ex10_1.htm


    
      

    

    
      Exhibit
        10.1

      EMPLOYMENT
        AGREEMENT

      


      This
        Employment Agreement (the “Agreement”) made this 10th day of
        December,
        2007 and effective as of the 10th day of December, 2007 (the “Effective Date”)
        between POMEROY IT SOLUTIONS, INC., a Delaware Corporation (the
“Company”) and CHRISTOPHER C. FROMAN (the
“Executive”).

       

      W
        I T N E S S E T H:

       

      WHEREAS,
        the Company desires to employ the Executive as Senior Vice President of Sales
        and Marketing of the Company;

      WHEREAS,
        the Company and the Executive desire to enter into the Agreement as to the
        terms
        of his employment by the Company;

      NOW
        THEREFORE, in consideration of the foregoing, of the mutual promises
        contained herein and of other good and valuable consideration, the receipt
        and
        sufficiency of which are hereby acknowledged, the parties hereto hereby agree
        as
        follows:

      


      1.          
         Position/Duties.

       

      
        	
                 

              	
                (a)

              	
                Executive
                  shall serve as the Senior Vice President of Sales and Marketing
                  of the
                  Company and shall report to the President/Chief Executive Officer
                  of the
                  Company. In this capacity, Executive shall have such duties, authorities
                  and responsibilities commensurate with the duties, authorities
                  and
                  responsibilities of persons in similar capacities in similar size
                  companies and such other duties and responsibilities as the
                  President/Chief Executive Officer of the Company or the Board of
                  Directors
                  of the Company(“Board”) shall from time to time assign to him consistent
                  with the Executive’s position as  Senior Vice President of Sales
                  and Marketing of the Company.

              


      

       

      
        	
                 

              	
                (b)

              	
                During
                  the Employment Term (as defined in Section 2), the Executive shall
                  devote
                  substantially all his business time and efforts to the business
                  and
                  affairs of the Company and the performance of his duties
                  hereunder.  In addition, Executive shall not render services of
                  a business, professional or commercial nature to any other person,
                  firm or
                  corporation, whether for compensation or otherwise, during the
                  Employment
                  Term.

              


      

       

      
        	
                 

              	
                (c)

              	
                Executive’s
                  primary workplace shall be the Company’s offices in Hebron, Kentucky,
                  except for usual and customary travel on the Company’s
                  business.

              


      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      2.         
          Term of Employment.

       

      This
        Agreement shall be in effect beginning on the Effective Date and terminating
        upon the earlier of (a) three (3) years,   twenty-seven (27) days
        (December 10 , 2007 – January 5, 2011) (the “Initial Term”) or (b) the Date of
        Termination as defined in Section 8(g).  The period of time from the
        Effective Date through the Initial Term and any Renewal Term, as defined
        in
        Section 3, or the Date of Termination, as applicable, is referred to as the
        “Employment Term”.

       

      3.       
            Renewal Term.

       

      The
        term
        of Executive’s employment and this Agreement shall automatically renew for
        additional consecutive renewal terms of one (1) year unless either party
        gives
        written notice of his/its intent not to renew the terms of the Agreement
        ninety
        (90) days prior to the expiration of the then expiring
        term.  Executive’s Base Salary for each Renewal Term shall be
        negotiated and mutually agreed upon by and between the Company and Executive;
        however, in no event shall Executive’s Base Salary for any Renewal Term be less
        than the Base Salary in effect for the prior year.

       

      4.      
             Base Salary.

       

      During
        each fiscal year of the Company during the Initial Term of this Agreement,
        the
        Company agrees to pay Executive a base salary (“Base Salary”) at an annual rate
        of Two Hundred Seventy-Five Thousand Dollars ($275,000.00).  For the
        period commencing December 10, 2007 and ending January 5, 2008, Executive
        shall
        be paid the sum of Twenty-Two Thousand Nine Hundred and Sixteen and 67/100
        Dollars ($22,916.67) per month, which amount shall be prorated for any partial
        month.  Said Base Salary shall be payable in accordance with the
        regular payroll practices of the Company, but not less frequently than
        monthly.  Executive’s Base Salary shall be subject to an annual review
        by the President/Chief Executive Officer of the Company in conjunction with
        the
        Compensation Committee of the Board (and may be increased, but not decreased,
        from time to time incident thereto ).

       

      5.        
           Bonuses.

       

      Each
        year
        during the Initial Term commencing January 6, 2008 and ending January 5,
        2009,
        Executive shall have the opportunity to earn both a quarterly and annual
        targeted bonus measured against financial criteria consisting primarily of
        NPBT
        (as defined below) and “SGMD” (as defined below) (as determined by the
        President/Chief Executive Officer of the Company in conjunction with the
        Compensation Committee of the Board)), of at least Three Hundred Thousand
        Dollars ($300,000.00), with a potential bonus in excess of such amount for
        achievement above target and a reduced bonus for achievement below target,
        all
        in accordance with the applicable bonus plan.  Two-thirds (2/3) of the
        potential targeted bonus shall be based on achievement of quarterly criteria
        and
        one-third (1/3) shall be allocated to annual attainment. Fifty (50%) percent
        of
        any potential bonus will be predicated upon the attainment of NPBT and Fifty
        (50%) percent will be predicated upon the attainment of SGMD. The bonus plan
        shall provide that under-performance in one quarter can be made up in subsequent
        quarters on a year-to-date basis.  The quarterly and annual bonuses
        payable to Executive during the Employment Term shall be fully paid in
        cash.  Executive shall be guaranteed his quarterly bonus for the
        period commencing December 10, 2007 and ending April 5, 2008 based upon One
        Hundred (100%) percent achievement, resulting in a bonus payment of Ninety-Two
        Thousand Seven Hundred Forty Two Dollars ($92,742.00), payable on or after
        April
        5, 2008 but not later than April 15, 2008.

       

      
        
          
          

        

        
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      For
        purposes of this Agreement, the Net Profit Before Taxes (“NPBT”) shall be
        determined on a consolidated basis computed without regard to the bonus payable
        to Executive pursuant to this Section 5, shall exclude any gains or losses
        realized by Company on the sale or other disposition of its assets other
        than in
        the ordinary course of business and shall exclude any extraordinary one-time
        charges taken by the Company.  NPBT shall be determined by the
        independent accountant regularly retained by the Company, subject to the
        foregoing provisions of this subparagraph and in accordance with generally
        accepted accounting principles.

       

      For
        purposes of this Agreement, the term “Sales Gross Margin Dollars (SGMD”) shall
        mean the sales gross profit of the Company during the applicable period,
        as
        reflected on its financial statements on a consolidated basis.  In
        making said sales gross profit determination, all gains and losses realized
        on
        the sale or disposition of Company’s assets not in the ordinary course shall be
        excluded  The SGMD shall be determined by the independent accountant
        regularly retained by the Company according to the foregoing provisions of
        this
        paragraph and in accordance with generally accepted accounting principles
        Said
        determinations and payment of  any bonus shall be made no later than
        the fifteenth (15th) day
        of the third
        (3rd) month
        following the end of the Company’s taxable year, and the determinations by the
        accountant shall be final, binding and conclusive on all parties
        hereto.  In the event the audited financial statements are not issued
        before the fifteenth (15th) day
        of the third
        (3rd) month
        following the end of the Company’s taxable year, Company shall make any payment
        due hereunder, if any, based on its best reasonable estimate of any liability
        hereunder, which amount shall be recorded and shall be reconciled by both
        parties once the audited financial statements are issued but in no event
        later
        than the end of the calendar year in which the Company’s taxable year
        ends.  Any quarterly bonus determinations shall be determined on a
        consolidated basis by the independent accountant regularly retained by the
        Company subject to the foregoing provisions of this paragraph and in accordance
        with generally accepted accounting principles.  Any amount due
        hereunder shall be paid within fifteen (15) days of the filing of Form 10-Q
        by
        the Company for the respective quarter, but in no event later than the fifteenth
        (15th) day
        of
        the third (3rd)
        month following the end of the Company’s taxable year.

       

      In
        the
        event that Company acquires during any applicable fiscal year a company that
        had
        gross revenues in excess of Twenty-Five Million Dollars ($25,000,000.00)
        for its
        most recently concluded fiscal year, Company and Executive shall in good
        faith
        determine whether any adjustments to the NPBT and SGMD criteria, whether
        upward
        or downward, shall be made in order to reflect the effect of such acquisition
        on
        the operations of the Company.

       

      
        
          
          

        

        
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      6.      
             Equity Awards.

       

      (a)           Stock
        Options.

       

      
        	
                 

              	
                (i)

              	
                Upon
                  the Effective Date of this Agreement, Executive shall be awarded
                  an option
                  to acquire One Hundred Thousand (100,000) shares of the common
                  stock of
                  the Company under the Company’s Amended and Restated 2002 Stock Incentive
                  Plan (“Plan”) at the fair market value of such common shares as of the
                  date of the award.  For purposes of this Agreement, the fair
                  market value as of the applicable date shall mean, with respect
                  to the
                  common shares, the closing sales price of a share of the Company’s common
                  stock on the over-the-counter market on the last market trading
                  day prior
                  to the date on which the value is to be determined (or the next
                  preceding
                  date on which sales occurred, if there were no sales on such
                  date).  Twenty-Five Thousand (25,000) shares shall vest upon the
                  Effective Date of Executive’s employment and Twenty-Five Thousand (25,000)
                  shares shall vest on each of the first three annual anniversaries
                  of the
                  Effective Date. The term of the award set forth above shall be
                  for a
                  period of five (5) years from the date of such award.  A copy of
                  the Award Agreement is attached hereto as Exhibit A.  The
                  options to be granted incident hereto shall be non-qualified stock
                  options
                  and shall not be treated by the Company or the Executive as an
                  incentive
                  stock option for federal income tax
                  purposes.

              


      

       

      
        	
                 

              	
                (ii)

              	
                In
                  the event a Change In Control (as defined in Section 10) occurs
                  during the
                  Initial Term of this Agreement, then all One Hundred Thousand (100,000)
                  shares shall be fully vested immediately prior to the Change In
                  Control.

              


      

       

      
        	
                 

              	
                (iii)

              	
                In
                  addition, on each annual anniversary of the Effective Date, Executive
                  shall be eligible for an additional stock option grant at the sole
                  discretion of the President/Chief Executive Officer of the Company
                  in
                  conjunction with the Compensation Committee of the
                  Board.

              


      

       

      (b)           Restricted
        Stock.

       

      
        	
                 

              	
                (i)

              	
                Upon
                  the Effective Date of this Agreement, the Company shall grant Executive
                  an
                  equity award of Twenty-Five Thousand (25,000) shares of restricted
                  stock
                  under the Plan.  Said restricted stock shall vest and the
                  restrictions thereon shall lapse in full on the fourth (4th)
                  annual
                  anniversary of the Effective Date. In the event a Change In Control
                  occurs
                  during the Initial Term of this Agreement, One Hundred Percent
                  (100%) of
                  such restricted stock shall fully vest and the restrictions thereon
                  shall
                  lapse immediately prior to the Change In Control.  In the event
                  that Company does not renew this Agreement at the expiration of
                  the
                  Initial Term of this Agreement pursuant to the provisions of Section
                  3,
                  100% of such restricted stock shall fully vest and the restrictions
                  thereon shall lapse immediately upon the expiration of the Initial
                  Term of
                  this Agreement.   A copy of the Restricted Stock Award
                  Agreement is attached hereto as Exhibit B.  (ii)In addition, on
                  each annual anniversary of the Effective Date, Executive shall
                  be eligible
                  for an additional award of restricted stock under the Plan at the
                  sole
                  discretion of the President/Chief Executive Officer of the Company
                  in
                  conjunction with the Compensation Committee of the
                  Board.

              


      

       

      
        
          
          

        

        
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                (c)

              	
                Adjustments
                  to Number of Shares.  The provisions of this Section 6 shall
                  be appropriately adjusted for any stock splits, reverse splits,
                  stock
                  dividends, combinations or reclassifications of the Company’s common
                  stock, or any other similar increases or decreases in the number
                  of issued
                  shares of such common stock affected without receipt of consideration
                  by
                  the Company.

              


      

      


      
        	
                 

              	
                (d)

              	
                Representations
                  and Warranties of the Company.  The Company represents and
                  warrants to Executive that (i) the shares he acquires pursuant to
                  options and restricted stock awards as provided for in this Agreement
                  will
                  be issued under the Plan; (ii) the Plan and the options and
                  restricted stock awards to be made hereunder are covered under
                  a Form S-8
                  registration statement (the effectiveness of which shall continue
                  to be
                  maintained so that Executive can resell the shares he receives
                  pursuant to
                  options and restricted stock awards pursuant to this Agreement
                  on a
                  current basis once exercised or vested, as applicable), (iii) there
                  are currently, and will continue to be, adequate shares available
                  under
                  the Plan for the issuance of stock pursuant to all options and
                  the
                  restricted stock awards provided for in this Agreement; and (iv) the
                  Plan permits the contemplated provisions of such
                  grants.

              


      

       

      7.        
           Fringe Benefits.

       

      During
        the Employment Term (or for such shorter period as pertains to Section 7(d)
        and
        Section 7(f), Executive shall be entitled to the following
        benefits:

       

      
        	
                 

              	
                (a)

              	
                Insurance.  Executive
                  shall be provided with standard medical, health, and other insurance
                  coverage in accordance with the plans from time to time maintained
                  by the
                  Company for its senior management
                  employees.

              


      

       

      
        	
                 

              	
                (b)

              	
                Vacation.  Executive
                  shall be entitled each year to three (3) weeks of vacation, during
                  which
                  his compensation will be paid in full; provided, however, Executive
                  shall
                  not take more than two weeks of vacation consecutively without
                  the prior
                  written consent of the President/Chief Executive
                  Officer.

              


      

       

      
        	
                 

              	
                (c)

              	
                Insurance
                  During the Term of Employment Agreement.  Company shall
                  maintain on the life of the Executive, provided he is insurable
                  at
                  standard rates, a term life insurance policy in the amount of Seven
                  Hundred Fifty Thousand Dollars ($750,000.00).  Executive shall
                  have the right to designate the beneficiary of such
                  policy.  Executive agrees to take any and all physicals that are
                  necessary incident to the issuance and/or renewal of said
                  policy.  In addition, Executive agrees to take any and all
                  physicals necessary incident to the procurement of Key Man insurance
                  upon
                  his life by Company.  In the event that Executive is not
                  insurable at standard rates during the term of this Agreement,
                  but
                  Executive is able to procure rated coverage, Executive has the
                  right to
                  procure coverage at a lower amount of insurance, the cost of which
                  is
                  equivalent to the standard term rate cost of Seven Hundred Fifty
                  Thousand
                  Dollars ($750,000.00) in coverage.  In the event Executive is
                  not insurable, then Company shall, within thirty (30) days following
                  the
                  date that Executive is determined to be uninsurable, pay Executive
                  an
                  amount equal to the projected cost of the contemplated term insurance
                  of
                  Seven Hundred Fifty Thousand Dollars ($750,000.00) at standard
                  rates.  In the event that Executive should die prior to the
                  insurance being obtained hereunder or in the event insurance cannot
                  be
                  obtained for medical reasons, Company shall have no obligation
                  to
                  Executive or his beneficiary for payment of any of the death benefit
                  amount upon Executive’s death.  Company and Executive agree to
                  use diligent efforts after the Effective Date to obtain the coverage
                  upon
                  Executive’s life hereunder.

              


      

       

      
        
          
          

        

        
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                (d)

              	
                Housing
                  Allowance.  Commencing January 1, 2008 and continuing on the
                  first day of each month thereafter until the earlier of (i) December
                  1,
                  2008 or (ii) Executive’s relocation to the Greater Cincinnati/Northern
                  Kentucky area, Company shall provide Executive with a housing allowance
                  of
                  Two Thousand Five Hundred Dollars ($2,500.00) per month to be paid
                  on the
                  first of every month during such
                  period.

              


      

       

      
        	
                 

              	
                (e)

              	
                Automobile
                  Allowance.  Company shall provide Executive with an
                  automobile allowance of Nine Hundred and 00/100 Dollars ($900.00)
                  per
                  month to be paid on the first of every
                  month.

              


      

       

      
        	
                 

              	
                (f)

              	
                Travel
                  Allowance.  Commencing January 1, 2008 and continuing on the
                  first day of each month thereafter until the earlier of (i) December1
                  1,
                  2008 or (ii) Executive’s relocation to the Greater Cincinnati/Northern
                  Kentucky area, Company shall provide Executive with a travel allowance
                  of
                  Three Thousand Nine Hundred Dollars ($3,900.00) per month to be
                  paid on
                  the first of every month during such
                  period.

              


      

       

      
        	
                 

              	
                (g)

              	
                Relocation
                  Allowance.  In connection with Executive relocating to the
                  Greater Cincinnati/Northern Kentucky metropolitan area, Company
                  shall
                  reimburse Executive for relocation expenses incurred by Executive
                  in
                  connection with such relocation in an amount not to exceed Seventy-Five
                  Thousand Dollars ($75,000.00).  Specifically, the Company shall
                  reimburse Executive concurrent with his relocation for the cost
                  of
                  physical packing and moving expenses for household good and vehicles,
                  house hunting travel, and closing costs (including sales commissions)
                  on
                  the sale of Executive’s current residence and incident to the purchase of
                  his new residence in the Greater Cincinnati/Northern Kentucky metropolitan
                  area. Executive shall provide Company with receipts and other
                  documentation substantiating such costs, including but not limited
                  to
                  copies of all settlement statements or other closing documents
                  that
                  substantiate Executive’s claim for reimbursement under this Section
                  7(g).  In the event Executive would voluntarily terminate his
                  employment with Company without Good Reason pursuant to Section
                  8(f),
                  within one year from the date of his relocation to the Greater
                  Cincinnati/Northern Kentucky metropolitan area, Executive shall
                  reimburse
                  the Company in full for all expenses for which the Company provided
                  reimbursement to Executive pursuant to this Section
                  7(g).

              


      

       

      
        
          
          

        

        
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                (h)

              	
                Expenses.   During
                  the Employment Term, Executive shall be entitled to receive prompt
                  reimbursement for all reasonable and customary travel and entertainment
                  expenses or other out-of-pocket business expenses incurred by Executive
                  in
                  preparing for and fulfilling the Executive’s duties and responsibilities
                  hereunder, including all expenses for (i) travel while away from home
                  on business or at the request or in the service of the Company
                  (but
                  excluding any commuting expenses covered by Section 7(f)), (ii)
                  mobile
                  phone service, (iii) email, fax and long distance communications
                  expenses in respect of the Executive’s home office, and (iv) legal
                  fees and expenses related to the negotiation and preparation of
                  this
                  Agreement and the documents referred to herein in an amount not
                  to exceed
                  Five Thousand Dollars ($5,000.00); provided that such expenses
                  are
                  incurred and accounted for in accordance with the policies and
                  procedures
                  established by the Company.  Executive shall use reasonable best
                  efforts to take advantage of advance purchase pricing for airplane
                  tickets.  Amounts reimbursable pursuant to this subparagraph (g)
                  shall be paid upon the earlier of (i) thirty (30) days after Executive’s
                  submission of a request for reimbursement and (ii) the fifteenth
                  (15th)
                  day of the
                  third (3rd)
                  month of
                  the Company’s fiscal year following the year in which the expense was
                  incurred.

              


      

       

      
        	
                 

              	
                (i)

              	
                Benefit
                  Plans.  Executive shall participate, after meeting
                  eligibility requirements, in any qualified retirement plans and/or
                  welfare
                  plans maintained by the Company during the Employment
                  Term.

              


      

       

      
        	
                 

              	
                (j)

              	
                Executive
                  shall be responsible for all taxes owed, if any, on the fringe
                  benefits
                  provided to him pursuant to this Section
                  7.

              


      

      


      


      8.       
            Termination.

       

      Executive’s
        employment hereunder and the Employment Term shall be terminated under the
        first
        of the following to occur:

       

      
        	
                 

              	
                (a)

              	
                Death.  The
                  Executive’s employment hereunder shall automatically terminate upon the
                  death of the Executive.

              


      

       

      
        	
                 

              	
                (b)

              	
                Disability.  The
                  Executive’s employment hereunder shall terminate upon written notice by
                  the Company to the Executive, of termination due to
                  Disability.  For purposes of this Agreement, “Disability” or
                  “Disabled” shall mean the Executive’s incapacity due to physical or mental
                  illness to substantially perform his duties and the essential functions
                  of
                  his position, with or without reasonable accommodation on a full-time
                  basis for One Hundred Eighty (180) days (including weekends and
                  holidays)
                  in any Three Hundred Sixty-Five (365) day period.  The existence
                  or non-existence of a physical or mental injury, infirmity or incapacity
                  shall be determined by an independent physician mutually agreed
                  to by the
                  Company and the Executive (provided that neither party shall unreasonably
                  withhold their consent).

              


      

       

      
        
          
          

        

        
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                (c)

              	
                Cause.
                  The Company may terminate the Executive’s employment hereunder for
                  Cause.  For purposes of this Agreement, the Company shall have
                  “Cause” to terminate the Executive’s employment hereunder
                  upon:

              


      

       

      
        	
                 

              	
                (i)

              	
                The
                  conviction of Executive of a felony or other crime involving theft,
                  misappropriation of funds, fraud or moral
                  turpitude;

              


      

       

      
        	
                 

              	
                (ii)

              	
                The
                  engaging by Executive in conduct which is demonstrably and materially
                  injurious to the Company, monetarily or otherwise, including but
                  not
                  limited to any material misrepresentation related to the performance
                  of
                  his duties, misappropriation, fraud, including with respect to
                  the
                  Company’s accounting and financial statements, embezzlement or conversion
                  by Executive of the Company’s or any of its subsidiaries’ property in
                  connection with Executive’s duties or in the course of the Executive’s
                  employment with the Company;

              


      

       

      
        	
                 

              	
                (iii)

              	
                Executive’s
                  gross negligence or gross misconduct in carrying out his duties
                  hereunder
                  resulting, in either case, in material harm to the Company;
                  or

              


      

       

      
        	
                 

              	
                (iv)

              	
                Any
                  act or omission constituting a material breach by the Executive
                  of any
                  material provision of this
                  Agreement.

              


      

       

      Notwithstanding
        the foregoing, in the event the basis for a termination for Cause is under
        subsections 8(c)(iii) or (iv) above, Executive shall not be deemed to have
        been
        terminated for Cause unless and until there shall have been delivered to
        him a
        copy of a resolution of the Board asserting that he has engaged in the conduct
        set forth above in Sections 8(c)(iii) or (iv) (as interpreted and enforced
        consistently with the Company’s treatment of all other executives and senior
        management) and specifying the particulars thereof in detail, and Executive
        shall not have cured such conduct to the reasonable satisfaction of the Board
        within thirty (30) days after receipt of such resolution.

       

      
        	
                 

              	
                (d)

              	
                Without
                  Cause.  Upon written notice by the Company to the Executive
                  of an involuntary termination without Cause, other than for death
                  or
                  Disability.

              


      

       

      
        	
                 

              	
                (e)

              	
                Good
                  Reason.  Upon written notice by the Executive to the Company
                  of the termination of his employment hereunder for Good
                  Reason.  “Good Reason” shall mean Executive’s resignation from
                  employment within thirty (30) days after the occurrence of one
                  of the
                  events hereinafter enumerated; provided, however, that Executive
                  must
                  provide written notice to the Company within thirty (30) days after
                  the
                  occurrence of the event allegedly constituting Good Reason and
                  the Company
                  shall have thirty (30) days after such notice is given to
                  cure:  (i) a material diminution in Executive’s authority,
                  duties or responsibilities without Executive’s written consent; (ii) a
                  material diminution in Executive’s  Base Salary or targeted
                  annual bonus at any time during the Employment Term without Executive’s
                  written consent; (iii) a requirement that Executive report to an
                  officer
                  or employee of the Company instead of reporting directly to the
                  President/Chief Executive Officer of the Company; (iv) the relocation
                  of
                  Executive to an area that is greater than thirty (30) miles from
                  the
                  Greater Cincinnati/Northern Kentucky metropolitan area without
                  the consent
                  of Executive; and (v) any other action or inaction that constitutes
                  a
                  material breach by Company of this
                  Agreement

              


      

       

      
        
          
          

        

        
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                (f)

              	
                Voluntary
                  Termination.  If Executive terminates employment with
                  Company without Good Reason, Executive agrees to provide the Company
                  with
                  thirty (30) days prior written notice.  Company, in its sole
                  discretion, following its receipt of such written notice from Executive
                  may accelerate the termination of Executive’s employment and the right to
                  any further compensation to a date prior to the ninetieth (90th)
                  day after
                  such written notice is given.

              


      

       

      
        	
                 

              	
                (g)

              	
                Date
                  of Termination.  For purposes of this Agreement, “Date of
                  Termination” shall mean (i) if Executive is terminated as Senior Vice
                  President of Sales and Marketing by the Company for Disability,
                  thirty
                  (30) days after written notice of such determination is given to
                  Executive
                  (provided that Executive shall not have returned to perform his
                  duties on
                  a full time basis during such thirty (30) day period); (ii) if
                  Executive’s
                  employment is terminated by the Company for any other reason, the
                  date on
                  which a written notice of termination is given, provided that,
                  in the case
                  of the termination for Cause under Sections 8(c)(iii) or (iv),
                  Executive
                  shall not have cured the matter or matters stated in the Notice
                  of
                  Termination within the thirty (30) day period provided in Section
                  8(c)(iii) or (iv); (iii) if Executive terminates his employment
                  for Good
                  Reason, the date of Executive’s resignation, provided that the notice and
                  cure provisions in Section 8(e) have been complied with; (iv) if
                  Executive
                  terminates employment for other than Good Reason, the date specified
                  in
                  Executive’s notice in compliance with Section 8(f) or, (v) in the event of
                  Executive’s death, the date of
                  death.

              


      

       

      
        	
                 

              	
                (h)

              	
                Notice
                  of Termination.  Any termination of Executive’s employment
                  by the Company or by Executive under this Section 8 (other than
                  in the
                  case of death) shall be communicated by a written notice (“Notice of
                  Termination”) to the other party hereto, indicating the specific
                  termination provision in this Agreement relied upon. If the termination
                  provision relied upon requires notice and an opportunity to cure,
                  then the
                  Notice of Termination shall set forth in reasonable detail any
                  facts and
                  circumstances claimed to provide a basis for termination of Executive’s
                  employment under the provisions so indicated.   The Notice
                  of Termination shall specify a date of termination and shall be
                  delivered
                  within the time period set forth in the various paragraphs of this
                  Section
                  8, as applicable (the “Notice
                  Period”).

              


      

       

      
        
          
          

        

        
          -
            9
            -

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                (i)

              	
                Compliance
                  with 409A.  To the extent any payment under Section 9 is
                  subject to Section 409A of the Internal Revenue Code of 1986, as
                  amended
                  (the “Code”) or exempt therefrom solely by virtue of the separation pay
                  plan exceptions under Treasury Regulations Section 1.409A-1(b)(9),
                  a
                  termination of Executive’s employment will not be deemed to occur unless
                  such termination constitutes a separation from service under Section
                  409A
                  of the Code and the regulations promulgated
                  thereunder.

              


      

      


      9.        
           Compensation Upon Termination.

       

      
        	
                 

              	
                (a)

              	
                Disability.  In
                  the event the Employment Term ends on account of Executive’s Disability,
                  the Company shall pay or provide Executive (i) any unpaid Base
                  Salary
                  through the date of termination and any accrued vacation in accordance
                  with Company policy; (ii) any unpaid bonus earned with respect
                  to any
                  fiscal year or any fiscal quarter ending on or preceding the date
                  of
                  termination; and (iii) reimbursements for any unreimbursed expenses
                  incurred through the date of termination (collectively “Accrued
                  Amounts”).  In addition, Executive shall receive any Prorata
                  Bonus as hereinafter defined.  For purposes hereof, a “Prorata
                  Bonus” shall be determined by calculating a prorata portion of the
                  Executive’s targeted bonus for the performance year in which the
                  Executive’s termination occurs, payable at the time the annual bonuses are
                  paid to the other senior executives, (determined by multiplying
                  the amount
                  the Executive would have received based upon actual performance
                  had his
                  employment continued through the end of the performance year, by
                  a
                  fraction, the number of which is the number of days during the
                  performance
                  year of termination that the Executive is employed by the Company
                  and the
                  denominator of which is Three Hundred Sixty-Five (365)).  The
                  Accrued Amounts shall be paid within ten (10) days after the Date
                  of
                  Termination.  Any Pro Rata Bonus shall be paid at the same time
                  other bonuses are paid with respect to the applicable performance
                  year.   In addition, Executive shall be
                  entitled to the following:

              


      

       

      
        	
                 

              	
                (i)

              	
                an
                  amount equal to his then-applicable full Base Salary minus Eighty-Four
                  Thousand Dollars ($84,000) (or such other amount as may be available
                  to
                  Executive pursuant to any salary continuation benefits under an
                  accident
                  and health benefit plan sponsored by the Company) to be paid within
                  ten
                  (10) days after the Date of Termination;
                  and

              


      

       

      
        	
                 

              	
                (ii)

              	
                Executive
                  shall be entitled to any rights he may have under the Consolidated
                  Omnibus
                  Budget Reconciliation Act of 1985, as amended
                  (“COBRA”).  Company shall reimburse Executive for any premium
                  for COBRA health, dental, and vision coverage paid by Executive
                  (including
                  coverage for Executive’s family) for a period of one (1) year after the
                  Date of Termination.

              


      

       

      
        	
                 

              	
                (b)

              	
                Death.  In
                  the event of Executive’s death, the Executive’s estate (or to the extent a
                  beneficiary has been designated in accordance with a program, the
                  beneficiary under such program) shall be entitled to any Accrued
                  Amounts
                  and a Prorata Bonus (as defined in Section 9(a).  Such Accrued
                  Amounts shall be paid within ten (10) days after the date of Executive’s
                  death.   In addition, Executive’s beneficiary shall receive
                  any Prorata Bonus as defined in Section 9(a) payable in the manner
                  set
                  forth in Section 9(a).

              


      

       

      
        
          
          

        

        
          -
            10
            -

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                (c)

              	
                Termination
                  for Cause or Without Good Reason.  If the Executive’s
                  employment should be terminated (i) by the Company for Cause, or
                  (ii) by
                  the Executive without Good Reason, Company shall pay to the Executive
                  any
                  Accrued Amounts within ten (10) days after the Date of
                  Termination.

              


      

       

      
        	
                 

              	
                (d)

              	
                Termination
                  Without Cause or For Good Reason.  If Executive’s employment
                  is terminated by the Company without Cause or the Executive terminates
                  his
                  employment for Good Reason, Executive shall be entitled to receive
                  from
                  the Company all Accrued Amounts through the Date of Termination
                  and a
                  Prorata Bonus (as defined in Section 9(a).  Such Accrued Amounts
                  shall be paid within ten (10) days after the Date of
                  Termination.  Any Prorata Bonus shall be payable in the manner
                  set forth in Section 9(a). Contingent upon Executive delivering
                  to the
                  Company a release in the form attached hereto as Exhibit C, and
                  the
                  expiration of all revocation periods related thereto, Executive
                  shall be
                  entitled to the following

              


      

       

      
        	
                 

              	
                (i)

              	
                the
                  Company shall pay Executive his Base Salary, then in effect, for
                  a period
                  of twelve (12) months commencing on the date that Company gives
                  written
                  notice to Executive of its intent to terminate his employment Without
                  Cause, pursuant to Section 8(d), provided Executive is not, during
                  such
                  time, employed by a competitor or otherwise in breach of this
                  Agreement.  Payment of such Base Salary shall be made in the
                  ordinary course of the Company’s business in accordance with its usual and
                  customary payroll practices.

              


      

      


      
        	
                 

              	
                (ii)

              	
                Executive
                  shall be entitled to his COBRA rights under the Company’s group health
                  plans.  Company shall reimburse Executive for any premium for
                  COBRA health, dental, and vision coverage paid by Executive (including
                  coverage for Executive’s family) for a period of one (1) year after the
                  Date of Termination.

              


      

       

      No
        amounts paid under this Section 9 will be reduced by any earnings that Executive
        may receive from any other source.

      


      10.          Change
        In Control Benefits.

       

      
        	
                 

              	
                (a)

              	
                For
                  purposes of this Agreement, “Change In Control”
                  shall mean the first to occur of any of the following
                  events:

              


      

       

      
        	
                 

              	
                (i)

              	
                any
                  “person” (as defined in Section 13(d) and 14(d) of the Securities Exchange
                  Act of 1934, as amended (the “Exchange Act”),
                  excluding for this purpose, (A) the Company or any subsidiary
                  of
                  the Company, or (B) any employee benefit plan of the Company or
                  any
                  subsidiary of the Company, or any person or entity organized, appointed
                  or
                  established by the Company for or pursuant to the terms of any
                  such plan,
                  which acquires beneficial ownership of voting securities of the
                  Company,
                  is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the
                  Exchange Act), directly or indirectly of securities of the Company
                  representing more than fifty percent (50%) of the combined voting
                  power of
                  the Company’s then outstanding securities; provided, however, that no
                  Change In Control will be deemed to have occurred as a result of
                  a change
                  in ownership percentage resulting solely from an acquisition of
                  securities
                  by the Company; or

              


      

       

      
        
          
          

        

        
          -
            11
            -

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                (ii)

              	
                persons
                  who, as of the Effective Date constitute the Board (the “Incumbent
                  Directors”) cease for any reason, including
                  without limitation, as a result of a tender offer, proxy contest,
                  merger
                  or similar transaction, to constitute at least a majority thereof,
                  provided that any person becoming a director of the Company subsequent
                  to
                  the Effective Date shall be considered an Incumbent Director if
                  such
                  person’s election or nomination for election was approved by a vote of
                  at
                  least fifty percent (50%) of the Incumbent Directors; but provided
                  further, that any such person whose initial assumption of office
                  is in
                  connection with an actual or threatened election contest relating
                  to the
                  election of members of the Board or other actual or threatened
                  solicitation of proxies or consents by or on behalf of a “person” (as
                  defined in Section 13(d) and 14(d) of the Exchange Act) other than
                  the
                  Board, including by reason of agreement intended to avoid or settle
                  any
                  such actual or threatened contest or solicitation, shall not be
                  considered
                  an Incumbent Director; or

              


      

       

      
        	
                 

              	
                (iii)

              	
                consummation
                  of a reorganization, merger or consolidation or sale or other disposition
                  of at least eighty percent (80%) of the assets of the Company (a
                  “Business Combination”), unless, in each case, following
                  such Business Combination, all or substantially all of the individuals
                  and
                  entities who were the beneficial owners of outstanding voting securities
                  of the Company immediately prior to such Business Combination beneficially
                  own, directly or indirectly, more than fifty percent (50%) of the
                  combined
                  voting power of the then outstanding voting securities entitled
                  to vote
                  generally in the election of directors of the Company resulting
                  from such
                  Business Combination (including, without limitation, a company
                  which, as a
                  result of such transaction, owns the Company or all or substantially
                  all
                  of the Company’s assets either directly or through one or more
                  subsidiaries) in substantially the same proportions as their ownership,
                  immediately prior to such Business Combination, of the outstanding
                  voting
                  securities of the Company; or

              


      

       

      
        	
                 

              	
                (iv)

              	
                approval
                  by the stockholders of the Company of a complete liquidation or
                  dissolution of the Company.

              


      

       

      
        
          
          

        

        
          -
            12
            -

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                (b)

              	
                Upon
                  a Change In Control of the Company, the Executive shall be entitled
                  to
                     receive the following:

              


      

       

      
        	
                 

              	
                (i)

              	
                All
                  of Executive’ stock options and restricted shares shall vest according to
                  terms contained in the respective award agreements (executed incident
                  to
                  the grant of such options or restricted
                  shares).

              


      

       

      
        	
                 

              	
                (ii)

              	
                Executive
                  shall be entitled to the benefits set forth in Section 9(d) if
                  his
                  employment is terminated Without Cause or For Good Reason after
                  such
                  Change in Control, or in the event the acquiring Company does not
                  assume
                  this Agreement pursuant to the provisions of Section
                  16(a).

              


      

       

      11.          Confidentiality,
        Competition, etc.

       

      
        	
                 

              	
                (a)

              	
                Confidentiality.  The
                  Executive agrees that he shall not, directly or indirectly, make
                  available, sell, disclose or otherwise communicate to any person,
                  other
                  than in the course of the Executive’s employment and for the benefit of
                  the Company (as determined by the Executive in good faith), either
                  during
                  the period of the Executive’s employment or at any time thereafter, any
                  nonpublic, proprietary or confidential information, knowledge or
                  data
                  relating to the Company, any of its subsidiaries, affiliated companies
                  or
                  businesses, which shall have been obtained by the Executive during
                  the
                  Executive’s employment by the Company. The foregoing shall not apply to
                  information that (i) was known to the public prior to its disclosure
                  to
                  the Executive; (ii) becomes known to the public subsequent to disclosure
                  to the Executive through no wrongful act of the Executive or any
                  representative of the Executive; or (iii) the Executive is required
                  to
                  disclose by applicable law, regulation or legal process (provided
                  that the
                  Executive provides the Company with prior notice of the contemplated
                  disclosure and reasonably cooperates with the Company at its expense
                  in
                  seeking a protective order or other appropriate protection of such
                  information). Notwithstanding clauses (i) and (ii) of the preceding
                  sentence, the Executive’s obligation to maintain such disclosed
                  information in confidence shall not terminate where only portions
                  of the
                  information are in the public
                  domain.

              


      

       

      
        	
                 

              	
                (b)

              	
                Nonsolicitation.
                  During the Executive’s employment with the Company and for the one (1)
                  year period thereafter, the Executive agrees that he will not,
                  directly or
                  indirectly, individually or on behalf of any other person, firm,
                  corporation or other entity, knowingly solicit, aid or induce (i)
                  any
                  managerial level employee of the Company or any of its subsidiaries
                  or
                  affiliates to leave such employment in order to accept employment
                  with or
                  render services to or with any other person, firm, corporation
                  or other
                  entity unaffiliated with the Company or knowingly take any action
                  to
                  materially assist or aid any other person, firm, corporation or
                  other
                  entity in hiring any such employee (provided, that the foregoing
                  shall not
                  be violated by general advertising not targeted at Company employees
                  nor
                  by serving as a reference for an employee with regard to an entity
                  with
                  which the Executive is not affiliated), or (ii) any customer of
                  the
                  Company or any of its subsidiaries or affiliates to purchase goods
                  or
                  services then sold by the Company or any of its subsidiaries or
                  affiliates
                  from another person, firm, corporation or other entity or assist
                  or aid
                  any other persons or entity in identifying or soliciting any such
                  customer
                  (provided, that the foregoing shall not apply to any product or
                  service
                  which is not covered by the noncompetition provision set forth
                  In Section
                  11(c), below).

              


      

       

      
        
          
          

        

        
          -
            13
            -

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                (c)

              	
                Noncompetition. The
                  Executive acknowledges that he performs services of a unique nature
                  for
                  the Company that are irreplaceable, and that his performance of
                  such
                  services to a competing entity that (i) is a value added reseller
                  of
                  computer hardware or software or (ii) provides product services,
                  consulting services and professional services, including but not
                  limited
                  to advisory services, deployment services, staffing services and
                  information technology outsourcing services (collectively, “Infrastructure
                  Solutions Services”) will result in irreparable harm to the Company.
                  Accordingly, during the Executive’s employment hereunder, and, except as
                  provided in Section 11(h), for the one (1) year period thereafter,
                  the
                  Executive agrees that the Executive will not, directly or indirectly,
                  own,
                  manage, operate, control, be employed by (whether as an employee,
                  consultant, independent contractor or otherwise, and whether or
                  not for
                  compensation), or render services to, any person, firm, corporation
                  or
                  other entity, in whatever form, that is (i) a value added reseller of
                  computer hardware or software or (ii) an Infrastructure Solution
                  Services provider, and, in either case, provides goods or services
                  primarily to customers in North America.  This Section 11(c)
                  shall not prevent the Executive from (i) owning not more than one
                  percent
                  (1%) of the total shares of all classes of stock outstanding of
                  any
                  publicly traded entity that is a value added reseller of computer
                  hardware
                  or software, (ii) rendering services to charitable organizations,
                  as such
                  term is defined in Section 501(c) of the Code, or (iii) directly
                  or
                  indirectly owning, managing, operating, controlling, or being employed
                  by
                  (whether as an employee, consultant, independent contractor or
                  otherwise,
                  and whether or not for compensation), or rendering services to,
                  any
                  person, firm, corporation or other entity, in whatever form, that
                  is in
                  any of the following businesses: (A) developing computer software
                  (but not such a developer that sells software directly to end users),
                  (B)
                  selling computer hardware or software to persons or entities other
                  than
                  end users, and (C) providing consulting services to clients in
                  industries
                  to which the Company has not provided Infrastructure Solution Services
                  during the year preceding termination of the Executive’s employment with
                  the Company.

              


      

       

      
        	
                 

              	
                (d)

              	
                Nondisparagement. Each
                  of the Executive and the Company (for purposes hereof, “the Company” shall
                  mean only (i) the Company by press release or other formally released
                  announcement and (ii) the executive officers and directors thereof
                  and not
                  any other employees) agrees that during the Employment Term and
                  for five
                  (5) years thereafter not to make any public statements that disparage
                  the
                  other party, or in the case of the Company, its respective affiliates,
                  employees, officers, directors, products or
                  services.  Notwithstanding the foregoing, statements made in the
                  course of sworn testimony in administrative, judicial or arbitral
                  proceedings (including, without limitation, depositions in connection
                  with
                  such proceedings) shall not be subject to this Section 11(d). This
                  provision shall also not cover normal competitive statements which
                  do not
                  cite the Executive’s employment by the
                  Company.

              


      

       

      
        
          
          

        

        
          -
            14
            -

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                (e)

              	
                Equitable
                  Relief and Other Remedies. The parties acknowledge and agree that the
                  other party’s remedies at law for a breach or threatened breach of any of
                  the provisions of this Section would be inadequate and, in recognition
                  of
                  this fact, the parties agree that, in the event of such a breach
                  or
                  threatened breach, in addition to any remedies at law, the other
                  party,
                  without posting any bond, shall be entitled to obtain equitable
                  relief in
                  the form of specific performance, temporary restraining order,
                  a temporary
                  or permanent injunction or any other equitable remedy which may
                  then be
                  available.

              


      

       

      
        	
                 

              	
                (f)

              	
                Reformation.
                  If it is determined by a court of competent jurisdiction in any
                  state that
                  any restriction in this Section 11 is excessive in duration or
                  scope or is
                  unreasonable or unenforceable under the laws of that state, it
                  is the
                  intention of the parties that such restriction may be modified
                  or amended
                  by the court to render it enforceable to the maximum extent permitted
                  by
                  the law of that state.

              


      

       

      
        	
                 

              	
                (g)

              	
                Survival
                  of Provisions. The obligations contained in this Section 11 shall
                  survive the termination or expiration of the Executive’s employment with
                  the Company and shall be fully enforceable
                  thereafter.

              


      

       

      
        	
                 

              	
                (h)

              	
                Non-Competition
                  Not Applicable.  The one (1) year non-competition provision
                  set forth in Section 11(c) commencing on the date of Executive’s
                  termination of employment shall not be applicable if Company does
                  not
                  renew this Agreement upon the expiration of the Initial Term of
                  this
                  Agreement or any Renewal Term; provided, however, such one (1)
                  year
                  non-competition provision shall be applicable in any such instance
                  if the
                  Company elects in writing to compensate Executive pursuant to Section
                  11(i) of this Agreement.

              


      

      


      
        	
                 

              	
                (i)

              	
                Optional
                  Payment for Non-Competition.  In the event that (i) the
                  Company does not renew this Agreement upon the expiration of the
                  Initial
                  Term of this Agreement or any Renewal Term with notice to Executive
                  of
                  such nonrenewal at least  ninety (90) days prior to the
                  expiration of the Initial Term or any Renewal Term,  Company
                  shall have the option to pay Executive an amount equal to his Base
                  Salary
                  that was in effect prior to such non-renewal in consideration for
                  Executive not competing with Company for a period of twelve (12)
                  months
                  from the date of the expiration of this
                  Agreement.

              


      

      


      12.           Continued
        Availability and Cooperation.

       

      
        	
                 

              	
                (a)

              	
                Following
                  termination of the Executive’s employment with the Company, the Executive
                  shall cooperate fully with the Company and with the Company’s counsel in
                  connection with any present and future actual or threatened litigation,
                  administrative proceeding or investigation involving the Company
                  that
                  relates to events, occurrences or conduct occurring (or claimed
                  to have
                  occurred) during the period of the Executive’s employment by the Company.
                  Cooperation will include, but is not limited
                  to:

              


      

       

      
        
          
          

        

        
          -
            15
            -

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                (i)

              	
                making
                  himself reasonably available for interviews and discussions with
                  the
                  Company’s counsel as well as for depositions and trial
                  testimony;

              


      

       

      
        	
                 

              	
                (ii)

              	
                if
                  depositions or trial testimony are to occur, making himself reasonably
                  available and cooperating in the preparation therefore, as and
                  to the
                  extent that the Company or the Company’s counsel reasonably
                  requests;

              


      

       

      
        	
                 

              	
                (iii)

              	
                refraining
                  from impeding in any way the Company’s prosecution or defense of such
                  litigation or administrative proceeding;
                  and

              


      

       

      
        	
                 

              	
                (iv)

              	
                cooperating
                  fully in the development and presentation of the Company’s prosecution or
                  defense of such litigation or administrative
                  proceeding.

              


      

       

      The
        Company will reimburse the Executive for reasonable travel, lodging, telephone
        and similar expenses, as well as reasonable attorneys’ fees (if independent
        legal counsel is necessary), incurred in connection with any cooperation,
        consultation and advice rendered under this Agreement after the Executive’s
        termination of employment; provided that (i) Executive shall not be required
        to
        make himself available for such purposes for more than three days in any
        calendar month, (ii) the Company and the Executive must mutually agree on
        which
        days the Executive will make himself available, and (iii) the Company shall
        pay
        in advance to the Executive (a) all reasonably anticipated travel and other
        expenses, subject to subsequent submission of supporting documentation and,
        if
        applicable, the refund by the Executive of any remaining balance of the advance
        after he has been reimbursed fully for the actual expenses incurred, and
        (b) a
        per diem, not accountable, of One Thousand Five Hundred Dollars ($1,500.00)
        per
        day.

       

      13.          Dispute
        Resolution.

       

      
        	
                 

              	
                (a)

              	
                In
                  the event that the parties are unable to resolve any controversy
                  or claim
                  arising out of or in connection with this Agreement or breach thereof,
                  either Party shall refer the dispute to binding arbitration, which
                  shall
                  be the exclusive forum for resolving such claims. Such arbitration
                  will be
                  administered by Judicial Arbitration and Mediation Services, Inc.
                  (“JAMS”)
                  pursuant to its Employment Arbitration Rules and Procedures and
                  governed
                  by Kentucky law. The arbitration shall be conducted by a single
                  arbitrator
                  selected by the parties according to the rules of JAMS. In the
                  event that
                  the parties fail to agree on the selection of the arbitrator within
                  thirty
                  (30) days after either party’s request for arbitration, the arbitrator
                  will be chosen by JAMS. The arbitration proceeding shall commence
                  on a
                  mutually agreeable date within ninety (90) days after the request
                  for
                  arbitration, unless otherwise agreed by the parties, and shall
                  be
                  conducted in the Commonwealth of
                  Kentucky.

              


      

       

      
        
          
          

        

        
          -
            16
            -

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                (b)

              	
                The
                  parties agree that each will bear their own costs and attorneys’ fees. The
                  arbitrator shall not have authority to award attorneys’ fees or costs to
                  any party.

              


      

       

      
        	
                 

              	
                (c)

              	
                The
                  arbitrator shall have no power or authority to make awards or orders
                  granting relief that would not be available to a party in a court
                  of law.
                  The arbitrator’s award is limited by and must comply with this Agreement
                  and applicable federal, state, and local laws. The decision of
                  the
                  arbitrator shall be final and binding on the
                  parties.

              


      

       

      
        	
                 

              	
                (d)

              	
                Notwithstanding
                  the foregoing, no claim or controversy for injunctive or equitable
                  relief
                  contemplated by or allowed under applicable law pursuant to Section
                  11 of
                  this Agreement will be subject to arbitration under this Section
                  13, but
                  will instead be subject to determination in a court of competent
                  jurisdiction in the state of the place of performance, which court
                  shall
                  apply Kentucky law consistent with Section 13 of this Agreement,
                  where
                  either party may seek injunctive or equitable
                  relief.

              


      

       

      14.          Other
        Agreements.

       

      No
        agreements (other than the exhibits hereto and agreements evidencing any
        grants
        of equity awards or the Special Change In Control Bonus Agreement) or
        representations, oral or otherwise, express or implied, with respect to the
        subject matter hereof have been made by either party which are not expressly
        set
        forth in this Agreement. Each party to this Agreement acknowledges that no
        representations, inducements, promises, or other agreements, orally or
        otherwise, have been made by any party, or anyone acting on behalf of any
        party,
        pertaining to the subject matter hereof, which are not embodied herein, and
        that
        no prior and/or contemporaneous agreement, statement or promise pertaining
        to
        the subject matter hereof that is not contained in this Agreement shall be
        valid
        or binding on either party.

       

      15.          Withholding
        of Taxes.

       

      The
        Company will withhold from any amounts payable under this Agreement all federal,
        state, city or other taxes as the Company is required to withhold pursuant
        to
        any law or government regulation or ruling.

       

      16.          Successors
        and Binding Agreement.

       

      
        	
                 

              	
                (a)

              	
                The
                  Company will require any successor (whether direct or indirect,
                  by
                  purchase of assets or stock, merger, consolidation, reorganization
                  or
                  otherwise) to all or substantially all of the business or assets
                  of the
                  Company expressly to assume and agree to perform this Agreement
                  in the
                  same manner and to the same extent the Company would be required
                  to
                  perform if no such succession had taken place. This Agreement will
                  be
                  binding upon and inure to the benefit of the Company and any successor
                  to
                  the Company, including without limitation any persons acquiring
                  directly
                  or indirectly all or substantially all of the business or assets
                  of the
                  Company whether by purchase, merger, consolidation, reorganization
                  or
                  otherwise (and such successor shall thereafter be deemed the “Company” for
                  the purposes of this Agreement), but will not otherwise be assignable,
                  transferable or delegable by the Company, except that the Company
                  may
                  assign and transfer this Agreement and delegate its duties thereunder
                  to a
                  wholly owned Subsidiary; provided that following any such assignment
                  the
                  Company shall remain fully liable with respect to all of its obligations
                  under this Agreement.

              


      

       

      
        
          
          

        

        
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                (b)

              	
                This
                  Agreement will inure to the benefit of and be enforceable by the
                  Executive’s personal or legal representatives, executors, administrators,
                  successors, heirs, distributees and
                  legatees.

              


      

       

      
        	
                 

              	
                (c)

              	
                This
                  Agreement is personal in nature and neither of the parties hereto
                  shall,
                  without the consent of the other, assign, transfer or delegate
                  this
                  Agreement or any rights or obligations hereunder except as expressly
                  provided in Sections 16(a) and 16(b). Without limiting the generality
                  or
                  effect of the foregoing, the Executive’s right to receive payments
                  hereunder will not be assignable, transferable or delegable, whether
                  by
                  pledge, creation of a security interest, or otherwise, other than
                  by a
                  transfer by the Executive’s will or by the laws of descent and
                  distribution and, in the event of any attempted assignment or transfer
                  contrary to this Section 16(c), the Company shall have no liability
                  to pay
                  any amount so attempted to be assigned, transferred or
                  delegated.

              


      

       

      17.          Notices.

       

      All
        communications, including without limitation notices, consents, requests
        or
        approvals, required or permitted to be given hereunder will be in writing
        and
        will be duly given when hand delivered or dispatched by electronic facsimile
        transmission (with receipt thereof confirmed), or five (5) business days
        after
        having been mailed by United States registered or certified mail, return
        receipt
        requested, postage prepaid, or three (3) business days after having been
        sent by
        a nationally recognized overnight courier service such as Federal Express
        or
        UPS, addressed to the Company (to the attention of the General Counsel of
        the
        Company) at its principal executive offices and to the Executive at his
        principal residence, or to such other address as any party may have furnished
        to
        the other in writing and in accordance herewith, except that notices of changes
        of address shall be effective only upon receipt.

       

      18.          Governing
        Law and Choice of Forum.

       

      
        	
                 

              	
                (a)

              	
                This
                  Agreement will be construed and enforced according to the laws
                  of the
                  Commonwealth of Kentucky, without giving effect to the conflict
                  of laws
                  principles thereof.

              


      

       

      
        	
                 

              	
                (b)

              	
                To
                  the extent not otherwise provided for by Section 13 of this Agreement,
                  the
                  Executive and the Company consent to the jurisdiction of all state
                  and
                  federal courts located in Boone County, Kentucky, as well as to
                  the
                  jurisdiction of all courts of which an appeal may be taken from
                  such
                  courts, for the purpose of any suit, action, or other proceeding
                  arising
                  out of, or in connection with, this Agreement or that otherwise
                  arises out
                  of the employment relationship. Each party hereby expressly waives
                  any and
                  all rights to bring any suit, action, or other proceeding in or
                  before any
                  court or tribunal other than the courts described above and covenants
                  that
                  it shall not seek in any manner to resolve any dispute other than
                  as set
                  forth in this paragraph and Section 13 of this Agreement. Further,
                  the
                  Executive and the Company hereby expressly waive any and all objections
                  either may have to venue, including, without limitation, the inconvenience
                  of such forum, in any of such courts. In addition, each of the
                  parties
                  consents to the service of process by personal service or any manner
                  in
                  which notices may be delivered hereunder in accordance with this
                  Agreement.

              


      

       

      
        
          
          

        

        
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      19.          Validity/Severability.

       

       If
        any provision of this Agreement or the application of any provision is held
        invalid, unenforceable or otherwise illegal, the remainder of this Agreement
        and
        the application of such provision will not be affected, and the provision
        so
        held to be invalid, unenforceable or otherwise illegal will be reformed to
        the
        extent (and only to the extent) necessary to make it enforceable, valid or
        legal. To the extent any provisions held to be invalid, unenforceable or
        otherwise illegal cannot be reformed, such provisions are to be stricken
        herefrom and the remainder of this Agreement will be binding on the parties
        and
        their successors and assigns as if such invalid or illegal provisions were
        never
        included in this Agreement from the first instance.

       

      20.          Survival
        of Provisions.

       

      Notwithstanding
        any other provision of this Agreement, the parties’ respective rights and
        obligations under Sections 8, 9, 10, 11, 12, 13, 17, 18, 20, and 21, will
        survive any termination or expiration of this Agreement or the termination
        of
        the Executive’s employment with the Company.

       

      21.          Liability
        Insurance.

       

      The
        Company shall cover the Executive under directors and officers liability
        insurance both during and, while potential liability exists, after the term
        of
        this Agreement in the same amount and to the same extent as the Company covers
        its other officers and directors.  The Company shall provide a
        certificate of insurance confirming this coverage promptly upon receipt of
        a
        request for same from Executive.

       

      22.          Public
        Announcements.

       

      The
        Company shall give the Executive a reasonable opportunity to review and comment
        in advance on any public announcement (including any filing with a governmental
        agency or stock exchange) relating to this Agreement or the Executive’s
        employment by the Company.

       

      23.          Compliance
        with Code Section 409A.

       

      This
        Agreement is intended to comply with the requirements of Code Section 409A
        and
        the regulations and guidance issued thereunder and shall be interpreted and
        administered in a manner consistent with that intent.  Any provision
        of this Agreement to the contrary notwithstanding, if Executive is a “specified
        employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code as of the
        date of his separation from service with the Company, no distribution that
        is
        subject to and not otherwise exempt from Code Section 409A shall be made
        or
        commence under this Agreement sooner than six months from the date of
        Executive’s separation from service (or, if earlier, the date of the Executive’s
        death).  In such case, any payments that were otherwise required to be
        made within such six-month period shall be accumulated and paid in a single
        lump
        sum on the first day of the month immediately following the end of such
        six-month period.


      
        
          
          

        

        
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      24.          Miscellaneous
        Payment.

       

      Upon
        the
        first business day of January 2008 (January 2, 2008), Company shall pay
        Executive the sum of Fifty Thousand Dollars ($50,000.00) which amount represents
        a payment by Company to Executive to partially reimburse Executive for certain
        benefits that were forfeited by him with his former employer, as a result
        of
        Executive taking this position with Company.

      


       

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        remainder of this page is intentionally blank.

      


      Signature
        page to follow.


      
        
          
          

        

        
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      IN
        WITNESS WHEREOF, the parties have executed this Agreement as of the day and
        year
        first above written.

      


      


      
        	 	
                POMEROY
                  IT SOLUTIONS, INC. 

              
	 	 	 
	 	 	 
	 	
                By:

              	
                /s/
                  Keith R. Coogan

              
	 	 	
                Keith
                  R. Coogan

              
	 	
                Its:

              	
                President/Chief
                  Executive Officer

              
	 	 	 
	 	 	 
	 	 	
                /s/
                  Christopher C. Froman

              
	 	
                Christopher
                  C. Froman 

              


      

       

       

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