FIRST AMENDMENT TO THE EXECUTIVE EMPLOYMENT, NON-COMPETE AND CONFIDENTIALITY AGREEMENT
Exhibit
10.6
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 Xxxxx 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 October 1, 2004,
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
1.5 is hereby deleted in its entirety and substituted with the
following:
"1.5 Termination
With Severance. In the event the Corporation terminates Executive
without cause or Executive resigns from his employment with the Corporation
for
Good Reason (as defined below), Executive shall be entitled to receive a
lump
sum severance equal to six months' base salary (at Executive's highest base
salary rate during his employment with the Corporation) plus the pro-rated
portion of Executive's then-current annual 'target' bonus. The
severance payment described in the previous sentence will be paid to Executive
within five business days following his termination without Cause or resignation
for Good Reason. If Executive's employment termination occurs in
connection with a Change in Control (as defined in the Income Continuity
Program), Executive shall be entitled to receive the greater of: (i)
the benefits provided under this Agreement or (ii) the benefits provided
under
the Income Continuity Program.
For
purposes of this Agreement, 'Good
Reason' means any of the following conditions: (i) a material
decrease in Executive's existing base salary or annual 'target' bonus
percentage, and/or a material decrease in any of his employee benefits; provided
that such decrease is not applicable to all officers of the Corporation,
(ii) a
material diminution in Executive's authority, duties, or responsibilities,
(iii)
a material diminution in the authority, duties, or responsibilities of the
supervisor to whom Executive is required to report, (iv) a material diminution
in the budget for which Executive retains authority, (v) a relocation of
the
Executive's primary office more than thirty-five (35) miles from its current
location, or (vi) the material breach by the Corporation of the agreement
under
which Executive provides services. If one or more of the above
conditions exists, Executive must provide notice to the Corporation within
a
period not to exceed ninety (90) days of the initial existence of the
condition. Upon such notice, the Corporation must be provided a
period of thirty (30) days during which it may remedy the
condition."
2. A
new Section 4.13 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 Internal Revenue Code of 1986, as amended (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."
3. A
new Section 4.14 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 Corporation does not so cooperate, the
Corporation 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 | ||||
| Xxxxx Xxxxxxx | ||||
| Date | Title | |||
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