Exhibit 10.1


 


EMPLOYMENT AGREEMENT


 


This Employment Agreement (this “Agreement”) is made and entered into as of February 4,
2003 by and between Intrusion Inc., a Delaware corporation (including any of
its subsidiaries or any parent corporation, the “Company”), and Aaron Bawcom, an individual
(the “Executive”).


 


RECITALS


 


WHEREAS,
Executive is currently a Vice President of the Company; and


 


WHEREAS,
the Company and the Executive have determined that it is in their respective
best interest to enter into this Agreement on the terms and conditions as set
forth herein.


 


NOW,
THEREFORE, in consideration of the premises and the
mutual covenants and promises contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto hereby agree as follows:


 


AGREEMENT


 


1.               EMPLOYMENT
TERMS AND DUTIES


 


1.1                                 Employment.  The Company hereby employs Executive, and
Executive hereby accepts continued employment by the Company, upon the terms
and conditions set forth in this Agreement.


 


1.2                                 Duties.  Executive shall continue to serve as Vice
President or any other similar duties the Company may assign Executive.


 


1.3                                 During
the term of Executive’s employment hereunder, Executive shall devote his full
working time and efforts to the performance of his duties and the furtherance
of the interests of the Company and shall not be otherwise employed.  Notwithstanding the above, Executive may
serve as a director or trustee of other organizations; engage in charitable,
civic, and/or governmental activities; provided that such service and
activities do not prevent Executive from performing the duties required of
Executive under this Agreement and further provided that Executive obtains
written consent for all such activities from the Company, which consent will
not be unreasonably withheld.  Executive
may engage in personal activities, including, without limitation, personal
investments, provided that such activities do not interfere with Executive’s
performance of duties hereunder and/or the provisions of Executive’s written
agreements with the Company.


 


1.4                                 Term.  Subject to the provisions of Section 1.5
and Section 1.7 below, the term of Executive’s employment under this
Agreement shall commence this date and shall continue for a period of two (2)
years (the “Employment Term”).


 


 

















 


1.5                                 Compensation
and Benefits.


 


1.5.1                        Base
Salary.  Subject to the
provisions of Section 1.7 and in consideration of the services rendered
to the Company hereunder by Executive; the Company shall, during the Employment
Term, pay Executive a salary at the annual rate of one hundred seventy five
thousand dollars ($175,000) (the “Base  Salary”), less statutory deductions and withholdings,
payable in accordance with the Company’s regular payroll practices.  Base Salary shall be payable bi-weekly in
accordance with the Company’s normal payroll practices.


 


1.5.2                        Retention
Bonus.   Executive shall
be paid, on or before February 21, 2003, a Retention Bonus of one-hundred
seventy-five thousand dollars ($175,000), less statutory deductions and
withholdings, payable in accordance with the Company’s regular payroll
practices.    Retention Bonus shall vest
ratibly for 24 months.  Unearned
Retention Bonus shall be repaid by Executive to Company in the event of
voluntary termination or termination for cause as defined in Section 1.6.2.
If Executive is terminated by the Company without Cause, the Retention Bonus
becomes fully vested.


 


1.5.3                        Benefits
Package.  In addition to
the Base Salary set forth in Section 1.5.1 and the Retention Pay set
forth in Section 1.5.2, during the Employment Term, Executive shall be
entitled to receive such employee benefits, vacation and holidays as may be in
effect from time to time as are afforded to other executives of the Company.


 


1.6                                 Termination.  Executive’s employment and this Agreement
(except as otherwise provided hereunder) shall terminate upon the occurrence of
any of the following, at the time set forth therefor (the “Termination Date”):


 


1.6.1                        Death or
Disability.  Immediately
upon the death of Executive or the determination by the Company that Executive
has ceased to be able to perform the essential functions of his duties, with or
without reasonable accommodation, for a period of not less than ninety (90)
days, due to a mental or physical illness or incapacity (“Disability”) (termination pursuant to this Section
1.6.1 being referred to herein as termination for “Death or Disability”); or


 


1.6.2                        Termination
For Cause.  Immediately
following notice of termination for “Cause” (as defined below), specifying such
Cause, given by the Company (termination pursuant to this Section 1.6.2
being referred to herein as termination for “Cause”). 
As used herein, “Cause” means termination based on
Executive’s:


 


(a)          conviction or plea of “guilty”
or “no
contest” to any crime constituting a felony in the jurisdiction in
which committed, any crime involving moral turpitude (whether or not a felony),
or any other violation of criminal law involving dishonesty or willful
misconduct that materially injures the Company (whether or not a felony);


 


(b)         substance abuse that in
any manner materially interferes with the performance of your duties;


 


(c)          breach of this
agreement;


 


(d)         misconduct that
materially discredits or damages the Company;


 


(e)          indictment for a felony
violation of the federal securities laws; or


 


(f)            chronic absence from
work for reasons other than illness or incapacity.


 


 

















 


1.6.3                        Other
Remedies.  Termination
pursuant to Section 1.6.2 above shall be in addition to and without prejudice
to any other right or remedy to which the Company may be entitled at law, in
equity, or under this Agreement.


 


1.7                                 Severance
and Termination.  In the
case of a termination of Executive’s employment hereunder for any reason
including and without limitation, termination without Cause, (i) Executive
shall not be entitled to receive payment of, and the Company shall have no
obligation to pay, any severance or similar compensation attributable to such
termination, other than Base Salary earned but unpaid, accrued but unused
vacation, vested benefits under any employee benefit plan, and any unreimbursed
expenses incurred by Executive as of the termination date, and (ii) the
Company’s obligations under this Agreement shall immediately cease.


 


 


2.               REPRESENTATIONS AND WARRANTIES BY THE EMPLOYEE


 


Executive represents and warrants to the Company that (i) this
Agreement is valid and binding upon and enforceable against him in accordance
with its terms, (ii) Executive is not bound by or subject to any contractual or
other obligation that would be violated by his execution or performance of this
Agreement, including, but not limited to, any non-competition agreement
presently in effect, and (iii) Executive is not subject to any pending or, to
Executive’s knowledge, threatened claim, action, judgment, order, or
investigation that could adversely affect his ability to perform his
obligations under this Agreement or the business reputation of the Company.


 


3.               MISCELLANEOUS


 


3.1                                 Notices.  All notices, requests, and other
communications hereunder must be in writing and will be deemed to have been
duly given only if delivered personally against written receipt or by facsimile
transmission with answer back confirmation or mailed (postage prepaid by
certified or registered mail, return receipt requested) or by overnight courier
to the parties at the following addresses or facsimile numbers:


 


If to the Executive, to:


Aaron Bawcom


10604 Birmingham Dr


Frisco, TX 75035


 


If to the Company, to:


Intrusion Inc.


1101 E. Arapaho Road


Richardson, Texas  75081


Facsimile:  (972) 234-1467


Attention:  Ward Paxton


 


3.2                                 Entire
Agreement.  This
Agreement supersedes all prior discussions and agreements among the parties
with respect to the subject matter hereof and contain the sole and entire agreement
between the parties hereto with respect thereto.


 


3.3                                 Waiver.  Any term or condition of this Agreement may
be waived at any time by the party that is entitled to the benefit thereof, but
no such waiver shall be effective unless set forth in a written instrument duly
executed by or on behalf of the party waiving such term or condition.  No waiver by any party hereto of any term or
condition of this Agreement, in any one or more


 

















 


instances, shall be deemed to be or construed
as a waiver of the same or any other term or condition of this Agreement on any
future occasion.  All remedies, either
under this Agreement or by law or otherwise afforded, will be cumulative and
not alternative.


 


3.4                                 Amendment.  This Agreement may be amended,
supplemented, or modified only by a written instrument duly executed by or on
behalf of each party hereto.


 


3.5                                 Change of
Control. Upon Change of Control of the Company, unearned
Retention Bonus shall become fully vested.


 


3.6                                 No Third
Party Beneficiary.  The
terms and provisions of this Agreement are intended solely for the benefit of
each party hereto and the Company’s successors or assigns, and it is not the
intention of the parties to confer third-party beneficiary rights upon any
other person.


 


3.7                                 No
Assignment; Binding Effect. 
This Agreement shall inure to the benefit of any successors or assigns
of the Company.  Executive shall not be
entitled to assign his obligations under this Agreement.


 


3.8                                 Headings.  The headings used in this Agreement have
been inserted for convenience of reference only and do not define or limit the
provisions hereof.


 


3.9                                 Severability.  The Company and Executive intend all
provisions of this Agreement to be enforced to the fullest extent permitted by
law. Accordingly, if a court of competent jurisdiction determines that the
scope and/or operation of any provision of this Agreement is too broad to be
enforced as written, the Company and Executive intend that the court should
reform such provision to such narrower scope and/or operation as it determines
to be enforceable.  If, however, any
provision of this Agreement is held to be illegal, invalid, or unenforceable
under present or future law, and not subject to reformation, then (i) such
provision shall be fully severable, (ii) this Agreement shall be construed and
enforced as if such provision was never a part of this Agreement, and (iii) the
remaining provisions of this Agreement shall remain in full force and effect
and shall not be affected by illegal, invalid, or unenforceable provisions or
by their severance.


 


3.10                           Governing
Law.  This Agreement
shall be governed by and construed in accordance with the laws of the State of
Texas applicable to contracts executed and performed in such State without
giving effect to conflicts of laws principles.


 


3.11                           Jurisdiction.  With respect to any suit, action, or other
proceeding arising from (or relating to) this Agreement, the Company and
Executive hereby irrevocably agree to the non-exclusive personal jurisdiction
and venue of the United States District Court for the Northern District of
Texas (and any Texas State Court within Dallas County, Texas).


 


3.12                           Counterparts.  This Agreement may be executed in any number
of counterparts and by facsimile, each of which will be deemed an original, but
all of which together will constitute one and the same instrument.


 


IN
WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed on the date first written above.


 


 

















 


	
   

  	
  “COMPANY”

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  INTRUSION INC.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ G. Ward Paxton

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  G. Ward Paxton

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  President & CEO

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  2/4/03

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  “EXECUTIVE”

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Aaron Bawcom

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  /s/ Aaron Bawcom

  	
   

  
	
   

  	
  Executive

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  2/4/03