Document:

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                                                                  EXHIBIT 10.12

                                [ISS Letterhead]

December 10, 1999

Mr. Mark Hangen
24432 Pressonville Road
Wellsville, KS  66092

Dear Mark:

I am pleased to make this offer for you to join our team at Internet Security
Systems. As Chief Operations Officer, your total compensation package will be
$450,000 annually at plan. The annual compensation will consist of a base
salary of $300,000 annually ($12,500 paid semi-monthly salary) plus a bonus
paid quarterly at plan in the amount of $20,000. The actual bonus paid will be
a function of company performance and individual objectives, as defined in the
attached performance compensation plan. In addition, you will be eligible for a
$70,000 annual bonus based solely upon ISS achievements of its 2000 sales and
performance objectives. Additionally, you will be granted an option to purchase
300,000 shares of ISS Common Stock, contingent upon the approval by the ISS
Board of Directors, at an exercise price equal to the closing price of ISS
common stock at the date of the grant by the Board of Directors at or after
your date of employment. These options will have our standard four-year annual
vesting schedule. In addition, you will be granted an additional 100,000 shares
of ISS common stock at the same time which vests according to the attached
schedule. These options shall be subject to all of the terms and conditions set
forth in ISS' Amended and Restated 1995 Stock Option Plan.

Additionally, if ISS terminates your employment without cause, ISS will
accelerate the vesting of your 300,000 share grant of options to the same
extent as if you had remained employed by ISS for one (1) year following the
date of the termination. ISS will not accelerate vesting if your resign from
your employment with ISS or if your employment with ISS is terminated for
Cause. As used herein, "Cause" means a termination based on (i) your conviction
of a felony or any other offense evidencing fraud or moral turpitude, (ii) your
failure or refusal to follow the lawful and proper directives of the Company
which is not corrected within seven (7) days after your receipt of written
notice identifying such failure or refusal, (iii) your willful malfeasance or
gross misconduct which discredits or damages the Company, (iv) any breach of
your obligations to maintain the confidentiality of ISS' confidential any
proprietary information and trade secrets, or (v) your chronic absence from
work.

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Page 2

Your job responsibilities shall be as outlined in the attached job position
responsibilities. ISS agrees to provide for your health benefits in accordance
with the current ISS Benefits plan. ISS will provide for three weeks of paid
vacation/sick leave during your first year of employment as defined in company
benefits program. In addition, you will be eligible to participate in the ISS
401 K program, the ISS Employee Stock Purchase Program (ESPP), and the ISS
Flexible Benefits Program (FLEX).

As I explained to you, this offer of employment is conditional upon the
following:

1)       Your execution of the standard form ISS intellectual property
         Agreement which obligates you to protect ISS proprietary and
         confidential information and in addition, obligates you to refrain
         from using any confidential information from previous employers.

2)       Your providing proof of personal identity and employability. In
         connection with this contingency, please complete the top of the
         enclosed I-9 form. Bring this I-9 form, and substantiating documents
         as outlined on the form to provide personal identity and employment
         eligibility, to my office on your first day of work.

3)       ISS satisfactory review of personal and professional references and
         satisfactory results of the ISS background investigation that will
         require your completion of an application and authorization form
         allowing such investigation. This process is, by our policy, a
         condition of employment by ISS. This process can be coordinated
         through our Director of Human Resources, Terri Jones.

ISS is an at-will employer, which means that employment with ISS is for no
specific period of time and either your or ISS are free to terminate your
employment relationship at any time for any reason, with or without cause. This
is the full and complete agreement between us on this term and supercedes any
prior representations or agreements, whether oral or written. Although your job
duties, title, compensation and benefits, as well as ISS personnel policies and
procedures, may change form time-to-time, the "at-will" nature of your
employment may only be changed in a document signed by you and the President or
the Vice President of Finance and Administration of the Company.

Based upon your acceptance of this offer, we would like for you to join us on
or before December 20, 1999.

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Page 3

Mark, I look forward to having you join the ISS team and to building a dynamic,
successful enterprise with you. Please do not hesitate to contact me at (w)
678-443-6450 or (h) 770-541-0021 to discuss this offer or any additional
questions or concerns. Again, I am excited to extend this offer of employment
and look forward to working with you.

                                         Sincerely,

                                         /s/ Thomas E. Noonan

                                         Thomas E. Noonan
                                         President and CEO

Accepted:

/s/ Mark Hangen
---------------------------
Mark Hangen

12/14/00
---------------------------
Date<PAGE>   1
                                                                  EXHIBIT 10.13

                                [ISS Letterhead]

June 10, 2000

Mr. Ken Walters
4718 Talleybrook Drive
Kennesaw, GA  30152

Dear Ken:

I am pleased to make this offer for you to join our team at Internet Security
Systems. As President & General Manager, Enterprise Solutions Business Unit,
your total compensation package will be $500,000 annually at plan. The annual
compensation will consist of a base salary of $350,000 annually ($14,583.33
paid bi-monthly salary) plus performance compensation paid quarterly at plan in
the amount of $25,000 per quarter. The actual performance compensation paid
will be a function of strategic business unit objectives, operational
performance objectives and revenue objectives as defined in the attached
performance compensation plan. In addition, you will be eligible for a $50,000
annual bonus based upon ISS performance and ISS achievement of its 2000 sales
and performance objectives. You will be granted an option to purchase 200,000
shares of ISS Common Stock, contingent upon the approval by the ISS Board of
Directors, at an exercise price equal to the closing price of ISS common stock
at the date o the grant by the Board of Directors at or after your date of
employment. These options will have our standard four-year annual vesting
schedule. In addition, you will be granted an additional 100,000 shares of ISS
common stock at the same time which vests according to the attached schedule.
These options shall be subject to all of the terms and conditions set forth in
ISS' Amended and Restated 1995 Stock Option Plan. ISS also agrees to provide
you a non interest-bearing loan in the amount of $100,000 payable to you at the
time of your commencement of employment at ISS. If you complete your first year
from the date of your employment in good standing with ISS, the loan shall be
completely forgiven. Should your employment be terminated for cause or should
you resign your employment with ISS within the first year of employment, this
loan shall be repaid by you immediately within 30 days of termination at the
following calculated rate: termination in 1st quarter of employment, $100,000;
termination in 2nd quarter of employment, $75,000; termination in 3rd quarter
of employment, $50,000; termination in 4th quarter of employment, $25,000.

Additionally, if ISS terminates your employment without cause, ISS will
accelerate the vesting of your 200,000 share grant of options to the same
extent as if you had remained employed by ISS for one (1) year following the
date of the termination. ISS will not accelerate vesting if you resign from
your employment with ISS or if your employment with ISS is terminated for
Cause. As used herein, "Cause" means a termination based on (i) your conviction
of a felony or any other offense evidencing fraud or moral turpitude, (ii) your
failure or refusal to follow the lawful and proper directives of the Company
which is not corrected within seven (7) days after your receipt of written
notice identifying such failure or refusal, (iii) your willful malfeasance or

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gross misconduct which discredits or damages the Company, (iv) any breach of
your obligations to maintain the confidentiality of ISS' confidential and
proprietary information and trade secrets, or (v) your chronic absence from
work. In addition, if ISS terminates your employment without cause as defined
above, ISS will continue to pay your base salary for a period of six months
following the date of termination.

The 100,000 performance-based options will have the following provisions:
Standard ten-year grant under ISS Stock Plan
Vesting of all 100,000 options at the end of five-year term, with accelerated
vesting based upon the following performance of ISS stock price (in the case of
a stock split, all amounts and prices will be adjusted accordingly):

10% acceleration (10,000 options) upon achievement of an average quarterly
stock price at $100.00 per share Additional 20% acceleration (20,000 shares)
upon achievement of an average quarterly stock price at $125.00 per share
Additional 30% acceleration (30,000 shares) upon achievement of an average
quarterly stock price at $150.00 per share Additional 40% acceleration (40,000
shares) upon achievement of an average quarterly stock price at $200.00 per
share

Your job responsibilities shall be as outlined in the attached job position
responsibilities. ISS agrees to provide for your health benefits in accordance
with the current ISS Benefits plan. ISS will provide for three weeks of paid
vacation/sick leave during your first year of employment as defined in company
benefits program. In addition, you will be eligible to participate in the ISS
401 K program, the ISS Employee Stock Purchase Program (ESPP), and the ISS
Flexible Benefits Program (FLEX).

As I explained to you, this offer of employment is conditional upon the
following:

1)   Your execution of the standard form ISS intellectual property Agreement
     which obligates you to protect ISS proprietary and confidential
     information and in addition, obligates you to refrain from using any
     confidential information from previous employers.

2)   Your providing proof of personal identity and employability. In connection
     with this contingency, please complete the top portion of the enclosed I-9
     form. Bring this I-9 form, and substantiating documents as outlined on the
     form to provide personal identity and employment eligibility, to my office
     on your first day of work.

3)   ISS satisfactory review of personal and professional references and
     satisfactory results of the ISS background investigation that will require
     your completion of an application and authorization form allowing such
     investigation. This process is, by our policy, a condition of employment
     by ISS. This process can be coordinated through our Director of Human
     Resources, Terri Jones.

ISS is an at-will employer, which means that employment with ISS is for no
specific period o time and either you or ISS are free to terminate your
employment relationship at any time for any reason, with or without cause. This
is the full and complete agreement between us on this term

                                                                              2
<PAGE>   3

and supercedes any prior representations or agreements, whether oral or
written. Although your job duties, title, compensation and benefits, as well as
ISS personnel policies and procedures, may change from time-to-time, the
"at-will" nature of your employment may only be changed in a document signed by
you and the President or the Vice President of Finance and Administration of
the Company.

Ken, we would like for you to join us on or before July 1, 2000. I look forward
to having you join the ISS team and to building a dynamic, successful
enterprise with you.

<TABLE>
<CAPTION>
Sincerely,                               Accepted:

<S>                                 <C>                                <C>
/s/ Thomas E. Noonan

Thomas E. Noonan                    /s/ Kenneth Walters                6/27/00
                                    ---------------------------        --------
President and CEO                   Ken Walters                        Date
</TABLE>

<PAGE>   4

Internet Security Systems, Inc. and Ken Walters agree to the following terms
and conditions regarding the loan to be provided under the terms of the
employment contract between the parties. Internet Security Systems, Inc. agrees
to lend to Ken Walters $100,000 for a period of up to one year. The loan will
not bear interest. The loan will be repaid immediately upon the earlier of the
termination of Mr. Walter's employment or the conclusion of one year of
employment. The amount to be repaid will be reduced by any portion of the loan
forgiven by Internet Security Systems, Inc. If Mr. Walters completes one full
year of employment, the loan will be entirely forgiven. If Mr. Walters resigns
or is terminated by Internet Security Systems, Inc. for reason other than
committing fraud, 25% of the loan will be forgiven for each full quarter of
employment completed.

Internet Security Systems, Inc. and Ken Walters agree that the loan is a below
market rate demand loan as defined by Internal Revenue Code Section 7872. As a
result, Mr. Walters will be required to recognize compensation for each year
the loan is outstanding for the amount of interest that would have been charged
on the outstanding balance using the short-term applicable federal rate.
Furthermore, Mr. Walters will be required to recognize income equal to the
amount of the loan forgiven by Internet Security Systems, Inc. at the time any
portion of the loan is forgiven.

/s/Thomas E. Noonan                              /s/Kenneth Walters
-----------------------------------              ------------------------------
for Internet Security Systems, Inc.              Ken Walters

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