UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
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CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
April 24, 2006
Date of report (date of earliest event reported)
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DIGITAL FUSION, INC.
(Exact Name of Registrant as Specified in its Charter)
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Delaware 0-24073 13-3817344
(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
4940-A Corporate Drive, Huntsville, AL 35805
(Address of Principal Executive Offices)
(256) 837-2620
(Registrant's telephone number, including area code)
Not Applicable
(Former Name or Former address, if Changed Since Last Report)
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Check the appropriate box below if the Form 8-K filing in intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14D-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Section 1 - Registrant's Business and Operations
Item 1.01 Entry into a Material Definitive Agreement.
Maria A. Sepulveda's Employment Agreement
On April 24, 2006 the Company entered into an employment agreement (the
"Agreement") with Maria A. Sepulveda (the "Executive") pursuant to which the
Company has retained the Executive to serve as Executive Vice President of
Northeast Region, effective May 1, 2006. The following summary is qualified in
its entirety by reference to the text of the Agreement.
The Executive's term of employment shall be for a period of two years
commencing on May 1, 2006, unless terminated earlier pursuant to the terms of
the Agreement. Under the terms of the Agreement, the Executive will receive
annual compensation of no less than $80,000 and participate in the Company's
Executive Incentive Plan. Subject to the terms and conditions of the Executive
Incentive Plan, the Company will grant to the Executive an option to purchase
180,000 shares of the Company's common stock of which 40,000 shares will vest
immediately and the remainder will vest subject to certain performance-based
criteria structured by the Board of Directors. The exercise price shall be
determined on the effective date of the grant. The Company will provide for the
Executive's participation in the medical, dental, vision, life and disability
insurance programs maintained by the Company for its employees.
The Agreement also provides for the payment by the Company to the Executive
severance payments equal to 12 months of the Executive's base salary at the time
of termination plus any accrued and unpaid incentive bonus upon a voluntary
termination of employment for "good reason," an involuntary termination of
employment without "good cause," or a voluntary termination of employment
following a reduction in the Executive's duties or title. Following such a
termination of employment, the Executive will receive (i) all benefits that have
vested under the terms of the Agreement, and (ii) health care coverage
continuation rights under COBRA. Upon, or up to one year after, a change of
control if the Executive's employment with the Company is terminated for any
reason other than his death, disability or legal incapacity, the Executive shall
be entitled to an amount up one-half of his annual base salary plus any other
accrued and unpaid amounts. This change of control payment may be made in a lump
sum or in equal monthly installments at the election of the Executive.
In the event the Executive terminates his employment for other than "good
reason," or the Company terminates the Executive's employment for "cause," the
Executive shall not be entitled to receive any salary or other compensation or
other benefits for any period after such termination. However, following such a
termination of employment, the Executive will receive (i) all benefits that have
vested under the terms of the Agreement, and (ii) health care coverage
continuation rights under COBRA. The Agreement and all benefits provided under
the Agreement will terminate immediately upon the death of the Executive,
provided that the Executive's heirs and estate will receive all benefits that
have vested under any written term of plan, and the Executive's dependents will
receive health care coverage continuation rights under COBRA.
The Agreement contains restrictive covenants which prohibit the Executive
from (i) associating with a business that is competitive with any line of
business of the Company for which the Executive provided services during the
term of the Executive's employment, without the Company's consent and (ii)
soliciting the Company's agents and employees during the term of the Executive's
employment and for a period of one year following any termination of employment.
James DeBroux's Employment Agreement
On April 24, 2006 the Company entered into an employment agreement (the
"Agreement") with James DeBroux (the "Executive") pursuant to which the Company
has retained the Executive to serve as Vice President of the Washington D.C.
Business Unit, effective May 1, 2006. The following summary is qualified in its
entirety by reference to the text of the Agreement.
The Executive's term of employment shall be for a period of two years
commencing on May 1, 2006, unless terminated earlier pursuant to the terms of
the Agreement. Under the terms of the Agreement, the Executive will receive
annual compensation of no less than $145,000 and participate in the Company's
Executive Incentive Plan. Subject to the terms and conditions of the Executive
Incentive Plan, the Company will grant to the Executive an option to purchase
120,000 shares of the Company's common stock of which 26,667 shares will vest
immediately and the remainder will vest subject to certain performance-based
criteria structured by the Board of Directors. The exercise price shall be
determined on the effective date of the grant. The Company will provide for the
Executive's participation in the medical, dental, vision, life and disability
insurance programs maintained by the Company for its employees.
The Agreement also provides for the payment by the Company to the Executive
severance payments equal to 6 months of the Executive's base salary at the time
of termination plus any accrued and unpaid incentive bonus upon a voluntary
termination of employment for "good reason," an involuntary termination of
employment without "good cause," or a voluntary termination of employment
following a reduction in the Executive's duties or title. Following such a
termination of employment, the Executive will receive (i) all benefits that have
vested under the terms of the Agreement, and (ii) health care coverage
continuation rights under COBRA. Upon, or up to one year after, a change of
control if the Executive's employment with the Company is terminated for any
reason other than his death, disability or legal incapacity, the Executive shall
be entitled to an amount up one-half of his annual base salary plus any other
accrued and unpaid amounts. This change of control payment may be made in a lump
sum or in equal monthly installments at the election of the Executive.
In the event the Executive terminates his employment for other than "good
reason," or the Company terminates the Executive's employment for "cause," the
Executive shall not be entitled to receive any salary or other compensation or
other benefits for any period after such termination. However, following such a
termination of employment, the Executive will receive (i) all benefits that have
vested under the terms of the Agreement, and (ii) health care coverage
continuation rights under COBRA. The Agreement and all benefits provided under
the Agreement will terminate immediately upon the death of the Executive,
provided that the Executive's heirs and estate will receive all benefits that
have vested under any written term of plan, and the Executive's dependents will
receive health care coverage continuation rights under COBRA.
The Agreement contains restrictive covenants which prohibit the Executive from
(i) associating with a business that is competitive with any line of business of
the Company for which the Executive provided services during the term of the
Executive's employment, without the Company's consent and (ii) soliciting the
Company's agents and employees during the term of the Executive's employment and
for a period of one year following any termination of employment.
Section 5 - Corporate Governance and Management
Item 5.02(c) Appointment of Certain New Officers
Maria A. Sepulveda Appointed Executive Vice President, Northeast Region
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(1) As described in Item 1.01 above, Maria A. Sepulveda was appointed to
Executive Vice President, Northeast Region effective May 1, 2006.
On April 25, 2006, Digital Fusion issued a press release announcing the
appointment of Ms. Sepulveda as the Company's new Executive Vice President for
the Northeast Region. The press release is attached to this Form 8-K as Exhibit
99.1.
James DeBroux Appointed Vice President, Washington, D.C. Business Unit
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(1) As described in Item 1.01 above, James DeBroux was appointed to Vice
President of the Washington, D.C. Business Unit of the Company, effective May 1,
2006.
On April 25, 2006, the Company issued a press release announcing the
appointment of Mr. DeBroux as the Company's new Vice President for the
Washington, D.C. Business Unit. The press release is attached to this Form 8-K
as Exhibit 99.1.
Section 9 - Financial Statements Exhibits
Item 9.01 Financial Statements and Exhibits
(c) Exhibits
Exhibit No. Description
99.1* Press release dated April 25, 2006, issued by Digital
Fusion, Inc.
* Filed herewith.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: April 27, 2006
DIGITAL FUSION, INC.
By: /s/ Elena I. Crosby
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Elena I. Crosby, Corporate Secretary
EXHIBIT INDEX
Exhibit No. Description
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99.1* Press release dated April 25, 2006, issued by Digital
Fusion, Inc.
*Filed herewith.