EXHIBIT 10.4
EMPLOYMENT AGREEMENT
This Employment Agreement (this "Agreement") is entered into on the 19th
day of April 1999, by and between Robert Hicks, an individual ("Executive"), and
California Amplifier, Inc., a Delaware corporation (the "Company").
1. EMPLOYMENT BY THE COMPANY AND TERM.
(a) FULL TIME AND BEST EFFORTS. Subject to the terms set forth herein, the
Company agrees to employ Executive as Director, Satellite Sales, and in such
other capacities as may be requested from time to time by the Board of Directors
of the Company (the "Board") or a duly authorized committee thereof, and
Executive hereby accepts such employment. Executive shall render such other
services for the Company and corporations controlled by, under common control
with or controlling, directly or indirectly, the Company, and to successor
entities and assignees of the Company as the Company may from time to time
reasonably request and as shall be consistent with the duties Executive is to
perform for the Company and with Executive's stature and experience. During the
term of his employment with the Company, Executive will devote his full time and
attention exclusively to, and use his best efforts to advance, the business and
welfare of the Company. Executive shall render such services primarily in the
Dallas, Texas area.
(b) DUTIES. Executive shall serve in an executive capacity and shall
perform such duties as are customarily associated with his title of Director,
Satellite Sales, as required by the Board.
(c) COMPANY POLICIES. The employment relationship between the parties shall
be governed by the general employment policies and practices of the Company,
including but not limited to those relating to protection of confidential
information, except that when the terms of this Agreement differ from or are in
conflict with the Company's general employment policies or practices, this
Agreement shall control.
(d) TERM. The term of employment of Executive under this Agreement (the
"Term") shall be one (1) year commencing on April 19, 1999, unless earlier
terminated; PROVIDED, HOWEVER, that the Term may be renewed on terms and
conditions mutually agreeable to both parties. The Company shall not have any
express or implied obligation under any circumstances to extend Executive's
employment beyond the end of the Term.
2. COMPENSATION AND BENEFITS.
(a) SALARY. During the first four months of the Term, Executive shall
receive for services to be rendered hereunder a salary at the rate of Nine
Thousand Dollars ($9,000) per month payable at least as frequently as monthly
and subject to payroll deductions as may be
1
necessary or customary in respect of the Company's salaried employees (the "Base
Salary"). After the first four months of the Term, the Base Salary shall be
reduced to Four Thousand Dollars ($4,000) per month.
(b) BONUSES. Executive's eligibility to receive bonuses during the Term,
and the amount of any such bonuses, shall be determined in the sole and absolute
discretion of the Board or a duly authorized committee thereof.
(c) COMMISSIONS. After the first four months of the Term, Executive shall
receive commission payments on a quarterly basis equal to one-half of one
percent (0.5%) ("Commissions) of the Company's revenues from sales occurring
during the remainder of the Term of United States Direct Broadcasting System
products purchased or developed by Gardiner Communications Corp., a Delaware
corporation (the "Products"). Upon the expiration of this Agreement, as renewed
if applicable (the "Expiration"), the Company shall pay Executive Commissions
for any shipments of the Products arranged for by Executive and made within
ninety (90) days after the Expiration, payable in cash not later than one
hundred twenty (120) days following the Expiration (subject to applicable
withholding).
(d) PARTICIPATION IN BENEFIT PLANS. During the Term, Executive shall be
entitled to participate, on the same terms and conditions generally applicable
to members of senior management of the Company, in any group insurance,
hospitalization, medical, dental, health and accident, disability, pension or
similar plan or program of the Company now existing or established hereafter to
the extent that he is eligible under the general provisions thereof. The Company
may, in its sole discretion and from time to time, establish additional or
eliminate or modify existing benefit programs as it deems appropriate.
3. REASONABLE BUSINESS EXPENSES AND SUPPORT. Executive shall be reimbursed
for documented and reasonable business expenses in connection with the
performance of his duties hereunder within the limits of the annual budget for
such expenses approved by the Board. Executive shall be furnished reasonable
office space, assistance and facilities in the Dallas, Texas area.
4. TERMINATION OF EMPLOYMENT. The date on which Executive's employment by
the Company ceases, under any of the following circumstances, shall be defined
herein as the "Termination Date."
(a) TERMINATION FOR CAUSE.
(i) TERMINATION; PAYMENT OF ACCRUED SALARY. The Board may
terminate Executive's employment with the Company at any time for cause,
immediately upon notice to Executive of the circumstances leading to such
termination for cause or, in the event that paragraph (ii) below provides for a
cure period, upon notice and the expiration of such cure period. In the event
that Executive's employment is terminated for cause, Executive shall receive
payment for all accrued salary and accrued Commissions through the Termination
Date, which in this event shall be the date upon which notice of termination is
given. The Company
2
shall have no further obligation to pay severance of any kind nor to make any
payment in lieu of notice.
(ii) DEFINITION OF CAUSE. "CAUSE" means the occurrence or
existence of any of the following with respect to Executive, as determined by a
majority of the disinterested directors of the Board:
(A) Executive's conviction by, or entry of a plea of guilty
or nolo contendere in, a court of competent and final jurisdiction for
any crime involving moral turpitude or any felony punishable by
imprisonment in the jurisdiction involved;
(B) Executive's commission of an act of fraud upon the
Company, whether prior to or subsequent to the date hereof;
(C) Executive's failure or refusal to perform his duties as
reasonably required by this Agreement, provided that termination of
Executive's employment pursuant to this subparagraph (C) shall not
constitute valid termination for cause unless Executive shall have
first received written notice from the Company stating with
specificity the nature of such failure or refusal and affording
Executive at least five (5) days to correct the act or omission
complained of;
(D) gross negligence, insubordination, material violation by
Executive of any duty of loyalty to the Company, or any other material
misconduct on the part of Executive, provided that termination of
Executive's employment pursuant to this subparagraph (D) shall not
constitute valid termination for cause unless Executive shall have
first received written notice from the Company stating with
specificity the nature of such failure or refusal and affording
Executive at least five (5) days to correct the act or omission
complained of;
(E) the repeated non-prescription use of any controlled
substance, or the repeated use of alcohol or any other non-controlled
substance which in the Board's reasonable determination renders
Executive unfit to serve in his capacity as an officer or employee of
the Company;
(F) Executive's failure to report to work for any
consecutive five-day period, other than for excused absences or
reasonable medical or personal reasons;
(G) sexual harassment by Executive that has been reasonably
substantiated and investigated;
(H) Executive's physical destruction of substantial property
or assets of the Company; or
3
(I) Executive's death.
(b) TERMINATION UPON DISABILITY. The Company may terminate Executive's
employment in the event Executive suffers a disability that renders Executive
unable to perform the essential functions of his position, even with reasonable
accommodation, for three (3) months within any six (6) month period. After the
Termination Date, which in this event shall be the date upon which notice of
termination is given, no further compensation will be payable under this
Agreement.
(c) TERMINATION WITHOUT CAUSE; SEVERANCE PAYMENTS. In the event that during
the Term, Executive's employment is terminated by the Company other than
pursuant to paragraph 4(a) or 4(b), then the Company shall pay Executive as
severance (i) an amount (the "Severance Payment") equal to the greater of (A)
one-half of Executive's Base Salary for the remainder of the Term or (B) two
months of Executive's Base Salary, in either case payable in cash in a lump sum
not later than thirty (30) days following the Termination Date (subject to
applicable withholding) and (ii) Commissions for any shipments of the Products
arranged for by Executive and made within ninety (90) days after the Termination
Date, payable in cash not later than one hundred twenty (120) days following the
Termination Date (subject to applicable withholding).
(d) BENEFITS UPON TERMINATION. In the event that during the Term
Executive's employment is terminated by the Company other than pursuant to
paragraph 4(a) or 4(b), all benefits provided under paragraph 2(d) hereof shall
be extended, at Executive's election and at the same cost to Executive as when
employed, to the extent permitted by the Company's insurance policies and
benefit plans, for a period following Executive's Termination Date equal to the
remainder of the Term, except as required by law (e.g., COBRA health insurance
continuation election). In the event that during the Term Executive's employment
is terminated (1) by the Company pursuant to paragraph 4(a) or 4(b) or (2)
otherwise, such benefits shall not be extended under any circumstances, except
(x) as required by law (e.g., COBRA health insurance continuation election) and
(y) if Executive is terminated pursuant to paragraph 4(a)(ii)(I), in which case
the Company shall continue coverage of Executive's dependents, if any, under all
benefit plans or programs of the type listed in paragraph 2(c) for a period of
three (3) months.
5. PROPRIETARY INFORMATION OBLIGATIONS. During the Term, Executive will
have access to and become acquainted with the Company's confidential and
proprietary information, including but not limited to information or plans
regarding the Company's personnel, or sales, marketing, and financial operations
and methods; relationships with its customers, subcontractors, suppliers and
redevelopment agencies and other governmental agencies (the "Relationships");
trade secrets; formulas; devices; secret inventions; processes; and other
compilations of information, records, and specifications (collectively, the
"Proprietary Information"). Executive shall not (a) disclose any of the
Proprietary Information directly or indirectly, or use it in any way, either
during the Term or at any time thereafter, except as required in the course of
his employment for the Company or as authorized in writing by the Company, or
(b) intentionally jeopardize or abuse the Relationships to the detriment of the
4
Company. All files, records, documents, computer-recorded information, drawings,
specifications, equipment and similar items relating to the business of the
Company, whether prepared by Executive or otherwise coming into his possession,
shall remain the exclusive property of the Company and shall not be removed from
the premises of the Company under any circumstances whatsoever without the prior
written consent of the Company, except when (and only for the period) necessary
to carry out Executive's duties hereunder, and if removed shall be immediately
returned to the Company upon any termination of his employment and no copies
thereof shall be kept by Executive.
6. NONINTERFERENCE. While employed by the Company and until one (1) year
from the expiration of the Term or the termination of this Agreement by the
Company, as the case may be, Executive agrees not to interfere with the business
of the Company by directly or indirectly soliciting, attempting to solicit,
inducing or otherwise causing any employee of the Company to terminate his or
her employment in order to become an employee, consultant or independent
contractor to or for any other employer.
7. NON-COMPETITION. Executive agrees that during the Term, he will not,
without the prior written consent of the Company, directly or indirectly,
possess an interest in, be employed by, or be connected with, as an employee,
consultant, officer, director, partner, member, stockholder or joint venturer,
any person or entity owning, managing, controlling, operating or otherwise
participating or assisting in any business which is similar to or in competition
with the business of the Company in any location; PROVIDED, HOWEVER, that the
foregoing shall not prevent Executive from being a stockholder of less than one
percent (1%) of the issued and outstanding securities of any class of a
corporation listed on a national securities exchange or designated as national
market system securities on an interdealer quotation system by the National
Association of Securities Dealers, Inc.
8. MISCELLANEOUS.
(a) NOTICES. Any notices provided hereunder must be in writing and
shall be deemed effective upon the earlier of personal delivery (including
personal delivery by telecopy or telex) or the third day after mailing by first
class mail to the recipient at the address indicated below:
To the Company:
California Amplifier, Inc.
460 Calle San Pablo
Camarillo, California 93012
Attention: Fred Sturm
Telephone: (805) 987-9000
Facsimile: (805) 987-2655
5
To Executive:
Robert Hicks
3505 Security Street
Garland, Texas 75042
Telephone: (214) 348-4747
Facsimile: (214) 341-1933
or to such other address or to the attention of such other person as the
recipient party will have specified by prior written notice to the sending
party.
(b) SEVERABILITY. Any provision of this Agreement which is deemed invalid,
illegal or unenforceable in any jurisdiction shall, as to that jurisdiction and
subject to this paragraph be ineffective to the extent of such invalidity,
illegality or unenforceability, without affecting in any way the remaining
provisions hereof in such jurisdiction or rendering that or any other provisions
of this Agreement invalid, illegal, or unenforceable in any other jurisdiction.
If any covenant should be deemed invalid, illegal or unenforceable because its
scope is considered excessive, such covenant shall be modified so that the scope
of the covenant is reduced only to the minimum extent necessary to render the
modified covenant valid, legal and enforceable.
(c) ENTIRE AGREEMENT. This Agreement by and between Executive and the
Company constitute the final, complete, and exclusive embodiment of the entire
agreement and understanding between the parties related to the subject matter
hereof and supersede and preempt any prior or contemporaneous understandings,
agreements or representations by or between the parties, written or oral.
(d) COUNTERPARTS. This Agreement may be executed by the parties in separate
counterparts and the signatures delivered by telecopy, each of which when so
executed and delivered shall be an original with the same effect as if the
signatures thereto and hereto were upon the same instrument and delivered in
person. This Agreement shall become effective when each party hereto shall have
received a counterpart hereof signed by the other parties hereto.
(e) SUCCESSORS AND ASSIGNS. This Agreement is intended to bind and inure to
the benefit of and be enforceable by Executive and the Company, and their
respective successors and assigns, except that Executive may not assign any of
his duties hereunder and he may not assign any of his rights hereunder without
the prior written consent of the Company.
(f) ATTORNEYS' FEES. If any legal proceeding is necessary to enforce or
interpret the terms of this Agreement, or to recover damages for breach
therefore, the prevailing party shall be entitled to reasonable attorneys' fees,
as well as costs and disbursements, in addition to any other relief to which he
or it may be entitled.
(g) AMENDMENTS. No amendments or other modifications to this Agreement may
be made except by a writing signed by both parties. No amendment or waiver of
this Agreement requires the consent of any individual, partnership, corporation
or other entity not a party to this
6
Agreement. Nothing in this Agreement, express or implied, is intended to confer
upon any third person any rights or remedies under or by reason of this
Agreement.
(h) CHOICE OF LAW. All questions concerning the construction, validity and
interpretation of this Agreement will be governed by the internal law, and not
the law of conflicts, of the State of California.
(i) ARBITRATION.
(1) Except as provided in subparagraph (4) hereof, any
controversy, dispute or claim arising out of, in connection with, or
in relation to the interpretation, performance or breach of this
Agreement, including any claim based on contract, tort or statute,
shall be settled, at the request of either party, by arbitration
conducted in Los Angeles, California, or such other location upon
which the parties may mutually agree, before and in accordance with
the then existing Rules of the American Arbitration Association
("AAA"), and judgment upon any award rendered by the arbitrator may be
entered by any State or Federal court having jurisdiction thereof. Any
controversy concerning whether a dispute is an arbitrable dispute
shall be determined by the arbitrator. The parties intend that this
agreement to arbitrate be valid, specifically enforceable and
irrevocable. The designation of a situs or specifically a governing
law for this agreement or the arbitration shall not be deemed an
election to preclude application of the Federal Arbitration Act, if it
would be applicable.
(2) The sole arbitrator shall be selected in accordance with
the procedures of the AAA.
(3) The arbitrator shall award to the prevailing party in
any arbitration proceeding commenced hereunder, and the court shall
include in its judgment for the prevailing party in any claim arising
under this Agreement or relating to the transactions contemplated
hereby, the prevailing party's costs and expenses (including expert
witness expenses and reasonable attorneys' fees) of investigating,
preparing and presenting such arbitration claim or cause of action.
(4) Any party hereto may request a court of competent
jurisdiction to grant provisional injunctive relief to such party
solely for the purpose of maintaining the status quo until an
arbitrator can render an award on the matter in question and such
award can be confirmed by a court having jurisdiction thereof.
7
IN WITNESS WHEREOF, the parties have executed this Agreement effective as
of the date and year first written above.
EXECUTIVE
/s/ Robert Hicks
--------------------------------------------------
Robert Hicks
CALIFORNIA AMPLIFIER, INC.
By: /s/ Fred Sturm
---------------------------------------------
Fred Sturm
President and Chief Executive Officer
8