GRC INTERNATIONAL, INC.
EMPLOYMENT AGREEMENT
(SENIOR VICE PRESIDENT OR ABOVE - DIRECT REPORT TO CEO)
THIS EMPLOYMENT AGREEMENT is made in Vienna, Virginia as of by and between
(hereinafter referred to in the first person or as "Employee") and GRC
International, Inc., a corporation with its principal offices at 1900 Gallows
Road, Vienna, Virginia 22182 ("GRCI"). The term "Company" shall include GRCI and
any parent, subsidiary or affiliate of GRCI. As a condition to, and in
consideration of, the Company's employment of Employee, the parties mutually
agree as follows:
1. DUTIES.
(a) I agree to work for the Company in the capacity set forth in Item 1(a) of
Exhibit A attached hereto. My duties will include all of those generally
associated with said position, subject to the direction and assignment of the
Board of Directors ("Board") of GRC International, Inc. ("GRCI"). The duties
assigned to me shall be performed at the place of employment specified in Item
1(b) of Exhibit A or at such other location as the Board may determine is in the
best interest of the Company. All of my working time and energies shall be
devoted to the foregoing duties. I will inform GRCI, in writing, if I engage in
any outside business activity, and I will obtain the prior written approval of
GRCI, if I engage in any outside business activity which (i) requires the use of
skills for which I was hired by the Company or the use of skills attained during
the course of my employment with the Company, or (ii) would, in the opinion of
GRCI, compete with or conflict with my employment with the Company. While
employed by the Company, absent the expressed, prior written authorization of
the Board, I will not, directly or indirectly, engage in any activity
competitive with or adverse to the Company's business or welfare, whether alone,
as a partner of any partnership or joint venture or as an officer, director,
employee, or holder of 5% or more of any class of stock, of any corporation.
(b) I agree that for a period of one year immediately following termination
(voluntary or otherwise) of my employment with the Company, I will not interfere
with the business of the Company by inducing an employee to leave the Company's
employment, by inducing a consultant to sever the consultant's relationship with
the Company, or by inducing a customer to sever the customer's relationship with
the Company.
(c) This Agreement cancels and replaces in their entirety any and all previous
employment agreements entered into between me and the Company.
2. INTELLECTUAL PROPERTY.
(a) In this Agreement, (i) "Intellectual Property" means any patent, trademark,
copyright, semiconductor mask right, trade secret, invention, discovery, design,
idea or
improvement (whether or not any of the foregoing are patentable, protectable by
copyright, or otherwise protectable), and (ii) the word "made", when used with
"Intellectual Property", means made, devised, developed, conceived or reduced to
practice. Exhibit B to this Agreement contains a complete list of all
Intellectual Property I consider proprietary to me, and, during my employment
with the Company, I agree to update Exhibit B from time to time as may be
necessary to keep it current. I will not incorporate or permit to be
incorporated into any work performed for or on behalf of the Company any
Intellectual Property proprietary to me or any third party.
(b) I will disclose to the Company all Intellectual Property made by me, alone
or with others, during any period of employment with the Company. All such
disclosures shall be reviewed by the Company in confidence to determine any
issues which may arise.
(c) I will assign to the Company all right, title and interest in and to all
Intellectual Property made at any time by me alone or with others during or
after my employment with the Company, if such Intellectual Property was made
using Company equipment, supplies, facilities, or trade secret information, or
such Intellectual Property either (i) relates at the time of conception or
reduction to practice of the invention to the Company's business, or actual or
demonstrably anticipated research or development of the Company; or (ii) results
from any work performed by me for the Company. All Intellectual Property subject
to this paragraph shall remain Company property whether or not so disclosed or
assigned to the Company. I will cooperate fully with the Company during and
after employment in accomplishing the intent of this provision and execute such
instruments and documents reasonably requested by the Company, in order to more
fully vest in the Company all ownership rights in the Intellectual Property. In
addition, I irrevocably appoint GRCI and each of its officers as my agent and
attorney-in-fact to act in my name and stead to execute and file any documents
and to do all other lawfully permitted actions to further the prosecution,
issuance and enforcement of patents, copyrights and other proprietary rights
with the same force and effect as if executed and delivered by me.
(d) The provisions of the foregoing Section 2(c) shall not apply to an invention
developed by me entirely on my own time without using Company equipment,
supplies, facilities, or trade secret information except for those inventions
that either (i) relate at the time of conception or reduction to practice of the
invention to the Company's business, or actual or demonstrably anticipated
research or development of the Company; or (ii) result from any work performed
by me for the Company.
3. PROPRIETARY INFORMATION. I understand that in the course of my employment
with the Company, I will be making use of, acquiring or adding to proprietary
and/or confidential information and materials of the Company or of other parties
("Proprietary Information"). I will not disclose or use any Proprietary
Information either during or after my employment with the Company, except to the
extent expressly authorized in writing by an officer of GRCI. The following are
some examples of Proprietary Information, even if not marked or identified as
such:
(i) Computer software of all kinds, source and object codes, algorithms, coding
sheets, compilers, assemblers, design concepts, routines and subroutines, and
all related documents and materials;
(ii) Business practices, marketing techniques, mailing lists, purchasing
information, price lists, pricing policies, quoting procedures, customer and
prospective customer lists and information, and all materials or information
relating to the manner in which the Company does business;
(iii) Discoveries, concepts and ideas, whether or not patentable, protectable by
copyright, or otherwise protectable, trade secrets, "know-how," production
processes, research and development activities, and information on products or
programs;
(iv) Financial information, cost structure, bidding strategy, salary structure,
and such other information not in the public domain as may be helpful to
competitors or harmful to the Company, its customers or employees;
(v) Any other information, materials or documents related to the business or
activities of the Company which are not generally known to others engaged in
similar businesses or activities; and
(vi) All ideas which are derived from my access to or knowledge of any of the
above.
4. CONFLICTS OF INTEREST. I have read and understood the Company's Corporate
Standards of Conduct, and while employed by the Company, I agree to abide by
said Standards of Conduct, as the same may be amended from time to time, and to
complete the Company's Ethics Questionnaire as required by the Company from time
to time. Except as fully disclosed in a document attached to this Agreement, I
am not a party to any agreement or understanding with any other person or
business, nor am I subject to any other legal restriction or obligation, which
would in any way prohibit, impede or hinder my employment with the Company or
the performance of my duties in the course of such employment.
5. COMPENSATION.
(a) During the term of my employment hereunder, the Company shall pay me the
annual salary set forth in Exhibit A, Item 3(a) ("Gross Annual Salary").
(b) In addition to my Gross Annual Salary, I shall be entitled to receive the
additional compensation, if any, specified in Exhibit A, Item 3(b) ("Additional
Compensation").
6. DISABILITY. If I am unable to fulfill the duties of my position by reason of
any illness, incapacity or disability, my salary shall be payable for only 90
days following the onset of such illness, incapacity or disability, provided,
however, that if I (i) have applied
for insurance benefits under the Company's long-term disability policy during
said 90 day period, and (ii) have not yet begun to receive payments under said
policy during said 90 day period, then my salary shall continue to be payable
for up to 180 days following the onset of such illness, incapacity or disability
until I begin to receive such payments. During the foregoing 90 day period (or
180 day period, if applicable), my salary, to the extent not covered by the
Company's short-term disability benefits, shall be paid through the use of my
sick leave, if any, accumulated prior to January 1, 1994, but if such sick leave
is or becomes exhausted or is inapplicable to me, my salary shall nevertheless
be paid for the 90 day period (or 180 day period, if applicable). If I shall
return to full employment and full discharge of my duties during the term of
this Agreement, full compensation shall be prospectively reinstated for any
remaining term of this Agreement.
7. TERMINATION AND SEVERANCE.
(a) Except as provided in Section 7(f) regarding termination during the thirty
(30) month period following a Change in Control, this Agreement may be
terminated by either party on six (6) months advance written notice to the other
party, and this Agreement may be terminated by the Company immediately for Cause
by written notice to me. For purposes of this Agreement, "Cause" means:
(i) the willful and continued failure of Employee to substantially
perform his or her duties with the Company (other than any such
failure resulting from incapacity due to physical or mental
illness), after a written demand for substantial performance is
delivered to Employee by the Company which specifically identifies
the manner in which the Company believes that Employee has not
substantially performed his or her duties;
(ii) the willful engaging by Employee in illegal conduct or gross
misconduct which is materially and demonstrably injurious to the
Company;
(iii)Employee's personal dishonesty or breach of fiduciary duty to the
Company that in either case results or was intended to result in
personal profit to Employee at the expense of the Company; or
(iv) willful violation by Employee of any law, rule or regulation
(other than traffic violations, misdemeanors or similar offenses)
or cease-and-desist order, court order, judgment or supervisory
agreement, which violation is materially and demonstrably
injurious to the Company.
For purposes of the preceding clauses (i) through (iv), no act or failure to
act, on the part of Employee, shall be considered "willful" unless it is done,
or omitted to be done, by Employee in bad faith and without reasonable belief
that Employee's action or omission was in the best interests of the Company. Any
act, or failure to act, based upon the instructions or with the express approval
of the Board or of a Company officer
with authority to direct Employee or based upon the advice of counsel for the
Company, shall be conclusively presumed to be done, or omitted to be done, by
Employee in good faith and in the best interests of the Company.
(b) To the maximum extent permitted by law, I hereby expressly authorize the
Company in advance upon my termination to deduct from my final paycheck(s) and
from my paid time off (PTO) check all amounts I owe the Company (including but
not limited to repayment of advances, loans or any other obligations).
(c) Upon termination of employment, I will execute and comply with the Employee
Termination Certificate attached hereto as Exhibit C, and deliver to the Company
all notes, data, tapes, lists, reference materials, sketches, drawings,
memoranda, records and other documents which are in my possession or control
belonging to the Company or relating to its business.
(d) Termination of this Agreement will not relieve me from my obligations under
Sections 1(b), 2 and 3 of this Agreement, which, by their respective terms,
continue beyond the termination of this Agreement.
(e) In the event of my death, this Agreement will terminate and all accrued and
unpaid compensation and expenses, less all amounts I owe the Company (including
but not limited to repayment of advances, loans or any other obligations), will
be payable to my estate.
(f) Notwithstanding any other provision of this Agreement to the contrary, at
any time during the thirty (30) month period following a Change in Control, my
employment may be terminated at any time by either party with or without Cause
on written notice to the other party, provided, however, that:
if:
(i) without Cause, the Company terminates my employment or terminates
this Agreement or gives me notice of either of such terminations;
or
(ii) I terminate my employment for Good Reason,
then:
(x) in addition to any Additional Compensation I have earned, the
Company shall pay me a lump-sum severance payment on the date of
termination of my employment in an amount equal to two (2) times
my Gross Annual Salary, less any income, excise, employment or
other tax withholdings which the Company is required by law to
deduct therefrom;
(y) the Company shall continue to provide me with the same level of
insurance benefits and officer perquisites which I have been
receiving from the
Company immediately prior to termination, and such benefits and
perquisites shall be provided until the earlier of (A) such time
as I obtain new benefits coverage by reason of new employment, or
(B) the two (2) year anniversary of my termination of employment
with the Company; and
(z) the Company shall reimburse me for any legal fees and expenses I
incur in successfully enforcing my rights under this Agreement, if
the Company fails to honor such rights.
For purposes of this Agreement, "Good Reason" means the occurrence, after the
Change in Control, of any of the following events:
(A) the Company materially diminishes my level of responsibility
or position in the Company;
(B) the Company materially diminishes my salary or my bonus
potential;
(C) the Company fails to provide me with generally the same
level of benefits or perquisites provided to other Company
executives in comparable positions;
(D) the Company requires me to relocate to an office more than
25 miles from my place of employment immediately prior to
the Change in Control; or
(E) the Company materially breaches this Agreement (including
but not limited to the terms set forth on Exhibit A hereto)
in any other way;
provided, however, that the foregoing clauses (A) through (E) shall not include
isolated, insubstantial or inadvertent actions of the Company not taken in bad
faith which are remedied by the Company promptly after receipt of notice thereof
given by Employee.
(g) For purposes of this Agreement, a Change in Control means the satisfaction
of the conditions set forth in any one of the following paragraphs:
(i) any person (as defined in Section 3(a)(9) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") as modified and used in
Sections 13(d) and 14(d) thereof, except that neither (A) GRCI or any of its
subsidiaries, (B) a trustee or other fiduciary holding securities under an
employee benefit plan of GRCI or any of its subsidiaries, (C) an underwriter
temporarily holding securities pursuant to an offering of such securities, nor
(D) a corporation owned, directly or indirectly, by the stockholders of GRCI in
substantially the same proportions as their ownership of stock of GRCI shall be
included in such term) (a "Person") is or becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of GRCI (not including in the securities beneficially owned by such
Person any securities acquired
directly from GRCI or its affiliates) representing 25% or more of the combined
voting power of GRCI's then outstanding securities; or
(ii) during any period of up to two consecutive years (not including
any period prior to the execution of this Agreement), individuals who at the
beginning of such period constitute the Board and any new director (other than a
director designated by a Person who has entered into an agreement with GRCI to
effect a transaction described in clause (i), (iii) or (iv) of this paragraph)
whose election by the Board or nomination for election by GRCI's stockholders
was approved by a vote of at least two thirds (2/3) of the directors then still
in office who either were directors at the beginning of the period or whose
election or nomination for election was previously so approved, cease for any
reason to constitute a majority thereof; or
(iii) the shareholders of GRCI approve (or in the event no approval of
GRCI's shareholders is required, GRCI consummates) a merger or consolidation of
GRCI with any other corporation, other than (A) a merger or consolidation which
would result in the voting securities of GRCI outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity), in combination with
the ownership of any trustee or other fiduciary holding securities under an
employee benefit plan of GRCI, at least 65% of the combined voting power of the
voting securities of GRCI or such surviving entity outstanding immediately after
such merger or consolidation, or (B) a merger or consolidation effected to
implement a recapitalization of GRCI (or similar transaction) in which no Person
acquires more than 50% of the combined voting power of GRCI's then outstanding
securities; or
(iv) the shareholders of GRCI approve (or in the event no approval of
GRCI's shareholders is required, GRCI enters into) a plan of complete
liquidation of GRCI or an agreement for the sale or disposition by GRCI of all
or substantially all GRCI's assets.
(h) Notwithstanding any other provision of this Agreement, in the event that any
payment or benefit received or to be received by Employee in connection with a
Change in Control or the termination of Employee's employment (whether pursuant
to the terms of this Agreement or any other plan, arrangement or agreement with
GRCI, any Person whose actions result in a Change in Control or any person
affiliated with GRCI or such Person) (all such payments and benefits, including
the Severance Benefits, being hereinafter called the "Total Benefits"), would be
subject (in whole or in part) to the excise tax (the "Excise Tax") imposed under
Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code"), then
the Severance Benefits shall be reduced to the extent necessary so that no
portion of the Total Benefits is subject to the Excise Tax if (A) the net amount
of such Total Benefits, as so reduced, (and after deduction of the net amount of
federal, state and local income taxes and FICA and Medicare taxes on such
reduced Total Benefits) is greater than (B) the excess of (i) the net amount of
such Total Benefits, without reduction (but after deduction of the net amount of
federal, state and local income taxes and FICA and Medicare taxes on such
Total Benefits), over (ii) the amount of Excise Tax to which Employee would be
subject in respect of such Total Benefits. For purposes of determining whether
and the extent to which the Total Benefits will be subject to the Excise Tax,
(i) no portion of the Total Benefits the receipt or enjoyment of which Employee
shall have effectively waived in writing prior to Employee's date of termination
of employment shall be taken into account, (ii) no portion of the Total Benefits
shall be taken into account which in the opinion of tax counsel selected by GRCI
does not constitute a "parachute payment" within the meaning of Section
280G(b)(2) of the Code, and (iii) the value of any non-cash benefit or any
deferred payment or benefit included in the Total Benefits shall be determined
by GRCI's independent auditors in accordance with the principles of Sections
280G(d)(3) and (d)(4) of the Code. For purposes of this Section 7(h), the term
"Severance Benefits" means the benefits provided for by clauses (x) and (y) of
Section 7(f) hereof.
8. NOTICE.
(a) Any notice to be given to me under this Agreement shall be in writing and
delivered by (i) registered or certified mail, return receipt requested; (ii)
express courier; or (iii) hand-delivery; at an address specified for me in this
Agreement or in any Exhibit hereto or at such other address of which written
notice has been given to GRCI by me by any of the foregoing means.
(b) Any notice to be given to the Company under this Agreement shall be in
writing and delivered by any of the means specified in subsection (a) above, to
the President, with a copy to the Senior Vice President, General Counsel &
Secretary, GRC International, Inc., 1900 Gallows Road, Vienna, Virginia 22182.
9. DISPUTES.
(a) This Agreement has been executed in and shall be governed by the laws of the
Commonwealth of Virginia.
(b) Any controversy or claim arising out of or relating to Employee's employment
or this Agreement shall be resolved in the courts of Fairfax County, Virginia,
and Employee hereby submits to the jurisdiction of such courts, and agrees to
accept service of process from such courts.
(c) I understand and agree that the Company will suffer irreparable harm if I
breach any of my obligations under this Agreement and that monetary damages may
be inadequate to compensate for such breach. Accordingly, in the event of a
breach or threatened breach by me, the Company, in addition to and not in
limitation of any other rights, remedies or damages available to it at law or in
equity or otherwise, shall be entitled to a injunctive relief preventing any
such breach by myself or by my partners, agents, representatives, servants,
employers, employees and/or any and all persons directly or indirectly acting
for or with me.
10. ASSIGNMENT; SUCCESSORS. My services are unique and personal. Accordingly, I
may not assign any rights or delegate any duties or obligations under this
Agreement. The rights and obligations of the Company under this Agreement shall
inure to the benefit of and shall be binding upon the successors and assigns of
the Company.
11. ENTIRE AGREEMENT. This Agreement, together with all documents attached to
this Agreement or specifically referred to in it, contains the entire agreement
and understandings by and between the Company and me with respect to the
covenants described in this Agreement, and any representation, promise,
agreement or understanding, written or oral, not contained in this Agreement
shall be of no force or effect. No change or modification of this Agreement
shall be valid or binding unless the change or modification is in writing and
signed by the parties to this Agreement. Any representation contrary to this
Agreement, express or implied, written or oral, is hereby disclaimed. Nothing in
this Agreement shall obligate the Company to employ me for any length of time.
No waiver of any provision of this Agreement shall be valid unless it is in
writing and signed by the party against whom such waiver is sought to be
enforced, and no waiver of any provision shall be deemed a waiver of any other
provision or a waiver of the same provision at any other time.
12. SEVERABILITY. Any provision of this Agreement which may be determined to be
unenforceable, invalid or illegal shall be deemed stricken from this Agreement
and all remaining provisions shall continue in full force and effect.
13. REASONABLENESS OF RESTRICTIONS. I have carefully read and considered the
provisions of this Agreement and, having done so, agree that the restrictions
set forth in this Agreement are fair and reasonable and are reasonably required
for the Company's protection. This Agreement shall be construed fairly as to all
parties and not in favor of or against any party, regardless of which party
prepared this Agreement. In the event that, notwithstanding the foregoing, any
part of this Agreement shall be held to be invalid or unenforceable, the
remaining parts of the Agreement shall nevertheless continue to be valid and
enforceable as though the invalid or unenforceable parts had not been included
in the Agreement. If any provision is held invalid or unenforceable with respect
to particular circumstances, it shall nevertheless remain in full force and
effect in all other circumstances.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first set forth above.
ATTEST: GRC INTERNATIONAL, INC.
By:
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Thomas E. McCabe Jim Roth
Sr. Vice President, General Counsel & Sec. President & Chief Executive
Officer
WITNESS EMPLOYEE
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(Signature)
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(Please print name)
APPROVED AND RATIFIED BY THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS OF
GRC INTERNATIONAL, INC.
By: ---------------------------
Leslie B. Disharoon, Committee Chairman
EXHIBIT A
DETAILS OF EMPLOYMENT
EMPLOYEE:
ITEM 1(a) Position:
ITEM 1(b) Place of Employment:
ITEM 2 Effective Date of Employment Agreement:
Effective Date of this Exhibit:
ITEM 3(a) Gross Annual Salary:
ITEM 3(b) Additional Compensation (if any):
ITEM 4 Notice to Employee:
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or
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EMPLOYEE: GRC INTERNATIONAL, INC.
By:
- ----------------------------- ---------------------------
Jim Roth
President & Chief Executive
Officer
APPROVED AND RATIFIED BY THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS OF
GRC INTERNATIONAL, INC.
By: -----------------------
Leslie B. Disharoon, Committee Chairman
EXHIBIT B
SCHEDULE OF INTELLECTUAL PROPERTY
I developed or conceived, and consider proprietary to me, the following
Intellectual Property, as that term is defined in the Employment Agreement to
which this Exhibit is attached:
EMPLOYEE
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(Signature)
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(Please print name)
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(Date)
EXHIBIT C
TERMINATION STATEMENT
(to be signed upon termination of employment)
1. I, (employee's name), am cognizant of my legal obligations, as stated in a
certain EMPLOYMENT AGREEMENT dated between myself and GRC International, Inc.
(together with its subsidiaries, the "Company"), and I hereby specifically
reaffirm all of the terms stated in that Agreement.
2. I hereby certify that all materials related directly or indirectly to my
employment with the Company have been returned to the Company. I further certify
that no computer listings, programs, object codes, source codes, product
development guides, flowcharts, test equipment, drawings, blueprints or other
materials owned by the Company or provided to or used by me in connection with
my employment at the Company, whether in machine-readable form or otherwise,
have been retained by me or given to any other third person or entity in
anticipation of my employment termination or for any other reason, and I also
certify that none of those materials will be removed from the Company's premises
by me.
3. I also certify that I have returned all Company identification and Company
credit cards issued to me and all keys to Company and/or customer property that
have been in my possession.
4. I am not aware of any action or situation involving any violation of the
Company's Corporate Standards of Conduct by any employee, director, consultant
or representative of the Company, except as follows:
5. My forwarding addresses are as follows:
HOME ADDRESS BUSINESS ADDRESS
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EMPLOYEE:
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(Signature)
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(Please print name)
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(Date)