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 Richard A. Montoni (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   Richard A. Montoni    
                                Date     Title  

 

3