FIRST AMENDMENT TO THE EXECUTIVE EMPLOYMENT, NON-COMPETE AND CONFIDENTIALITY AGREEMENT
Exhibit
10.4
FIRST
AMENDMENT TO THE
EXECUTIVE
EMPLOYMENT, NON-COMPETE
AND
CONFIDENTIALITY AGREEMENT
THIS
FIRST AMENDMENT TO THE EXECUTIVE
EMPLOYMENT, NON-COMPETE AND CONFIDENTIALITY AGREEMENT ("Amendment") is entered
into this ______ day of ______________, 2007, by and between Xxxxxxx X. Xxxxxxx
(the "Executive") and MAXIMUS, Inc., a Virginia corporation with its principal
place of business in Reston, Virginia (the "Corporation") and provides as
follows:
WHEREAS,
on or about April 24, 2006,
the Corporation and Executive entered into an Employment Agreement;
and
WHEREAS,
the parties desire to amend
the Employment Agreement to comply with Section 409A of the Internal Revenue
Code of 1986, as amended as set forth in this Amendment.
NOW,
THEREFORE, in consideration of
these premises and intending to be legally bound, the parties agree as
follows:
1. Section
1.4 is hereby deleted in its entirety and substituted with the
following:
"Severance. The
parties agree that in the event the Corporation terminates the Executive's
employment without Cause or the Executive terminates the employment for "Good
Reason" (as defined in the Income Continuity Plan) prior to the expiration
of
the Scheduled Term, the Executive shall be entitled to the
following:
(a)
Benefits, at the Corporation's expense, as provided under Section 1.2 for
the
greater of the remainder of the Scheduled Term or twelve (12)
months. To the extent that these payments are not exempt from Section
409A of the Internal Revenue Code of 1986, as amended (the 'Code') under
the
COBRA, reimbursement, in-kind benefit, or other applicable exceptions
thereunder, such payments shall be made at the time and in the amount required
under the documents governing each such benefit;
(b)
Vesting of stock options and Restricted Stock Units; and
(c)
a lump
sum, payable within 30 days following termination of employment, equal to
the
greater of (i) Base Salary for the remainder of the Scheduled Term or (ii)
two
times the sum of the Executive's Base Salary plus the lesser of his target
bonus
or previous year's actual bonus, which lump sum shall be considered a separate
payment for purposes of Section 409A of the Code. If the Executive's
employment termination occurs in connection with a Change in Control, the
Executive shall be entitled to receive such payments and benefits as provided
under the Income Continuity Plan, and this Section 1.4 shall not
apply."
2. The
second sentence of Section 1.5 is deleted and substituted with the
following:
"If
any
law or the terms of any plan document (or related agreement) prevents the
Corporation from treating the Executive as remaining in employment with the
Corporation continuously during this period, the Corporation, within 60 days
after the Executive terminates employment, shall pay or provide to the executive
an amount equal to the difference between (a) and (b), where (a) and (b)
are
determined as follows:
(a) The
payments or benefits the Executive would have received or been entitled to
if
the Executive had remained in employment with the Corporation continuously
during the period beginning March 18, 2002 through the Effective Date;
and
(b)
The
payments or benefits the Executive actually received or is entitled to under
applicable law and the terms of the applicable plan documents."
3. A
new Section 4.12 is hereby added to the Employment Agreement as
follows:
"Distributions
to Specified
Employees. Notwithstanding any provision to the contrary,
to the extent the Executive is considered a specified employee under Section
409A of the Code and would be entitled to a payment during the six month
period
beginning on the Executive's date of termination that is not otherwise excluded
under Section 409A of the Code under the exceptions for short-term deferrals,
separation pay arrangements, reimbursements, in-kind distributions, or an
otherwise applicable exemption, the payment will not be made to the Executive
until the earlier of the six month anniversary of the Executive's date of
termination or the Executive's death."
4. A
new Section 4.13 is hereby added to the Employment Agreement as
follows:
"Section
409A of the
Code. It is the intention of the parties that this Agreement
comply with and be administered in accordance with Section 409A of the Code
and
the interpretive guidance thereunder, including the exceptions for short-term
deferrals, separation pay arrangements, reimbursements, and in-kind
distributions. The Agreement shall be construed and interpreted in accordance
with such intent. To the extent such potential payments or benefits
could become subject to such Section, the parties shall cooperate to amend
this
Agreement with the goal of giving the Executive the economic benefits described
herein in a manner that does not result in such tax being imposed. In
the event that the Company does not so cooperate, the Company shall indemnify
the Executive for any interest and additional tax arising from the application
of Section 409A of the Code, grossed-up for any other income tax incurred
by
Executive related to the indemnification (i.e., indemnification of such
additional income tax), assuming the highest marginal income tax rates apply
to
any taxable indemnification. Any indemnification payment shall be
made within ninety (90) days of the date Executive makes payment of the interest
and/or additional tax."
* * *
2
IN
WITNESS WHEREOF, the undersigned
have executed this Agreement effective as of the date first above
written.
| EXECUTIVE | MAXIMUS, Inc. | |||
| By | ||||
| Xxxxxxx X. Xxxxxxx | ||||
| Date | Title | |||
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