Separation Agreement

SEPARATION AGREEMENT AND GENERAL RELEASE
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Mr. Rick Gordon February ____, 2006 c/o All American Semiconductor, Inc. 16115 N.W. 52nd Avenue Miami, Florida 33014


Dear Rick:


This letter is being sent at your request on behalf of All American Semiconductor, Inc. (the "Company") and is concerning the terms of your separation from employment with the Company. In order to avoid any questions or disputes as to the interpretation of any of the provisions of the Employment Agreement, made and entered into on April 27, 2000, between you and the Company (the "Employment Agreement") and in order to avoid any dispute as to whether or not any compensation or severance obligations exist, and, if so, how much, we have each agreed that the Company will pay the compensation and/or severance obligations as set forth in this Separation Agreement and General Release (this "Agreement") and nothing more. Any terms not defined in this Agreement that are defined in the Employment Agreement will have the meanings ascribed to them in the Employment Agreement.


1. Your employment with the Company and/or any of its affiliates terminated effective February 28, 2006.


2. In consideration of your acceptance of and agreement with this Agreement and in full and complete satisfaction, payment and provision of any and all salary, base salary, Cash Bonus, payments, wages, overtime, reimbursements, paid time off, used or unused vacation time, deferred compensation, insurance, programs, pensions, plans, benefits, and other remuneration and/or compensation of any kind whatsoever through the last date of your employment and for all periods thereafter, and all amounts due or to become due you under the Employment Agreement or otherwise, you and the Company, on behalf of itself and all of the "Released Parties" as defined below, agree that following (collectively the "Severance") will apply and nothing else:


(a) The Company will pay you, as "base salary" of $ 216,300 for the period from March 1, 2006 to February 28, 2007 and $ 227,115 for the period from March 1, 2007 to February 29, 2008. The "base salary" shall be payable on the same basis as the Company, from time to time, generally pays its employees, and the provisions of Section 5(b) of the Employment Agreement concerning any new employment shall continue to apply. You agree to advise the Company of any compensation you earn other than the Severance with respect to the period of March 1, 2006 through February 29, 2008 to be set off against any of the Severance the Company has agreed to pay.


(b) You will continue to be entitled to receive the "Cash Bonus" if any is earned, as described in Section 3(a) of the Employment Agreement for the calendar year 2006 and the calendar year 2007 in the amounts, with the limits and as and when provided in Section 3(a) of the Employment Agreement. You will not be entitled to any bonus attributable to any period after December 31, 2007.


(c) Through February 29, 2008, you will be entitled to participate in the medical insurance program offered by the Company from time to time to all employees on the same terms and conditions as offered to all other employees from time to time, on the basis set forth below and subject to the provisions in this paragraph that follow. Your contribution level through August 31, 2006 shall be the same as was in effect for February 2006. Beginning September 1, 2006, you will be entitled to medical insurance as and to the extent required under the Consolidated Omnibus Budget Reconciliation Act of 1986 ("COBRA"). If you are eligible for COBRA and do elect the coverage available under COBRA, then the Company will, through the end of February 2008, reimburse you monthly in an amount equal to the difference between the monthly amount you were contributing to the Company's medical insurance program before you started COBRA and the amount you are required to pay under COBRA


(d) You have indicated that the Lexus that you are currently using is leased by both you and the Company. You have also indicated that, as of February 6, 2006, there were twenty seven (27) monthly payments remaining on the lease for this automobile. The Company agrees to make the twenty seven (27) monthly payments that you say are remaining. To the extent allowed by the Company's insurance carrier(s) the Company will continue the automobile insurance that it currently has on such vehicle except that such insurance will only cover you as the driver of this vehicle and will not cover you as a driver of any other vehicle. If the Company's current or future insurance carrier(s) refuse(s) this coverage, than the Company shall have no obligation in this regard and you shall obtain all insurance coverages reasonably requested by the Company for which you will be reimbursed by the Company. You agree that you will be the primary driver of this vehicle and that you will not permit anyone else to drive the vehicle except your wife in limited circumstances. You will provide us with proof of insurance that confirms that you have all insurances reasonably requested by the Company and all insurances required to comply with your umbrella coverage which umbrella should provide coverage of no less that $1 million. You will be responsible for obtaining your own automobile insurance on all other vehicles. In the event that you elect at any time to buy out the lease on this Lexus or in any other way have the Company released from responsibility under the current lease on ...