employment unless such termination is also a
“separation from service” within the meaning of Code Section 409A and, for
purposes of any such provision of this Letter Agreement, references to a
“termination,” “termination of employment” or like terms shall mean “separation
from service.” In the event that any payment or benefit made hereunder or under
any compensation plan, program or arrangement of the Company would constitute
payments or benefits pursuant to a non-qualified deferred compensation plan
within the meaning of Code Section 409A and, at the time of your “separation
from service” you are a “specified employee” within the meaning of Code
Section 409A, then any such payments or benefits that are provided to you on
account of your “separation from service” shall be delayed until the six-month
anniversary of the date of your “separation from service” (such six month
anniversary being the “Specified Employee Payment Date”). The aggregate amount
of any payments that would otherwise have been made during such six-month period
shall be paid in a lump sum on the Specified Employee Payment Date with interest
and, thereafter, any remaining payments shall be paid without delay in
accordance with their original schedule. If you die before the Specified
Employee Payment Date, any delayed payments shall be paid to your estate in a
lump sum within 30 days of your death. Each payment made under this Letter
Agreement shall be designated as a “separate payment” within the meaning of Code
Section 409A. You acknowledge and agree that in the event that this Letter
Agreement or any benefit described herein shall be deemed not to comply with
Code Section 409A, then neither the Company, the Board, the Compensation
Committee nor its or their designees or agents shall be liable to you or other
persons for actions, decisions or determinations made in good faith. Further, as
a condition to entering into this Letter Agreement, you agree that you will
abide by all provisions of any compensation recovery (“clawback”) policy, stock
ownership guidelines, equity retention policy and/or other similar policies
maintained by the Company, each as in effect from time to time and to the extent
applicable to you from time to time. In addition, you will be subject to such
compensation recovery, recoupment, forfeiture or other similar provisions as may
apply at any time to you under applicable law.

15. Compensation and Benefit Plans Control. The Company’s benefit offerings and
other terms and conditions of employment are subject to change or termination,
with or without notice. In the event of differences between any documents
relating to compensation and benefits, the terms of the applicable plan or other
document will control.

16. Governing Law; Successors and Assigns. This Letter Agreement will be
governed by and construed in accordance with the laws of the State of South
Carolina, without regard to the principles of conflict of laws, and in
accordance with applicable U.S. federal law. The provisions, obligations and
rights of this Letter Agreement will be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns.

 

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On behalf of the Compensation Committee, the Board and the Company, we thank you
for your service and look forward to your continued service. If the terms of
this Letter Agreement are acceptable to you, please sign the letter below and
return it to the Company’s Vice President Worldwide – Human Resources, at your
earliest opportunity.

Sincerely,

/s/ Peter Browning

Peter Browning

Chairman of the Compensation Committee,

Board of Directors of ScanSource, Inc.

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I acknowledge receipt and acceptance of the continued offer of employment in
this Letter Agreement, as such terms are modified by this Letter Agreement. By
my signature below, I accept all terms and conditions set forth above. In
addition, I acknowledge and agree that, I will be employed on an at-will basis
and that any change to that status may only be made through an agreement in
writing signed by the Company. In addition, my continued employment is
contingent on the condition that I execute a mutual agreement to arbitrate
claims in form acceptable to the Company, which should be executed in
conjunction with your acceptance of the offer of continued employment as
described in this Letter Agreement.

 

Accepted:

 

/s/ Gerald Lyons

       

Gerald Lyons

     

Date: August 23, 2017

 

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