DANKA BUSINESS SYSTEMS PLC
DAVID BERG EMPLOYMENT CONTRACT
<DOCUMENT>
<TYPE>EX-10.40
<SEQUENCE>6
<FILENAME>dex1040.txt
<DESCRIPTION>DAVID BERG EMPLOYMENT CONTRACT
<TEXT>
<PAGE>

                                                                   Exhibit 10.40

                              EMPLOYMENT AGREEMENT

         This Employment Agreement (the "Employment Agreement") is made and
entered into as of the 26th day of July 2001, by and among Danka Office Imaging
Company ("Danka Office Imaging"), Danka Business Systems PLC ("Danka Business
Systems"), Danka Holding Company ("Danka Holding"), and David P. Berg, an
individual ("Executive"). Danka Office Imaging, Danka Business Systems, and
Danka Holding are collectively referred to herein as the "Company."

                                   WITNESSETH:

     WHEREAS, the Company wishes to assure itself of the services of Executive,
on the terms and conditions set forth herein; and Executive desires to be so
employed by the Company on said terms.

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

1.   EMPLOYMENT. The Company hereby employs Executive, and Executive hereby
     ----------
accepts employment with the Company, all upon the terms and subject to the
conditions set forth in this Employment Agreement.

2.   CAPACITY AND DUTIES. Executive shall be employed in the capacity of
     -------------------
Corporate Executive Vice President/President Americas Group Division reporting
to the Chief Executive Officer of the Company. Executive shall direct and
oversee the management and operations of the Latin America, Canada and
Australian Business Units.

3.   EMPLOYMENT TERM.
     ---------------

     (a)  Term. Employment of Executive by the Company pursuant to this
          -----
     Employment Agreement shall begin on August 6, 2001, and continue until
     terminated by either party as provided herein. The period during which
     Executive is employed by the Company pursuant to this Employment Agreement
     is referred to herein as the "Term" of this Employment Agreement.

4.   PLACE OF EMPLOYMENT. Executive's principal place of work shall be located
     -------------------
in the St. Petersburg, Florida metropolitan area.

5.   COMPENSATION.
     ------------

     (a)  Salary. Beginning on August 6, 2001 and continuing during the Term,
          ------
     the Company shall pay Executive a base salary at the rate of $250,000.00
     per annum (the "Annual Base Salary"), payable in a manner consistent with
     the Company's payroll procedures for U.S. salaried employees. The Human
     Resources Committee of the Board (the "H.R. Committee") shall review
     Executive's Annual Base Salary at least annually and may increase, but not
     decrease, the Annual Base Salary.

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         Performance Bonuses. In addition to the Annual Base Salary, Executive
         -------------------
         shall be entitled to receive an annual bonus under the performance
         bonus plan (the "Performance Bonus Plan") approved by the H.R.
         Committee, beginning in the Company's Fiscal Year 2002, which begins
         April 1, 2001. Upon the Company's achievement of one hundred percent
         (100%) of the budgeted target levels of the Performance Bonus Plan, the
         Company shall pay Executive a bonus equal to $167,000.00. Executive
         shall be entitled to bonus consideration under the Performance Bonus
         Plan for the Company's second fiscal quarter (ending September 30,
         2001), and thereafter in accordance with such plan. If the Company
         meets certain stretch objectives defined and set forth in the
         Performance Bonus Plan (as determined by the H.R. Committee), the
         Company will pay Executive additional bonuses in accordance with such
         Plan. The Company shall pay any bonus earned by Executive in a lump sum
         cash payment, less applicable withholdings, as promptly after the end
         of the relevant accounting period as the H.R. Committee is able to
         certify the Company's achievement of the relevant financial goals,
         subject to any deferral election made by Executive under the terms of
         the Company's deferred compensation plan for U.S. executives.

         (b) Initial Bonus. Executive shall receive a bonus of $50,000.00 within
             -------------
         ten business (10) days of execution of this Agreement ("Initial
         Bonus"). If, within twelve (12) months of execution of this Employment
         Agreement, Executive voluntarily resigns, or is terminated for cause,
         as defined herein, Executive shall reimburse Company an amount equal to
         the pro rata portion of the Initial Bonus actually paid hereunder.
         (e.g. If Executive resigns 6 months from the date of execution of this
         Employment Agreement, Executive shall pay Company 50% of Initial Bonus
         received under this Section).

6.   ADDITIONAL COMPENSATION AND BENEFITS. During the Term, the Company shall
     ------------------------------------
pay to or provide Executive with the following additional compensation and
benefits:

     (a)  Stock Options.
          -------------

          (i)  Executive shall be eligible to participate in the Company's stock
          option plans available to the Company's employees in accordance with
          the terms and conditions of such plans.

          (ii) Executive shall receive from the Company a registered stock
          option grant in the amount of 200,000 American Depository Shares
          ("ADSs") representing ordinary shares of Danka Business Systems PLC.
          Vesting of 150,000 of such options will be in accordance with the
          Company Stock Option Plan (1/3 per year for 3 years). Executive shall
          be entitled to immediate vesting of 25,000 options upon achievement of
          100% of the FY2002 goals for Executive's business units and immediate
          vesting of 25,000 options for achievement of 125% of FY2002 goals for
          Executive's business units. In the event the above goals are not met,
          these 50,000 options shall become vested on the fifth anniversary of
          the date such options are granted. The Company shall file a
          registration statement on Form S-8 with the Securities Exchange
          Commission such that all of the ADSs subject to the

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<PAGE>

          option grant shall be registered shares upon the exercise of the
          option. The exercise price of the options set on the date such grant
          is approved by the H.R. Committee.

          (iii) If Executive seeks to acquire by exercise of any stock option
          all or part of the shares that have become exercisable and the Company
          declines to allow him to acquire such shares, whether because the
          Company has not obtained shareholder approval for the option or
          otherwise, the Company shall pay Executive, within ten (10) days after
          his attempt to acquire such shares, (1) an amount equal to the
          difference between the number of shares Executive sought to acquire
          multiplied by the closing price for a share of the Company's common
          stock as of the date Executive sought to acquire such shares, on the
          one hand, and the option exercise price per share multiplied by the
          number of shares Executive sought to acquire, on the other hand, and
          (2) an additional payment sufficient to pay any federal, state, and
          local income tax and social security, or other employment tax on the
          amount paid under Section 6(a)(iii)(1), as well as any additional
          federal, state and local income tax and social security or other
          employment tax on any such gross-up payment, determined by using the
          top marginal rates of federal, state, and local income taxes and
          social security, or other employment taxes applicable to the
          Executive's taxable income in effect during the year of payment.

     (b)  Executive Deferred Compensation Plan. Executive shall be eligible to
          ------------------------------------
     participate in the Company's Executive deferred compensation plan in
     accordance with its terms and conditions.

     (c)  Insurance. The Company shall provide Executive and his dependents with
          ---------
     reasonable and adequate health, dental, short term disability, long term
     disability, and life insurance. Such insurance coverage shall be no less
     favorable than that from time to time made available to other senior
     executives of the Company located in the United States.

     (d)  401K Plan. Executive shall be entitled to participate in the Company's
          ---------
     401K plan in accordance with its terms and conditions.

     (e)  Vacation. Executive shall be entitled to at least four (4) weeks of
          --------
     paid vacation during each year during the Term, prorated for partial years.
     Such vacation shall be subject to the Company's policies and procedures for
     senior executives.

     (f)  Business Expenses. The Company shall promptly reimburse Executive for
          -----------------
     all reasonable, ordinary and necessary expenses he incurs in connection
     with his employment by the Company (including, but not limited to,
     automobile and other business travel, and customer entertainment expenses)
     on the same basis as other senior executives of the Company.

     (g)  Relocation Expenses. The Company shall pay Executive up to $50,000
          -------------------
     (with tax gross up) for the commission payable upon the sale of Executive's
     Minnesota home

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     "Relocation Expense". If, within thirty-six (36) months of execution of
     this Employment Agreement, Executive voluntarily resigns or is terminated
     for cause, as defined herein, Executive shall reimburse the Company an
     amount equal to a pro rata portion of such Relocation Expenses actually
     paid hereunder. (e.g. If Executive resigns eighteen (18) months from the
     date of execution of this Employment Agreement, Executive shall pay the
     Company 50% of the Relocation Expense received under this section.

     (h)  Indemnification. The Company will, to the fullest extent permitted by
          ---------------
     law, indemnify and hold Executive harmless from any and all liability
     (including, without limitation, judgments, fines, settlement payments,
     expenses, costs, and attorneys' fees) arising from his service as an
     employee, officer, or director of the Company. To the fullest extent
     permitted by law, if there is a potential or actual conflict of interest
     between the Company and Executive, the Company will advance legal fees and
     expenses to Executive for counsel selected by Executive in connection with
     any litigation, investigation, action, suit, or other proceeding related to
     Executive's employment with the Company or his performing services for the
     Company, whether as a director, officer, or employee of the Company. During
     the Term, the Company shall maintain adequate and reasonable Directors and
     Officers liability insurance naming Executive as an insured.

     (i)  Other Employee Benefits. Executive shall also be entitled to any other
          -----------------------
     fringe benefits, bonuses, and similar programs, including regular holidays,
     and shall be eligible to participate in all plans or arrangements
     maintained by the Company for the benefit of its employees, officers, or
     directors, including without limitation all compensation, welfare, bonus,
     incentive, retirement, thrift, pension, profit sharing, deferred
     compensation, employee loan, and insurance plans or arrangements. Executive
     shall at all times receive benefits no less favorable than those received
     by other senior executives.

7.   TERMINATION BY THE COMPANY OR BY EXECUTIVE. This Employment Agreement may
     ------------------------------------------
be terminated as follows:

     (a)  By the Company.
          --------------

          (i)  For Cause. The Company may terminate this Employment Agreement
               ---------
          and Executive's employment with the Company at any time for Cause (as
          defined in Section 9) ("Cause Termination"); provided, however, that
                                                       -----------------
          the Company shall give Executive written notice of Cause Termination
          specifying the reason for the termination, and Executive shall have
          the opportunity to address the Board before he is terminated for
          Cause.

          (ii) By Company Notice. The Company may terminate this Employment
               -----------------
          Agreement and Executive's employment with the Company upon sixty (60)
          days written notice for any reason not included in the definition of
          Cause ("Company Notice Termination").

     (b)  Death or Disability. This Employment Agreement and Executive's
          -------------------
     employment with the Company will terminate immediately upon Executive's
     death or Disability (as

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     defined in Section 9) ("Death or Disability Termination"). If either party
     terminates Executive's employment due to Disability, the terminating party
     shall give the other party written notice to that effect.

     (c)  By Executive.
          ------------

          (i)  For Good Reason. Executive may terminate this Employment
               ---------------
          Agreement and Executive's employment by the Company at any time for
          Good Reason (as defined in Section 9) ("Good Reason Termination"). In
          the event the Company disputes Executive's Good Reason Termination,
          the Company shall notify Executive in writing of such dispute within
          ten (10) days of receiving notice of such termination for Good Reason.
          If the Company does not so notify Executive within the ten (10) day
          period, the Company shall be deemed to have accepted Executive's
          determination of Good Reason.

          (ii) By Executive Notice. Executive may terminate this Employment
               -------------------
          Agreement and Executive's employment with the Company for any reason
          not included in the definition of Good Reason by giving the Company
          sixty (60) days written notice of such termination ("Executive Notice
          Termination").

8.   PAYMENTS UPON TERMINATION.
     -------------------------

     (a)  Company Notice Termination and Good Reason Termination. If the Company
          ------------------------------------------------------
     terminates Executive's employment for any reason other than for Cause (as
     defined in Section 9) or if Executive terminates his employment for Good
     Reason (as defined in Section 9), in the first year of employment the
     Company shall pay to Executive (subject to withholding of applicable taxes)
     a severance of Two Hundred Fifty Thousand and 00/100 Dollars ($250,000.00);
     and, if thereafter, Five Hundred Thousand and 00/100 Dollars ($500,000.00).
     Such severance shall be paid in equal installments over twelve (12) months
     on the Company's standard bi-weekly Company payroll dates, beginning one
     (1) month following the date of termination. The Company shall continue to
     provide Executive and his family, for a period of twenty-four (24) months
     after the date of termination, with the same insurance benefits coverage
     being provided to Executive under Section 6(c) on the date the notice of
     termination is given. Executive shall also be entitled to a pro-rata
     portion of the performance bonus under Section 5(b) to which he would have
     been entitled in the year of termination if his employment had not
     terminated. Executive shall also be entitled to any of his Annual Base
     Salary accrued through the date of termination, payments for any accrued
     but unused vacation for the year of termination, any bonuses earned but not
     previously paid with respect to the accounting period of the Company most
     recently ended, and any vested benefits payable to Executive under the
     terms of any deferred compensation plan, 401K plan, stock option plan, or
     other benefit plans maintained by the Company in which Executive
     participated. Additionally, notwithstanding the terms of the Company's
     stock option plan(s), all stock options received by Executive shall become
     fully vested and immediately exercisable upon a Company Notice Termination
     or Good Reason Termination. Such stock options shall remain exercisable for
     a period of not less than twenty-four (24) months. All of

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     Executive's other unvested benefits, including, without limitation, any
     Company 401K contributions or profit sharing contributions, shall
     immediately vest upon a Company Notice Termination or Good Reason
     Termination.

     (b)  Cause Termination and Executive Notice Termination. If Executive's
          --------------------------------------------------
     employment is terminated by the Company for Cause (as defined in Section 9)
     or if Executive terminates his employment for any reason other than Good
     Reason (as defined in Section 9), Executive shall be entitled to receive
     any of his Annual Base Salary accrued through the date of termination, any
     accrued but unpaid vacation pay for the year of termination, any bonuses
     earned but not previously paid with respect to the accounting period of the
     Company most recently ended, and any vested benefits payable to Executive
     under the terms of any deferred compensation plan, 401K plan, stock option
     plan, or other plans maintained by the Company in which Executive
     participates. Notwithstanding the terms of the Company's stock option
     plan(s), Executive shall not forfeit any vested options upon a Cause
     Termination or Executive Notice Termination, and all such vested options
     shall remain exercisable for a period of at least twenty-four (24) months

     (c)  Death or Disability Termination. If Executive's employment is
          -------------------------------
     terminated due to his death or Disability (as defined in Section 9), the
     Company will also continue to pay Executive (or his estate), as severance,
     the Annual Base Salary through the end of the month of termination.
     Executive (or his estate) shall also be entitled to receive any of his
     Annual Base Salary accrued through the date of termination, any accrued but
     unpaid vacation pay for the year of termination, any bonuses earned but not
     previously paid with respect to the accounting period of the Company most
     recently ended, and any vested benefits payable to Executive under the
     terms of any deferred compensation plan, 401K plan, stock option plan, or
     other plans maintained by the Company in which Executive participates. The
     Company shall continue to provide Executive (if Disabled) and his family,
     for a period of twenty-four (24) months after the date of termination, with
     the same insurance benefits required by Section 6(c) on the date Death or
     Disability Termination occurs. Additionally, notwithstanding the terms of
     the Company's stock option plans, all stock options received by Executive
     shall become fully vested and immediately exercisable upon a Death or
     Disability Termination. Such stock options shall remain exercisable for a
     period of not less than twenty-four (24) months. All of Executive's other
     unvested benefits, including, without limitation, any Company 401K
     contributions or profit sharing contributions, shall immediately vest upon
     a Death or Disability Termination.

9.   DEFINITIONS. In addition to the words and terms elsewhere defined in this
     -----------
Employment Agreement, certain capitalized words and terms used in this
Employment Agreement shall have the meanings given to them by the definitions
and descriptions in this Section 9 unless the context or use indicates another
or different meaning or intent, and such definition shall be equally applicable
to both the singular and plural forms of any of the capitalized words and terms
herein defined. The following words and terms are defined terms under this
Employment Agreement:

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     (a)  Cause. For purposes of this Employment Agreement, the term "Cause"
          -----
     shall mean and be limited to:

          (i)   Executive was convicted of a felony or entered a guilty or nolo
          contendere plea to such a crime;

          (ii)  Executive was convicted of any lesser crime committed in
          connection with the performance of his duties hereunder involving
          dishonesty, fraud or moral turpitude; or

          (iii) Executive's gross negligence in, or willful failure to
          substantially perform his material duties in accordance with Section 2
          herein (other than any such failure resulting from Executive's
          Disability, as defined herein) which gross negligence or willful
          failure has a material adverse effect on the Company; provided,
                                                                --------
          however, that such gross negligence or willful failure shall not be
          -------
          considered Cause unless it continues after the Company has made a
          written demand for substantial performance on Executive and Executive
          has failed to correct the acts or omissions complained of after a
          reasonable opportunity (of not less than sixty (60) days) to do so.

     (b)  Disability. For purposes of this Employment Agreement, the term
          ----------
     "Disability" shall mean the inability of Executive to perform Executive's
     essential duties and responsibilities (even with reasonable accommodation)
     under this Employment Agreement for a period of one hundred and eighty
     (180) consecutive days during any twelve (12) month period by reason of
     Executive's mental or physical disability. Both the Company and Executive
     may appoint a qualified physician to determine whether Executive is
     Disabled. If those physicians cannot agree, the physicians shall mutually
     appoint a third qualified physician, whose determination of whether
     Executive has a Disability shall be final.

     (c)  Good Reason. For purposes of this Employment Agreement, the term "Good
          -----------
     Reason" shall mean:

          (i)   the Company materially breaches a term of this Employment
          Agreement (including, without limitation, the failure of the Company
          to pay or provide Executive any of the compensation or benefits to
          which he is entitled under this Employment Agreement), which breach
          was not corrected by the Company within thirty (30) days after
          receiving written notice of such breach from Executive;

          (ii)  the relocation of Executive's principal office, without
          Executive's prior written consent, more than forty (40) miles away
          from the Company's current headquarters in St. Petersburg, Florida.;

          (iii) the Company's reduction of Executive's compensation and/or
          benefits hereunder without Executive's prior written consent;

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<PAGE>

          (iv)  there has been an adverse or material change in Executive's
          status, position, duties, responsibilities (including reporting
          responsibilities), authority, or titles, which change was not
          withdrawn or rescinded by the Company within thirty (30) days after
          receiving written notice of objection to such change from Executive;

          (v)   the assignment to Executive of any duties or work
          responsibilities, or any instructions, orders, or directives which are
          inconsistent with his status, position, duties, responsibilities
          (including reporting responsibilities), authority, or titles as set
          forth in this Employment Agreement or as required by law.

          (vi)  any removal of Executive from, or the failure to appoint, elect,
          reappoint, or reelect Executive to, the positions of Corporate
          Executive Vice President /President Americas Group Division; and/or

          (vii) the failure of the H.R. Committee to set reasonably attainable
          budgeted target levels and objectives in the Performance Bonus Plan.

     (d)  Restricted Area.  For purposes of this Employment Agreement, the term
          ---------------
     "Restricted Area" shall mean the entire world.

10.  NON-COMPETITION AND CONFIDENTIALITY.
     -----------------------------------

     (a) Non-Competition. During the Term and for a period of twenty-four (24)
         ---------------
     months following the termination of Executive's employment hereunder for
     Good Cause or without Good Reason, Executive shall not, in the Restricted
     Area, directly or indirectly, enter the employ of, or render any services
     to, any person, firm or corporation engaged in any business competitive
     with the businesses engaged in by the Company, any constituent partners of
     the Company or any of their respective parents, subsidiaries or affiliates;
     further, Executive shall not engage in such business, directly or
     indirectly, as an individual, partner, shareholder, director, officer,
     principal, agent, employee, trustee, consultant, or any other relationship
     or capacity; provided, however, that nothing contained in this Section 10
     shall be deemed to prohibit Executive from acquiring, solely as an
     investment, a less than five percent (5%) interest in the equity of any
     publicly traded corporation or limited partnership.

     (b) Non-Solicitation of Employees. During the Term and for a period of
         -----------------------------
     twenty-four (24) months following the termination of Executive's employment
     hereunder for Good Cause or without Good Reason, Executive, except within
     the course of the performance of his duties hereunder, shall not solicit
     for employment any current employee of the Company, any constituent partner
     of the Company, or any of their respective parents, subsidiaries, or
     affiliates, if Executive has had material business contact with such
     individual during the Term.

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     (c) Confidentiality. Executive shall not, at any time hereafter, disclose
         ---------------
     to any person, firm or corporation or otherwise use any confidential
     information regarding the customers, suppliers, market arrangements, or
     methods of operations of the Company, any constituent partner of the
     Company or any of their respective parents, subsidiaries, or affiliates or
     any other information of the Company, any constituent partner of the
     Company or any of their respective parents, subsidiaries or affiliates,
     except to the extent necessary to conduct the business of the Company, or
     to comply with law or the valid order of a governmental agency or court of
     competent jurisdiction. Without limiting the generality of the foregoing,
     the Parties acknowledge and agree that all information not otherwise
     generally known to the public relating to each of (i) this Agreement, or
     (ii) the Company, any constituent partner of the Company or any of their
     respective parents, subsidiaries, or affiliates, is confidential and
     proprietary and is not to be disclosed, to any persons or entities or
     otherwise used, except to the extent necessary to conduct the business of
     the Company, or to comply with law or the valid order of a governmental
     agency or court of competent jurisdiction.

     (d) Rights to Innovations. Any invention, improvement, design, development
         ---------------------
     or discovery conceived, developed, invented or made by Executive, alone or
     with others, during his employment hereunder and applicable to the business
     of the Company, its parents, subsidiaries or affiliates shall become the
     sole and exclusive property of the Company. Executive shall (i) disclose
     the same completely and promptly to the Company, (ii) execute all documents
     requested by the Company in order to vest in the Company the entire right,
     title and interest, in and to the same, (iii) execute all documents
     required by the Company for the filing, and prosecuting of such
     applications for patents, copyrights and/or trademarks, which the Company,
     in its sole discretion, may desire to prosecute, and (iv) provide to the
     Company, at the Company's expense, all assistance it may reasonably require
     including, without limitation, the giving of testimony in any suit, action
     or proceeding, in order to obtain, maintain and protect the Company's
     rights therein and thereto.

     (e) Injunctive Relief. Any breach or threatened breach by Executive of any
         -----------------
     provision of this Section 10 shall cause the Company irreparable harm which
     cannot be remedied solely by damages. In the event of a breach or
     threatened breach by Executive of any of the provisions of this Section 10,
     the Company shall be entitled to seek injunctive relief restraining
     Executive. Nothing herein shall be construed as prohibiting the Company
     from pursuing any other remedies available at law or in equity in the event
     of such breach or threatened breach, including the recovery of damages.

11.  SUCCESSORS. This Employment Agreement shall be binding on the Company and
     ----------
any successor to its business or to a majority of its business assets and the
Company shall require any successor in interest (whether direct or indirect, by
purchase, merger, consolidation, or otherwise) to expressly assume and agree to
perform this Employment Agreement; provided, however, that no such assumption
                                   --------  -------
shall relieve the Company of its obligations hereunder.

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<PAGE>

12.  BINDING EFFECT. This Employment Agreement shall inure to the benefit of and
     --------------
be enforceable by Executive's personal and legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.

13.  MODIFICATION AND WAIVER. No provision of this Employment Agreement may be
     -----------------------
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in a writing that specifies the specific provision affected, which
writing shall be signed by Executive and such officer of the Company as may be
specifically designated by the Board. 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 Employment 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.

14.  AMENDMENTS. No amendments or variations of the terms and conditions of this
     ----------
Employment Agreement shall be valid unless the same is in a writing that
specifies the term or condition affected, which writing is signed by Executive
and such officer of the Company as may be specifically designated by the Board.

15.  SEVERABILITY. The invalidity or unenforceability of any provision of this
     ------------
Employment Agreement, whether in whole or in part, shall not in any way affect
the validity and/or enforceability of any other provision herein contained. Any
invalid or unenforceable provision shall be deemed severable to the extent of
any such invalidity or unenforceability.

16.  ENTIRE AGREEMENT. This Employment Agreement sets forth the entire
     ----------------
agreement and understanding of the Company and Executive in respect of the terms
and conditions of Executive's employment after the Commencement Date, and
supersedes all prior employment agreements, covenants or representations or
warranties, whether oral or written, made by the parties, or any representative
of the Company, with respect to such terms and conditions of employment;
provided, however, that this Employment Agreement does not supersede or affect
--------  -------
the Change of Control Agreement between Executive and the Company.

17.  NOTICES. All notices, communications and deliveries hereunder shall be made
     -------
in writing signed by or on behalf of the party making the same and shall be
delivered (a) personally; (b) by telecopy transmission with a copy sent by U.S.
mail, first class, postage prepaid; (c) by registered or certified mail (return
receipt requested); or (d) by any national overnight courier service (with
postage and other fees prepaid). All such notices, communications, and delivers
shall be addressed as follows:

                              If to the Company:
                              -----------------

                              Danka Office Imaging Company
                              11201 Danka Circle North
                              St. Petersburg, Florida  33716
                              Attn: General Counsel
                              Telephone No.: (727) 579-2801
                              Telecopy No.:  (727) 579-2880

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<PAGE>

                              and:
                              ---

                              Danka Business Systems PLC
                              Masters House
                              107 Hammersmith Road
                              London, England w14 OQH
                              Attn: Secretary


                              If to the Executive:
                              -------------------

                              David P. Berg
                              XXXXXXXXXXXXXX
                              XXXXXXXXXXX
                              Telephone No.: (XXX) XXX-XXX

or to such other representative or at such other address of a party as such
party hereto may furnish to the other parties in writing. Any such notice,
communication or delivery shall be deemed given or made (a) on the date of
delivery if delivered in person (by courier service or otherwise), (b) upon
transmission by facsimile if receipt is confirmed by telephone, provided
transmission is made during regular business hours, or if not, the next business
day, or (c) on the fifth (5th) business day after it is mailed by registered or
certified mail.

18.  GOVERNING LAW. This Employment Agreement shall be construed and enforced
     -------------
pursuant to the laws of the State of Florida.

19.  ARBITRATION. Any controversy or claim arising out of or relating to this
     -----------
Employment Agreement or the breach thereof, other than a claim for injunctive
relief, shall be settled by arbitration in accordance with the Employment
Arbitration Rules of the American Arbitration Association (the "Rules") in
effect at the time demand for arbitration is made by any party. This arbitration
shall be conducted before three (3) arbitrators. One arbitrator shall be named
by the Company, a second shall be named by Executive, and the third arbitrator
shall be named by the two arbitrators so chosen. In the event that the third
arbitrator is not agreed upon, he or she shall be named by the American
Arbitration Association. The arbitration shall occur in St. Petersburg, Florida
or such other location as may be mutually agreed to by the Company and
Executive. The award made by all or a majority of the panel of arbitrators shall
be final and binding, and judgment may be entered in any court of law having
competent jurisdiction. The award is subject to confirmation, modification,
correction, or vacation only as explicitly provided in Title 9 of the United
States Code, as amended.

20.  NO MITIGATION OR OFFSET. Executive shall not be required to mitigate the
     -----------------------
amount of any severance or termination payment provided for in this Employment
Agreement by seeking other employment or otherwise, nor shall the amount of any
payment or benefit provided for in this Employment Agreement be reduced by any
compensation or income Executive may receive from any source. In addition, no
payments to Executive under this Employment Agreement may

                                       11
<PAGE>

be subject to any offset or setoff due to any claim the Company, or its parents,
affiliates, or subsidiaries, may have against Executive.

21.  ATTORNEYS' FEES. The Company will promptly reimburse Executive for all
     ---------------
attorneys' fees (for counsel selected by Executive) and expenses arising out of
any dispute under or in connection with this Employment Agreement (whether
litigation or arbitration) to the extent Executive is the prevailing party.
Executive shall in no way be responsible or liable for the Company's attorneys'
fees and expenses in any dispute arising under or in connection with this
Employment Agreement, and no award or order relating to this Employment
Agreement shall award the Company its attorneys' fees.

22.  SOURCE OF PAYMENTS. All salary, bonus, severance, and all other payments to
     ------------------
Executive under this Employment Agreement shall be paid to Executive by the
Company through its U.S. payroll system and shall be made in cash in U.S.
dollars. If the Company should fail to make any such payment to Executive when
due, Danka Office Imaging, Danka Holding, and Danka Business Systems shall be
jointly and severally liable to Executive for such payments.

23.  REPRESENTATION. The Company represents and warrants that it and the person
     --------------
executing this Employment Agreement on behalf of the Company are fully
authorized and empowered to enter into this Employment Agreement and that the
performance of its obligations under this Employment Agreement will not violate
any agreement between it and any other person, firm, or organization.

24.  COUNTERPARTS. This Employment Agreement may be executed in more than one
     ------------
(1) counterpart and each counterpart shall be considered an original.

     IN WITNESS WHEREOF, this Employment Agreement has been duly executed by the
Company and Executive as of the date first above written.

                         SIGNATURES ON FOLLOWING PAGE

                                       12
<PAGE>

                              DANKA BUSINESS SYSTEMS PLC


                              [Lang Lowrey]
                              -----------------------------------
                              By: P. Lang Lowrey
                                 --------------------------------
                              Title: Chief Executive Officer
                                    -----------------------------


                              DANKA HOLDING COMPANY


                              [Lang Lowrey]
                              -----------------------------------
                              By: P. Lang Lowrey
                                  -------------------------------
                              Title: Chief Executive Officer
                                    -----------------------------


                              DANKA OFFICE IMAGING COMPANY

                              [Lang Lowrey]
                              -----------------------------------
                              By: P. Lang Lowrey
                                 --------------------------------
                              Title: Chief Executive Officer
                                    -----------------------------


                              EXECUTIVE


                              [David P. Berg]
                              -----------------------------------
                              David P. Berg

                                       13

</TEXT>
</DOCUMENT>
