EMPLOYMENT AGREEMENT

Exhibit 10.3

EMPLOYMENT AGREEMENT

           THIS EMPLOYMENT AGREEMENT (the “ Agreement ”) is made as of the 1 ^st day of June, 2009, by and among UNIVERSAL POWER GROUP, INC ., a Texas corporation (the “ Company ”), having its principal place of business at 1720 Hayden Drive, Carrollton, Texas 75006, on the one hand, and IAN EDMONDS , residing at ___________________ (the “ Executive ”), on the other.

WITNESSETH

          WHEREAS , the Executive has been employed by the Company in an executive capacity since _______; and

           WHEREAS , the Company, recognizing the unique skills and abilities of the Executive, wishes to insure that the Executive will continue to be employed by the Company; and

           WHEREAS , the Executive desires to continue in the employment of the Company; and

           WHEREAS , the parties desire, by this Agreement, to set forth the terms and conditions of the employment relationship between the Company and the Executive.

          NOW, THEREFORE , in consideration of the foregoing and the mutual covenants in this Agreement, the Company and the Executive agree as follows:

          1. Employment and Duties .

                     (a) The Company hereby employs the Executive as its Chief Executive Officer and President on the terms and conditions provided in this Agreement and Executive agrees to accept such employment subject to the terms and conditions of this Agreement. The Executive shall be the senior executive officer of the Company and, as such, shall be responsible for the overall management and operations of the Company, shall perform the duties and responsibilities as are customary for the officer of a corporation in such positions, and shall perform such other duties and responsibilities as are reasonably determined from time to time by the Company’s Board of Directors (the “ Board ”).

                     (b) The Executive shall report to and be supervised by the Board.

                    (c) The Executive shall be based at the Company’s principal place of business provided that such principal place of business shall be within a fifty (50) mile radius of 1720 Hayden Drive, Carrollton, Texas and, except for business travel incident to his employment under this Agreement, the Company agrees the Executive shall not be required to relocate.

                    (d) The Executive agrees to devote substantially all his attention and time during normal business hours to the business and affairs of the Company and to use his reasonable best efforts to perform faithfully and efficiently the duties and responsibilities of his positions and to accomplish the goals and objectives of the Company as may be established by the Board. Notwithstanding the foregoing, the Executive may engage in the following activities (and shall be entitled to retain all economic benefits thereof including fees paid in connection therewith) as long as they do not interfere in any material respect with the performance of the Executive’s duties and responsibilities hereunder and, with respect to subsections (i) and (ii) below, that such activity is pre-approved by the Chairman of the Board: (i) serve on corporate, civic, religious, educational and/or charitable boards or committees, provided that the Executive shall not serve on any board or committee of any corporation or other business which competes with the Business (as defined in Section 10(a) below); and (ii) make investments in businesses or enterprises and manage his personal investments; provided that with respect to such activities Executive shall comply with any business conduct and ethics policy applicable to employees of the Company.

           2. Term . The term of this Agreement shall commence on June 1, 2009 (the “ Commencement Date ”), and shall terminate on May 31, 2014, unless extended or earlier terminated in accordance with the terms of this Agreement. Commencing on June 1, 2010 and continuing on June 1 of each year thereafter (each such date an “ Anniversary Date ”), this Agreement shall automatically renew for one additional year such that the remaining term shall be five years unless either party notifies the other in writing at least 180 days prior to the Anniversary Date that it is electing not to renew the Agreement, in which case the Agreement shall terminate at the end of the fourth year following the next Anniversary Date. The date on which this Agreement terminates, would terminate or is terminated by either party is herein referred to as the “ Termination Date ”. The period beginning on the Commencement Date and ending on the Termination Date is herein sometimes referred to as the “ Employment Term ”.

          3. Compensation . As compensation for performing the services required by this Agreement, and during the term of this Agreement, the Executive shall be compensated as follows:

                     (a) Base Compensation . The Company shall pay to the Executive an annual salary (“ Base Compensation ”) of $250,000, payable in equal installments pursuant to the Company’s customary payroll procedures in effect for its executive personnel at the time of payment, but in no

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event less frequently than monthly, subject to withholding for applicable federal, state, and local income and employment related taxes. The Executive may be entitled to such increases in Base Compensation with respect to each calendar year during the term of this Agreement, as shall be determined by the Company’s Compensation Committee (the “ Committee ”), in its sole and absolute discretion, based on an annual review of the Executive’s performance.

                    (b) Incentive Compensation . In addition to Base Compensation, for each calendar year ending within the Employment Term, the Executive shall be entitled to receive additional compensation (“ Incentive Compensation ”) in an amount equal to 7.5% of the Company’s “ Adjusted Pre-Tax Income ” (as defined below) for such year, provided such Adjusted Pre-Tax Income shall exceed the Target Amount established by the Committee for such calendar year. The Committee shall use its reasonable best efforts to establish the Target Amount on or before March 31 of such year. In the event the Company exercises its right not to renew this Agreement, as provided in Section 2, in addition to any amounts to which he would be entitled under Section 8(g), the Executive shall be entitled to receive his Pro Rata Share (as defined in subsection 8(a)(ii)) of Incentive Compensation for the year in which the Termination Date occurs.

          Adjusted Pre-Tax Income means the Company’s Net Income Before Provision for Income Taxes for such calendar year as set forth on the Company’s audited Statement of Income for such calendar year adjusted as follows:

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          4. Employee Benefits . During the Employment Term and subject to the limitations set forth in this Section 4, the Executive and his eligible dependents shall have the right to participate in any retirement plans (qualified and non-qualified), pension, insurance, health, disability or other benefit plan or program that has been or is hereafter adopted by the Company (or in which the Company participates), according to the terms of such plan or program, on terms no less favorable than the most favorable terms granted to senior executives of the Company.

           5. Vacation and Leaves of Absence . The Executive shall be entitled to the normal and customary amount of paid vacation provided to senior executive officers of the Company, but in no event less than twenty-five (25) days during each twelve (12) month period, beginning on the Commencement Date of this Agreement. Any vacation days that are not taken in a given twelve (12) month period shall not accrue or carry-over from year to year. Upon any termination of this Agreement for any reason whatsoever, accrued and unused vacation for the year in which this Agreement terminates will be paid to the Executive within ten (10) days of such termination based on his annual rate of Base Compensation in effect on the date of such termination. In addition, the Executive may be granted leaves of absence with or without pay for such valid and legitimate reasons as the Company in its sole and absolute discretion may determine, and the Executive shall be entitled to the same sick leave and holidays provided to other senior executives of the Company.

           6. Expenses .

                    (a) Business Expenses . The Executive shall be promptly reimbursed against presentation of vouchers or receipts for all reasonable and necessary expenses incurred by him in connection with the performance of his duties hereunder.

                    (b) Automobile Expense . During the Employment Term, in order to facilitate the performance of the Executive’s duties hereunder, and otherwise for the convenience of the Company, the Company shall provide the Executive with a Mercedes-Benz S550 4 Door Sedan or such other comparable automobile, or shall reimburse the Executive for the cost of leasing an automobile (provided that the lease payments with respect to such automobile shall not exceed $2,500 per month

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or such greater amount as shall be approved by the Board in advance) and shall pay or reimburse Executive (upon presentation of vouchers or receipts) for the reasonable cost of all maintenance, insurance, repairs, and other reasonable expenses related to such automobile.

          7. Indemnification .

                    (a) General . The Company agrees that if the Executive is made a party or is threatened to be made a party to any action, suit or proceeding, whether civil, criminal, administrative or investigative (a “ Proceeding ”), by reason of the fact that he is or was a director or officer of the Company, is or was serving at the request of the Company as a director, officer, member, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including, without limitation, service with respect to employee benefit plans, whether or not the basis of such Proceeding is alleged action in an official capacity as a director, officer, member, employee or agent while serving as a director, officer, member, employee or agent, the Executive shall be indemnified and held harmless by the Company to the fullest extent authorized by applicable law (in accordance with the certificate of incorporation and/or bylaws of the Company), as the same exists or may hereafter be amended, against all Expenses (as defined below) incurred or suffered by the Executive in connection therewith, and such indemnification shall continue as to the Executive even if the Executive has ceased to be an officer, director or agent, or is no longer employed by the Company and shall inure to the benefit of his heirs, executors and administrators.

                    (b) Expenses . As used in this Agreement, the term “ Expenses ” shall include, without limitation, damages, losses, judgments, liabilities, fines, penalties, excise taxes, settlements and costs, attorneys’ fees, accountants’ fees, and disbursements and costs of attachment or similar bonds, investigations, and any expenses of establishing a right to indemnification under this Agreement.

                     (c) Enforcement . If a claim or request under this Agreement is not paid by the Company, or on their behalf, within fifteen days after a written claim or request has been received by the Company, the Executive may at any time thereafter bring suit against the Company to recover the unpaid amount of the claim or request and if successful in whole or in part, the Executive shall be entitled to be paid also the expenses of prosecuting such suit. The burden of proving that the Executive is not entitled to indemnification for any reason shall be upon the Company.

                     (d) Subrogation . In the event of payment under this Agreement, the Company

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shall be subrogated to the extent of such payment to all of the rights of recovery of the Executive.

                     (e) Partial Indemnification . If the Executive is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of any Expenses, but not, however, for the total amount thereof, the Company shall nevertheless indemnify the Executive for the portion of such Expenses to which the Executive is entitled.

                    (f) Advances of Expenses . Expenses incurred by the Executive in connection with any Proceeding shall be paid by the Company in advance upon request of the Executive that the Company pay such Expenses.

                     (g) Notice of Claim . The Executive shall give to the Company notice of any claim made against his for which indemnity will or could be sought under this Agreement. In addition, the Executive shall give the Company such information and cooperation as it may reasonably require and as shall be within the Executive’s power and at such times and places as are convenient for the Executive.

                     (h) Defense of Claim . With respect to any Proceeding as to which the Executive notifies the Company of the commencement thereof: (i) the Company will be entitled to participate therein at its own expense; and (ii) except as otherwise provided below, to the extent that it may wish, the Company jointly with any other indemnifying party similarly notified will be entitled to assume the defense thereof, with counsel reasonably satisfactory to the Executive. The Company shall not be entitled to assume the defense of any action, suit or proceeding brought by or on behalf of the Company or as to which the Executive shall have reasonably concluded that there may be a conflict of interest between the Company and the Executive in the conduct of the defense of such action.

                              The Company shall not be liable to indemnify the Executive under this Agreement for any amounts paid in settlement of any action or claim effected without its written consent. The Company shall not settle any action or claim in any manner which would impose any penalty or limitation on the Executive without Executive’s written consent. Neither the Company nor the Executive shall unreasonably withhold or delay their consent to any proposed settlement.

                     (i) Non-exclusivity . The right to indemnification and the payment of expenses incurred in defending a Proceeding in advance of its final disposition conferred in this Section 7 shall not be exclusive of any other right which the Executive may have or hereafter may acquire under any

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statute, provision of the certificate of incorporation, by laws, or other governing documents of the Company, agreement, vote of stockholders, members or disinterested directors or otherwise.

                     (j) Directors and Officers Liability Policy . The Company agrees to use reasonable efforts to maintain directors and officers liability insurance covering the Executive in a reasonable and adequate amount determined by the Company.

          8. Termination and Termination Benefits .

                     (a) Termination . (i) For Cause . Notwithstanding any provision contained herein, the Company may terminate this Agreement at any time during the Employment Term for “Cause” (as defined below). Termination pursuant to this subsection 8(a)(i) shall be effective immediately upon giving the Executive written notice thereof stating the reason or reasons therefor with respect to clause (2) above, and thirty (30) days after written notice thereof from the Company to the Executive specifying the acts or omissions constituting the failure and requesting that they be remedied with respect to clause (1) above, but only if the Executive has not cured such failure within such thirty (30) day period.

                               (ii) Death and Disability . Notwithstanding any other provision of this Agreement, this Agreement shall terminate on the date of the Executive’s death. If due to illness, physical or mental disability, or other incapacity, the Executive shall fail, for a total of any six (6) consecutive months (“ Disability ”), to substantially perform the principal duties required by this Agreement, the Company may terminate this Agreement upon thirty (30) days’ written notice to the Executive.

                               (iii) Without Cause . The Company may terminate the Executive’s employment hereunder without Cause at any time.

                               (iv) Good Reason . The Executive may terminate his employment hereunder for “ Good Reason ”.

                     (b) Termination Benefits.

                               (i) Termination For Cause . In the event of a termination pursuant to Section 8(a)(i) above, the Executive shall be entitled to payment of his Base Compensation and the benefits pursuant to Section 4 hereof up to the effective date of such termination and it is also the intention and agreement of the Company that Executive shall not be deprived by reason of

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termination for Cause of any payments, options or benefits which have been vested or have been earned or to which Executive is entitled as of the effective date of such termination.

                    (ii) Termination Without Cause, Upon Death, For Disability or For Good Reason. If the Company terminates the Executive’s employment hereunder without Cause or as a result of Disability, or if this Agreement is terminated by reason of the Executive’s death, or if the Executive terminates his employment for Good Reason, the Executive (or his estate, in the case of death) shall be paid: (i) his Base Compensation at the rate in effect at the time of termination through the Termination Date; (ii) his Pro Rata Share of any Incentive Compensation to which he would have been entitled for the year in which such termination occurs; (iii) a lump sum payment equal to the product of twenty-four (24) times the Monthly Salary Amount (as defined below); (iv) any deferred compensation (including, without limitation, interest or other credits on the deferred amounts) and any accrued vacation pay; (v) continuation for a period of twelve months after such termination, of the health and welfare benefits of the Executive and any long-term disability insurance generally provided to senior executives of the Company (as provided for by Section 4 of this Agreement) (or the Company shall provide the economic equivalent thereof); provided, however, if the Executive obtains new employment and such employment makes the Executive eligible for health and welfare or long-term disability benefits which are equal to or greater in scope then the benefits then being offered by the Company, then the Company shall no longer be required to provide such benefits to the Executive; and (vi) any other compensation and benefits as may be provided in accordance with the terms and provisions of any applicable plans or programs of the Company.

                     (c) 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 plan or program provided or maintained by the Company and for which the Executive may qualify, nor shall anything herein limit or otherwise prejudice such rights as the Executive may have under any other existing or future agreements with the Company. Except as otherwise expressly provided for in this Agreement, amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plans or programs of the Company at or subsequent to the date of termination shall be payable in accordance with such plans or programs.

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                    (d) Vesting of Stock Grants and Stock Options . In the event of any termination of this Agreement, Executive’s rights with regard to any stock grants, loan agreements or stock options shall be as set forth in the respective agreement containing the terms and conditions pertaining thereto. Notwithstanding the foregoing, in the event that the Executive is terminated for reasons other than