EMPLOYMENTAGREEMENT

                                    EMPLOYMENT AGREEMENT,  effective as of July 1, 2001,by and between Jaco Electronics,  Inc., a New York corporation  having officesat 145 Oser Avenue,  Hauppauge,  New York 11788 ("Jaco"),  and Charles Girsky,residing  at  3455  Twin  Lake  Ridge,  Westlake  Village,   California  91361("Girsky").

                                                WHEREAS, Girsky is an Executive Vice President of Jaco;

                                                WHEREAS,  Girsky's last written employment agreement with Jaco waseffective July 1, 1998;

                                                WHEREAS,  Jaco and  Girsky  have  agreed to amend  the  employmentagreement  consistent  with the terms  hereof  (the  employment  agreement  asamended  and  restated  is   hereinafter   referred  to  as  the   "EmploymentAgreement"); and

                                                WHEREAS,  Jaco desires to have the  continued  services of Girsky,and Girsky  desires  to  continue  to be  employed  by Jaco,  on the terms andconditions hereinafter set forth.

                                                NOW,  THEREFORE,  in  consideration  of the mutual  covenants  andagreements herein contained, the parties agree as follows:

1.             Term ofEmployment; Duties.

            1.1 Jaco hereby employsGirsky as Executive Vice President of Jaco, and Girsky hereby agrees to serveJaco in such capacity and to perform such duties consistent therewith asJaco’s Board of Directors and/or the President from time to time shalldetermine for period commencing on July 1, 1997 (the “Effective Date”)and ending on the fourth (4th) anniversary of the Effective Date (the“Initial Term”), provided, however, the term of this EmploymentAgreement shall be automatically extended after each anniversary date of theEffective Date for an additional one year period following the Initial Term,unless either Jaco or Girsky shall provide a notice of non-renewal to the otherparty (the “Notice of Non-Renewal”), which notice shall be in writingand shall be delivered not less than 90 days prior to an anniversary date afterthe Effective Date (the “Employment Period”). In the event that aNotice of Non-Renewal is delivered by either party, this Employment Agreementshall continue for a period of three (3) years following the anniversary datewhich follows immediately after the date that a valid and effective Notice ofNon-Renewal is delivered. By way of example, if the Notice of Non-Renewal isdelivered after the third anniversary date and not less than 90 days prior tothe fourth anniversary date of the Effective Date, this Employment Agreementshall continue until the seventh anniversary date of the Effective Date. 

        Notwithstandinganything contained herein to the contrary, in the event that a Notice ofNon-Renewal is delivered by either party at such time as Girsky is at least 70years of age, then this Employment Agreement shall continue for a period of onlyone (1) year following the anniversary date which follows immediately after thedate that a valid and effective Notice of Non-Renewal is delivered. 

2.                Compensation.

            2.1             For all servicesrendered pursuant to the terms hereof, Girsky shall receive a base salary of$225,000 for each of the 12 month periods (a “Contract Year”) endingon or before June 30, 2001, and effective July 1, 2001, Girsky shall receive abase salary of $250,000 for each Contract Year ending June 30, 2002, and eachJune 30, thereafter (“Base Salary”), which Base Salary shall be paidto Girsky in equal periodic installments not less frequently than monthly. Inaddition and not in lieu thereof, Girsky shall be entitled to receive suchfringe benefits and to participate in such benefit plans and programs as aregenerally made available by Jaco to other senior executive employees, including,but not limited to, health insurance. 

            2.2             Girsky shall receive acash bonus (the “Cash Bonus”) for each Contract Year equal to (i) twopercent (2%) of Jaco’s annual earnings before income taxes for thecorresponding fiscal year if such earnings before income taxes are in excess of$1,000,000, and not more than $2,500,000 or (ii) three percent (3%) ofJaco’s earnings before income taxes for the corresponding fiscal year ifsuch earnings before income taxes are in excess of $2,500,000 up to a maximumannual Cash Bonus of $360,000. If Jaco’s earnings before income taxes arein excess of $12,000,000 for any such fiscal year, in addition to the Cash Bonusof $360,000, Girsky shall receive such number of common stock options of Jaco asshall be negotiated between Girsky and Jaco at such time (the “OptionBonus” and, together with the Cash Bonus, the “PerformanceBonus”). As used herein, the term “earnings before income taxes”shall mean the income of Jaco before extraordinary items and before payment ofincome taxes as shown on Jaco’s consolidated financial statements preparedin accordance with generally accepted accounting principles. The PerformanceBonus shall be payable every year on November 1 for the preceding fiscal year. 

            2.3             Upon Girsky’sdeath during the term hereof, his legal representative(s) shall be paid the sumof $250,000 (the “Death Benefit”), payable in twelve (12) equalmonthly installments, commencing within thirty (30) days after Girsky’sdeath. In addition, upon Girsky’s death during the term hereof and to theextent that Girsky was eligible, his legal representative(s) shall be entitledto receive any other death benefits as are generally made available by Jaco toother senior executive employees, including, but not limited to, group term lifeinsurance. 

            2.4             The obligations of Jacoto Girsky hereunder are general unsecured obligations of Jaco to Girsky, andGirsky shall have no security interest or other interest of any naturewhatsoever in any other assets of Jaco. Jaco, in its absolute discretion, mayestablish any reserves or special accounts or segregate assets to fund suchobligation. Girsky shall not sell, transfer, assign, pledge, encumber,hypothecate or otherwise alienate any right or entitlement of his hereunder. Nosuch purported sale, transfer, assignment, pledge, encumbrance, hypothecation orother alienation shall have any force or effect or in any way be binding upon orbe enforceable against Jaco. Except as otherwise provided by law, no such rightor entitlement shall be subject to attachment or garnishment. 

3.            Services to be Provided.
            3.1             Girsky shall devote hisbest efforts and substantially all of his working time to the business of Jaco. 

            3.2             Girsky shall performall duties, obligations, and responsibilities assigned to him by the Board ofDirectors and/or the President and ordinarily performed by a person employed asa senior executive officer, and shall devote his full attention to theperformance of the duties assigned to him. 

            3.3             If duly elected, Girskyshall also serve as a director of Jaco and as officer and/or director of any ofits subsidiaries, whether now existing or hereafter established or acquired, andhe shall perform such duties as are assigned to him, from time to time, by theBoard of Directors and/or the President of Jaco or any of its subsidiaries. 
4.                Termination of Employment.
            4.1             During the EmploymentPeriod, Girsky’s employment may be terminated by the Board of Directors ofJaco on the occurrence of any one or more of the following events: 
                  (a)   The death of Girsky;                  (b)   Subject to the  provisions  of  Section  4.2 below,  the  disability  ofGirsky; or                  (c) For “Cause”,which shall mean (i) the willful failure by Girsky substantially to perform hisduties hereunder for reasons other than death or disability; (ii) thewillful engaging by Girsky in misconduct materially injurious to Jaco; or(iii) the commission by Girsky of an act constituting common law fraud or afelony.            4.2             If Girsky becomesmentally or physically disabled for a period of six (6) consecutive months sothat he is not able to perform his duties substantially as contemplated herein(“Disability”), Jaco’s obligations to pay the Base Salary and thePerformance Bonus shall cease from and after the last day of such six (6) monthperiod and shall not be resumed unless and until Girsky shall have returned tohis duties on a full time basis for a period of two (2) consecutive months.During such two (2) month period, Girsky shall be paid at the rates of BaseSalary and Performance Bonus which would then have been prevailing hereunder hadhe not become so disabled. If Girsky’s Disability becomes permanent, Jaco,at its option, may terminate Girsky’s employment with Jaco and itsobligation hereunder to pay the Base Salary and the Performance Bonus.Girsky’s Disability shall be deemed to have become permanent when, as aresult of the injury or sickness, Girsky becomes wholly and continuouslydisabled and is thus prevented from performing the material and substantialduties of his employment as set forth in Section 1.1 above and while under thecare of a physician.5.             **Reimbursement of Expenses
Jaco shall reimburse Girsky for all reasonable expensesincurred in connection with the promotion of the business of Jaco, includingexpenses for travel, entertainment and similar expenses incurred by Girsky onJaco’s behalf. No such reimbursement shall be made except upon thepresentation by Girsky of an itemized account of such expenses or other evidencethereof for which reimbursement then is being sought, all in form reasonablysatisfactory to Jaco. 
6.             **Indemnity.**Jaco, to the maximum extent it may provide indemnification to an officer ordirector under applicable law, shall indemnify Girsky and hold him harmless fromany and all liability arising out of any act or failure to act undertaken by himin good faith while performing services for Jaco, and shall use its best effortsto obtain coverage for him under any insurance policy now in force or hereafterobtained during the Employment Period covering officers and directors of Jacoagainst claims made against them or any of them for any act or failure to act insuch capacities. Jaco shall pay all expenses, including reasonableattorneys’ fees, actually or necessarily incurred by Girsky in connectionwith the defense of any action, suit, or proceeding arising out of any suchclaim and in connection with any appeal arising therefrom. 

7.             **Disclosure ofInformation**. All memoranda, notes, records, or other documentsmade or compiled by Girsky or made available to him during the course of hisemployment with Jaco concerning the business of Jaco shall be Jaco’sproperty and shall be delivered to Jaco by Girsky on the termination ofGirsky’s employment. Unless authorized by Jaco, Girsky shall not use forhimself or others or divulge to others, any proprietary or confidentialinformation of Jaco obtained by him as a result of his employment. For purposesof this Section 7, the term “proprietary or confidentialinformation” shall mean all information which (i) is known only to Girskyor to Girsky and employees, former employees, consultants of Jaco, or others ina confidential relationship with Jaco, (ii) relates to specific matters such astrade secrets, customers, potential customers, vendor lists, pricing and credittechniques, research and development activities, books and records, andcommission schedules, as they may exist from time to time, which Girsky may haveacquired or obtained by virtue of work heretofore or hereafter performed for oron behalf of Jaco or which he may acquire or may have acquired knowledge ofduring the performance of such work, and (iii) is not readily available toothers. In the event of a breach or a threatened breach by Girsky of theprovisions of this Section 7, Jaco shall be entitled to an injunctionrestraining Girsky from disclosing, in whole or in part, the aforementionedproprietary or confidential information of Jaco, or from rendering any servicesto any person, firm, corporation, association, or other entity to whom or towhich such proprietary or confidential information, in whole or in part, hasbeen disclosed or is threatened to be disclosed. Nothing contained herein shallbe construed as prohibiting Jaco from pursuing any other remedies available toJaco for such breach or threatened breach, including the recovery of damagesfrom Girsky. 
8.            **Restrictive Covenants.**
8.1 Girsky herebyacknowledges and recognizes the highly competitive nature of Jaco’sbusiness and, accordingly, in consideration of the premises contained herein,agrees that during the Employment Period and thereafter until the DesignatedDate (as hereinafter defined) he will not: (i) directly or indirectly engage inany Competitive Activity (as hereinafter defined), whether such engagement shallbe as an officer, director, employee, consultant, agent, lender, stockholder, orother participant; or (ii) assist others in engaging in any CompetitiveActivity. The term “Competitive Activity” shall mean and shall includesoliciting, raiding, enticing, or inducing, individually or in concert withothers, (i) any person or entity to be a customer for the same or similarservices for which that person or entity engaged Jaco, if such person or entity(a) was a customer of Jaco’s during the Employment Period or at any timethereafter prior to the Designated Date, or (b) was solicited by Jaco to be acustomer during the one-year period prior to the termination of this EmploymentAgreement; (ii) any manufacturer or supplier whose products are distributed byJaco at the time this Employment Agreement is terminated to act as amanufacturer or supplier for any other party of the same or similar goods thatit supplies to Jaco; or (iii) any employee of Jaco to leave Jaco or to dobusiness with any enterprise or business which competes with Jaco. 

            8.2             As used in this Section8, the “Designated Date” shall mean any of the following dates: 

                        (a) in the event Girskywillfully terminates his employment with Jaco in violation of this EmploymentAgreement prior to the expiration of the Employment Period, the term“Designated Date” shall mean the first anniversary of the date of suchtermination; 

                        (b) in the event Jacoterminates the employment of Girsky under this Employment Agreement for Cause,the term “Designated Date” shall mean the first anniversary of thedate of such termination; or 

                        (c) in the event Jacoterminates the employment of Girsky without cause, the term “DesignatedDate” shall mean the date of such termination. 

            8.3             It is the desire andintent of the parties that the provisions of this Section 8 shall be enforced tothe fullest extent permissible under the laws and public policies applied ineach jurisdiction in which enforcement is sought. Accordingly, if any provisionof this Section 8 shall be adjudicated to be invalid or unenforceable in anysuch jurisdiction, such provision of this Section 8 shall be deemed amended todelete therefrom the portion thus adjudicated to be invalid or unenforceable,such deletion to apply only with respect to the operation of such provision ofthis Section 8 in the particular jurisdiction in which such adjudication ismade. In addition, if the scope of any restriction contained in this Section 8is adjudicated to be too broad to permit enforcement thereof to its fullestextent, then such restriction shall be enforced to the maximum extent permittedby law, and Girsky hereby consents and agrees that such scope may be judiciallymodified accordingly in any proceeding brought to enforce such restriction. 

            8.4             In the event of abreach or threatened breach by Girsky of the provisions of this Section 8, Jacoshall be entitled to an injunction restraining him from such breach. Nothingcontained herein shall be construed as prohibiting Jaco from pursuing any otherremedies available to it for such breach or threatened breach or any otherbreach of this Employment Agreement. 
9.            **Consolidation; Merger; Change of Control.**
            9.1             In the event of anyconsolidation or merger of Jaco into or with another corporation during theEmployment Period, and Jaco is not the surviving entity, or the sale of all orsubstantially all of the assets of Jaco to another corporation during theEmployment Period, or in the event that fifty (50%) percent or more of thevoting common stock of Jaco shall be owned by one or more individuals orentities, who are acting in concert or as part of an affiliated group (otherthan a group one of the members of which is Girsky) at any time during theEmployment Period, (the occurrence of any of the foregoing, a “Change ofControl”), then (i) within thirty (30) days of the occurrence of suchevent, Jaco shall pay or cause to be paid to Girsky a certified orcashier’s check in an amount equal to two hundred and fifty percent (250%)of the average of Girsky’s Base Salary plus Cash Bonus for the previousfive (5) years; and (ii) this Employment Agreement may be assigned by Jaco orany such successor or surviving corporation with the prior written consent ofGirsky. 

            9.2             Notwithstanding theprovisions of Section 9.1 above, any such payments shall be made only in anamount which, when taken together with the present value of all other paymentsto Girsky that are contingent on a Change of Control of Jaco, computed inaccordance with the provisions of Section 280G(d)(4) of the Internal RevenueCode of 1986 (the “Code”), does not equal or exceed three timesGirsky’s “Base Amount”, as computed in accordance with CodeSection 280G(b)(3). 

10.             **Continuing HealthBenefits**. Commencing upon the termination of Girsky’semployment with Jaco, and ending on the later to occur of (i) Girsky’sdeath, or (ii) the death of his spouse, Jaco shall permit Girsky, and to theextent eligible, his spouse, to participate in the regular health and medicalbenefit program provided by Jaco to the senior executive officers of Jaco assame may be amended from time to time, which health and medical benefits shallbe paid for by Jaco, it being understood that Girsky and/or his spouse shall becovered under any prevailing health and medical program for which he/she/they isor are medically qualified at the same level as such benefits are provided toother senior executive officers. 

11.**Notices**. Any notices required or permitted to be givenunder the provisions of this Employment Agreement shall be in writing anddelivered personally, sent by recognized overnight courier or mailed bycertified or registered mail, return receipt requested, postage prepaid to thepersons and at the addresses first set forth above, or to such other person atsuch other address as any party may request by notice in writing to the otherparty to this Employment Agreement. Notices which are hand delivered ordelivered by recognized overnight courier shall be effective on delivery.Notices which are mailed shall be effective on the third day after mailing. 

12.**Construction**, This Employment Agreement shall be construedin accordance with, and be governed by, the laws of the State of New York forcontracts entered into and to be performed in New York. 

13. **Successors andAssigns**. This Employment Agreement shall be binding on thesuccessors and assigns of Jaco and shall inure to the benefit and be enforceableby and against its successors and assigns. This Employment Agreement is personalin nature and may not be assigned or transferred by Girsky without the priorwritten consent of Jaco. 

14. **EntireAgreement**. This Employment Agreement contains the entireunderstanding and agreement between the parties relating to the subject matterhereof, and neither this Employment Agreement nor any provision hereof may bewaived, modified, amended, changed, discharged, or terminated, except by anagreement in writing signed by the party against whom enforcement of any waiver,modification, change, amendment, discharge, or termination is sought. 

15.   **Counterparts.**  This Employment Agreement may be executed  simultaneously     in counterparts,  each of which shall be deemed an original,  and all of whichcounterparts shall together constitute a single agreement.

16.   **Illegality.**  In  case  any  one  or  more  of  the  provisions  of  this      Employment  Agreement  shall be  invalid,  illegal,  or  unenforceable  in anyrespect,  the validity,  the  legality,  and  enforceability  of the remainingprovisions  contained  herein  shall not in any way be  affected  or  impairedthereby.

17.   **Captions.**  The captions of the sections hereof are for convenience  only      and shall not  control or affect the  meaning  or  construction  of any of theterms or provisions of this Employment Agreement.
      IN WITNESS WHEREOF, the parties have executed this Agreement as of thedate first above written.                                                            **JACO ELECTRONICS, INC.**                                                                                                          By:   /s/ Jeffrey D. Gash                                                                              Name:Jeffrey D. Gash                                                                              Title:Executive VP                                                                             /s/ Charles Girsky                                                                              Charles Girsky**