Unassociated Document


    EXECUTIVE EMPLOYMENT
AGREEMENT

    


    This Executive Employment Agreement
(this “Agreement”) is made as of the 15th day of December, 2009 by and between
InferX Corp., a Delaware corporation (the “Company”), and Raimondo
G. Piluso, a natural person, residing in the Commonwealth of Virginia
(“Executive”).

    


    WHEREAS, the Company wishes to employ
Executive as its Chief Operating Officer (“COO”) and Executive wishes to accept
such employment;

    


    WHEREAS, the Company and Executive wish
to set forth the terms of Executive’s employment and certain additional
agreements between Executive and the Company.

    


    NOW, THEREFORE, in consideration of the
foregoing recitals and the representations, covenants and terms contained
herein, the parties hereto agree as follows:

    


    
      	
               
      

            	
              1.

            	
              Employment
      Period

            


    

    


    The
Company will employ Executive, and Executive will serve the Company, under the
terms of this Agreement commencing October 27, 2009 (the “Commencement Date”)
for a term of three (3) years unless earlier terminated under Section 4
hereof.  The period of time between the commencement and the
termination of Executive’s employment hereunder shall be referred to herein as
the “Employment Period.”

    


    
      	
               
      

            	
              2.

            	
              Duties
      and Status

            


    

    


    The
Company hereby engages Executive as its COO on the terms and conditions set
forth in this Agreement. including the terms and conditions of the Employee
Proprietary Information, Inventions, and Non-Competition Agreement attached
hereto as Exhibit
A and incorporated herein (the “Non-Disclosure Agreement”). Executive
agrees to devote the Executive’s entire business time, attention and energies to
the business and interests of the Company during the Employment Period. During
the  Employment Period, Executive shall report directly to the
President of the Company and shall exercise such authority, perform such
executive functions and discharge such responsibilities as are reasonably
associated with Executive’s position, commensurate with the authority vested in
Executive pursuant to this Agreement and consistent with the governing documents
of the Company.

    


    
      	
               
      

            	
              3.

            	
              Compensation
      and Benefits

            


    

    


    
      	
               
      

            	
              (a)

            	
              Salary.  During
      the Employment Period, the Company shall pay to Executive, as compensation
      for the performance of his duties and obligations under this Agreement, a
      base salary of $175,000 per annum, payable
  semi-monthly.

            


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (b)

            	
              Bonus.  During
      the Employment Period, Executive shall be eligible for a bonus to be paid
      in cash, stock or both on terms that shall be mutually acceptable to the
      Board and Executive.

            


    

     

    
      	
               
      

            	
              (c)

            	
              Equity.   Upon
      execution of this Agreement Executive shall receive an option to acquire
      500,000 shares of the Company’s common stock under the Company’s 2006
      Stock Incentive Plan, of which 200,000 shares shall vest at the time of
      execution of this Agreement and 150,000 shares shall vest upon the first
      and second anniversaries of the date of this Agreement. Executive shall be
      eligible to receive restricted stock, additional options, etc. (“Equity”)
      under the Company’s 2006 Stock Incentive Plan at the discretion of the
      Board of Directors (the “Board”).

            


    

     

    
      	
               
      

            	
              (d)

            	
              Other
      Benefits.  During the Employment Period, Executive shall
      be entitled to participate in all of the employee benefit plans, programs
      and arrangements of the Company in effect during the Employment Period
      which are generally available to senior executives of the Company, subject
      to and on a basis consistent with the terms, conditions and overall
      administration of such plans, programs and arrangements.  In
      addition, during the Employment Period, Executive shall be entitled to
      fringe benefits and perquisites comparable to those of other senior
      executives of the Company including, but not limited to, standard
      holidays, twenty (20) days of vacation pay plus five (5) sick/personal
      days, to be used in accordance with the Company’s vacation pay policy for
      senior executives.

            


    

     

    
      	
               
      

            	
              (e)

            	
              Business
      Expenses.  During the Employment Period, the Company
      shall promptly reimburse Executive for all appropriately documented,
      reasonable business expenses incurred by Executive in the performance of
      his duties under this Agreement, including telecommunications expenses and
      travel expenses.

            


    

     

    
      	
               
      

            	
              (f)

            	
              Automobile
      Allowance.  The Company shall pay up to $500 per month to
      lease an automobile for Executive, such lease to be in the name of the
      Company.

            


    

     

    
      	
               
      

            	
              4.

            	
              Termination
      of Employment

            


    

    


    
      	
               
      

            	
              (a)

            	
              Termination for
      Cause.  The Company may terminate Executive’s employment
      hereunder for Cause (defined below).  For purposes of this
      Agreement and subject to Executive’s opportunity to cure as provided in
      Section 4(c) hereof, the Company shall have Cause to terminate Executive’s
      employment hereunder if such termination shall be the result
      of:

            


    

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (i)

            	
              a
      material breach
      of fiduciary duty or material breach
      of the terms of this Agreement or any other agreement between Executive
      and the Company (including without limitation any agreements regarding
      confidentiality, inventions assignment and
    non-competition);

            


    

     

    
      	
               
      

            	
              (ii)

            	
              the
      commission by Executive of any act of embezzlement, fraud, larceny or
      theft on or from the Company;

            


    

     

    
      	
               
      

            	
              (iii)

            	
              substantial
      and continuing neglect or inattention by Executive of the duties of his
      employment or the willful misconduct or gross negligence of Executive in
      connection with the performance of such duties which remains uncured for a
      period of fifteen (15) days following receipt of written notice from the
      Board specifying the nature of such
breach;

            


    

     

    
      	
               
      

            	
              (iv)

            	
              the
      commission and indictment by Executive of any crime involving moral
      turpitude or a felony; and

            


    

     

    
      	
               
      

            	
              (v)

            	
              Executive’s
      performance or omission of any act which, in the judgment of the Board, if
      known to the customers, clients, stockholders or any regulators of the
      Company, would have a material and adverse impact on the business of the
      Company.

            


    

     

    
      	
               
      

            	
              (b)

            	
              Termination for Good
      Reason.  Executive shall have the right at any time to
      terminate his employment with the Company upon not less than thirty (30)
      days prior written notice of termination for Good Reason (defined
      below).  For purposes of this Agreement and subject to the
      Company’s opportunity to cure as provided in Section 4(c) hereof,
      Executive shall have Good Reason to terminate his employment hereunder if
      such termination shall be the result
of:

            


    

     

    
      	
            	
              (i) 

            	
              the
      Company’s material breach of this Agreement;
or

            


    

     

    
      	
               
      

            	
              (ii)

            	
              A
      requirement by the Company that Executive perform any act or refrain from
      performing any act that would be in violation of any applicable
      law.

            


    

     

    
      	
               
      

            	
              (iii)

            	
              A
      material and substantial reduction of the Employee’s responsibilities that
      is inconsistent with the Employee’s status as a senior executive of the
      Company, but in each case subject to the limitations on the Employee's
      rights and responsibilities set forth in Section
  2.

            


    

    


    
      	
               
      

            	
              (iv)

            	
              A
      requirement that Executive relocate his permanent residence more than
      thirty (30) miles from his current
address.

            


    

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (c)

            	
              Notice and Opportunity to
      Cure.  Notwithstanding the foregoing, it shall be a
      condition precedent to the Company’s right to terminate Executive’s
      employment for Cause and Executive’s right to terminate for Good Reason
      that (i) the party seeking termination shall first have given the other
      party written notice stating with specificity the reason for the
      termination (“breach”) and (ii) if such breach is susceptible of cure or
      remedy, a period of fifteen (15) days from and after the giving of such
      notice shall have elapsed without the breaching party having effectively
      cured or remedied such breach during such 15-day period, unless such
      breach cannot be cured or remedied within fifteen (15) days, in which case
      the period for remedy or cure shall be extended for a reasonable time (not
      to exceed an additional thirty (30) days) provided the breaching party has
      made and continues to make a diligent effort to effect such remedy or
      cure.

            


    

    


    
      	
               
      

            	
              (d)

            	
              Voluntary
      Termination.  Executive, at his election, may terminate
      his employment upon not less than sixty (60) days prior written notice of
      termination other than for Good
Reason.

            


    

    


    
      	
               
      

            	
              (e)

            	
              Termination Upon Death or
      Permanent and Total Disability.  The Employment Period
      shall be terminated by the death of Executive.  The Employment
      Period may be terminated by the Board if Executive shall be rendered
      incapable of performing his duties to the Company by reason of any
      medically determined physical or mental impairment that can be reasonably
      expected to result in death or that can be reasonably be expected to last
      for a period of either (i) six (6) or more consecutive months from the
      first date of Executive’s absence due to the disability or (ii) nine (9)
      months during any twelve-month period (a “Permanent and Total
      Disability”).  If the Employment Period is terminated by reason
      of a Permanent and Total Disability of Executive, the Company shall give
      thirty (30) days’ advance written notice to that effect to
      Executive.

            


    

    


    
      	
               
      

            	
              (f)

            	
              Termination at the Election of
      the Company.  At the election of the Company, otherwise
      than for Cause as set forth in Section 4(a) above, upon not less than
      sixty (60) days prior written notice of
  termination.

            


    

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (g)

            	
              Termination for Business
      Failure.  Anything contained herein to the contrary
      notwithstanding, in the event the Company’s business is discontinued
      because continuation is rendered impracticable by substantial financial
      losses, lack of funding, legal decisions, administrative rulings,
      declaration of war, dissolution, national or local economic depression or
      crisis or any reasons beyond the control of the Company, then this
      Agreement shall terminate as of the day the Company determines to cease
      operation with the same force and effect as if such day of the month were
      originally set as the termination date hereof.  In the event
      this Agreement is terminated pursuant to this Section 4(g), the Executive
      will not be entitled to severance
pay.

            


    

    


    
      	
               
      

            	
              5.

            	
              Consequences
      of Termination

            


    

    


    
      	
               
      

            	
              (a)

            	
              By Executive for Good Reason
      or the Company Without Cause.  In the event of a
      termination of Executive’s employment during the Employment Period by
      Executive for Good Reason pursuant to Section 4(b) or the Company without
      Cause pursuant to Section 4 (f) the Company shall pay Executive (or his
      estate) and provide him with the following, provided that Executive enter
      into a release of claims agreement agreeable to the Company and
      Executive:

            


    

    


    
      	
               
      

            	
              (i)

            	
              Cash
      Payment.  A cash payment, payable in equal installments
      over a six (6) month period after Executive’s termination of employment,
      equal to the sum of the following:

            


    

     

    
      	
               
      

            	
              (A)

            	
              Salary.  The
      equivalent of the greater of (i) twelve (12) months of Executive’s
      then-current base salary or (ii) the remainder of the term of this
      Agreement (the “Severance Period”);
plus

            


    

     

    
      	
               
      

            	
              (B)

            	
              Earned but Unpaid
      Amounts.  Any previously earned but unpaid salary through
      Executive’s final date of employment with the Company, and any previously
      earned but unpaid bonus amounts prior to the date of Executive’s
      termination of employment.

            


    

    


    
      	
               
      

            	
              (C)

            	
              Equity.  All
      Equity vested at time of termination shall be retained by Executive and
      all Equity that has not vested shall be accelerated and be deemed vested
      for purposes of this Section 5.

            


    

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (ii)

            	
              Other
      Benefits.  The Company shall provide continued coverage
      for the Severance Period under all health, life, disability and similar
      employee benefit plans and programs of the Company on the same basis as
      Executive was entitled to participate immediately prior to such
      termination, provided that Executive’s continued participation is possible
      under the general terms and provisions of such plans and
      programs.  In the event that Executive’s participation in any
      such plan or program is barred, the Company shall use its commercially
      reasonable efforts to provide Executive with benefits substantially
      similar (including all tax effects) to those which Executive would
      otherwise have been entitled to receive under such plans and programs from
      which his continued participation is barred.  In the event that
      Executive is covered under substitute benefit plans of another employer
      prior to the expiration of the Severance Period, the Company will no
      longer be obligated to continue the coverages provided for in this Section
      5(a)(ii).

            


    

    


    
      	
               
      

            	
              (b)

            	
              Other Termination of
      Employment.  In the event that Executive’s employment
      with the Company is terminated during the Employment Period by the Company
      for Cause (as provided for in Section 4(a) hereof) or by Executive other
      than for Good Reason (as provided for in Section 4(b) hereof), the Company
      shall pay or grant Executive any earned but unpaid salary, bonus, and
      Options through Executive’s final date of employment with the Company, and
      the Company shall have no further obligations to
  Executive.

            


    

    


    
      	
               
      

            	
              (c)

            	
              Withholding of
      Taxes.  All payments required to be made by the Company
      to Executive under this Agreement shall be subject only to the withholding
      of such amounts, if any, relating to tax, excise tax and other payroll
      deductions as may be required by law or
  regulation.

            


    

    


    
      	
               
      

            	
              (d)

            	
              No Other
      Obligations.  The benefits payable to Executive under
      this Agreement are not in lieu of any benefits payable under any employee
      benefit plan, program or arrangement of the Company, except as
      specifically provided herein, and Executive will receive such benefits or
      payments, if any, as he may be entitled to receive pursuant to the terms
      of such plans, programs and arrangements.  Except for the
      obligations of the Company provided by the foregoing and this Section 5,
      the Company shall have no further obligations to Executive upon his
      termination of employment.

            


    

    


    
      	
               
      

            	
              (e)

            	
              Mitigation or
      Offset.  Executive shall not be required to mitigate the
      damages provided by this Section 5 by seeking substitute employment or
      otherwise and there shall not be an offset of the payments or benefits set
      forth in this Section 5.

            


    

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              6.

            	
              Governing
      Law

            


    

    


    This Agreement and the rights and
obligations of the parties hereto shall be construed in accordance with the laws
of the Commonwealth of Virginia, without giving effect to the principles of
conflict of laws.


    
      
         


      

      
        -7-

        
          

        

      

      
         


      

    

    


    
      	
               
      

            	
              7.

            	
              Indemnity
      and Insurance

            


    

    


    The Company shall indemnify and save
harmless Executive for any liability incurred by reason of any act or omission
performed by Executive while acting in good faith on behalf of the Company and
within the scope of the authority of Executive pursuant to this Agreement and to
the fullest extent provided under the Bylaws, the Articles of Incorporation and
the Stock Corporation Act of Virginia, except that Executive must have in good
faith believed that such action was in, or not opposed to, the best interests of
the Company, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe that such conduct was unlawful.

    


    The Company shall provide that
Executive is covered by Directors and Officers insurance that the Company
provides to other senior executives and/or board members.

    


    
      	
               
      

            	
              8.

            	
              Cooperation
      with the Company After Termination of
Employment

            


    

    


    Following termination of Executive’s
employment for any reason, Executive shall fully cooperate with the Company in
all matters relating to the winding up of Executive’s pending work on behalf of
the Company including, but not limited to, any litigation in which the Company
is involved, and the orderly transfer of any such pending work to other
employees of the Company as may be designated by the
Company.  Following any notice of termination of employment by either
the Company or Executive, the Company shall be entitled to such full time or
part time services of Executive as the Company may reasonably require during all
or any part of the sixty (60)-day period following any notice of termination,
provided that Executive shall be compensated for such services at the same rate
as in effect immediately before the notice of termination.

    


    
      	
               
      

            	
              9.

            	
              Notice

            


    

    


    All
notices, requests and other communications pursuant to this Agreement shall be
sent by overnight mail or by fax with proof of transmission to the following
addresses:

    


    If to Executive:

    


    Ray Piluso

     

    Phone:

    Fax:


    
      
         


      

      
        -8-

        
          

        

      

      
         


      

    

    


    If to the Company:

    


    InferX Corp.

    Attn: Vijay Suri, President and
CEO

    46950
Jennings Farm Drive

    Suite
290

    Sterling,
Virginia 20190

    Phone:   (703)
444-6064

    Fax:  (703)

    


    
      	
               
      

            	
              10.

            	
              Waiver
      of Breach

            


    

    


    Any waiver of any breach of this
Agreement shall not be construed to be a continuing waiver or consent to any
subsequent breach on the part of either Executive or of the
Company.

    


    
      	
               
      

            	
              11.

            	
              Non-Assignment
      / Successors

            


    

    


    Neither party hereto may assign his/her
or its rights or delegate his/hers or its duties under this Agreement without
the prior written consent of the other party; provided, however, that (i) this
Agreement shall inure to the benefit of and be binding upon the successors and
assigns of the Company upon any sale or all or substantially all of the
Company’s assets, or upon any merger, consolidation or reorganization of the
Company with or into any other corporation, all as though such successors and
assigns of the Company and their respective successors and assigns were the
Company; and (ii) this Agreement shall inure to the benefit of and be binding
upon the heirs, assigns or designees of Executive to the extent of any payments
due to them hereunder.  As used in this Agreement, the term “Company”
shall be deemed to refer to any such successor or assign of the Company referred
to in the preceding sentence.

    


    
      	
               
      

            	
              12.

            	
              Severability

            


    

    


    To the extent any provision of this
Agreement or portion thereof shall be invalid or unenforceable, it shall be
considered deleted there from and the remainder of such provision and of this
Agreement shall be unaffected and shall continue in full force and
effect.

    


    
      	
               
      

            	
              13.

            	
              Counterparts

            


    

    


    This Agreement may be executed in one
or more counterparts, each of which shall be deemed to be an original but all of
which together will constitute one and the same instrument.


    
      
         


      

      
        -9-

        
          

        

      

      
         


      

    

    


    
      	
               
      

            	
              14.

            	
              Arbitration

            


    

    


    Executive and the Company shall submit
to mandatory and exclusive binding arbitration, any controversy or claim arising
out of, or relating to, this Agreement or any breach hereof where the amount in
dispute is greater than or equal to $50,000, provided, however, that the
parties retain their right to, and shall not be prohibited, limited or in any
other way restricted from, seeking or obtaining equitable relief from a court
having jurisdiction over the parties.  In the event the amount of any
controversy or claim arising out of, or relating to, this Agreement, or any
breach hereof, is less than $50,000, the parties hereby agree to submit such
claim to mediation.  Such arbitration shall be governed by the Federal
Arbitration Act and conducted through the American Arbitration Association
(“AAA”) in the District of Columbia, before a single neutral arbitrator, in
accordance with the National Rules for the Resolution of Employment Disputes of
the American Arbitration Association in effect at that time.  The
parties may conduct only essential discovery prior to the hearing, as defined by
the AAA arbitrator.  The arbitrator shall issue a written decision
which contains the essential findings and conclusions on which the decision is
based.  Mediation shall be governed by, and conducted through, the
AAA.  Judgment upon the determination or award rendered by the
arbitrator may be entered in any court having jurisdiction thereof.

    


    
      	
               
      

            	
              15.

            	
              Entire
      Agreement

            


    

    


    This Agreement and all schedules and
other attachments hereto constitute the entire agreement by the Company and
Executive with respect to the subject matter hereof and, except as specifically
provided herein, supersedes any and all prior agreements or understandings
between Executive and the Company with respect to the subject matter hereof,
whether written or oral.  This Agreement may be amended or modified
only by a written instrument executed by Executive and the Company.

     

    [Signature Page
Follows]


    
      
         


      

      
        -10-

        
          

        

      

      
         


      

    

     

    IN WITNESS WHEREOF, the parties have
executed this Agreement as of the date above

    


    
      
        	
                INFERX
      CORP.

              
	 
      
	
                /s/ Vijay Suri

              
	
                By:
      Vijay Suri

              
	
                Its:  President
      and CEO

              
	 
      
	
                /s/ Raimondo
  G. Piluso

              
	
                Raimondo
      G. Piluso

              


      

    

     

    
      [Signature Page to Ray Piluso
Executive Employment Agreement]

    


    
      
         


      

      
        -11-

        
          

        

      

      
         


      

    


    Exhibit A

     

    Employee Proprietary
Information, Inventions, and Non-Competition Agreement

     

    
      
         


      

      
        -12-