EMPLOYMENT AGREEMENT
This Agreement (the "Agreement") is dated November 1st, 1996 BETWEEN HAWKER
PACIFIC, INC. ("HPI") having its principal place of business at 11310 Sherman
Way, Sun Valley, California 91352 AND DAVID L. LOKKEN ("Employee") of 48-571
Shady View Drive, Palm Desert, California 92260
1. RECITALS. HPI desires to continue to benefit from Employee in
his capacity as President and Chief Executive Officer of HPI;
and Employee will serve as President and Chief Executive
Officer of HPI on the agreements set forth below and for other
consideration, HPI and Employee agree that Employee will be
employed by HPI in accordance with the terms of this Agreement.
2. SERVICES. During the term of his employment, Employee shall be
responsible for effectively performing the duties of his position and
such other duties assigned to him which are consistent with his
position and such other duties assigned to him which are consistent
with his position. Employee will utilize HPI's resources as
appropriate to best fulfill his responsibilities. Employee agrees to
devote his entire productive time, ability and attention to the
business of HPI. During the term of his employment, Employee also
agrees that he shall not directly or indirectly perform any services
of a business, commercial or professional nature for any person or
organization, whether for compensation or otherwise, without HPI's
prior written consent.
3. PLACE OF PERFORMANCE. HPI shall provide Employee with an appropriate
office at its offices, and all supplies, equipment, and office
personnel reasonably necessary to perform Employee's duties and
services.
4. COMPENSATION AND BENEFITS. As compensation and benefits for
Employee's services, HPI shall provide the following compensation and
benefits to Employee during the term of employment and upon
termination of his employment as provided by this Agreement:
4.1 BASE SALARY HPI shall pay Employee a base salary of $179,000
(one hundred seventy nine thousand dollars) per year or at such
higher rate as HPI may from time to time determine, payable in
equal installments at HPI's regular payroll periods.
4.2 BONUS. Employee shall be eligible for a periodic bonus on the
terms and conditions of a separate Executive Bonus Plan
Agreement between Employee and HPI. Such Executive Bonus Plan
Agreement shall address bonus based on HPI's performance. The
foregoing notwithstanding, the bonus calculation for 1996 will
be in accordance with the BTR plan and payable in February 1997
subsequent to confirmation of results by external audit and
approval by Unique Investment Corporation.
4.3 BENEFITS. Employee shall be entitled to such fringe benefits
and perquisites as are generally made available to similarly
contracted employees of HPI, whether such benefits are presently
in effect or come into effect during the term of this Agreement,
and such other fringe benefits as may be determined by HPI in
its sole discretion, except that Employee's benefits shall not
be reduced from those benefits specifically provided in this
Agreement.
4.4 VACATIONS. Employee shall be entitled to a vacation period of
four (4) weeks per year. Administration of Employee's vacation
and vacation year to year carry over will
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be in accordance with the applicable HPI Policies and Procedures.
Upon termination of his employment with HPI for any reason,
Employee shall be paid for all unused, accrued vacation time.
4.5 HOLIDAYS. Employee shall receive paid holidays in accordance
with applicable HPI Policies and Procedures.
4.6 SICK LEAVE. Employee shall be entitled to sick leave without
any loss in compensation.
4.7 INSURANCE. HPI shall provide to Employee paid health, dental,
disability and life insurance benefits in accordance with HPI
established plans. HPI shall reimburse Employee for insurance
premiums, deductibles and any other expenses not paid by the
Company Plan and for one comprehensive physical examination
annually.
4.8 PENSION PLAN(S). Employee will be eligible to participate in
HPI's Pension and 401k Plans in accordance with HPI Policies and
Procedures.
4.9 AUTOMOBILE. During the term of this Agreement, HPI will pay
Employee a $1,500 (one thousand five hundred dollars) per month
automobile allowance.
4.10 BUSINESS EXPENSES. HPI shall reimburse Employee for all
business expenses reasonably incurred by Employee in connection
with the performance of his duties under this Agreement
provided that Employee furnishes HPI with adequate records or
other evidence respecting such expenditures. HPI shall
reimburse Employee, or shall pay directly, all reasonable
entertainment, promotion, telephone and other expenses incurred
in connection with the performance of Employee's duties under
this Agreement as well as all reasonable travel and living
expenses while traveling business related. HPI shall reimburse
Employee or shall pay directly, rent expenses for
accommodations in close proximity to HPI headquarters.
4.11 EQUITY PARTICIPATION. Employee will acquire equity in HPI in
accordance with terms and conditions of a separate Executive
Equity Plan Agreement between Employee and HPI.
5. TERM AND TERMINATION.
5.1 TERM OF AGREEMENT. The term of Employee's employment with HPI
shall commence on November 1, 1996 and shall end on October 31,
2001 the ("Termination Date"), unless terminated earlier in
accordance with the terms of this Agreement or unless extended
in accordance with paragraph 5.2 below.
5.2 TERMINATION. Either party shall give at least three months
prior written notice to the other prior to the Termination Date
to terminate this Agreement or the Agreement shall be extended
for an additional year under the same terms and conditions of
this Agreement. For purposes of this Agreement, the "Term of
this Agreement" shall mean the full term of the Agreement,
including subsequent terms, and not only the initial term.
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5.3 RIGHTS OF EMPLOYEE UPON TERMINATION.
(A) HPI may terminate Employee "Without Cause" at any time upon
giving written notice to Employee. HPI shall then pay
Employee "Severance Pay" equal to Employee's Base Salary
and benefits in accordance with the paragraphs of Article 4
above for the remaining term of this Agreement until the
Termination Date or for two years whichever period is
longer. "Severance Pay" shall include a calendar based
pro-rata bonus for the year of termination. Severance pay
shall be paid in equal installments on HPI's normal payment
schedule or in lump sum(s) at Employer's option.
Additionally, the Employee shall receive "Severance Pay" as
described above if at any time the Employee's duties or
terms of employment materially change and Employee elects
to leave the employ of HPI as a result of such change.
(B) HPI may terminate Employee for "Cause" at any time, with or
without advance notice upon giving written notice to
Employee, if Employee has: (i) committed fraud,
misappropriation or theft; (ii) engaged in gross
misconduct in the performance of his duties; (iii) engaged
in unlawful conduct which has a material adverse effect on
HPI; or (iv) been convicted of a felony.
If Employee is terminated for "Cause" he shall have no rights
whatsoever pursuant to this Agreement except as provided for
in the Executive Equity Plan Agreement. This Employment
Agreement shall terminate immediately upon such written
notice to Employee.
5.4 DEATH OR DISABILITY.
(A) Upon Employee's death, Employee's Base Salary and all
benefits payable to Employee shall be paid to his heirs
under the terms of this Agreement through the Termination
Date. Such amount to be reduced by proceeds of life
insurance paid by HPI.
(B) Upon Employee's "permanent disability", Employee's Base
Salary and fringe benefits payable shall be paid through
the Termination Date reduced by any disability insurance
proceeds received by him from any policy paid for by HPI
and any State disability insurance. "Permanent disability"
means Employee's inability to substantially perform his
duties for any physical, mental, emotional or other reason
for 90 consecutive days or more.
6. MISCELLANEOUS PROVISIONS.
6.1 NOTICES. All notices, demands and other communications,
provided for in this Agreement ("Notice") shall be in writing
and shall be given to such party at its address as set forth
below or such address as such party may specify of the purpose
by Notice to the other party listed below. Each Notice shall
be deemed delivered to the party to whom it is addressed on the
next business day following its actual delivery at the address
specified in this paragraph.
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TO: Hawker Pacific, Inc.
11310 Sherman Way
Sun Valley, CA 91352
Attn: CFO
TO: David L. Lokken
48-571 Shady View Drive
Palm Desert, CA 92260
6.2 NO ASSIGNMENT. This Agreement may not be assigned by any party
without the prior written consent of the other party.
6.3 INTERPRETATION. The resolution of ambiguities against the
drafting party shall not apply in the enforcement and
interpretation of this Agreement, and this Agreement shall be
given a fair and reasonable construction in accordance with the
intent of the parties.
6.4 GOVERNING LAW. This Agreement shall be governed by,
interpreted under, construed and enforced in accordance with
the laws of the State of California.
6.5 PARTIAL INVALIDITY. If any term or provision of this Agreement
or the application thereof shall, to any extent, be invalid or
unenforceable, then the remainder of this Agreement, or the
application of such term or provision other than those as to
which it is held invalid or unenforceable, shall not be
affected and shall be valid and enforceable to the fullest
extent permitted by law.
6.6 COUNTERPARTS AND PHOTOCOPIES. This Agreement may be executed
in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and
the same instrument. Photocopies of this Agreement shall also
be given the same effect as the original.
6.7 ENTIRE AGREEMENT. This Agreement is the final expression of,
and contains the entire agreement between, the parties with
respect to the subject matter of this Agreement and supersedes
all prior negotiations, understandings and agreements. No
statements, promises or representations have been made by any
party to any other, or relied upon, and no consideration has
been offered, promised, expected or held out other than
expressly provided in this Agreement. This Agreement may not be
modified, changed, amended, supplemented or terminated, except
by a written instrument signed by the party to be charged or by
its duly authorized agent.
6.8 WAIVERS. The waiver by either party of the breach of any term,
provision, covenant or condition contained in this Agreement,
or the failure or either party to insist on strict performance
by the other, shall not be deemed to be a waiver of such term,
provision, covenant or condition contained in this Agreement.
The acceptance of performance by either party shall not be
deemed to be a waiver of any breach or default by the other
party, regardless of the non-defaulting party's knowledge of
such breach or default at the time of acceptance of
performance.
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6.9 ATTORNEY'S FEES. If any action is commenced to enforce any of
the provisions of this Agreement or to enforce a judgment, the
unsuccessful party shall pay all costs incurred by the
prevailing party, including reasonable attorneys' fees and
costs, arbitration fees and costs, court costs and
reimbursements for any other expenses.
6.10 CAPTIONS. The paragraph and section headings in this Agreement
are solely for convenience of reference and are not a part of
an are not intended to govern, limit or aid in the construction
of any term provision of this Agreement.
6.11 FURTHER ASSURANCES. The parties agree, without any additional
consideration or any unreasonable delay, to execute all such
other instruments and documents and to take all actions as may
be reasonably necessary or desirable to further implement the
provisions of this Agreement.
7. ARBITRATION. All claims, disputes or other matters in question
arising out of, or relating to, this Agreement or the breach of this
Agreement shall be decided in accordance with the then current
California Employment Resolution Dispute Rules of the American
Arbitration Association. Arbitration shall be held in Los Angeles,
California. The award of the arbitrator shall be final and binding
upon the parties, and judgment may be entered upon it in accordance
with applicable law in any court having jurisdiction. This agreement
to arbitrate shall be self-executing without the necessity of filing
any action in any court and shall be specifically enforceable under
the prevailing arbitration law.
The parties execute this Agreement on the date set forth above.
HAWKER PACIFIC, INC.
By: /s/ SCOTT HARTMAN
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Its: C.O.O.
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Date: 27 November 1996
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DAVID L. LOKKEN
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Date: 27 November 1996
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