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EXHIBIT 10.5
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made effective for all
purposes and in all respects as of the 24th day of October, 1997, by and
between (i) BTG, INC., a Virginia corporation (hereinafter referred to as
"Employer"), and (ii) XXXXXX X. XXXXXXX (hereinafter referred to as
"Employee").
WHEREAS, Employer desires to employ Employee in the capacity of its
President and Chief Executive Officer;
WHEREAS, Employee desires to be employed by Employer in the aforesaid
capacities; and
WHEREAS, Employer and Employee desire to amend the terms and
conditions of their agreements and understandings as previously set out in an
Employment Agreement entered into as of the 28th day of October, 1994.
NOW, THEREFORE, in consideration of the foregoing, of the mutual
promises herein contained, and of other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending legally to be bound, hereby agree as follows:
1. Term of Agreement. The term of employment under this
Agreement (the "Term") shall be for the period commencing on October 24, 1997
(the "Effective Date") and ending on March 31, 2002. The Term shall be
automatically extended without further action by either party for a successive
or successive two (2) year period or periods, unless written notice of either
party's intention to terminate this Agreement pursuant to this Section 1 has
been given to the other party at least six (6) months prior to the expiration
of the Term or any two (2) year extension of the Term, or unless notice of
termination is otherwise given pursuant to Section 5 hereof. As used in this
Agreement, (i) "Initial Term" shall mean the period commencing on the Effective
Date and ending on March 31, 2002 and (ii) "Contract Year" shall mean the
twelve-month period during the Term beginning on each April 1 and ending on the
following March 31.
2. Duties of Employee.
A. Duties and Responsibilities. Subject to the
provisions of this Agreement, during the Term, Employer shall employ Employee
and Employee shall serve Employer as President and Chief Executive Officer of
Employer. During the Term, Employee shall discharge the obligations and
responsibilities normally associated with such offices and shall perform such
other duties and responsibilities as the Board of Directors of Employer (the
"Board") shall determine from time to time that are consistent with Employee's
positions and the terms of this Agreement.
B. Full-time Efforts. Employee covenants and agrees
that, at all times during the Term, Employee shall devote his full-time efforts
to his duties as an employee of Employer.
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3. Compensation. As compensation for the services to be rendered
to Employer by Employee under this Agreement, Employee shall be paid cash
compensation in any consecutive twelve month period , during the Initial Term
of this Agreement, of not less than Four Hundred Thousand Dollars. The minimum
annual cash compensation shall increase by ten percent at the start of each
successive two year extension of the Term hereof. Such cash compensation shall
be paid in accordance with Employer's standard pay policies. In the event that
Employee shall be given significant new or additional responsibilities (without
a corresponding decrease in existing responsibilities) at any time during the
Term, Employer and Employee agree to discuss the amount, if any, of increase in
Employee's Cash Compensation that is warranted as a result of such new or
additional responsibilities.
4. Additional Benefits. In addition to the compensation referred
to in Section 3 hereof, Employee shall be entitled to receive the following
additional benefits during the Term:
A. Insurance. Employer shall provide Employee with such
health, medical, disability dependent health care, life and other insurance as
Employer generally makes available to its executive officers in such Contract
Year.
B. Vacation. For each Contract Year during the Term,
Employee shall be entitled to paid annual leave, plus normal company holidays
in accordance with Employer's then current policies and shall retain unused
accrued annual leave in accordance with such polices.
C. Business Expenses. Employee shall be entitled to
reimbursement by Employer of customary business expenses, in accordance with
Employer's guidelines, limits and procedures relating thereto that apply to
executive employees of Employer.
5. Termination
A. Termination for Cause. Employee's employment
hereunder and all of Employer's obligations hereunder (except as hereinafter
provided) may be terminated by Employer immediately for Cause (as hereinafter
defined) by giving written notice of such termination to Employee. For
purposes of this Agreement, "Cause" shall mean: (i) Employee's willful and
gross misconduct which has, or could reasonably be expected to have, a material
adverse effect on the business, assets, operations, results of operations or
financial condition of Employer. A termination for Cause pursuant hereto shall
take effect ten (10) days after the delivery of written notice to Employee
describing such Cause unless Employee shall, during such ten (10) day period,
remedy the Cause specified in such notice; provided however, that such
termination shall take effect immediately upon the giving of such notice if the
Board specifically determines in good faith that such Cause is unremediable.
B. Death and Disability. Except as otherwise provided
in this Section 5, Employee's employment hereunder and all of Employer's
obligations hereunder (except as hereinafter provided) shall be terminated by
the death of Employee and also may be terminated by the Board by giving
written notice of such termination to Employee if Employee
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shall be rendered incapable by illness or any physical or mental disability
from substantially complying with the terms, conditions and provisions on his
part to be observed and performed for a period in excess of six (6) consecutive
months during the Term. In the event of a termination of Employee's
employment pursuant to this Section 5, as a result of his death or disability,
Employer shall pay to Employee or his estate, as the case may be, his salary
pursuant to Section 3 for a period of three (3) months following the date of
death or termination for disability.
6. Board Seat. Employer agrees that, during the Term, for so
long as Employee shall remain employed by Employer, Employer shall cause
Employee to be nominated to serve on the Board.
7. Director and Officer Liability. Employer agrees to indemnify
Employee in connection with his serving as an officer and director of Employer,
in a manner consistent with Employer's Articles of Incorporation, Bylaws and
current practices and policies. In the event that Employer shall enter into
any indemnification agreement with any officer or director of Employer or any
subsidiary, Employer shall promptly enter into an agreement containing similar
provisions with respect to indemnification with Employee.
8. Covenant Not To Compete. Employee covenants and agrees that
he will not, at any time during his employment by Employer or for a period of
two years thereafter, directly or indirectly, whether as principal or as agent,
officer, director, employee, consultant, or otherwise, alone or in association
with any other person, firm, corporation or other business organization, carry
on, or be engaged, concerned or take part in, or render services to, or own any
interest or share in the earnings of or invest in the stock, bonds or other
securities of, any person, firm, corporation or other business organization
which is in the business of providing to any commercial or government entity
any goods or services that are competitive with any product offered for sale or
being developed by Employer during the Term. The foregoing covenant is
applicable in the United States and in any other country in which Employer has
marketed goods or services during the Term. Nothing herein contained, however,
shall be deemed to prohibit Employee from owning stock in public companies in
pursuance of his passive investment program so long as he does not become an
affiliate thereof, as such term is defined in the Securities Exchange Act of
1934, as amended.
9. Tax Withholding. Payments to Employee of all compensation
contemplated under this Agreement shall be subject to all applicable legal
requirements with respect to the withholding of taxes or other amounts required
by law or regulation.
10. Amendment; Waiver. This Agreement may not be modified,
amended or waived in any manner except by an instrument in writing signed by
the parties hereto. The waiver by either party of compliance with any
provision of this Agreement by the other party shall not operate or be
construed as a wavier of any provision of this Agreement, or of any subsequent
breach by such party of a provision of this Agreement.
11. Governing Law. In view of the fact that the principal office
of Employer is located in the Commonwealth of Virginia, it is understood and
agreed that the construction and
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interpretation of this Agreement shall at all times and in all respects be
governed by the substantive laws of the Commonwealth of Virginia without regard
to its rules regarding conflicts of laws.
12. Severability. The provisions of this Agreement (including
particularly, but not limited to, the provisions of Section 8 hereof) shall be
deemed severable, and the invalidity or unenforceability of any one or more of
the provisions hereof shall not affect the validity and enforceability of the
other provisions hereof.
13. Notices. Any notice required to be given hereunder shall be
sufficient if in writing, and sent by courier service (with proof of service),
facsimile transmission, hand delivery or certified or registered mail (return
receipt requested and first-class postage prepaid), to his residence in the
case of Employee, and to its principal office in the case of Employer.
14. Entire Agreement. This Agreement contains the entire
agreement and understanding by and between Employer and Employee with respect
to the employment herein referred to, and no representations, promises,
agreements or understandings, written or oral, not contained herein shall be of
any force or effect.
IN WITNESS WHEREOF, Employer and Employee have duly executed this
Agreement under seal as of the day and year first above written.
BTG, INC.
By: /s/ XXXX X. XXXXXX
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Xxxx X. Xxxxxx
Senior Vice President, CFO
EMPLOYEE
/s/ XXXXXX X. XXXXXXX
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Xxxxxx X. Xxxxxxx
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