Document:

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                                                                    EXHIBIT 10.2

[EMERGENT INFORMATION TECHNOLOGIES, INC. LOGO]

                              AMENDED AND RESTATED
                          EMPLOYEE STOCK PURCHASE PLAN

    Emergent Information Technologies, Inc., a California corporation (the
"Company"), originally adopted an Employee Stock Purchase Plan effective as of
March 1, 1999, and amended the plan effective as of July 1, 1999. The Plan was
amended again on November 1, 2000. This Amended and Restated Employee Stock
Purchase Plan (the "Plan") is effective as of March 21, 2001.

                                    ARTICLE 1
                               PURPOSE OF THE PLAN

        1.1 Purpose. The Company has determined that it is in its best interest
to provide incentives to attract and retain employees and to increase employee
morale by providing a program through which employees of the Company, and the
Company's subsidiaries as the Company's Board of Directors (the "Board of
Directors" or the "Board") may from time to time designate (each a "Designated
Subsidiary," and collectively, "Designated Subsidiaries"), may acquire a
proprietary interest in the Company through the purchase of shares of the Common
Stock of the Company ("Company Stock"). The Plan is hereby established by the
Company to permit employees to subscribe for, and purchase directly from the
Company, shares of the Company Stock at a discount from the market price and to
pay the purchase price in installments by payroll deductions. The Plan is
intended to qualify as an "employee stock purchase plan" under Section 423 of
the Internal Revenue Code of 1986, as amended from time to time (the "Code").
Accordingly, the provisions of the Plan shall be administered, interpreted, and
construed in a matter consistent with the requirements of that section of the
Code. The Plan is not intended to be an employee benefit plan under the Employee
Retirement Income Security Act of 1974, and therefore is not required to comply
with that Act.

                                    ARTICLE 2
                                   DEFINITIONS

        2.1 Compensation. "Compensation" means wages, tips, overtime pay,
bonuses, commissions, and other Compensation reported on Form W-2. Compensation
shall include any amounts contributed by the Employer pursuant to a salary
reduction agreement that is not currently includible in the Participant's gross
income by reason of the application of Code Sections 125, 402(e)(3), 402(g)(3),
402(h)(1)(B), 403(b), 414(h)(2), or 457(b). Compensation excludes the sum of all
of the following items, even if otherwise includible in gross income: (i)
reimbursements or other expense allowances; (ii) cash and noncash fringe
benefits; (iii) moving expenses; (iv) deferred compensation; and (v) welfare
benefits.

        2.2 Eligibility Date. "Eligibility Date" means ninety (90) calendar days
from an Employee's initial date of employment with the Company or any of its
Designated Subsidiaries.

        2.3 Employee. "Employee" means each person currently employed by the
Company or any of its Designated Subsidiaries, any portion of whose income is
subject to federal withholding of income or employment taxes, but excluding any
persons employed by the Company or any Designated Subsidiary on a part-time
(less than 20 hours per week) or temporary basis.

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        2.4 Enrollment Date. "Enrollment Date" means the first day of each
Offering Period (January 1 and July 1) under the Plan. However, for the first
Offering Period, the Enrollment Date shall be July 1, 1999 and shall extend
through July 31, 1999.

        2.5 Five Percent (5%) Owner. "5% Owner" means an Employee who,
immediately after the grant of any rights under the Plan, would own Company
Stock and/or hold outstanding options to purchase Company Stock possessing five
percent (5%) or more of the total combined voting power of all classes of stock
of the Company. For purposes of this Section, the ownership attribution rules of
Code Section 425(d) shall apply.

        2.6 Offering Period. "Offering Period" means either of the six-month
periods from January 1 through June 30 and July 1 through December 31 of each
year. The first Offering Period shall commence on July 1, 1999 and shall end
December 31, 1999.

        2.7 Participant. "Participant" means an Employee who has satisfied the
eligibility requirements of Section 3.1 and has become a participant in the Plan
in accordance with Section 3.2.

        2.8 Purchase Date. "Purchase Date" means the last day of each Offering
Period (i.e., June 30 or December 31).

                                    ARTICLE 3
                          ELIGIBILITY AND PARTICIPATION

        3.1 Eligibility. Subject to limitations imposed by Section 423(b) of the
Code, each Employee of the Company or any Designated Subsidiary may become a
Participant in the Plan on the Enrollment Date coincident with or next following
the Eligibility Date.

        3.2 Participation. An Employee who has satisfied the eligibility
requirements of Section 3.1 may become a Participant in the Plan upon his
completion and delivery to the Company's stock purchase coordinator, as
designated by the Company, of an election notice form provided by the Company
(the "Election Notice Form") authorizing payroll deductions. Payroll deductions
for a Participant shall commence on the Enrollment Date coincident with or next
following the filing of the Participant's Election Notice Form and shall remain
in effect until revoked by the Participant by the filing of a notice of
withdrawal from the Plan under Article 8 or by the filing of a new Election
Notice Form providing for a change in the Participant's payroll deduction rate
in accordance with Section 5.

        3.3 Special Rules. Under no circumstances shall:

               (a) A 5% Owner be granted a right to purchase Company Stock under
        the Plan;

               (b) A Participant be entitled to purchase Company Stock under the
        Plan which, when aggregated with all other employee stock purchase plans
        of the Company, exceed an amount equal to the Aggregate Maximum.
        "Aggregate Maximum" means an amount equal to $21,250 worth of Company
        Stock (determined using the fair market value of such Company Stock at
        each applicable Enrollment Date) during each calendar year; or

               (c) The number of shares of Company Stock purchasable by a
        Participant on any Purchase Date exceed 5,000 shares, subject to
        periodic adjustments under Section 10.4.

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                                    ARTICLE 4
                                 OFFERING PERIOD

    The initial grant of the right to purchase Company Stock under the Plan
shall occur on July 1, 1999 and terminate on December 31, 1999. Thereafter, the
Plan shall provide for Offering Periods commencing on each Enrollment Date and
terminating on the next following Purchase Date.

                                    ARTICLE 5
                               PAYROLL DEDUCTIONS

        5.1 Participant Election. Upon completion of the Election Notice Form,
each Participant shall designate the amount of payroll deductions to be made
from his or her paycheck to purchase Company Stock under the Plan. The amount of
payroll deductions shall be designated in whole percentages of Compensation, not
to exceed 15%. The amount so designated upon the Election Notice Form shall be
effective as of the next payroll period and shall continue until terminated or
altered in accordance with Section 5.2 below.

        5.2 Changes in Election. A Participant may terminate participation in
the Plan at any time prior to the close of an Offering Period as provided in
Article 8. A Participant may increase or decrease the rate of payroll deductions
once during each Offering Period by completing and delivering to the Company's
stock purchase coordinator a new Election Notice Form setting forth the desired
change. A Participant may also terminate payroll deductions and have accumulated
deductions for the Offering Period applied to the purchase of Company Stock as
of the next Purchase Date by completing and delivering to the stock purchase
coordinator a new Election Notice Form setting forth the desired change. Any
change under this Section shall become effective on the next payroll period (to
the extent practical under the Company's payroll practices) following the
delivery of the new Election Notice Form.

        5.3 Participant Accounts. The Company shall establish and maintain a
separate account ("Account") for each Participant. The amount of each
Participant's payroll deductions shall be credited to his or her Account. No
interest will be paid or allowed on amounts credited to a Participant's Account.
All payroll deductions received by the Company under the Plan are general
corporate assets of the Company and may be used by the Company for any corporate
purpose. The Company is not obligated to segregate such payroll deductions.

                                    ARTICLE 6
                            GRANT OF PURCHASE RIGHTS

        6.1 Right to Purchase Shares. On each Purchase Date, each Participant
shall have the right to purchase at the price determined under Section 6.2 that
number of shares (including fractional shares) of Company Stock that can be
purchased or issued by the Company based upon that price with the amounts held
in his or her Account, subject to the limits set forth in Section 3.3. In the
event that there are amounts held in a Participant's Account that are not used
to purchase Company Stock, such amounts shall remain in the Participant's
Account and shall be eligible to purchase Company Stock in any subsequent
Offering Period.

        6.2 Purchase Price. The purchase price for any Offering Period shall be
the lesser of:

               (a) 85% of the Fair Market Value of Company Stock on the
        Enrollment Date; or

               (b) 85% of the Fair Market Value of Company Stock on the Purchase
        Date.

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        6.3 Fair Market Value. "Fair Market Value" shall be determined as
follows:

               (a) If the Company Stock is then listed or admitted to trading on
        the NASDAQ National Market or a stock exchange which reports closing
        sale prices, the Fair Market Value shall be the closing sale price on
        the date of valuation on the NASDAQ National Market or principal stock
        exchange on which the Company Stock is then listed or admitted to
        trading, or, if no closing sale price is quoted or no sale takes place
        on such day, then the Fair Market Value shall be the closing sale price
        of the Company Stock on the NASDAQ National Market or such exchange on
        the next preceding day on which a sale occurred.

               (b) If the Company Stock is not then listed or admitted to
        trading on the NASDAQ National Market or a stock exchange which reports
        closing sale prices, the Fair Market Value shall be the average of the
        closing bid and asked prices of the Company Stock in the
        over-the-counter market on the date of valuation.

               (c) If neither (a) nor (b) is applicable as of the date of
        valuation, then the Fair Market Value shall be determined by the
        Administrator (see Section 7.2) using any reasonable method of
        valuation, which determination shall be conclusive and binding on all
        interested parties.

                                    ARTICLE 7
                                PURCHASE OF STOCK

        7.1 Purchase of Company Stock. A Participant who does not, prior to a
Purchase Date, notify the Company that such Participant does not want to
purchase any shares of Company Stock pursuant to the Plan or that such
Participant wants to purchase fewer than the maximum number of shares available
for purchase, shall be deemed to elect to purchase the maximum number of shares
of Company Stock (including fractional shares) purchasable with the amounts held
in such Participant's Account, at the purchase price determined under Section
6.2 above and, on each Purchase Date, the Plan shall purchase such shares on
behalf of such Participant. In the event that there are amounts held in a
Participant's Account that are not used to purchase Company Stock, all such
amounts shall be held in the Participant's Account and carried forward to the
next Offering Period. The Board or a Committee may, in its discretion, limit the
purchase of Company Stock to only whole shares and not fractional shares.

        7.2 Delivery of Company Stock.

               (a) Company Stock acquired under the Plan shall be issued
        directly to a contract administrator (the "Administrator") engaged by
        the Company to administer the Plan under Article 9. All Company Stock so
        issued ("Plan Held Stock") shall be held in the name of the
        Administrator for the benefit of the Plan. The Administrator shall
        maintain accounts for the benefit of the Participants that shall reflect
        each Participant's interest in the Plan Held Stock. Such accounts shall
        reflect the number of shares of Company Stock (including fractional
        shares) that are being held by the Administrator for the benefit of each
        Participant.

               (b) For share withdrawals, only whole shares of Company Stock
        will be issued to a Participant. The time of issuance and delivery of
        shares may be postponed for such period as may be necessary to comply
        with the registration requirements under the Securities Act of 1933, as
        amended, the listing requirements of any securities exchange on which
        the Company Stock may then be listed, or the requirements under other
        laws or regulations applicable to the issuance or sale of such shares. A
        payment will be made to a Participant for any fractional shares of
        Company Stock owned by the Participant. This payment shall be computed
        using the Fair Market Value of a share of Company Stock on the date the
        withdrawal is processed by the Company's

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        stock purchase coordinator. For shares of Company Stock sold by a
        Participant from his or her account maintained by the Administrator, the
        Participant shall receive credit for all whole and fractional shares at
        the actual price for which the shares were sold.

                                    ARTICLE 8
                                   WITHDRAWAL

        8.1 In Service Withdrawal. At any time prior to the Purchase Date of an
Offering Period, a Participant may withdraw the amounts held in his or her
Account by executing and delivering to the Company's stock purchase coordinator
written notice of withdrawal on the form provided by the Company. In such a
case, the entire balance of the Participant's Account shall be paid to the
Participant, without interest, as soon as is practicable. Upon such
notification, the Participant shall cease to participate in the Plan for the
remainder of the Offering Period in which the notice is given. An Employee who
has withdrawn under this Section 8.1 at least thirty (30) days prior to the
Purchase Date of an Offering Period shall be excluded from participation in the
Plan for the remainder of the Offering Period, but may then be reinstated as a
participant for a subsequent Offering Period by executing and delivering a new
Election Notice Form to the Company's stock purchase coordinator. An Employee
who has withdrawn under this Section 8.1 less than thirty (30) days prior to the
Purchase Date of an Offering Period shall be excluded from participation in the
Plan for the remainder of the Offering Period and for one (1) subsequent
Offering Period, but may thereafter be reinstated as a participant for a
subsequent Offering Period by executing and delivering a new Election Notice
Form to the Company's stock purchase coordinator.

        8.2 Termination of Employment. In the event that a Participant's
employment with the Company terminates for any reason, the Participant shall
cease to participate in the Plan on the date of termination. As soon as is
practical following the date of termination, the entire balance of the
Participant's Account shall be paid to the Participant, without interest.

                                    ARTICLE 9
                               PLAN ADMINISTRATION

        9.1 Plan Administration.

               (a) The authority to control and manage the operation and
        administration of the Plan shall be vested in the Board of Directors or
        a committee ("Committee") thereof. The Board or the Committee shall have
        all powers necessary to supervise the administration of the Plan and
        control its operations.

               (b) In addition to any powers and authority conferred on the
        Board or Committee elsewhere in the Plan or by law, the Board or the
        Committee shall have the following powers and authority:

                      (i) To designate agents to carry out responsibilities
               relating to the Plan;

                      (ii) To administer, interpret, construe and apply the Plan
               and to answer all questions which may arise or which may be
               raised under the Plan by a Participant, his beneficiary or any
               other person whatsoever;

                      (iii) To establish rules and procedures from time to time
               for the conduct of its business and for the administration and
               effectuation of its responsibilities under the Plan; and

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                      (iv) To perform or cause to be performed such further acts
               as it may deem to be necessary, appropriate, or convenient for
               the operation of the Plan.

               (c) Any action taken in good faith by the Board or the Committee
        in the exercise of authority conferred upon it by this Plan shall be
        conclusive and binding upon a Participant and his beneficiaries. All
        discretionary powers conferred upon the Board shall be absolute.

        9.2 Limitation on Liability. No Employee or member of the Board or
Committee shall be subject to any liability with respect to his or her duties
under the Plan unless the person acts fraudulently or in bad faith. To the
maximum extent permitted by law, the Company shall indemnify each member of the
Committee and every other member of the Board, as well as any other Employee
with duties under the Plan, against all liabilities and expenses (including any
amount paid in settlement or in satisfaction of a judgment) reasonably incurred
by the individual in connection with any claims against the individual by reason
of the performance of the individual's duties under the Plan. This indemnity
shall not apply, however, if: (a) it is determined in the action, lawsuit, or
proceeding that the individual is guilty of gross negligence or intentional
misconduct in the performance of those duties; or (b) the individual fails to
assist the Company in defending against any such claim. The Company shall have
the right to select counsel and to control the prosecution or defense of the
suit. The Company shall not be obligated to indemnify any individual for any
amount incurred through any settlement or compromise of any action unless the
Company consents in writing to the settlement or compromise.

                                   ARTICLE 10
                                  COMPANY STOCK

        10.1 Limitations on Purchase of Shares. The maximum number of shares of
Company Stock that shall be made available for sale under the Plan shall be
950,000 shares, subject to adjustment under Section 10.4 below. The shares of
Company Stock to be sold to Participants under the Plan will be issued by the
Company. If the total number of shares of Company Stock that would otherwise be
issuable pursuant to rights granted pursuant to Section 6.1 of the Plan at the
Purchase Date exceeds the number of shares then available under the Plan, the
Company shall make a pro rata allocation of the shares remaining available in as
uniform and equitable manner as is practicable. In such event, the Company shall
give written notice of such reduction of the number of shares to each
participant affected thereby and any unused payroll deductions shall be returned
to such participant if necessary.

        10.2 Registration of Company Stock. Shares to be delivered to a
Participant under the Plan will be registered in the name of the Participant.

        10.3 Changes in Capitalization of the Company. Subject to any required
action by the shareholders of the Company, the number of shares of Company Stock
covered by each right under the Plan which has not yet been exercised and the
number of shares of Company Stock which have been authorized for issuance under
the Plan but have not yet been placed under rights or which have been returned
to the Plan upon the cancellation of a right, as well as the Purchase Price per
share of Company Stock covered by each right under the Plan which has not yet
been exercised, shall be proportionately adjusted for any increase or decrease
in the number of issued shares of Company Stock resulting from a stock split,
stock dividend, spin-off, reorganization, recapitalization, merger,
consolidation, exchange of shares or the like. Such adjustment shall be made by
the Board of Directors for the Company, whose determination in that respect
shall be final, binding and conclusive. Except as expressly provided herein, no
issue by the Company of shares of stock of any class, or securities convertible
into shares of stock of any class, shall affect, and no adjustment by reason
thereof shall be made with respect to, the number or price of shares of Company
Stock subject to any right granted hereunder.

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        10.4 Merger of Company. In the event that the Company at any time
proposes to merge into, consolidate with, or enter into any other reorganization
pursuant to which the Company is not the surviving entity (including the sale of
substantially all of its assets or a "reverse" merger in which the Company is
the surviving entity), then, to the extent permitted by applicable law: (i) any
surviving corporation shall assume the rights theretofore granted or substitute
for such rights new rights covering the shares of a successor corporation, with
appropriate adjustments as to the number and kind of shares and prices, or (ii)
the Plan and the rights theretofore granted shall continue in full force and
effect. In the event any surviving corporation refuses to assume or continue the
Plan, or to substitute similar options for those under the Plan, then the Board
of Directors or its committee shall cause written notice of the proposed action
to be given to the persons holding rights not less than 10 days prior to the
anticipated effective date of the proposed transaction and, concurrent with the
effective date of the proposed transaction, such rights shall be exercised
automatically in accordance with Section 7.1 as if such effective date were a
Purchase Date of the applicable Offering Period unless a Participant withdraws
from the Plan as provided in Section 8.1.

                                   ARTICLE 11
                                  MISCELLANEOUS

        11.1 Amendment and Termination. The Plan shall terminate on December 31,
2008. Since future conditions affecting the Company cannot be anticipated or
foreseen, the Company reserves the right to amend, modify, or terminate the Plan
at any time. Notwithstanding the foregoing, no such amendment or termination
shall affect rights previously granted, nor may an amendment make any change in
any right previously granted which adversely affects the rights of any
Participant. In addition, no amendment may be made without prior approval of the
shareholders of the Company if such amendment would:

               (a) Increase the number of shares of Company Stock that may be
        issued under the Plan;

               (b) Materially modify the requirements as to eligibility for
        participation in the Plan; or

               (c) Materially increase the benefits that accrue to Participants
        under the Plan.

        11.2 Benefits Not Alienable. Benefits under the Plan may not be assigned
or alienated, whether voluntarily or involuntarily. Any attempt at assignment,
transfer, pledge or other disposition shall be without effect, except that the
Company may treat such act as an election to withdraw funds in accordance with
Article 8.

        11.3 No Enlargement of Employee Rights. The Plan is strictly a voluntary
undertaking on the part of the Company and shall not be deemed to constitute a
contract between the Company and any Employee or to be consideration for, or an
inducement to, or a condition of, the employment of any Employee. Nothing
contained in the Plan shall be deemed to give the right to any Employee to be
retained in the employ of the Company or to interfere with the right of the
Company to discharge any Employee at any time.

        11.4 No Additional Rights. Neither the adoption of the Plan nor the
granting of any right to purchase stock hereunder shall affect or restrict in
any way the power of the Company to undertake any corporate action otherwise
permitted under applicable law. Furthermore, no Employee shall have any rights
as a Stockholder with respect to shares to be purchased under the Plan until
time at which the Fair Market Value of the Common Stock is determined on the
Purchase Date. Finally, except as provided in

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Section 10.4, no adjustments will be made for cash or stock dividends or other
rights relating to Company Stock for which the record date is prior to the
Purchase Date.

        11.5 Governing Law. To the extent not preempted by Federal law, all
legal questions pertaining to the Plan shall be determined in accordance with
the laws of the State of California.

        11.6 Non-business Days. When any act under the Plan is required to be
performed on a day that falls on a Saturday, Sunday or legal holiday, that act
shall be performed on the next succeeding day which is not a Saturday, Sunday or
legal holiday. Notwithstanding the above, Fair Market Value shall be determined
in accordance with Section 6.3.

        11.7 Compliance With Securities Laws. Notwithstanding any provision of
the Plan, the Committee shall administer the Plan in such a way to ensure that
the Plan at all times complies with any requirements of Federal Securities Laws.

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                                                                   EXHIBIT 10.17

                                SM&A CORPORATION
                              EMPLOYMENT AGREEMENT

        This EMPLOYMENT AGREEMENT (this "Agreement") is entered into as of
          , 2000, by and between SM&A CORPORATION, a California corporation
("SM&A"), and STEVEN S. MYERS ("Employee"), with reference to the following:

        A. SM&A desires to employ Employee on the terms and conditions set forth
herein;

        B. Employee desires to perform services for SM&A as an employee of SM&A
on the terms and conditions set forth herein.

        NOW, THEREFORE, in consideration for the promises and obligations set
forth below, SM&A and Employee agree as follows:

1.      Employment and Term.

        1.1 SM&A agrees to employ, and Employee agrees to be employed by SM&A,
on the terms and conditions described below (the "Employment").

        1.2 This Agreement shall be effective as of February 1, 2000 (the
"Effective Date") and shall, unless sooner terminated pursuant to the terms set
forth below, terminate on January 31, 2003.

2.      Duties.

        2.1 Employee agrees that during the Employment, Employee shall devote
his full-time efforts to his duties as an employee of SM&A, now or in the future
assigned to Employee by SM&A. From and after the date of this Agreement,
Employee shall serve as Chief Executive Officer and Chairman of the Board of
SM&A. The parties further acknowledge that the Employee is ultimately
responsible to the Board of Directors of SM&A. Employee agrees to continue to
serve without additional compensation, if, from time to time he is elected or
appointed thereto, in one or more offices as a Director or member of any
committee of the Board of Directors of SM&A or of any direct or indirect
subsidiary of SM&A.

3.      Compensation.

        3.1 As consideration for said performance and duties of adherence to the
covenants in this Agreement, Employee shall be entitled to the compensation set
forth on Exhibit A attached hereto and incorporated herein by this reference
(the "Compensation").

        3.2 Employee understands and acknowledges that, except as otherwise set
forth in this Agreement, the Compensation will constitute the full and exclusive
consideration to be received by Employee for all services performed by Employee
in connection with SM&A's employment of Employee, and for the performance of all
his promises and obligations under this Agreement.

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        3.3 Aside from the Compensation, SM&A may adopt, or continue in force,
benefit plans for the benefit of its employees or certain of its employees which
may include, but not be limited to, group life insurance, medical insurance,
etc. SM&A may terminate any or all such plans at any time and may choose not to
adopt any additional or replacement plans. Employee's rights under any benefit
plans now in force or later adopted by SM&A shall be governed solely by the
terms of such plans; provided, however, that in no event shall Employee's rights
under any such benefit plans be less than those of any other executive officer
SM&A.

4.      Duty to Devote Full Time and Avoid Conflict of Interest. Employee agrees
that during the Employment he shall devote his full-time efforts to his duties
as an employee of SM&A. Employee further agrees that during the Employment he
shall not, directly or indirectly, engage or participate in any activities which
are in conflict with the best interests of SM&A.

5.      Compliance with Rules and Regulations. Employee agrees to comply with
SM&A's rules, regulations and practices, including but not limited to those
rules concerning vacation and sick leave, as they may from time to time be
adopted or modified, so long as they are uniformly applied to all employees.

6.      Non-competition and Non-solicitation by Employee.

        6.1 Employee agrees that, during the Employment, Employee will not
engage in any activity competitive with or adverse to SM&A's business or
welfare, whether alone, as a partner, or as an officer, director, employee or
shareholder of any other corporation and shall not otherwise undertake planning
for or the organization of any business activity competitive with SM&A's
business or combine or conspire with other employees or representatives of SM&A
for the purpose of organizing any such competitive business activity. This
prohibition shall not include ownership of less than five percent (5%) of the
outstanding stock by Employee in a publicly traded corporation.

        6.2 For a period of two (2) years following the termination of the
Employment, Employee shall not induce, solicit or influence or attempt to
induce, solicit or influence any person who is engaged as an employee or
otherwise by SM&A or any client of SM&A, to terminate his or her employment or
other engagement with SM&A.

7.      Trade Secrets of SM&A. Employee acknowledges and understands that during
the Employment, Employee will have access to and will utilize and review
information which constitutes valuable, important and confidential trade
secrets, as that term is interpreted under the Uniform Trade Secrets Act
(California Civil Code Section 3426 et seq.) and/or confidential and proprietary
material and information of or relating to the business of SM&A necessary for
the successful conduct of SM&A's business. This information includes, but is not
limited to: (a) listings of and data regarding the Clients (past and current);
(b) information regarding potential customers and clients; (c) data relating to
the identity of the Clients of SM&A; (d) information regarding bidding, billing
and pricing practices; (e) information regarding the nature and type of services
rendered to the Clients; (f) other methodologies, computer programs, databases,
processes, compilations of information, results of proposals, job notes, reports
and records, and (g) information regarding the nature and type of software
products sold to or under development with Clients of SM&A (all of which
information is sometimes referred to in this Agreement as

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the "Secrets"). The foregoing notwithstanding, Secrets shall not include
information or data which is (i) in the public domain, (ii) generally known in
the information technology staffing services industry, (iii) already known to
Employee as of the date he began his employment with SM&A, or (iv) rightfully
disclosed to Employee outside of the scope of his employment with SM&A by a
third party not under a duty of confidentiality to SM&A. Employee understands
further that the Secrets have been and will be accumulated, by Employee and
other personnel at SM&A at considerable expense to SM&A (including but not
limited to compensation paid to SM&A personnel dealing with the Secrets and the
Clients), and that SM&A has and will continue to expend its resources in order
to maintain actively and vigorously the confidentiality of the Secrets, as such
information is extremely valuable to SM&A, and well worth the expense of
enforcement and preservation of such confidentiality. Accordingly, Employee
agrees as follows:

               (a) All of the Secrets shall be safeguarded and treated as
        confidential by Employee.

               (b) Any and all data, notes, letters, computer programs, email
        records, reports, telephone records and all other written documentation
        relating to the business of SM&A (including but not limited to the
        Secrets) that may be collected, compiled, written, reviewed or conceived
        by Employee, whether set forth in tangible media or intangible, from or
        by reason of services performed by Employee for SM&A shall become the
        absolute property of SM&A, and Employee shall not assert or establish a
        claim for any statutory or common law right or any other possessory or
        proprietary right with respect to any of the above. The foregoing
        notwithstanding, upon the termination of the Employment, Employee may
        (i) at his own expense, make and retain copies of records pertaining to
        investment banking contacts (including analysts and mergers and
        acquisitions), commercial banking contacts, independent public
        accounting contacts, legal contacts or other contacts in the investment
        community (buy-side and sell-side) to the extent that such records do
        not constitute trade secrets of SM&A and (ii) retain closing binders for
        financings and acquisitions previously furnished to him; provided,
        however, that Employee shall ensure that SM&A retains a copy of all such
        records and closing binders; and provided further, that Employee shall
        be obligated to maintain the information contained in any closing binder
        retained by him as confidential to the extent that such information
        constitutes Secrets.

               (c) Employee shall hold the Secrets in strictest confidence and
        shall not (i) disclose any Secrets to any person, corporation, firm, or
        other entity, either during the Employment or afterward, or (ii) use any
        Secrets in Employee's subsequent business or employment, without the
        prior express written authorization of SM&A; provided, however, that
        Employee may disclose Secrets to the extent required to do so by a
        subpoena lawfully issued in a judicial proceeding or arbitration.

                (d) Employee shall not otherwise commit any act which shall
        compromise the confidentiality of any Secrets, including but not limited
        to making a copy of such property (whether electronic, paper or
        otherwise) without the prior express written authorization of SM&A,
        except as permitted by Section 7(b) above.

                                       3
<PAGE>   4
8.      Confidential Information of Clients. All ideas, concepts, information
and written material disclosed to Employee by SM&A, or acquired from any of the
Clients, and all financial, accounting, statistical, personnel, and business
data and plans of the Clients, are and shall remain the sole and exclusive
property and proprietary information of SM&A, or said Client, and are disclosed
in confidence by SM&A or permitted to be acquired from the Clients in reliance
on Employee's agreement to maintain them in confidence and not to use or
disclose them to any other person except in furtherance of SM&A's business.

9.      Return of Information. At the time of the termination of the Employment,
except as permitted by Section 7(b) above, Employee agrees to deliver promptly
to SM&A all notes, books, electronic data (regardless of storage media),
correspondence and other written or graphical records (including all copies
thereof) in Employee's possession or under Employee's control relating to any
business, work, the Clients or any other aspect of SM&A, whether or not
containing any Secrets, including but not limited to each original and all
copies of all or any part thereof.

10.     Cooperation. Employee agrees that, both during the Employment and
afterward, he will sign all papers, give evidence and testimony and, at SM&A's
expense, perform all acts which, in SM&A's opinion, are necessary, proper or
expedient to carry out and fulfill the purposes and intents of this Agreement.

11.     Remedies; Injunctive Relief. In the event of a breach or threatened
breach by Employee of any of the provisions of this Agreement, Employee agrees
that SM&A, in addition to and not in limitation of any other rights, remedies,
or damages available to SM&A at law or in equity, shall be entitled to a
preliminary and a permanent injunction in order to prevent or restrain any such
breach by Employee or by Employee's partners, agents, representatives, servants,
employers, employees, and/or any and all persons directly or indirectly acting
for or with Employee.

12.     Termination of Employment.

        12.1 The Employment may be terminated by SM&A at any time with "Cause"
(as defined below). Except as otherwise agreed in writing or as otherwise
provided by this Agreement as due and payable (or as required by law), upon
termination of the Employment by SM&A with Cause, SM&A shall have no further
obligation to Employee under this Agreement by way of compensation or otherwise,
but Employee's duties under Sections 6 through 10, inclusive, shall continue
after said termination of Employment. Notwithstanding the foregoing, to the
extent the grounds for any proposed termination with Cause are capable of being
cured or remedied by Employee, SM&A shall not terminate Employee with Cause
unless the representative of the Board of Directors of SM&A has first counseled
Employee as to how he could effect such cure or remedy and Employee is given at
least thirty (30) days to do so. A determination of whether Employee has
satisfactorily effected such cure or remedy shall be promptly made by a majority
of the disinterested (i.e., not the Employee) directors of the Board of
Directors at the end of the period provided to Employee for such cure or remedy
and such determination shall be final.

                                       4
<PAGE>   5

        12.2 The Employment may be terminated at any time (i) by SM&A without
Cause (as defined below) by giving Employee thirty (30) days' advance written
notice of such termination or (ii) by Employee for Good Reason (as defined
below) by giving SM&A thirty (30) days' advance written notice of such
termination. In the event that SM&A terminates the Employment without Cause, or
Employee terminates the Employment for Good Reason, SM&A shall (i) pay to
Employee the base salary of the Compensation, (ii) provide the same health and
life insurance benefits, and (iii) pay the lease payments with respect to the
automobile lease described in Exhibit A attached hereto, in each case until the
earlier to occur of (A) the last day of the term of this Agreement specified in
Section 1.2 above, (B) the expiration of twelve (12) calendar months after the
effective date of such termination of the Employment, (C) the date upon which
Employee becomes employed on a full-time basis (including but not limited to
self-employment, but only if Employee holds himself out to the public as being a
self-employed consultant or other businessman), or (D) the date upon which
Employee violates any of Sections 6 through 10, inclusive. In addition, SM&A
shall pay Employee the pro-rated Incentive Bonus described in Exhibit A attached
hereto to which Employee was entitled during the Employment (which proration
shall be based on a fraction, the numerator of which is the number of calendar
days during the fiscal year during which Employee was employed prior to the
effective date of the termination of the Employment and the denominator of which
is 365). If SM&A's medical and/or life insurance plans do not allow Employee's
continued participation in such plan or plans during the period described above,
then SM&A shall pay to Employee, in monthly installments, from the date on which
Employee's participation in such medical and/or life insurance, as applicable,
is prohibited for the remainder of the time period described in the second
sentence of this Section 12.2, the monthly premium or premiums which had been
payable by SM&A with respect to Employee for such discontinued medical and/or
life insurance, as applicable.

        12.3 Employee may terminate the Employment without Good Reason at any
time by giving SM&A thirty (30) days' advance written notice of such
termination. Upon Employee's termination of the Employment without Good Reason,
SM&A shall have no further obligation to Employee under this Agreement by way of
compensation or otherwise (except for the obligation to pay the Compensation to
which Employee may be entitled at the time of such termination), but Employee's
duties under Sections 6 through 10, inclusive, shall continue after said
termination of the Employment.

        12.4 The Employment will terminate immediately upon Employee's death. In
such event, SM&A shall (i) pay to Employee's estate the base salary and family
health benefits components of the Compensation until the earlier to occur of (A)
the last day of the term of this Agreement specified in Section 1.2 above or (B)
the expiration of twelve (12) calendar months after the effective date of such
termination. In addition, SM&A shall pay to Employee's estate the pro-rated
Incentive Bonus described in Exhibit A attached hereto to which Employee was
entitled during the Employment (which proration shall be based on a fraction,
the numerator of which is the number of calendar days during the fiscal year
during which Employee was employed prior to his death and the denominator of
which is 365). Except for the payments expressly provided in this Section 12.4,
SM&A shall have no further obligation to Employee's estate under this Agreement
by way of compensation or otherwise.

        12.5 SM&A may terminate the Employment at any time if Employee becomes
Disabled (as defined below) by giving Employee thirty (30) days' advance written
notice of such

                                       5
<PAGE>   6
termination. In the event that SM&A terminates the Employment because Employee
has become Disabled, SM&A shall (i) pay to Employee the base salary of the
Compensation and (ii) provide the same health and life insurance benefits, in
each case until the earlier to occur of (A) the last day of the term of this
Agreement specified in Section 1.2 above, (B) the expiration of twelve (12)
calendar months after the effective date of such termination of the Employment,
(C) the date upon which Employee becomes employed on a full-time basis
(including but not limited to self-employment, but only if Employee holds
himself out to the public as being a self-employed consultant or other
businessman), or (D) the date upon which Employee violates any of Sections 6
through 10, inclusive. In addition, SM&A shall pay Employee the pro-rated
Incentive Bonus described in Exhibit A attached hereto to which Employee was
entitled during the Employment (which proration shall be based on a fraction,
the numerator of which is the number of calendar days during the fiscal year
during which Employee was employed prior to the effective date of the
termination of the Employment and the denominator of which is 365). If SM&A's
medical and/or life insurance plans do not allow Employee's continued
participation in such plan or plans during the period described above, then SM&A
shall pay to Employee, in monthly installments, from the date on which
Employee's participation in such medical and/or life insurance, as applicable,
is prohibited for the remainder of the time period described in the second
sentence of this Section 12.5, the monthly premium or premiums which had been
payable by SM&A with respect to Employee for such discontinued medical and/or
life insurance, as applicable.

        12.6 As used in this Agreement, the following terms shall have the
meanings indicated:

                (a) "Cause" shall mean an action or actions by Employee during
        the Employment (including but not limited to inactions) which constitute
        either (i) gross insubordination, gross negligence, unethical or
        criminal behavior constituting a felony under federal or state law and
        which involves moral turpitude, or a breach of fiduciary duty of
        Employee as an officer and/or director of SM&A, or (ii) a violation of
        any of Sections 4 through 10, inclusive.

                (b) "Disabled" shall mean Employee's ability to perform his
        duties under this Agreement is impaired, due to sickness, physical or
        mental impairment or injury, by more than twenty-five (25%) for a period
        of six (6) consecutive months or for nine (9) months in any consecutive
        twelve (12) month period. In the event Employee disputes SM&A's
        determination that he is Disabled, Employee shall give written notice of
        such dispute to SM&A during the thirty (30) day notice period prior to
        the proposed effective date of such termination, and Employee and SM&A
        shall thereupon each select, within thirty (30) days of such notice from
        Employee, a physician to evaluate whether Employee is Disabled. Such
        physicians shall complete their evaluation and report to the Board of
        Directors within thirty (30) days. If such physicians do not agree as to
        whether Employee is Disabled, they shall promptly select a third
        physician to further evaluate Employee, whose conclusion on such matter
        shall be rendered within ten (10) days of his or her selection and shall
        be final and binding on Employee and SM&A.

               (c) "Good Reason" shall mean any of the following:

                      (i) (A) the assignment to Employee of duties inconsistent
               with Employee's current position, duties, or responsibilities
               which is sufficient to

                                       6
<PAGE>   7

               constitute a diminution of status with SM&A, (B) a material
               change in Employee's titles or offices or diminution of reporting
               relationships (such that Employee is reporting to Company
               personnel other than the Board of Directors) adverse to Employee,
               or (C) any removal of Employee from or any failure to reelect
               Employee to any of his positions as a senior officer of SM&A,
               except, in any such case, with Employee's consent or in
               connection with the termination of his employment for disability,
               retirement (at age 70), death or resignation (other than
               resignation for Good Reason), provided, however, that Good Reason
               shall not include the assignment to Employee of any duties or
               responsibilities of one or more management positions within his
               competence to the extent that any such position is not filled at
               any time and it is necessary to perform the duties and
               responsibilities of such position pending the hiring of a person
               to hold such position, provided that any such assignment does not
               exceed six (6) months, and provided that SM&A is actively seeking
               to fill such position during the period of such assignment;

                      (ii) a purported reduction by SM&A in the Compensation in
               effect on the date hereof or as the same may be increased from
               time to time during the term of this Agreement or any failure by
               SM&A to reimburse Employee or provide the benefits set forth in
               Exhibit A;

                      (iii) any material failure by SM&A to continue in effect
               any significant and material benefit plan or arrangement
               (including, without limitation, SM&A's incentive bonus plan,
               profit sharing plan, stock option plans, medical insurance plans,
               disability insurance plans, life insurance plans or vacation pay
               plans, with such generally applicable amendments thereto as may
               be approved from time to time in good faith by SM&A's Board of
               Directors) in which Employee is participating or other plans
               providing Employee with substantially similar benefits
               (collectively, the "Benefit Plans"), or any action by SM&A which
               would materially and adversely affect Employee's participation in
               or materially reduce Employee's benefits under any Benefit Plan;

                      (iv) a relocation of the office to which Employee is
               required to report to a location outside of a twenty-five (25)
               mile radius of the then existing SM&A corporate headquarters, or
               a requirement that Employee relocate his residence from Irvine,
               California;

                      (v) any failure by SM&A to obtain the assumption of this
               Agreement by any successor or assign of SM&A, if such successor
               or assigns asserts the position that it is not bound by the
               provisions hereof,

                      (vi) any failure by SM&A to comply with any material
               provision of this Agreement; or

                      (vii) a failure to provide support services, staff, office
               space and accouterments necessary to perform any duties assigned
               to Employee or a material reduction in the level of support
               services and staff, office space or

                                       7
<PAGE>   8
               accouterments made available to Employee, unless such reduction
               is generally effective for all other officers of equal rank or
               junior to Employee; provided, however, that no such action shall
               be considered to constitute Good Reason unless and until Employee
               has given SM&A written notice of, and thirty (30) days'
               opportunity to cure or remedy the specific action which Employee
               alleges would constitute Good Reason if not so cured or remedied
               and SM&A has failed to effect such cure or remedy.

        12.7 The rights and remedies provided in this Section 12 shall
constitute the exclusive rights and remedies available to Employee relating to
or arising from the termination of the Employment, including claims for breach
of contract; provided, however, that Employee shall be entitled to pursue any
and all available legal remedies based on any claim that such termination
constituted a violation of applicable federal or state law.

        12.8 No policies or procedures of SM&A or benefits provided by SM&A,
whether oral or written, express or implied, formal or informal, are intended,
nor shall they be construed to limit the right or ability of SM&A or Employee to
terminate the Employment as set forth above. Except as otherwise agreed in
writing or as otherwise provided by this Agreement, upon termination of the
Employment, neither SM&A nor Employee shall have any further obligation to each
other by way of compensation or otherwise.

        12.9 SM&A will require any successor or assign (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of SM&A, by agreement in form
and substance reasonably satisfactory to Employee, expressly, absolutely and
unconditionally to assume and agree to perform this Agreement in the same manner
and to the same extent that SM&A would be required to perform this Agreement if
no such succession or assignment had taken place. In any such event, the term
"SM&A" as used in this Agreement shall mean any such successor or assign which
executes and delivers the agreement provided for in the immediately preceding
sentence or which otherwise becomes bound by the terms and provisions of this
Agreement by operation of law.

        12.10 Employee shall make a reasonable good faith effort to find new
employment during any period during which payments are paid to Employee
following Employee's termination of employment with SM&A. Except as expressly
provided herein, no payment or benefit provided for under this Agreement shall
be reduced by any compensation earned by Employee as the result of employment by
another employer after the date of termination with SM&A. Except as expressly
provided herein, the provisions of this Agreement, and any payment or benefit
provided for hereunder, shall not reduce any amounts otherwise payable, or in
any way diminish Employee's existing rights, or rights which would accrue solely
as a result of the passage of time, under any SM&A benefit plan, employment
agreement or other contract, plan or arrangement. Except as required in
connection with the determinations contemplated by Section 12.6, the amount of
any payment provided under this Agreement shall not be reduced by reason of any
present value calculation.

13.     Change of Control of SM&A. Notwithstanding anything to the contrary in
any Stock Option Agreement or Incentive Stock Option Agreement previously
entered into by SM&A and Employee, upon the occurrence of a "change of control"
during the Employment, any and all

                                       8
<PAGE>   9

stock options granted to Employee under SM&A's stock option plans shall, whether
or not the Employment is terminated as a result of such change of control,
become immediately vested and exercisable for a period not to exceed the lesser
of (a) two (2) years, or (b) the date on which such stock options would
otherwise have terminated (other than by reason of the termination of the
Employment). The term "change of control" shall mean (i) any merger or
consolidation where SM&A is not the continuing or surviving corporation or
pursuant to which all or substantially all of the shares of SM&A's Common Stock
are converted into cash, other property or securities of another corporation,
other than, in either case, a merger or consolidation in which the shares of
SM&A's Common Stock outstanding immediately prior to such merger or
consolidation represent or are converted into securities representing more than
50% of the voting power of the surviving corporation in such merger or
consolidation or the parent of such corporation, (ii) any sale, lease, exchange
or other transfer (in one transaction or a series of related transactions) of
all, or substantially all, of the assets of SM&A, (iii) the approval by the
shareholders of SM&A of any plan or proposal for the liquidation or dissolution
of SM&A, (iv) any " person" (as such term is used in Sections 13(d) and 14(d)(2)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act")) shall
become the beneficial owner (within the meaning of Rule 13d-3 under the Exchange
Act) of 35% or more of SM&A's outstanding Common Stock after the date hereof,
(v) during any period of two consecutive years, individuals who, at the
beginning of such period constitute the entire Board of Directors, together with
persons whose nomination was approved by a vote of at least two thirds of such
directors (or directors so approved) shall cease for any reason to constitute a
majority of the members of the Board of Directors, or (vi) there shall be any
change of control of a nature which would be required to be reported in response
to Item 6(e) of Schedule 14A of Regulation 14A promulgated under the Exchange
Act or any successor regulation of substantially similar import, regardless of
whether SM&A is subject to such reporting requirement at such time.

14.     Miscellaneous Provisions.

        14.1 In the event that any of the provisions of this Agreement shall be
held to be invalid or unenforceable, then all other provisions shall
nevertheless continue to be valid and enforceable as though the invalid or
unenforceable parts had not been included in this Agreement. In the event that
any provision relating to the time period of any restriction imposed by this
Agreement shall be declared by a court of competent jurisdiction to exceed the
maximum time period which such court deems reasonable and enforceable, then the
time period of restriction deemed reasonable and enforceable by the court shall
become and shall thereafter be the maximum time period.

        14.2 This Agreement shall be binding upon the heirs, executors,
administrators, and successors-in-interest of the parties hereto.

        14.3 This Agreement shall be construed and enforced according to the
laws of the State of California, excluding its choice of law rules.

        14.4 This Agreement supersedes all previous correspondence, promises,
representations, and agreements, if any, either written or oral, between SM&A
and Employee. No provision of this Agreement may be modified except by a writing
signed by both SM&A and Employee.

                                       9
<PAGE>   10

        14.5 All notices, demands, requests, consents, approvals or other
communications (collectively "Notices") required or permitted to be given
hereunder or which are given with respect to this Agreement shall be in writing
and shall be personally served or deposited in the United States mail,
registered or certified, return receipt requested, postage prepaid, addressed as
set forth below, or such other address as such party shall have specified most
recently by written notice. Notices shall be deemed given on the date of service
if personally served. Notices mailed as provided herein shall be deemed given on
the third business day following the date so mailed:

              To SM&A:             SM&A Corporation
                                   4695 MacArthur Blvd., Suite 800
                                   Newport Beach, CA 92660
                                   Attention: Chairman, Compensation Committee
                                   Board of Directors

              with a copy to:      Rutan & Tucker, LLP
                                   611 Anton Boulevard, 14th Floor
                                   Costa Mesa, CA 92626
                                   Attention: Thomas J. Crane

              To Employee:         Steven S. Myers
                                   5 Summit
                                   Irvine, CA 92612
              with a copy to:
                                   -----------------------------

                                   -----------------------------

                                   -----------------------------
                                   Attention:
                                             -------------------

        14.6 Should any party institute any action or proceeding to enforce this
Agreement or any provision hereof, or for damages by reason of any alleged
breach of this Agreement or of any provision hereof, or for a declaration of
rights hereunder, the prevailing party in any such action or proceeding shall be
entitled to receive from the other party all costs and expenses, including
reasonable attorneys', accountants' and experts' fees, incurred by the
prevailing party in connection with such action or proceeding.

15.     Acknowledgment by Employee. Employee has carefully read and considered
the provisions of this Agreement and agrees that all of the above-stated
restrictions, obligations and promises are fair and reasonable and reasonably
required for the protection of the interests of SM&A. Employee further
acknowledges that the goodwill and value of SM&A is enhanced by these provisions
and that said enhancement is desired by Employee. Finally, Employee indicates
his acceptance of this Agreement by signing and returning the enclosed copy of
this Agreement where indicated below.

16.     Counsel. The parties hereto have requested that counsel to the Company,
Rutan & Tucker, LLP, prepare this Agreement and acknowledge that in so doing
that such counsel is

                                       10
<PAGE>   11

acting on behalf of the Company. Myers acknowledges that Rutan & Tucker, LLP has
previously served as and continues to serve as counsel to the Company in other
matters.

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

                                        SM&A CORPORATION

                                        By:   /s/ J. CHRISTOPHER LEWIS
                                            ------------------------------------
                                              J. Christopher Lewis
                                              Chairman, Compensation Committee
                                              of the Board of Directors

                                       11
<PAGE>   12
                                    EXHIBIT A

                         COMPENSATION OF STEVEN S. MYERS

        The following summarizes the compensation to which Employee shall be
entitled under the foregoing terms of this Employment Agreement.

1.      BASE SALARY           Effective February 1, 2000, Employee's base annual
                              salary shall be $600,000 per year, paid in at
                              bi-weekly installments. In no event, and under no
                              circumstances, shall Employee's annual salary be
                              reduced below the most recent annual salary. For
                              example, in no event can Employee's base annual
                              salary ever be reduced below $600,000.

2.      LEAVE CREDIT          During the Employment, and in addition to the
                              company observed and posted holidays of 10 per
                              year, Employee shall accrue paid leave at a rate
                              of 25 days per annum; provided, however, that
                              any such leave time, if not used, will be subject
                              to SM&A's limitations on carrying forward unused
                              leave time; and, provided further, that Employee
                              shall use his best efforts to coordinate with the
                              President and COO of SM&A the dates upon which
                              Employee shall use his aforesaid vacation so as to
                              minimize the negative impact upon SM&A occasioned
                              by Employee's absence.

3.      CELLULAR
        PHONE:                SM&A shall reimburse Employee for the periodic
                              cost of a cellular telephone including but not
                              limited to phone equipment rental.

4.      OTHER
        BENEFITS:             Employee shall be entitled to participate in and
                              receive benefits under all profit-sharing plans,
                              pension plans, group medical plans and other
                              benefit plans for the payment of additional
                              compensation or benefits to employees of SM&A
                              which SM&A at any time maintains for executive
                              employees.

5.      AUTOMOBILE
        LEASE:                In lieu of an automobile allowance, SM&A shall
                              lease an automobile of Employee's choice. In
                              addition, the reasonable cost of annual insurance,
                              fuel, maintenance, cleaning and repairs shall
                              be borne by SM&A.

                                       12
<PAGE>   13

6.      BUSINESS
        EXPENDITURES:         Employee may be authorized to incur reasonable
                              expenses for promoting and conducting the business
                              of SM&A, including but not limited to expenditures
                              for entertainment and travel. SM&A shall reimburse
                              Employee monthly for all such approved business
                              expenses upon presentation of reasonable
                              documentation establishing the amount, date, place
                              and essential character of the expenditures.

7.      INCENTIVE
        BONUS:                Employee's incentive bonus for each fiscal year
                              shall provide for a maximum bonus of up to
                              $400,000 of his base salary for such year and
                              shall be subject to such terms and conditions as
                              shall be determined in good faith by the Board of
                              Directors, with the recommendation of and in
                              consultation with the Compensation Committee of
                              the Board of Directors. The incentive bonus may be
                              based on financially oriented components or upon
                              Employee's individual accomplishments or both. The
                              incentive bonus earned for a fiscal year of SM&A
                              shall be paid not later than three (3) business
                              days following the review and approval by the
                              Board of Directors of SM&A of the final financial
                              statement results of the audit for said fiscal
                              year by SM&A's independent auditors.

                              Employee may draw up to $70,000 through quarterly
                              payments, a gross amount equal to $17,500 as a
                              non-guaranteed advance against the Incentive
                              Bonus.

8.      INDEMNI
        FICATION:             SM&A has entered into a directors and officers
                              Indemnification Agreement with Employee, under
                              which SM&A is required to indemnify Employee
                              against personal liability for acts of SM&A, to
                              the extent such indemnification is permitted by
                              law.

                                       13

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