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                                                                   EXHIBIT 10.29
                                                                                

                              EMPLOYMENT AGREEMENT
                                        

     THIS EMPLOYMENT AGREEMENT, is made and entered into as of the 25th day of
February, 1999 and effective as of January 1, 1999, by and between TEMPLATE
SOFTWARE, INC., a Virginia corporation (the "Company") and Joseph M. Fox (the
                                             -------                         
"Executive").
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                                    RECITALS
                                        

     A.  The Company desires to retain Executive to provide the services
hereinafter set forth.

     B.  Executive is willing to provide such services to the Company on the
terms and conditions hereinafter set forth.


                                   AGREEMENT
                                        

     In consideration of the promises and the terms and conditions set forth in
this Agreement, the parties agree as follows:

     1.  EMPLOYMENT AND TERM.  The Company agrees to employ the Executive and
         -------------------                                                 
the Executive agrees to work for the Company, subject to the terms and
conditions below, for a term of one years, beginning January 1, 1999, and ending
December 31, 1999.

     2.  COMPENSATION; BENEFITS.  Subject to the terms and conditions of this
         ----------------------                                              
Agreement, the Company shall pay to the Executive a base salary of Seventy-Five
Thousand Dollars ($75,000), to be paid each pay period in accordance with the
Company's regular payroll policies.  In addition, the Executive shall be
entitled to receive such benefits as are available generally to full-time
employees of the Company, including, but not limited to, medical insurance,
dental insurance, life insurance, vacation, holidays and sick leave, as the
Company generally provides to its full-time employees holding similar positions
as that of the Executive.  Notwithstanding the foregoing, the Company reserves
the right to adopt, amend or discontinue any employee benefit plan or policy in
accordance with then-applicable law.

     3.  DUTIES.  The Executive shall be employed as Chairman of the Company's
         ------                                                               
Board of Directors.  The Executive will not be required to spend his full time
at the Company, but shall use his best efforts to conscientiously and diligently
perform the duties assigned to him by the Company.  The Executive also shall
perform such duties as may be assigned to him from time to time by the Company's
Board of Directors.

     4.  RIGHT TO CONTRACT; CONFLICT OF INTEREST.  The Executive hereby
         ---------------------------------------                       
represents and warrants to the Company that (i) he has full right and authority
to enter into this Agreement and to perform his obligations hereunder, and (ii)
the execution and delivery of this Agreement by the Executive and the
performance of the Executive's obligations hereunder 

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will not conflict with or breach any agreement, order or decree to which the
Executive is a party or by which he is bound. During the term of this Agreement,
the Executive shall not directly or indirectly consult, advise, be retained or
employed by, or in any manner perform any service with any other business or
entity engaged in a like or competing business to that of the Company without
first obtaining consent in writing from the Company.

     5.  TRANSFER BY COMPANY.  If at any time during the term of this Agreement,
         -------------------                                                    
the Company transfers the Executive to another location, the Company will
reimburse the Executive for all reasonable moving expenses incurred as a result
of such transfer.  In the event that the Executive terminates this Agreement
without cause pursuant to Section 8 hereof within one year after any such
                          ---------                                      
transfer, the Executive shall refund to the Company all amounts paid to him by
the Company as moving expenses (including temporary housing and incidental
expenses) pursuant to this Section 5. The Executive agrees that any amounts
                           ---------                                       
owing to the Company under this Section 5 may be deducted from any salary or
                                ---------                                   
other amounts owed to him by the Company, consistent with applicable law.

     6.  TERMINATION BY THE COMPANY.
         -------------------------- 

     (a) The Company shall have the right to terminate this Agreement with or
without cause at any time during the term of this Agreement by giving written
notice to the Executive.  The termination shall become effective on the date
specified in the notice, which termination date shall not be a date prior to the
date 5 days following the date of the notice of termination itself.  In the
event that the Executive is terminated for cause, the Company shall pay the
Executive salary through the day on which such termination is effective.  In the
event that the Executive is terminated without cause, the Company shall pay to
the Executive compensation equal to the greater of (i) the compensation due to
Executive through the end of the term of this Agreement, and (ii) twelve (12)
months of the Executive's base salary on the effective date of termination.

     (b) For purposes of this Section 6, "cause" shall mean (i) a material
                              ---------   -----                           
breach by the Executive of any covenant or condition hereunder; (ii) a material
neglect of duty by the Executive; or (iii) the commission by the Executive of
any act or omission constituting gross negligence, dishonesty, fraud, immoral or
disreputable conduct which is, or in the reasonable opinion of the Company's
Board of Directors is likely to be, harmful to the Company or its reputation.

     7.  TERMINATION BY DEATH OR DISABILITY OF THE EXECUTIVE.
         --------------------------------------------------- 

     (a) In the event of the Executive's death during the term of this
Agreement, all obligations of the parties hereunder shall terminate immediately,
and the Company shall pay to the Executive's beneficiary or estate, the salary
and other compensation due the Executive through the day on which his death
shall have occurred.

     (b) If the Executive is unable to perform his duties hereunder due to
mental, physical or other disability for a period of 90 consecutive business
days, as determined by the Company, or for 90 business days in any period of 12
consecutive months, this Agreement may 

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be terminated by the Company, at its option, by written notice to the Executive,
effective on the termination date specified in such notice, provided such
termination date shall not be a date prior to the date of the notice of
termination itself. In this case, the Company will pay the Executive the salary
and other compensation due him through the day on which such termination is
effective.

     8.  TERMINATION BY THE EXECUTIVE.
         -----------------------------

     (a) The Executive may voluntarily terminate this Agreement at any time,
with or without cause, by giving 30 days written notice to the Company. Any such
termination, if without cause, shall become effective on the date specified in
such notice, provided that the Company may elect to have such termination become
effective on a date after, but not more than 14 days after, the date of the
notice.  If such termination is with cause, it shall become effective on the 30
days after the date of such notice, provided the Company has failed to cure the
cause specified in the notice.

     (b) After the date of any such termination, the Executive shall be entitled
to the salary due him through the day on which such termination becomes
effective, unless such termination was for cause, in which case he shall be
entitled to receive from the Company compensation equal to the compensation the
Executive would have received had the Company terminated this Agreement without
cause pursuant to Section 6(a).
                  -------------

     (c) In the event the Executive terminates this Agreement without cause, or
the Company terminates this Agreement with cause, in either case within one year
after the commencement of the Executive's employment with the Company, the
Executive shall refund to the Company all amounts, if any, paid him by the
Company as moving expenses (including temporary housing and incidental
expenses).  The Executive agrees that any amounts owing to the Company as moving
expenses under this Section 8 may be deducted from any salary owed to him by the
                    ---------                                                   
Company, consistent with applicable law.

     (d) For purposes of this Section 8, "cause" shall mean a material failure
                              ---------   -----                               
by the Company to perform its obligations under this Agreement.

     9.  SUSPENSION. In the event the Company has reasonable cause to believe
         ----------                                                          
that there exists cause for termination of this Agreement as defined in Section
                                                                        -------
6, immediately upon written notice to the Executive, the Company may but shall
-                                                                             
not be obligated to suspend the Executive, with pay, for a period not to exceed
four (4) weeks, either as a disciplinary measure or in order to investigate the
Company's belief that such cause exists.  No such suspension shall prevent the
Company from thereafter exercising its rights to terminate this Agreement in
accordance with its terms.

     10.  NON-COMPETITION AND NON-SOLICITATION.
          -------------------------------------

     (a) Non-Competition.  The Executive agrees that, during his employment
         ---------------                                                   
hereunder, and for a period of two (2) months after the later of (i) the
effective date of termination of this Agreement, (ii) the date on which the
Executive's period of compensated 

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severance hereunder expires, or (iii) the date of entry by a court of competent
jurisdiction of a final judgment enforcing this covenant, he will not, in any
geographic area where the Company engages in its business or maintains sales or
service representatives or employees:

             (A) compete with the Company, or any subsidiary or affiliate of the
Company;

             (B) interfere with or disrupt, or attempt to interfere with or
disrupt, the relationship, contractual or otherwise, between the Company, or any
subsidiary or affiliate of the Company, and any customer, supplier or employee
of the Company, or any such subsidiary or affiliate;

     (b) Non-Solicitation.  The Executive agrees that, during his employment
         ----------------                                                   
hereunder, and for a period of two (2) years after the later of (i) the
effective date of termination of this Agreement, (ii) the date on which the
Executive's period of compensated severance hereunder expires, or (iii) the date
of entry by a court of competent jurisdiction of a final judgment enforcing this
covenant, he will not offer employment to any current employee of the Company or
solicit (directly or indirectly, either individually or in connection with any
employer or other business partner) any current employee of the Company to
accept employment elsewhere.

     (c) The following terms, as used in this Section 10 shall have the meanings
                                              ----------                        
set forth below:

             (A) The term "compete" means to engage in competition, directly or
                           -------                                             
indirectly, individually or through a family member or other person acting on
the Executive's behalf, as an employee, officer, director, proprietor, partner
or stockholder or other security holder (other than of a corporation listed on a
national securities exchange or the securities of which are regularly traded in
the over-the-counter market, provided that the Executive at no time owns in
excess of 5% of the outstanding securities of such corporation entitled to vote
for the election of directors) of any firm, corporation or entity of any nature
whatsoever.

             (B) The term "affiliate" means any person, firm or corporation,
                          -----------
directly or indirectly through one or more intermediaries, controlling,
controlled by or under common control with the Company.

     (d) The Executive further acknowledges that this Section 10 is an
                                                      ----------      
independent covenant within this Agreement, and that this covenant shall survive
any termination of Agreement and shall be treated as an independent covenant for
the purposes of enforcement.  With respect to this covenant, the Executive
hereby acknowledges receipt of Ten Dollars ($10.00) and other good and valuable
consideration stated herein including the consideration of his continued
employment by the Company.

     (e) The Executive shall, during the term of this Agreement and thereafter,
notify any prospective employer of the terms and conditions of this Agreement
regarding confidentiality, non-disclosure and non-competition.

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     11.  CONFIDENTIALITY AND NON-DISCLOSURE.
          -----------------------------------

     (a) The Executive shall hold in strict confidence and shall not, either
during the term of this Agreement or after the termination hereof, disclose,
directly or indirectly, to any third party, person, firm, corporation or other
entity, irrespective of whether such person or entity is a competitor of the
Company or is engaged in a business similar to that of the Company, any trade
secrets or other proprietary or confidential information of the Company or any
subsidiary or affiliate (as defined in Section 10) of the Company obtained by
                                       ----------                            
the Executive from or through his employment hereunder.  The Executive hereby
acknowledges and agrees that all proprietary information referred to in this
                                                                            
Section 11 shall be deemed trade secrets of the Company and of its subsidiaries
----------                                                                     
and affiliates, as defined in Section 10, and that the Executive shall take such
                              ----------                                        
steps, undertake such actions and refrain from taking such other actions, as
mandated by the provisions hereof and by the provisions of the Virginia Uniform
Trade Secret Act.  Executive further acknowledges that the Company's products
and titles consist of copyrighted material, and Executive shall exercise his
best efforts to prevent the use of such copyrighted material by any person or
entity which has not prior thereto been authorized to use such information by
the Company.

     (b) The Executive further hereby agrees and acknowledges that any
disclosure of any proprietary information prohibited herein, or any breach of
the provisions of Sections 4 or 10 of this Agreement, may result in irreparable
                  -----------   --                                             
injury and damage to the Company which will not be adequately compensable in
monetary damages, that the Company will have no adequate remedy at law therefor,
and that the Company may obtain such preliminary, temporary or permanent
mandatory or restraining injunctions, orders or decrees as may be necessary to
protect the company against, or on account of, any breach by the Executive of
the provisions contained in Sections 4, 10 or 11.
                            ----------  --    -- 

     (c) The Executive further agrees that, upon termination of this Agreement,
whether voluntary or involuntary or with or without cause, the Executive shall
notify any new employer, partner, associate or any other firm or corporation
with whom the Executive shall become associated in any capacity whatsoever of
the provisions of this Section 11, and that the Company may give such notice to
                       ----------                                              
such firm, corporation or other person.

     12.  ASSIGNMENT AND DISCLOSURE OF INVENTIONS.
          ----------------------------------------

     (a) From and after the date the Executive first became employed with the
Company, the Executive hereby agrees to promptly disclose in confidence to the
Company all inventions, improvements, designs, original works of authorship,
formulas, processes, compositions of matter, computer software programs,
databases, mask works, and trade secrets ("Inventions"), whether or not
                                           ----------                  
patentable, copyrightable or protectible as trade secrets, that are made or
conceived or first reduced to practice or created by the Executive, either alone
or jointly with others, during the period of the Executive's employment, whether
or not in the course of the Executive's employment.

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     (b) The Executive hereby acknowledges that copyrightable works prepared by
the Executive within the scope of the Executive's employment are "works for
                                                                  ---------
hire" under the Copyright Act and that the Company will be considered the author
thereof.  The Executive hereby agrees that all Inventions that (a) are developed
using equipment, supplies, facilities or trade secrets of the Company, (b)
result from work performed by the Executive for the Company, or (c) relate to
the Company's business or current or anticipated research and development, will
be the sole and exclusive property of the Company and are hereby assigned by the
Executive to the Company.

     13.  SEVERABILITY.  The Company and the Executive recognize that the laws
          ------------                                                        
and public policies of the Commonwealth of Virginia are subject to varying
interpretations and change.  It is the intention of the Company and of the
Executive that the provisions of this Agreement shall be enforced to the fullest
extent permissible under the laws and public policies of the Commonwealth of
Virginia, but that the unenforceability (to the modification to conform to such
laws or public policies) of any provision or provisions hereof shall not render
unenforceable, or impair, the remainder of this Agreement. Accordingly, if any
provisions of this Agreement shall be determined to be invalid or unenforceable,
either in whole or in part, this Agreement shall be deemed amended to delete or
modify, as necessary, the offending provision or provisions and to alter the
balance of this Agreement in order to render it valid and enforceable.

     14.  ASSIGNMENT.  Neither the rights nor obligations under this Agreement
          ----------                                                          
may be assigned by either party, in whole or in part, by operation of law or
otherwise, except that it shall be binding upon and inure to the benefit of any
successor of the Company and its subsidiaries and affiliates, whether by merger,
reorganization or otherwise, or any purchaser of all or substantially all of the
assets of the Company.

     15.  NOTICES.  Any notice expressly provided for under this Agreement shall
          -------                                                               
be in writing, shall be given either manually or by mail and shall be deemed
sufficiently given when actually received by the party to be notified or when
mailed, if mailed by certified or registered mail, postage prepaid, addressed to
such party at their addresses as set forth below.  Either party may, by notice
to the other party, given in the manner provided for herein, change their
address for receiving such notices.

     (a)  If to the Company, to:

          Template Software, Inc.
          45365 Vintage Park Plaza, Suite 100
          Dulles, Virginia 20166
          Attn: President
        
          with a copy to:
        
          Hunton & Williams
          1751 Pinnacle Drive, Suite 1700
          McLean, Virginia 22102
          Attn: Joseph W. Conroy, Esquire

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     (b)  If to the Executive, to

          Joseph M. Fox
          c/o Template Software, Inc.
          45365 Vintage Park Plaza, Suite 100
          Dulles, Virginia 20166

     16.  GOVERNING LAW.  This Agreement shall be executed, construed and
          -------------                                                  
performed in accordance with the laws of the Commonwealth of Virginia without
reference to conflict of laws principles.

     17.  HEADINGS.  The section headings contained in this Agreement are for
          --------                                                           
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.

     18.  ENTIRE AGREEMENT, AMENDMENTS.  This Agreement constitutes and embodies
          ----------------------------                                          
the entire agreement between the parties in connection with the subject matter
hereof and supersedes all prior and contemporaneous agreements and
understandings in connection with such subject matter.  No covenant or condition
not expressed in this Agreement shall affect or be effective to interpret,
change or restrict this Agreement.  In the event of a conflict or inconsistency
between the terms of this Agreement and the Company's policies regarding
employees, the terms of this Agreement shall supersede the conflicting or
inconsistent Company policies.  No change, termination or attempted waiver of
any of the provisions of this Agreement shall be binding unless in writing
signed by the Executive and on behalf of the Company by an officer thereunto
duly authorized by the Company's Board of Directors.  No modification, waiver,
termination, rescission, discharge or cancellation of this Agreement shall
affect the right of any party to enforce any other provision or to exercise any
right or remedy in the event of any other default.





                            [SIGNATURE PAGE FOLLOWS]
                                        

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


                              TEMPLATE SOFTWARE, INC.


                              By:    /s/ E. Linwood Pearce
                                 --------------------------------------------
                                 Name:  E. Linwood Pearce
                                 Title:  President / Chief Executive Officer


                              EXECUTIVE


                                   /s/ Joseph M. Fox
                                 --------------------------------------------
                                 Joseph M. Fox

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