FIFTH AMENDMENT TO LOAN AND SECURITY AGREEMENT

       THIS FIFTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is
made and entered as of January 21, 2008, by and among SED INTERNATIONAL
HOLDINGS, INC., a Georgia corporation (“Parent”), SED INTERNATIONAL, INC., a
Georgia corporation (“SED”), SED MAGNA (MIAMI), INC., a Delaware corporation
(“Magna”; Parent, SED and Magna are collectively referred to herein as
“Borrowers” and each individually as a “Borrower”), the parties to the Loan
Agreement (as hereinafter defined) from time to time as lenders (collectively,
“Lenders” and each individually, a “Lender”) and WACHOVIA BANK, NATIONAL
ASSOCIATION, a national banking association, in its capacity as agent for
Lenders (in such capacity, “Agent”).

Recitals:

       Borrowers, Agent and Lenders are parties to that certain Loan and
Security Agreement dated September 21, 2005, as amended by that certain letter
amendment dated January 24, 2006, that certain Second Amendment to Loan and
Security Agreement dated May 17, 2006, that certain letter amendment dated May
17, 2006, that certain letter amendment dated December 21, 2006, that certain
letter amendment dated February 1, 2007, that certain Third Amendment to Loan
and Security Agreement dated March 1, 2007, that certain letter amendment dated
April 25, 2007, that certain letter amendment dated May 18, 2007, that certain
Fourth Amendment dated August 23, 2007 and that certain letter amendment dated
October 15, 2007 (as so amended, and as at any other time amended, restated,
modified or supplemented, the “Loan Agreement”), pursuant to which Lenders have
made certain revolving credit loans and other financial accommodations to
Borrowers.

       The parties desire to amend the Loan Agreement as hereinafter set forth.

       NOW, THEREFORE, for TEN DOLLARS ($10.00) in hand paid and other good and
valuable consideration, the receipt and sufficiency of which are hereby
severally acknowledged, the parties hereto, intending to be legally bound
hereby, agree as follows:

       1.       Definitions. All capitalized terms used in this Amendment,
unless otherwise defined herein, shall have the meaning ascribed to such terms
in the Loan Agreement.

       2.       Amendments to Loan Agreement. The Loan Agreement is hereby
amended as follows:

       (a)      By deleting the definition of “Borrowing Base” contained in
Section 1.19 of the Loan Agreement and by substituting the following in lieu
thereof:

       1.19       “Borrowing Base” shall mean, at any time, the amount equal to
the sum of:

(1) (a) eighty-five percent (85%) of the Eligible Accounts, plus (b) the lesser
of (i) the Foreign Accounts Loan Limit or (ii) eighty-five percent (85%) of the
Eligible Foreign Accounts, plus (2) the lesser of (a) the Inventory Loan Limit
or (b) the sum of: (i) the lesser of (A) sixty percent (60%) multiplied by the
Value of the Eligible Inventory on hand 90 days or less or (B) eighty-five
percent (85%) of the Net Recovery Percentage of such Eligible Inventory, plus
(ii) the lesser of (A) twenty-five percent (25%) multiplied by the Value of the
Eligible Inventory on hand more than 90 days but not more than 180 days or (B)
eighty-

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five percent (85%) of the Net Recovery Percentage of such Eligible Inventory,
plus (iii) the lesser of (A) the Westinghouse Inventory Loan Limit, (B) 70% of
the Value of Eligible Westinghouse Inventory, or (C) 115% of the Net Recovery
Percentage of such Eligible Westinghouse Inventory (using the general television
category on the Agent’s appraisal to determine the applicable Net Recovery
Percentage fraction), plus (iv) the Acer/QVC Inventory Formula Amount, minus (3)
Reserves.

       For purposes only of applying the Inventory Loan Limit, Agent may treat
the then undrawn amounts of outstanding Letters of Credit for the purpose of
purchasing Eligible Inventory as Revolving Loans to the extent Agent is in
effect basing the issuance of the Letter of Credit on the Value of the Eligible
Inventory being purchased with such Letter of Credit. In determining the actual
amounts of such Letter of Credit to be so treated for purposes of the sublimit,
the outstanding Revolving Loans and Reserves shall be attributed first to any
components of the lending formulas set forth above that are not subject to such
sublimit, before being attributed to the components of the lending formulas
subject to such sublimit. The amounts of Eligible Inventory of any Borrower
shall, at Agent’s option, be determined based on the lesser of the amount of
Inventory set forth in the general ledger of such Borrower or the perpetual
inventory record maintained by such Borrower.

       (b)      By deleting subclause (n) from the definition of “Eligible
Accounts” set forth in Section 1.39 of the Loan Agreement and by substituting
the following in lieu thereof:

       (n)      the aggregate amount of such Accounts owing by QVC Inc. do not
constitute more than thirty-six percent (36%) of the aggregate amount of all
otherwise Eligible Accounts (so long as Accounts owing by QVC Inc. are subject
to credit insurance payable to Agent issued by an insurer and on terms and in an
amount acceptable to Agent), and the aggregate amount of such Accounts owing by
any single account debtor other than QVC Inc. do not constitute more than
fifteen percent (15%) of the aggregate amount of all otherwise Eligible Accounts
(but the portion of the Accounts not in excess of the applicable percentages may
be deemed Eligible Accounts);

       (c)      By deleting the last sentence in the definition of “Eligible
Inventory” contained in Section 1.40 of the Loan Agreement and by substituting
in lieu thereof the following:

Any amount which is included as “Eligible Westinghouse Inventory” or “Eligible
Acer/QVC Inventory” on any Borrowing Base certificate shall not also be included
as Eligible Inventory on the same Borrowing Base certificate, any amount which
is included as “Eligible Acer/QVC Inventory” on any Borrowing Base certificate
shall not also be included as Eligible Acer/QVC In-Transit Inventory on the same
Borrowing Base certificate, and any amount which is included as “Eligible
Acer/QVC In-Transit Inventory” on any Borrowing Base certificate shall not also
be included as Eligible Acer/QVC Inventory or Eligible Inventory on the same
Borrowing Base certificate.

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       (d)      By adding the following new definitions of “Acer/QVC Inventory
Formula Amount”, “Eligible Acer/QVC Inventory” and “Eligible Acer/QVC In-Transit
Inventory”, respectively, as a new Section 1.129 of the Loan Agreement
immediately following Section 1.128 thereof:

1.129 Additional Definitions (Fifth Amendment to Loan and Security Agreement):

       “Acer/QVC Inventory Formula Amount” means an amount equal to the lesser
of (1) the sum of (a) the lesser of $5,500,000 or 70% of the Value of Eligible
Acer/QVC Inventory, plus (b) the lesser of $2,500,000 or 70% of the Value of
Eligible Acer/QVC In-Transit Inventory, or (2) 103% of the Net Recovery
Percentage of Eligible Acer/QVC Inventory and Eligible Acer/QVC In-Transit
Inventory (using the general notebooks category on the Agent’s appraisal to
determine the applicable Net Recovery Percentage fraction)].

       “Eligible Acer/QVC Inventory” means Inventory which satisfies all of the
criteria for “Eligible Inventory” set forth in the definition thereof and which
(i) consists of Acer branded notebook or desktop personal computers aged less
than 45 days, (ii) is subject to a purchase order that has been delivered to
Borrower by QVC Inc. and with respect to which an “air date” has been set by the
QVC Inc. (and Borrower has delivered to Agent such documentation thereof as
Agent may request), and (iii) is in the possession of and under the control of
Borrower at a facility owned, leased or controlled by Borrower.

       “Eligible Acer/QVC In-Transit Inventory” means Inventory which satisfies
all of the criteria for “Eligible Acer/QVC Inventory” set forth in the
definition thereof except for subclause (iii) thereof, but only if (i) such
Inventory is located in the United States, is in transit from the vendor to QVC
Inc. and was shipped not more than 15 days prior to any date of determination;
(ii) under the terms of sale, title and risk of loss with respect to such
Inventory have passed from the vendor to Borrower; (iii) such Inventory is fully
insured, in such amounts, with such insurance companies and subject to such
deductibles as are reasonably satisfactory to Agent and in respect of which
Agent has been named as sole loss payee pursuant to a loss payee endorsement
acceptable to Agent; (iv) Borrower has delivered to Agent such documentation
relating to the shipment of such Inventory as Agent may request; and (v) Agent
has established, in accordance with this Agreement, such Reserves with respect
to such Inventory and the shipment thereof as Agent deems necessary or
appropriate.

       (e)      By deleting from Section 6.4 of the Loan Agreement the phrase,
“fourth, to pay principal due in respect of the Loans;”, and by substituting in
lieu thereof the following:

fourth, to pay principal in respect of the Loans and to pay or prepay
Obligations arising under or pursuant to any Hedging Agreements of a Borrower or
Guarantor with Lender (up to the amount of any then effective Reserve
established in respect of such Obligations), on a pro rata basis;

       (f)       By deleting the notice address of Agent and Issuing Bank from
Section 13.3 of the Loan Agreement and by substituting the following in lieu
thereof:

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  If to Agent or     Issuing Bank: Wachovia Bank, National Association     1133
Avenue of the Americas     New York, NY 10036     Attn: Wachovia Capital Finance
-                      Portfolio Manager     Facsimile: (212) 545-4283

       3.       Amendments to Loan Agreement (Revolving Loan Limit Increase).
Borrowers, Agent and Lenders acknowledge and agree that, effective on the date
hereof (as used herein, the “Increase Date”), Borrowers requested, and Agent and
Lenders approved, a Revolving Loan Limit Increase in the amount of $10,000,000.
In furtherance thereof:

       (a)      Borrowers, Agent and Lender agree that the Loan Agreement is
amended, effective as of the Increase Date, by deleting the definitions of
“Maximum Credit” and “Revolving Loan Limit” set forth in Section 1 of the Loan
Agreement and by substituting the following definitions in lieu thereof,
respectively:

       1.87     “Maximum Credit” shall mean the amount of $50,000,000.

       1.111  “Revolving Loan Limit” shall mean an amount equal to $50,000,000
minus the then outstanding principal amount of the Revolving Loans and Letters
of Credit.

       (b)      Borrowers, Agent and Lender agree that the Loan Agreement is
amended, effective as of the Increase Date, by deleting the amount of the
Commitment of Wachovia Bank, National Association, as Lender, set forth next to
its signature to the Loan Agreement (i.e., $40,000,000) and by substituting in
lieu thereof the amount of $50,000,000.

       (c)      Borrowers acknowledge and agree that Borrowers shall not be
entitled to receive, and Agent and Lenders shall have no obligation to provide,
any additional Revolving Loan Limit Increases.

       (d)      Borrowers represent and warrant to Agent and Lenders that, as of
the Increase Date, each of the Revolving Loan Limit Increase Conditions was
satisfied.

       4.       Ratification and Reaffirmation. Each Borrower hereby ratifies
and reaffirms the Obligations, each of the Financing Agreements and all of such
Borrower’s covenants, duties, indebtedness and liabilities under the Financing
Agreements.

       5.       Acknowledgments and Stipulations. Each Borrower acknowledges and
stipulates that the Loan Agreement and the other Financing Agreements executed
by such Borrower are legal, valid and binding obligations of such Borrower that
are enforceable against such Borrower in accordance with the terms thereof; all
of the Obligations are owing and payable without defense, offset or counterclaim
(and to the extent there exists any such defense, offset or counterclaim on the
date hereof, the same is hereby waived by such Borrower); and the security
interests and liens granted by Borrowers in favor of Agent are duly perfected,
first priority security interests and liens, subject only to liens and other
encumbrances permitted under the Loan Agreement.

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       6.       Representations and Warranties. Each Borrower represent and
warrant to Agent and Lenders, to induce Agent and Lenders to enter into this
Amendment, that no Default or Event of Default exists on the date hereof;
delivery and performance of this Amendment have been duly authorized by all
requisite corporate action on the part of each Borrower and this Amendment has
been duly executed and delivered by each Borrower; and all of the
representations and warranties made by each Borrower in the Loan Agreement are
true and correct in all material respects on and as of the date hereof, except
to the extent such representations and warranties specifically relate to an
earlier date, in which case such representations and warranties shall have been
true, correct and complete in all material respects on and as of such earlier
date.

       7.       Reference to Loan Agreement. Upon the effectiveness of this
Amendment, each reference in the Loan Agreement to “this Agreement,”
“hereunder,” or words of like import shall mean and be a reference to the Loan
Agreement, as amended by this Amendment.

       8.       Breach of Amendment. This Amendment shall be part of the Loan
Agreement and a breach of any representation, warranty or covenant herein shall
constitute an Event of Default.

       9.       Condition Precedent. The effectiveness of the amendments
contained in Sections 2 and 3 hereof is subject to the delivery to Agent of (a)
an original counterpart of this Amendment executed by each Borrower, (b) an
updated Certificate Regarding Distribution Agreements executed by each Borrower
and (c) such other documents, instruments and agreements as the Agent may
require, in each case in form and substance satisfactory to Agent.

       10.     Amendment Fee; Expenses of Agent. In consideration of Agent’s and
Lenders’ willingness to enter into this Amendment as set forth herein, Borrowers
jointly and severally agree to pay to Lenders an amendment fee in the amount of
$25,000 in immediately available funds on the date hereof. Additionally,
Borrowers jointly and severally agree to pay, on demand, all costs and expenses
incurred by Agent in connection with the preparation, negotiation and execution
of this Amendment and any other Financing Agreements executed pursuant hereto
and any and all amendments, modifications, and supplements thereto, including,
without limitation, the costs and fees of Agent’s legal counsel and any taxes or
expenses associated with or incurred in connection with any instrument or
agreement referred to herein or contemplated hereby.

       11.     Effectiveness; Governing Law. This Amendment shall be effective
upon acceptance by Agent and Lenders (notice of which acceptance is hereby
waived), whereupon the same shall be governed by and construed in accordance
with the internal laws of the State of Georgia.

       12.     Successors and Assigns. This Amendment shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.

       13.     No Novation, etc.. Except as otherwise expressly provided in this
Amendment, nothing herein shall be deemed to amend or modify any provision of
the Loan Agreement or any of the other Financing Agreements, each of which shall
remain in full force and effect. This Amendment is not intended to be, nor shall
it be construed to create, a novation or accord and satisfaction, and the Loan
Agreement as herein modified shall continue in full force and effect.

       14.     Counterparts; Telecopied Signatures. This Amendment may be
executed in any number of counterparts and by different parties to this
Amendment on separate counterparts, each of which, when so executed, shall be
deemed an original, but all such counterparts shall constitute one and

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the same agreement. Any signature delivered by a party by facsimile transmission
shall be deemed to be an original signature hereto.

       15.     Further Assurances. Each Borrower agrees to take such further
actions as Agent shall reasonably request from time to time in connection
herewith to evidence or give effect to the amendments set forth herein or any of
the transactions contemplated hereby.

       16.     Section Titles. Section titles and references used in this
Amendment shall be without substantive meaning or content of any kind whatsoever
and are not a part of the agreements among the parties hereto.

       17.     Release of Claims. To induce Agent and Lenders to enter into this
Amendment, each Borrower hereby releases, acquits and forever discharges Agent
and each Lender, and all officers, directors, agents, employees, successors and
assigns of Agent and each Lender, from any and all liabilities, claims, demands,
actions or causes of action of any kind or nature (if there be any), whether
absolute or contingent, disputed or undisputed, at law or in equity, which are
known to Borrowers, that each Borrower now has or ever had against Agent and any
Lender arising under or in connection with any of the Financing Agreements or
otherwise. Each Borrower represents and warrants to Agent and Lenders that such
Borrower has not transferred or assigned to any Person any claim that such
Borrower ever had or claimed to have against Agent or any Lender.

       18.     Waiver of Jury Trial. To the fullest extent permitted by
applicable law, the parties hereto each hereby waives the right to trial by jury
in any action, suit, counterclaim or proceeding arising out of or related to
this Amendment.

[Remainder of page intentionally left blank;
signatures begin on following page.]

 

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       IN WITNESS WHEREOF, the Borrowers have caused this Amendment to be duly
executed under seal and delivered in Atlanta, Georgia by their respective duly
authorized officers on the date first written above.

 

SED INTERNATIONAL HOLDINGS, INC.

By: _________________________________

Title: ________________________________

By: _________________________________

Title: ________________________________

          [CORPORATE SEAL]

SED INTERNATIONAL, INC.

By: _________________________________

Title: ________________________________

By: _________________________________

Title: ________________________________

          [CORPORATE SEAL]

SED MAGNA (MIAMI), INC.

By: _________________________________

Title: ________________________________

By: _________________________________

Title: ________________________________

          [CORPORATE SEAL]

Accepted and agreed:

WACHOVIA BANK, NATIONAL
ASSOCIATION, as Agent and sole Lender

By: _________________________________

Title: ________________________________

Fifth Amendment to Loan and Security Agreement

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