Document:

Amendment No. 2 and Waiver to Credit Agreement dated September 30, 2008

 EXHIBIT 10.1 
 AMENDMENT NO. 2 AND WAIVER TO CREDIT AGREEMENT 
 This AMENDMENT NO. 2 AND
WAIVER TO CREDIT AGREEMENT dated as of September 30, 2008 (this “Amendment”) to the Credit Agreement dated as of October 17, 2006 and as amended by an Amendment to Credit Agreement dated June 25, 2007 (as further
amended, restated, supplemented or modified, from time to time, the “Credit Agreement”), by and among MEDICAL ACTION INDUSTRIES INC., a Delaware corporation (the “Company”), the Lenders party thereto and JPMORGAN CHASE
BANK, N.A., a national banking association, as Administrative Agent for the Lenders. 
 WHEREAS, the Company has requested that
the Lenders amend certain provisions of the Credit Agreement, and the Lenders and the Administrative Agent have agreed to amend such provisions of the Credit Agreement, subject to the terms and conditions set forth herein; 
 NOW, THEREFORE, in consideration of the premises and of the mutual agreements herein contained, the parties hereto agree as follows: 

  

	 	1.	Amendments. 

 a. The definition of the term
“Applicable Margin” in Section 1.01 of the Credit Agreement is hereby amended and restated in its entirety to provide as follows: 
 “Applicable Margin” shall mean (a) with respect to an Adjusted Libor Loan, the percentage set forth below under the heading “LIBOR Margin” opposite the applicable ratio, (b) with respect to an Alternate
Base Rate Loan, the percentage set forth below under the heading “ABR Margin” opposite the applicable ratio and (c) with respect to calculation of the unused fee described in Section 3.04(a) hereof, the percentage set forth below
under the heading “Unused Fee Rate” opposite the applicable ratio. 
  

										
	 Leverage Ratio
	  	ABR Margin
(360 day basis)	 	 	LIBOR Margin
(360 day basis)	 	 	Unused Fee Rate
(360 day basis)	 
	 Greater than or equal to 3.50:1.00
	  	1.25	%	 	3.00	%	 	.45	%
	 Greater than or equal to 3.00:1.00 but less than 3.50:1.00
	  	1.00	%	 	2.75	%	 	.40	%
	 Greater than or equal to 2.50:1.00 but less than 3.00:1.00
	  	.75	%	 	2.50	%	 	.40	%
	 Greater than or equal to 2.00:1.00 but less than 2.50:1.00
	  	.50	%	 	2.25	%	 	.35	%
	 Less than 2.00:1.00
	  	.25	%	 	2.00	%	 	.35	%

 Notwithstanding the foregoing, during the period commencing on September 30, 2008 and ending
on the date of reset of the Applicable Margin in accordance with this paragraph, the ABR Margin shall be 1.00%, the LIBOR Margin shall be 2.75% and the 

 
Unused Fee Rate shall be .40%. The Applicable Margin will be set or reset with respect to each Loan on the date which is five (5) Business Days
following the date of receipt by the Administrative Agent of the financial statements referred to in Section 6.03(a) and Section 6.03(b) together with a certificate of the Financial Officer of the Company certifying the Leverage Ratio and
setting forth the calculation thereof in detail; provided, however, if any such financial statement and certificate are not received by the Administrative Agent within the time period required pursuant to Section 6.03(a) or
Section 6.03(b), as the case may be, the Applicable Margin will be set or reset, unless the rate of interest specified in Section 3.01(c) is in effect, based on a Leverage Ratio of greater than 3.50:1.00 from the date such financial
statements and certificate were due until the date which is five (5) Business Days following the receipt by the Administrative Agent of such financial statements and certificate, and provided, further, that the Lenders shall not in any way be
deemed to have waived any Default or Event of Default, including without limitation, an Event of Default resulting from the failure of the Company to comply with Section 7.13 of this Agreement, or any rights or remedies hereunder or under any
other Loan Document in connection with the foregoing proviso. During the occurrence and continuance of a Default or an Event of Default, no downward adjustment, and only upward adjustments, shall be made to the Applicable Margin. 
 b. Section 1.01 of the Credit Agreement is hereby amended by inserting the following definition immediately before the definition of the term
“Board”: 
 “Asset Sale” means a sale, lease or sub-lease (as lessor or sublessor), sale and leaseback, assignment,
conveyance, exclusive license (as licensor or sublicensor), transfer or other disposition to, or any exchange of property with, any Person, in one transaction or a series of transactions of all or any part of the Company’s or any of its
Subsidiaries’ businesses, assets or properties of any kind, whether real, personal, or mixed and whether tangible or intangible, whether now owned or hereafter acquired, leased or licensed, including the equity interests of any of the
Company’s Subsidiaries, other than (i) inventory (or other assets) sold, leased or licensed out in the ordinary course of business (excluding any such sales, leases or licenses out by operations or divisions discontinued or to be
discontinued), (ii) equipment or other assets (including leases or subleases of real property) sold, replaced, abandoned, leased or otherwise disposed of that are obsolete, worn-out, condemned or are no longer used or useful in the business of
the Company or any of its Subsidiaries, (iii) dispositions, by means of trade-in, of equipment used in the ordinary course of business, so long as such equipment is replaced, substantially concurrently, by like-kind equipment, or (iv) the
use or transfer of cash and cash equivalents in a manner that is not prohibited by the terms of this Agreement. 
 c. Section 1.01 of
the Credit Agreement is hereby amended by inserting the following definition immediately before the definition of “Business Day”: 
 “Brentwood Property” shall mean the premises located at 500 Expressway Drive South, Brentwood, New York. 
 d.
Section 1.01 of the Credit Agreement is hereby amended by inserting the following definition immediately before the definition of “Commercial Letter of Credit”: 
 “Collateral Mortgage” shall mean a Mortgage and Security Agreement by Town of Islip Industrial Development Agency in favor of the
Administrative Agent with respect to the Brentwood Premises, in form and substance satisfactory to the Administrative Agent and the Lenders. 

 e. Section 1.01 of the Credit Agreement is hereby amended by inserting the following definitions
immediately before the definition of the term “Default”: 
 “Consolidated Working Capital” at any date, the excess
of Consolidated Current Assets on such date less Consolidated Current Liabilities on such date. 
 “Consolidated Current
Assets” at any date, all amounts (other than cash and cash equivalents) that would, in conformity with GAAP, be set forth opposite the caption “total current assets” (or any like caption) on a balance sheet of the Company.

 “Consolidated Current Liabilities” at any date, all amounts that would, in conformity with GAAP, be set forth opposite the
caption “total current liabilities” (or any like caption) but excluding (a) the current portion of any Indebtedness, and (b) without duplication of clause (a) above, all Indebtedness consisting of Revolving Loans or
Swingline Loans to the extent otherwise included therein. 
 f. The definition of “Excess Cash Flow” in Section 1.01 of the
Credit Agreement is hereby amended and restated in its entirety to provide as follows: 
 “Excess Cash Flow” for the fiscal
year, the excess, if any, of (a) the sum, without duplication, of (i) Net Income for such fiscal, (ii) the amount of all non-cash charges (including depreciation and amortization charges) deducted in arriving at such Net Income,
(iii) decreases in Consolidated Working Capital for such fiscal year, over (b) the sum, without duplication, of (i) the aggregate amount of all regularly scheduled principal payments of Indebtedness consisting of borrowed money
made during such fiscal year, and (ii) increases in Consolidated Working Capital for such fiscal year. 
 g. The definition of the term
“Fixed Charge Coverage Ratio” in Section 1.01 of the Credit Agreement is hereby amended and restated in its entirety to provide as follows: 
 “Fixed Charge Coverage Ratio” shall mean the ratio of (1) EBITDA to (2) the sum of (a) the current portion of Total Debt, plus (b) interest expense plus (c) cash
dividends and distributions plus (d) stock repurchases. Each of the foregoing categories shall be measured on a Consolidated basis for the Company and its Subsidiaries and shall be calculated in accordance with Generally Accepted
Accounting Principles consistently applied and shall be calculated (without duplication) for the four fiscal quarters then most recently ended, except for the current portion of Total Debt, which shall each be calculated for the next succeeding four
fiscal quarters. 
 h. Section 1.01 of the Credit Agreement is hereby amended by inserting the following definition before the
definition of the term “Net Income”: 
 “Net Asset Sale Proceeds” means, with respect to any Asset Sale, an amount
equal to: (i) cash payments (including any cash received by way of deferred payment pursuant to, or by monetization of, a note receivable or otherwise, but only as and when so received) received by the Company or any of its Subsidiaries from
such Asset Sale (net of purchase price adjustments reasonably expected to be payable in connection therewith; provided that to the extent such purchase price adjustment is determined to be not payable or is 

 
otherwise not paid within 180 days of such Asset Sale (other than as result of a dispute with respect to such purchase price adjustment which is subject to a
resolution procedure set forth in the applicable transaction documents), such proceeds shall constitute Net Asset Sale Proceeds), minus (ii) any bona fide costs incurred in connection with such Asset Sale, including (a) income or
gains taxes payable by the seller as a result of any gain recognized in connection with such Asset Sale and any transfer, documentary or other taxes payable by seller in connection therewith, (b) payment of the outstanding principal amount of,
premium or penalty, if any, and interest on any Indebtedness (other than the Loans) that is secured by a Lien on the stock or assets in question and that is required to be repaid under the terms thereof as a result of such Asset Sale and (c) a
reasonable reserve for any payments (fixed or contingent) attributable to seller’s indemnities and representations and warranties to purchaser in respect of such Asset Sale undertaken by the Company or any of its Subsidiaries in connection with
such Asset Sale including pension and other post-employment benefit liabilities and liabilities related to environmental matters and liabilities under indemnification obligations associated with such Asset Sale, and (d) brokerage fees,
accountants’ fees, investment banking fees, legal fees, costs and expenses, survey costs, title insurance premiums and other customary fees actually incurred in connection with such Asset Sale. 
 i. The definition of the term “Security Documents” is hereby amended and restated in its entirety to provide as follows: 
 “Security Documents” shall mean the Security Agreement, the Pledge Agreement, the Collateral Mortgage and each other Collateral Security
Document delivered to the Administrative Agent hereunder. 
 j. Section 2.04 of the Credit Agreement is hereby amended and restated in
its entirety to provide as follows: 
 “Section 2.04. Term Note The Term Loan made by each Lender shall be evidenced by a
promissory note of the Company, substantially in the form of Exhibit B, with appropriate insertions (individually a “Term Note” and, collectively, the “Term Notes”) payable to the order of such Lender and
representing the obligation of the Company to pay the unpaid principal amount of the term Loan of such Lender with interest thereon as prescribed in Section 3.01. Each Lender is authorized to record the Type of its Term Loan and the date and
amount of each payment or prepayment of principal thereof in such Lender’s records or on the grid schedule annexed to the Term Note; provided, however, that the failure of a Lender to set forth each payment and other information shall not in
any manner affect the obligation of the Company to repay the Term Loan made by such Lender in accordance with the terms of its Term Note and this Agreement. The Term Note, the grid schedule and the books and records of each Lender shall constitute
presumptive evidence of the information so recorded absent manifest error. Each Term Note shall (a) be dated the Closing Date, (b) be stated to mature on the Term Loan Maturity Date and (c) be payable as to principal in nineteen
consecutive equal quarterly installments commencing on March 31, 2007 and on the last day of each March, June, September and December thereafter, with a twentieth and final payment on the Term Loan Maturity Date. The amount of such payments
received by each Lender on the initial installment date and each installment date through June 30, 2008 shall be in the amount of each Lender’s Commitment Proportion of $3,250,000, for each installment date from September 30, 2008
through March 31, 2009 shall be in the amount of each Lender’s Commitment Proportion of $250,000, for each installment date from June 30, 

 
2009 through March 31, 2010 shall be in the amount of each Lender’s Commitment Proportion of $1,625,000, for each installment date from
June 30, 2010 through March 31, 2011 shall be in the amount of each Lender’s Commitment Proportion of $3,250,000, for each installment date from June 30, 2011 through September 30, 2011 shall be in an amount of each
Lender’s Commitment Proportion of $5,325,000, and the last installment received by each Lender shall be in the amount of each Lender’s Commitment Proportion of the remaining principal amount outstanding. Each Term Note shall bear interest
from the date thereof until paid in full on the unpaid principal amount thereof from time to time outstanding at the applicable interest rate per annum determined as provided in, and payable as specified in, Section 3.01.” 
 k. Section 3.03 of the Credit Agreement is hereby amended by deleting paragraphs “(b)” and “(c)” thereof and by inserting the
following paragraphs in substitution thereof: 
 “(b) Simultaneously with the delivery of the annual financial statements to be delivered
pursuant to Section 6.03(a) hereof, the Company shall repay the Term Loan in an amount equal to 50% of Excess Cash Flow, less amounts equal to any principal balance of the Term Loan voluntarily prepaid by the Company during the relevant fiscal
year. 
 (c) No later than the third Business Day following the date of receipt by the Company or any of its Subsidiaries of any Net Asset
Sales Proceeds, the Company shall prepay the Loans in an aggregate amount equal to 100% of such Net Asset Sale Proceeds. 
 (d) The Company
shall apply net proceeds (after costs and expenses) realized by the Company upon the sale of any equity interest in the Company or any debt instruments by the Company to prepay Loans hereunder. The Company shall prepay the Loans in an amount equal
to 100% of such net proceeds promptly upon the closing of any such sale of equity interests or debt instruments. 
 (e) Each prepayment of
principal of a Loan pursuant to this Section 3.03 shall be accompanied by accrued interest to the date prepaid on the amount prepaid and all amounts, if any, due pursuant to Section 3.08 hereof. Prepayments shall be applied first to prepay
the outstanding principal balance of the Term Loan and then to reduce the outstanding principal balance of the Revolving Credit Loans. Prepayments of the Term Loan may not be reborrowed. Partial prepayments of any Loan shall be applied first to
outstanding Alternate Base Rate Loans and then to Adjusted Libor Loans having the shortest remaining Interest Periods. Prepayments of Adjusted Libor Loans shall be accompanied by the amounts, if any, due pursuant to Section 3.08.”

 l. Section 7.13(b) (Maximum Leverage Ratio) of the Credit Agreement is hereby amended by deleting the chart therefrom and
substituting the following in its place: 
  

			
	 Period
	  	Ratio
	 From 6/30/10 and thereafter
	  	2.50:1.00

 m. Section 7.13(c) (Fixed Charge Coverage Ratio) of the Credit Agreement is hereby amended
and restated to provide in its entirety as follows: 
 “(c) Fixed Charge Coverage Ratio. Permit the Fixed Change Coverage Rate at
the end of any quarter to be less than the ratio set forth below opposite the applicable period: 
  

			
	 Period
	  	Ratio
	 9/30/08 – 3/31/09
	  	1.25:1.00
	 6/30/09 – 3/31/10
	  	1.00:1.00
	 6/30/10 and thereafter
	  	1.10:1.00

 n. Section 7.13 of the Credit Agreement is hereby amended to insert the following subsections
“(e)” and “(f)” therein immediately following subsection “(d)” thereof: 
 “(e) Minimum EBITDA.
Permit EBITDA to be less than the amounts set forth below for the periods set forth below: 
  

				
	 Period
	  	Minimum EBITDA
	 2 fiscal quarters ending 9/30/08
	  	$	7,500,000
	 3 fiscal quarters ending 12/31/08
	  	$	10,000,000
	 4 fiscal quarters ending 3/31/09 and 6/30/09
	  	$	12,500,000
	 4 fiscal quarters ending 9/30/09 through 3/31/10
	  	$	15,000,000

 (f) Limitation on Net Losses. Permit Net Losses in excess of (i) $500,000 for the
fiscal quarter ending 9/30/08 and (ii) $500,000 for the six months ending 12/31/08, or permit Net Losses to occur in two consecutive fiscal quarters commencing with the two quarters ending in 3/31/09.” 
 o. Exhibit B to the Agreement is hereby amended and replaced by Exhibit B annexed to this Amendment. 
  

	 	2.	Waiver.  

 a. The Lenders hereby waive the
requirements of Section 3.03(b) of the Credit Agreement solely with respect to the payment that would otherwise be payable on March 31, 2008. 
 b. Except as expressly waived hereby, the Credit Agreement remains in full force and effect in accordance with the terms thereof. The Credit Agreement is ratified and confirmed in all respects by each Company. The
waiver herein is specifically limited to the matter set forth above and for the specific instance and purpose for which given and does not constitute directly or by implication an amendment or waiver of any other provisions of the Credit Agreement
or a waiver of any Default or Event of Default. 
  

	 	3.	Agreement with Respect to Collateral Mortgage. 

 a. This Company agrees that the Administrative Agent shall engage an appraiser to perform an appraisal on the Brentwood Premises (an “Appraisal”), which Appraisal shall show a value of not less than $12,500,000 and which Appraisal
shall be satisfactory to the Administrative Agent in all 

 
aspects. In addition, the Company shall provide the Administrative Agent with a satisfactory flood search indicating that the Brentwood Premises is not in a
flood hazard zone. The Administrative Agent shall also complete a review of the environmental status of the Brentwood Premises and shall have received such expert assessments, reports and analyses thereof as it shall reasonably request and such
review and reports and analyses must be satisfactory in form and content to the Administrative Agent. 
 b. Within 120 days after execution
and delivery of this Amendment, the Company shall delivery to the Administrative Agent for recording a fully executed Collateral Mortgage in an amount equal to $10,000,000, together with (a) a title policy and a lender’s title insurance
binder issued by an insurance company authorized to transact business in the State of New York and acceptable to the Lenders naming the Administrative Agent as insured and insuring that the Collateral Mortgage creates a continuing, valid lien on the
Brentwood Premises, prior to all Liens, and securing an amount and on terms and conditions satisfactory to the Required Lender at such time, (b) a current legal description and survey of the Brentwood Premises, certified to the Administrative
Agent and the title company, (c) a certificate of insurance from an independent insurance broker confirming the insurance required to be maintained pursuant to the Collateral Mortgage, with respect to the Brentwood Premises, naming the
Administrative Agent as mortgagee with respect to such insurance, (d) copies of all documents executed and delivered in connection with the proposed transaction with the Town of Islip Industrial Development Agency (the “IDA”), as may
be requested by the Administrative Agent and the Lender, including authorization by the IDA and (r) such other documents, promissory notes, agreements and information that the Administrative Agent and the Lenders may request. 
 c. In the event that the Appraisal of the Brentwood Premises indicates a fair market value of less than $12,500,000, the Company shall mortgage its
premises located at 10 Columbia Boulevard, Clarksburg, West Virginia, and such additional properties of the Company as are necessary to cause the fair market value of properties mortgaged to secure the Company’s obligations hereunder to be not
less than $12,500,000, in order to provide one or more mortgages aggregating not less than $10,000,000. In such event, the Company shall deliver to the Administrative Agent an additional mortgage in form and substance satisfactory to the
Administrative Agent and the Lenders, together with each of such documents as are required under clause (b) above and such other documents and agreements as the Administrative Agent may reasonably require, including an additional amendment to
the Credit Agreement. 
 d. The Company agrees to pay all title insurance premiums, appraisal fees, fees for any environmental consultant or
engineer, recording and filing fees and charges and other expenses incurred by the Administrative Agent in connection with the Appraisal, the recording of the Collateral Mortgage and the delivery of any documents required pursuant to this Section,
including such documents as may be required pursuant to clause “(c)” above and fees for any appraisal and environmental review conducted with respect to such additional property. 
  

	 	4.	Conditions to Effectiveness. 

 This Amendment
shall become effective upon receipt by (x) the Administrative Agent of: (a) this Amendment, duly executed by the Company and the Guarantors, (b) a certificate of the Secretary or Assistant Secretary of the Company, dated as of the
date hereof, in the form of Exhibit 1 hereto, and (c) such other documents, instruments and agreements that the Administrative Agent shall reasonably require with respect thereto and (y) each Lender of a duly executed substitute
Term Note, substantially in the form of Exhibit B to this Amendment with appropriate insertions, 

	 	5.	Miscellaneous. 

 Capitalized terms used
herein and not otherwise defined herein shall have the same meanings as defined in the Credit Agreement. 
 Except as expressly amended
hereby, the Credit Agreement shall remain in full force and effect in accordance with the original terms thereof. 
 The amendments set forth
above are limited specifically to the matters set forth above and for the specific instances and purposes given and do not constitute directly or by implication a waiver or amendment of any other provision of the Credit Agreement or a waiver of any
Default or Event of Default, whether now existing or hereafter arising, which may occur or may have occurred. 
 The Company hereby
represents and warrants that (a) after giving effect to this Amendment, the representations and warranties made by the Company and each of its Subsidiaries pursuant to the Credit Agreement and the other Loan Documents to which each is a party
are true and correct in all material respects as of the date hereof with the same effect as though such representations and warranties had been made on and as of such date, unless any such representation or warranty is as of a specific date, in
which case, as of such date, and (b) after giving effect to this Amendment, no Default or Event of Default has occurred and is continuing. 
 The Company hereby: (a) acknowledges and confirms that, notwithstanding the consummation of the transactions contemplated by this Amendment, (i) all terms and provisions contained in the Security Documents are, and shall remain,
in full force and effect in accordance with their respective terms and (ii) the liens heretofore granted, pledged and/or assigned to the Administrative Agent for the benefit of the Lenders as security for the Company’s obligations under
the Credit Agreement (including, without limitation, the amended and restated Revolving Credit Notes), the Credit Agreement and the other Loan Documents shall not be impaired, limited or affected in any manner whatsoever by reason of this Amendment
and that all such liens shall be deemed granted, pledged and/or assigned to the Administrative Agent for the benefit of the Lenders as security for the Company’s obligations to the Administrative Agent and the Lenders, including, without
limitation, those arising in connection with the increase in the Revolving Credit Commitment; and (b) represents, warrants and confirms the non-existence of any offsets, defenses, or counterclaims to its obligations under the Credit Agreement
or any Loan Document. 
 This Amendment may be executed in one or more counterparts, each of which shall constitute an original, but all of
which when taken together shall constitute but one Amendment. This Amendment shall become effective when duly executed counterparts hereof which, when taken together, bear the signatures of each of the parties hereto shall have been delivered to the
Administrative Agent. 
 This Amendment shall constitute a Loan Document. 
 This Amendment shall be governed by, and construed in accordance with, the laws of the State of New York. 
 [next page is signature page] 

 IN WITNESS WHEREOF, the Company, the Lenders and the Administrative Agent have caused this
Amendment to be duly executed by their duly authorized officers, all as of the day and year first above written. 
  

			
	MEDICAL ACTION INDUSTRIES INC.
		
	By:	 	 
	Name:	 	Paul D. Meringolo
	Title:	 	Chief Executive Officer/President
	
	 JPMORGAN CHASE BANK, N.A.,
 as
Administrative Agent and as a Lender

		
	By:	 	 
	Name:	 	Stephen Zajac
	Title:	 	Senior Vice President
	
	CITIBANK, N.A., as a Lender
		
	By:	 	 
	Name:	 	
	Title:	 	
	
	SOVEREIGN BANK, N.A., as a Lender
		
	By:	 	 
	Name:	 	
	Title:	 	

 The undersigned, not parties to the Credit Agreement but as Guarantors under the Guaranty and as Grantors under the
Security Agreement, each hereby (a) accept and agree to the terms of the foregoing Amendment, (b) acknowledge and confirm that all terms and provisions contained in their respective Guaranty are, and shall remain, in full force and effect
in accordance with their respective terms and that its obligations thereunder include obligations of the Company owing to the Administrative Agent and the Lenders in connection with the increase in the Revolving Credit Commitment, and
(c) (i) all terms and provisions contained in the Security Agreement are and shall remain, in full force and effect in accordance with their respective terms and (ii) the liens heretofore granted, pledged and/or assigned to the Lender
as security for the Guaranteed Obligations (as defined in the Guaranty) shall not be impaired, limited or affected in any manner whatsoever by reason of this Amendment and that all such liens shall be deemed granted, pledged and/or assigned to the
Administrative Agent for the benefit of the Lenders as security for the Guaranteed Obligations, including, without limitation, those Guaranteed Obligations related to Revolving Credit Loans. 
  

			
	MAI ACQUISITION CORP.
		
	By:	 	 
	Name:	 	Paul D. Meringolo
	Title:	 	Chief Executive Officer/President
	
	MEDEGEN NEWCO, LLC
		
	By:	 	 
	Name:	 	Paul D. Meringolo
	Title:	 	Chief Executive Officer/President
	
	MEDEGEN MEDICAL PRODUCTS, LLC
		
	By:	 	 
	Name:	 	Paul D. Meringolo
	Title:	 	Chief Executive Officer/PresidentEX-10.1

Executive Officer

Change in Control Agreement

This Executive Officer Change in Control Agreement (the “Agreement”) is dated as of October 1,
2008, by and among Sport Supply Group, Inc., a Delaware corporation (the “Company”), and John Pitts
(the “Executive”).

The following recitals are true and constitute the basis for this Agreement:

	 	A.	 	The Company recognizes that the current business environment makes it difficult
to attract and retain highly-qualified executives unless a certain degree of security
can be offered to such executives against organizational and personnel changes which
frequently follow a Change in Control (as defined below) of a corporation;

	 	B.	 	The Board of Directors of the Company (the “Board”) recognizes the valued
service the Executive provides as an officer of the Company and/or its subsidiaries and
considers the Executive to be an important resource the Company desires to retain;

	 	C.	 	The Company desires to assure fair treatment of its key executives in the event
of a Change in Control and to allow them to make critical career decisions without
undue time pressure and financial uncertainty, thereby increasing their willingness to
remain with the Company notwithstanding the outcome of a possible Change in Control of
the Company;

	 	D.	 	The Company recognizes its key executives will be involved in evaluating or
negotiating any offers, proposals or other transactions that could result in a Change
in Control of the Company and believes that it is in the best interests of the Company
and its stockholders that such key executives be in a position, free from personal,
financial and employment consideration, to be able to assess objectively and pursue
aggressively the interests of the Company’s stockholders in making these evaluations
and carrying on such negotiations; and

	 	E.	 	The Board believes it is essential to provide the Executive with compensation
arrangements upon a Change in Control that provide the Executive with individual
financial security and which are competitive with those of other corporations, and in
order to accomplish these objectives, the Board has caused the Company to enter into
this Agreement.

NOW THEREFORE in consideration of the Executive’s willingness to continue working as an
employee of the Company or any of its subsidiaries and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. Certain Definitions. In addition to the terms that are defined in other parts of
this Agreement, the following terms shall have the specified meanings set forth below:

(a) “Cause” for purposes of this Agreement shall mean (i) the conviction of the Executive of a
felony, (ii) an act or acts of personal dishonesty taken by the Executive and intended to result in
substantial personal enrichment of the Executive at the expense of the Company or (iii) repeated
violations by the Executive of the Executive’s obligations under Sections 5, 16 and 18 of this
Agreement that are demonstrably willful and deliberate on the Executive’s part and that are not
remedied in a reasonable period of time after receipt of written notice from the Company.

(b) “Code” for purposes of this Agreement shall mean the Internal Revenue Code of 1986, as
amended, and any reference to any subsection thereof shall be construed to incorporate reference to
any section or subsection of the Code enacted as a successor thereto, any applicable proposed,
temporary or final regulations promulgated pursuant to such sections and any applicable
interpretation thereof by the Internal Revenue Service.

(c) “Competes” for purposes of this Agreement shall mean any one or more of the following
activities:

(i) manufacturing, distributing, designing, selling or installing sports equipment and
supplies (the “Sports Distribution Business”) to any Person within any industry segment for
which the Company has either offered to provide or conduct, or actually provided or
conducted, the Sports Distribution Business during Executive’s employment with the Company;
or

(ii) engaging in any other business activities (other than those described in (c)(i)
above) which are conducted, offered or provided by the Company while the Executive is
employed by the Company and as to which Executive is involved, if those activities are in
the same markets or states as the Company engaged in during Executive’s employment with the
Company.

(d) “Disability” for purposes of this Agreement shall mean Executive’s incapacity due to
physical or mental illness that prevents Executive from engaging in the full-time performance of
Executive’s duties with Company for a period of 60 consecutive days or for 90 days, whether or not
consecutive, in any 360 day period and, within 30 days after written notice is provided to
Executive by Company, Executive shall not have returned to the full-time performance of Executive’s
duties.

(e) “Good Reason” for purposes of this Agreement shall mean any of the following acts by the
Company (or any of its affiliates), without the consent of the Executive (in each case, other than
an isolated, insubstantial and inadvertent action not taken in bad faith): (i) a material
diminution in the Executive’s authority, duties or responsibilities or in the authority, duties or
responsibilities of the supervisor to whom the Executive is required to report (including a
requirement that the Executive report to a governing body other than the Board or a similar
governing body of the Company, or a corporate officer or employee other than the Chief Executive
Officer or the President); (ii) a material diminution in the Executive’s base compensation; (iii) a
material diminution in the budget over which the Executive retains authority; (iv) the relocation
of the Executive to an office or location more than 50 miles from the location at which the
Executive normally performed services for the Company immediately prior to such relocation; or (v)
any action or inaction that constitutes a material breach by the Company of the agreement under
which the Executive provides services. In the case of any allegation of Good Reason by the
Executive, (A) the Executive shall provide notice to the Company of the event alleged to constitute
Good Reason within 90 days of the occurrence of such event, and (B) the Company shall have the
opportunity to remedy the alleged Good Reason event within 30 days from receipt of notice of such
allegation.

(f) “Person” for purposes of this Agreement shall mean any individual, corporation, limited
liability company, partnership, joint venture, association, trust, unincorporated organization or
other entity.

(g) “Present Value” for purposes of this Agreement shall mean the amount determined in
accordance with Section 280G(d)(4) of the Code as of the date specified for such determination,
applying a discount rate, compounded no less frequently than monthly, that is equivalent to the
rate specified for such determination.

(h) “Principal Obligations” for purposes of this Agreement shall mean either (i) the
principal, premium, interest, fees, costs, expenses and other amounts accrued or due on the
Company’s existing or future credit facilities, term loans or revolving credit or commercial paper
facilities (including any related hedging obligations or letter of credit subfacilities) entered
into with commercial banks or financial institutions and guarantees thereof or (ii) the Company’s
5.75% convertible senior subordinated notes due 2009 or any future senior subordinated notes.

2. Term. This Agreement shall commence on the date hereof and shall terminate upon
the earlier of (a) the termination of Executive’s employment with the Company or any of its
subsidiaries for any reason (by either the Executive or the Company) at any time more than 6 months
prior to a Change in Control, (b) the termination of Executive’s employment with the Company or any
of its subsidiaries either by the Company for Cause or the Executive without Good Reason at any
time either before or after a Change in Control, or (c) the termination of the Executive’s
employment with the Company or any of its subsidiaries either by the Company without Cause, by the
Executive for Good Reason, or upon the death or Disability of Executive at any time within the 6
month period before or the 12 month period after a Change in Control and the payment by the Company
of all obligations to the Executive under Section 6 of this Agreement (the “Term”).

3. Change in Control. For the purpose of this Agreement, a “Change in Control” of the
Company shall mean the occurrence of any of the following events at any time during the Term:

(a) the acquisition by any person of beneficial ownership, directly or indirectly, through a
purchase, merger or other acquisition transaction or series of transactions, of shares of capital
stock of the Company entitling such person to exercise 40% or more of the total voting power of all
shares of capital stock of the Company entitled to vote generally in the elections of directors,
other than any such acquisition by either (i) the Company or (ii) any subsidiary or any employee
benefit plan of the Company, and during any period of two consecutive years, individuals who at the
beginning of such period constituted the board of directors (together with any new directors whose
election to the board of directors, or whose nomination for election by the stockholders of the
Company, was approved by a vote of a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for election was
previously approved) cease for any reason to constitute a majority of the board of directors then
in office; or

(b) the acquisition by any person of beneficial ownership, directly or indirectly, through a
purchase, merger or other acquisition transaction or series of transactions, of shares of capital
stock of the Company entitling such person to exercise 50% or more of the total voting power of all
shares of capital stock of the Company entitled to vote generally in the elections of directors,
other than any such acquisition by either (i) the Company or (ii) any subsidiary or any employee
benefit plan of the Company; or

(c) any consolidation of the Company with, or merger of the Company into, any other person,
any merger of another person into the Company, or any conveyance, sale, transfer or lease or
disposal of all or substantially all of the assets of the Company to another person (other than (i)
any such transaction (A) involving a merger or consolidation that does not result in any
reclassification, conversion, exchange or cancellation of outstanding shares of capital stock of
the Company (other than any reclassification, conversion, exchange or cancellation of outstanding
shares of capital stock of the Company solely for shares of publicly traded common stock listed on
the American Stock Exchange or on an established national securities exchange or automated
over-the-counter trading market in the United States) and (B) pursuant to which the holders of 50%
or more of the total voting power of all shares of the Company’s capital stock entitled to vote
generally in the election of directors immediately prior to such transaction have the entitlement
to exercise, directly or indirectly, more than 50% of the total voting power of all shares of
capital stock entitled to vote generally in the election of directors of the continuing or
surviving corporation immediately after such transaction or (ii) any transaction which is effected
solely to change the jurisdiction of incorporation of the Company and results in a
reclassification, conversion or exchange of outstanding shares of common stock into solely shares
of common stock).

For purposes of this Section 3, whether a person is a “beneficial owner” will be determined in
accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), and “person” includes any syndicate or group that would be deemed to be a person under
Section 13(d)(3) of the Exchange Act.

4. The Company’s Covenants. In order to induce the Executive to remain in the employ
of the Company and in consideration of the Executive’s covenants set forth in Sections 5, 16 and 18
of this Agreement, the Company agrees, under the conditions described herein, to pay the Executive
the Severance Payment (as defined in Section 6 below) and the other payments and benefits described
herein. This Agreement shall not be construed as creating an express or implied contract of
employment, and except as otherwise agreed in writing between the Executive and the Company, the
Executive shall not have any right to be retained in the employ of the Company.

5. The Executive’s Covenants. The Executive agrees that, subject to the terms and
conditions of this Agreement, in the event of a Change in Control while the Executive is employed
by the Company, the Executive will remain in the employ of the Company until the earliest of (a)
the date which is 6 months following the date of a Change in Control, (b) the date of termination
by the Executive of the Executive’s employment for Good Reason, or (c) the termination by the
Company of the Executive’s employment either with or without Cause, or due to Executive’s death or
Disability.

6. Severance Payment.

(a) If, at any time during the 6 month period prior to a Change in Control, the Company shall
terminate the Executive’s employment without Cause, the Executive’s employment shall terminate due
to his death or Disability, or the Executive shall terminate his employment for Good Reason, then
the Company shall be obligated to pay the Executive in a lump sum in cash on the next business day
following the Change in Control an amount (subject to all withholding and applicable deductions)
equal to 2 times the sum of (i) the highest of (A) the Executive’s then current base salary on an
annualized basis as in effect immediately prior to the Change in Control or (B) the Executive’s
highest annualized base salary (with the Company or any of its subsidiaries) in effect during the 1
year period before such Change in Control and (ii) the actual bonus paid to the Executive by the
Company or any of its subsidiaries for the most recent fiscal year ended prior to the occurrence of
the Change in Control (the “Severance Payment”); provided, however, that the amount of the
Severance Payment shall be subject to being delayed and/or reduced in accordance with either
Section 7 or Section 8 below.

(b) If on or after the Change in Control and prior to the 12 month anniversary of the Change
in Control either the Company shall terminate the Executive’s employment without Cause, the
Executive’s employment shall terminate due to his death or Disability, or the Executive shall
terminate his employment for Good Reason, the Severance Payment (calculated as described in
subsection (a) above) shall be due and payable by the Company as of the effective date of the
termination of the Executive’s employment with the Company and shall be subject to being delayed
and/or reduced in accordance with either Section 7 or Section 8 below.

(c) Notwithstanding any other term or provision of this Agreement to the contrary, no
Severance Payment shall become due and payable by the Company to the Executive under the terms of
this Agreement if at the effective time of any Change in Control the Company is then in default of
any of its payment obligations under the terms of its Principal Obligations or if any dissolution,
assignment for the benefit of creditors or reorganization under any chapter of Title 11 of the
United States Code shall have caused a Change in Control of the Company.

7. Reduction of Payments by the Company.

(a) Anything in this Agreement to the contrary notwithstanding, in the event it shall be
determined that any payment or distribution by the Company to or for the benefit of the Executive
(whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or
otherwise) (a “Payment”) would be nondeductible by the Company for Federal income tax purposes
because of Section 280G of the Code, then the Severance Payment shall be reduced in such a manner
that its aggregate Present Value shall be equal to the Reduced Amount. The “Reduced Amount” shall
mean an amount expressed in Present Value that maximizes the aggregate present value of the
Severance Payment without causing any Payment to be nondeductible by the Company because of Section
280G of the Code. Prior to any reduction pursuant to this Section 7(a), the total amount of
Payments shall be deemed, for purposes of calculating the Payment, to be reduced by the value of
the non-competition, non-solicitation and consulting obligations set forth in Section 18 of this
Agreement, which value will be determined by a reputable valuation expert selected by the Company
and reasonably acceptable to the Executive.

(b) All determinations required to be made under this Section 7 shall be made by an
independent accounting firm selected by the Company (the “Accounting Firm”) and the Accounting Firm
shall provide detailed supporting calculations both to the Company and the Executive within 15
business days of the payment date or such earlier time as is requested by the Company. Any such
determination by the Accounting Firm shall be binding upon the Company and the Executive. The
Executive shall determine which and how much of the Severance Payment shall be eliminated or
reduced consistent with the requirements of this Section 7, though such eliminated or reduced
amount shall be, at a minimum, an amount that reduces the Severance Payment to the Reduced Amount;
provided, that, if the Executive does not make such determination within 10 business days of the
receipt of the calculations made by the Accounting Firm, the Company shall elect which and how much
of the Severance Payment shall be eliminated or reduced consistent with the requirements of this
Section 7 and shall notify the Executive promptly of such election. Within 5 business days
thereafter (but in no event later than March 15 of the calendar year following the calendar year in
which the applicable payment date specified in Section 6 hereof on which the Severance Payment
would otherwise be paid occurs), the Company shall pay or distribute to or for the benefit of the
Executive such amounts as are then due to the Executive under this Agreement.

(c) As a result of the uncertainty in the application of Section 280G of the Code at the time
of the initial determination by the Accounting Firm hereunder, it is possible that the Severance
Payment will have been made by the Company which should not have been made (an “Overpayment”) or
that an amount of the Severance Payment which will not have been made by the Company could have
been made (an “Underpayment”), in each case, consistent with the calculations required to be made
hereunder. In the event that the Accounting Firm, based upon the assertion of a deficiency by the
Internal Revenue Service against the Executive that the Accounting Firm believes has a high
probability of success determines an Overpayment has been made, any such Overpayment paid or
distributed by the Company to or for the benefit of the Executive shall be repaid by the Executive
to the Company together with interest at the applicable Federal rate provided in Section 7872(f)(2)
of the Code; provided, however, that no amount shall be payable by the Executive to the Company if
and to the extent such deemed payment would not either reduce the amount on which the Executive is
subject to tax under Section 1 and Section 4999 of the Code or generate a refund of such taxes. In
the event that the Accounting Firm, based upon controlling precedent or other substantial
authority, determines that an Underpayment has occurred, any such Underpayment shall be promptly
paid by the Company to or for the benefit of the Executive together with interest at the applicable
Federal rate provided in Section 7872(f)(2) of the Code; provided, that any such Underpayment shall
constitute a payment (within the meaning of Treas. Reg. § 1.409A-2(b)(2)) separate and apart from
the Severance Payment; and provided, further that any such Underpayment shall be deemed a disputed
payment (within the meaning of Treas. Reg. § 1.409A-3(g)) and shall be made no later than the end
of the first taxable year of the Company in which the Accounting Firm determines pursuant to this
Section 7(c) that such Underpayment is due.

8. Compliance with Section 409A of the Code. To the extent applicable, it is intended
that this Agreement comply with the provisions of Section 409A of the Code. This Agreement shall
be administered in a manner consistent with this intent, and any provision that would cause this
Agreement to fail to satisfy Section 409A of the Code shall have no force and effect until amended
to comply with Section 409A of the Code (which amendment may be retroactive to the extent permitted
by Section 409A of the Code and may be made by the Company without the consent of the Executive).

9. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit the
Executive’s continuing or future participation in any benefit, bonus, incentive or other plans,
programs, policies or practices provided by the Company or any of its subsidiaries and for which
the Executive may qualify, nor shall anything herein limit or otherwise affect such rights the
Executive may have under any stock option or other agreements with the Company or any of its
subsidiaries. Amounts that are vested benefits or that the Executive is otherwise entitled to
receive under any plan, policy, practice or program of the Company or any of its subsidiaries at or
subsequent to the termination of Executive’s employment shall be payable in accordance with such
plan, policy, practice or program.

10. Successor to the Company.

(a) The Company will require any successor or assign (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of the business and/or assets of
the Company, by agreement in form and substance satisfactory to the Executive, expressly,
absolutely and unconditionally to assume and agree to perform this Agreement in the same manner and
to the same extent that the Company would be required to perform it if no such succession or
assignment had taken place. Any failure of the Company to obtain such agreement prior to the
effectiveness of any such succession or assignment shall be a material breach of this Agreement. As
used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor
or assign to its business and/or assets as aforesaid which executes and delivers the agreement
provided for in this Section 10 or which otherwise becomes bound by all the terms and provisions of
this Agreement by operation of law. If at any time during the term of this Agreement the Executive
is employed by any corporation a majority of the voting securities of which is then owned by the
Company, “Company” as used in Section 1, 2, 3, 4, 5, 6, 7, 8, 16 and 18 hereof shall in addition
include such employer. In such event, the Company agrees that it shall pay or shall cause such
employer to pay any amounts owed to the Executive pursuant to Section 6 hereof.

(b) This Agreement shall inure to the benefit of and be enforceable by the Executive, and the
Executive’s personal and legal representatives, executors, administrators, successors, heirs,
distributees, devisees, and legatees. If the Executive should die while any amounts are still
payable to him or her hereunder, all such amounts, unless otherwise provided herein, shall be paid
in accordance with the terms of this Agreement to the Executive’s devisee, legatee, or other
designee or, if there be no such designee, to the Executive’s estate.

11. Notice. For purposes of this Agreement, notices and all other communications
provided for in this Agreement shall be in writing and shall be deemed to have been duly given when
delivered or mailed by United States registered mail, return receipt requested, postage prepaid, to
the party entitled to receive such notice at the address shown on the signature page hereof, or to
such other address as either party may have furnished to the other in writing in accordance
herewith, except that notices of change of address shall be effective only upon receipt.

12. Miscellaneous. No provisions of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in writing signed by the
Executive and the Company. No waiver by either party hereto at any time of any breach by the other
party hereto of, or compliance with, any condition or provision of this Agreement to be performed
by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No agreements or representations, oral or otherwise,
express or implied, with respect to the subject matter hereof have been made by either party which
are not set forth expressly in this Agreement. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas, without regard to the choice of law provisions,
statutes, regulations or principles of this or any other jurisdiction.

13. Validity. The invalidity or unenforceability of any provisions of this Agreement
shall not affect the validity or enforceability of any other provision of this Agreement, which
shall remain in full force and effect.

14. Counterparts. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original but all of which together will constitute one and the same
instrument.

15. Legal Fees and Expenses. The Company shall be obligated to pay all legal fees and
expenses that the Executive may incur as a result of the Company contesting the validity,
enforceability, or the Executive’s interpretation of, or determinations under, this Agreement.

16. Confidentiality. As an employee of the Company, the Executive shall have access
to the Company’s confidential information and the Company shall be unconditionally obligated to,
and hereby agrees to, provide Executive with access to new and additional elements of the Company’s
confidential information so long as Executive is employed by the Company. The Executive shall
retain in confidence any and all confidential information known to the Executive concerning the
Company and its businesses so long as such information is not otherwise publicly disclosed.

17. Entire Agreement. This Agreement constitutes the entire agreement between the
parties hereto relating to the matters encompassed hereby and supersedes any prior oral or written
agreements relating thereto.

18. Noncompete. If the Executive receives the Severance Payment from the Company, the
Executive agrees that for a period of 1 year immediately following the termination of the
Executive’s employment with the Company for any reason (either by the Company or the Executive)
Executive shall not, without the prior written consent of the Company, directly or indirectly by
assisting others, engage in, solicit on behalf of, render any services to, guarantee any
obligations of, extend credit to, or have any ownership interest or other affiliation in, any
business or other endeavor that Competes with the Company in the United States. Notwithstanding
anything herein to the contrary, nothing in this Agreement shall prevent or prohibit Executive from
owning not more than 5% of a class of equity securities issued by any Person listed on any national
securities exchange or interdealer quotation system.

[Remainder of page intentionally left blank.]

1

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

	 	 	 	 	 	 	 
	Sport Supply Group, Inc.
	 	Executive:
	By: /s/: Adam Blumenfeld
	 	/s/: John Pitts
	 
	 	 
	
 
	 	Adam Blumenfeld,

Chief Executive Officer
	 	John Pitts

	 	

	Address:

	 	1901 Diplomat Drive

Dallas, TX 75234
	 	Address:
	 	2900 Ramblewood Way

Plano, TX 75023

Dallas 1403067v.7

2

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