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Exhibit 10.20    
    


EMPLOYMENT AGREEMENT  


        THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into as of December 9, 2003, between Channell
Commercial Corporation, a Delaware corporation (the "Company"), and William H. Channell, Jr.
("Executive") with reference to the following facts: 


        A.    WHEREAS,
Executive is currently serving as the Company's President and Chief Operating Officer; 



        B.    WHEREAS,
the Company has appointed Executive to the position of Chief Executive Officer, and the Company and Executive wish to set forth this Agreement to set forth the
terms upon which Executive shall serve as the President and Chief Executive Officer of the Company; 


        C.    WHEREAS,
the Company regards Executive as valuable to it, and has determined that it would be to the advantage of the Company to provide an inducement to Executive to
remain in the Company's service and an incentive for increased efforts; 


        D.    Based
on these facts, Executive and the Company wish to enter into this Agreement providing for the continued employment of Executive on the terms set forth herein, which
Agreement shall amend, restate and supersede the existing Employment Agreement dated as of July 8, 1996 between Executive and the Company, as such Employment Agreement was previously amended,
effective as of the first date written above. 


        NOW
THEREFORE, based on the mutual covenants contained herein, the parties agree as follows: 


        1.     Employment and Duties. The Company hereby agrees to employ Executive and Executive hereby accepts employment with the
Company under the terms and conditions set forth in this Agreement. Executive shall be employed as President and Chief Executive Officer, with the duties and responsibilities commensurate with his
position as may be assigned by the Board of Directors of the Company. Executive shall devote substantially all of his full working time, attention and energies to performing his duties for the Company
on an exclusive basis (except for a limited amount of time devoted to personal financial matters and community activities), and shall perform his duties faithfully and to the best of his abilities. 


        2.     Term of Employment. Subject to earlier termination as provided in Section 5 and to automatic renewal for additional
five-year terms, as provided in this Section, Executive's employment under this Agreement shall commence on the date first stated above and continue until the fifth anniversary of such
date (the "Employment Term"; each year during the "Employment Term" a "Term
Year"). In the event that Executive continues to be employed by the Company following the Employment Term, that employment shall be governed by this Agreement and shall
continue for successive five-year terms until terminated by either party (in the case of any termination by the Company, provided that the Company has given Executive at least six months'
prior written notice that the Board of Directors (or its duly authorized committee) has elected not to continue the Employment Term following the expiration of the then current Term Year). 



        3.     Compensation. As compensation for the performance by Executive of all of his obligations under this Agreement, the Company
shall pay to Executive: 



        3.1   Base Salary. A base salary during the Employment Term, at a rate of Seven Hundred Eighteen Thousand Three Hundred Twenty
Dollars ($718,320) per Term Year, payable in accordance with the Company's normal practices for its senior executive officers (the "Base Salary"). The
Base Salary may be increased from time to time in the discretion of the Company's Board of Directors (the "Board") (or its duly authorized committee) to
ensure, among other things, that the Base Salary remains comparable to base salaries paid to comparably situated executives at other public companies. In addition, the Base Salary shall be adjusted
annually 






 

commencing
on July 1, 2004, to reflect the most recently published annualized percentage increase in the Consumer Price Index of the Bureau of Labor Statistics of the United States Department
of Labor for the Los Angeles area (provided, that the first Base Salary adjustment, effective July 1, 2004, shall reflect the change in the Index from January 1, 2003). The Base Salary
shall not be decreased during the term of this Agreement. 


        3.2   Incentive Compensation. In addition to Base Salary, Executive will be entitled to participate in cash and other bonus
programs of the Company, including, to the extent provided by the committee of the Board administering such plan, the Company's 1996 Performance Based Annual Incentive Compensation Plan. In
particular, Executive shall be entitled to earn bonuses under three plans or programs, including: (i) up to $200,000 per Term Year based upon achievement of goals and objectives established by
the Board (or its duly authorized committee); (ii) up to $210,000 per Term Year based upon growth in revenue and/or fully diluted earnings per share, with the metrics to be established by the
Board (or its duly authorized committee) annually; provided, that in the event of unusual industry or Company-specific events or circumstances, the
Board (or its duly authorized committee) may employ alternative metrics that more appropriately incentivize Executive; and (iii) a Long Term Incentive Plan
("LTIP") providing Executive with bonuses based upon growth in the Company's market capitalization annually as well as over a three-year
period commencing January 1, 2004. The LTIP will be memorialized in a separate agreement between Executive and the Company, which will include terms substantially in accordance with  Exhibit A
attached hereto. 




        4.     Benefits. 



        4.1   Expenses. The Company shall repay or reimburse Executive for ordinary and necessary business expenses to the extent
compatible with the Company's general policies for its senior executive officers. Executive shall keep accurate and complete records of all such expenses. 


        4.2   Insurance Benefits. During the Employment Term, the Company shall provide Executive with those insurance benefits
generally available to its senior executive officers, as such benefits may be modified from time to time in the Company's sole and absolute discretion. 


        4.3   Vacation and Sick Leave. During the Employment Term, Executive shall be entitled to a paid annual vacation in accordance
with the policies established from time to time by the Company for its senior executive officers; provided, however, that Executive shall be entitled to no less than six weeks paid annual vacation per
Term Year. Without the Company's written consent, vacation must be taken in the year earned and Executive's vacation will be scheduled at times convenient to the Company's business. Executive shall be
entitled to paid sick days and personal days in accordance with the policies established from time to time by the Company for its senior executive officers. 


        4.4   Automobile Allowance. During the Employment Term, the Company shall provide Executive with an automobile allowance in the
amount of eighteen hundred dollars ($1800.00) per calendar month, payable in accordance with the policies established from time to time by the Company for its senior executive officers. The Company
shall secure, at its expense, automobile insurance for one automobile of Executive, such insurance of a type and in an amount and form satisfactory to the Company. The Company agrees to provide
evidence of such insurance and to promptly notify Executive if such insurance is cancelled, suspended, expired or otherwise impaired. 



        4.5   Incentive Stock Plans. Executive shall be eligible to participate in the Company's incentive stock plan(s) to the extent
determined by the Board or its duly authorized committee in its sole discretion. The determination of award(s) under such stock plans shall be made by the Board or such duly authorized committee from
time to time in its sole discretion. The Company and Executive currently anticipate an award to Executive of at least 50,000 options to purchase 



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common
stock of the Company per year; provided, that the final determination of award(s) under incentive stock plans shall be made by the Board or its
duly authorized committee from time to time in its sole discretion. Notwithstanding anything to the contrary in any stock option agreement evidencing any stock option grant to the Executive, in the
event of Executive's death while employed by the Company, all stock options held by Executive at the time of his death shall accelerate and become immediately exercisable in full. 




        5.     Termination of Employment. 



        5.1   Termination. The Company may terminate Executive's employment with the Company at any time with or without "Cause" by
written notice to Executive. Executive may terminate Executive's employment with the Company at any time with or without "Good Reason" by written notice to the Company. "Cause" exists if any one or
more of the following should occur, as determined reasonably in good faith by the Board: Executive's (a) willful and repeated failure to perform his duties under, or breach of, this Agreement,
which failure results in a material detriment to the Company, after at least 10 days advance written notice and opportunity to cure; (b) willful and repeated failure to comply with a
reasonable direction of the Board, which failure results in a material detriment to the Company, after at least 10 days advance written notice and opportunity to cure; (c) willful and
material breach of his fiduciary duty to the Company (it being agreed that the Company will provide written notice to Executive of any act or omission deemed by the Board to constitute such a breach,
such notice to be provided approximately contemporaneously with the Board becoming aware of such act or omission); or (d) conviction by a court of competent jurisdiction of a felony or other
serious crime. "Good Reason" shall mean (i) a significant reduction of Executive's duties, title, position or responsibilities relative to Executive's duties, title, position or
responsibilities in effect immediately prior to such reduction that is effected without Executive's consent or agreement; (ii) a substantial reduction, without good business reasons, of the
quality of the office accommodations or employment benefits (including, without limitation, elimination or reduction of any of the benefit plans, or Executive's eligibility for participation in them,
referred to in Section 3.2 hereof, unless replaced with a plan or participation criteria providing for equal or superior benefits) available to Executive immediately prior to such reduction if
such reduction is effected without Executive's consent or agreement; (iii) a reduction of Executive's Base Salary or a material reduction in Executive's participation in incentive bonus
programs as in effect immediately prior to such reduction (for the avoidance of doubt, failure by the Company to grant Executive stock options as referenced in Section 4.5 hereof shall not
constitute such a reduction, it being understood that the Board or its duly authorized committee retains sole discretion whether to grant such options) if such reduction is effected without
Executive's consent or agreement; (iv) the relocation of Executive's primary office at the Company to a facility or location that is more than fifty (50) miles away from Executive's
primary office location immediately prior to such relocation, if such relocation is effected without Executive's consent or agreement; or (v) a Change of Control. 


        "Change of Control" of the Company shall mean the occurrence of any of the following: 


        (a)   Any
person or group, as such terms are defined in Section 13(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), other than the Channell Family Trust, William H. Channell, Sr., Jacqueline M. Channell, William H. Channell, Jr. and/or any affiliate thereof, becomes the beneficial
owner (within the meaning of Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company, or of any entity resulting from a merger or consolidation
involving the Company, representing more than 50% of the combined voting power in the election of directors of the then outstanding securities of the Company or such entity; 


        (b)   The
individuals who, as of the time immediately following the execution of this Agreement, are members of the Board (the "Existing
Directors"), cease, for any reason, to constitute more than 50% of the number of authorized directors of the Company as determined in 



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the
manner prescribed in the Company's charter documents; provided, however, that if the election, or nomination for election, by the Company's
stockholders of any new director was approved by a vote of at least 50% of the Existing Directors, such new director shall be considered an Existing Director; provided, further, that no individual
shall be considered an Existing Director if such individual initially assumed office as a result of either an actual or threatened "Election Contest"
(as described in Rule 14a-11 promulgated under the Exchange Act) or other actual or threatened solicitation of proxies by or on behalf of anyone other than the Board (a
"Proxy Contest"), including by reason of any agreement intended to avoid or settle any Election Contest or Proxy Contest; or 


        (c)   The
consummation of (x) a merger, consolidation or reorganization to which the Company is a party, whether or not the Company is the Person surviving or resulting
therefrom, or (y) a sale, assignment, lease, conveyance or other disposition of all or substantially all of the assets of the Company, in one transaction or a series of related transactions, to
any person other than the Company, where any such transaction or series of related transactions as is referred to in clause (x) or clause (y) above in this subparagraph
(c) (singly or collectively, a "Transaction") does not otherwise result in a "Change of Control" pursuant to subparagraph (a) of this
definition of "Change of Control"; provided, however, that no such Transaction shall constitute a "Change of Control" under this subparagraph
(c) if the persons who were the stockholders of the Company immediately before the consummation of such Transaction are the beneficial owners, immediately following the consummation of such
Transaction, of 50% or more of the combined voting power of the then outstanding voting securities of the person surviving or resulting from any merger, consolidation or reorganization referred to in
clause (x) above in this subparagraph (c) or the person to whom the assets of the Company are sold, assigned, leased, conveyed or disposed of in any transaction or series of related
transactions referred in clause (y) above in this subparagraph (c), in substantially the same proportions in which such beneficial owners held voting stock in the Company immediately before
such Transaction. 




        In
the event of Executive's physical or mental disability (so that Executive is not reasonably able to render full services as contemplated hereby) for any consecutive period exceeding
eight (8) months, or
for shorter periods aggregating more than eight (8) months during any twelve (12) month period, the Company shall nevertheless continue to pay full salary up to and including the last
date of the eighth consecutive month of disability, or the day on which the shorter periods of disability shall have equaled to a total of eight (8) months during such twelve (12) month
period, but the Company may, at any time within six (6) weeks thereafter, at its election terminate this Agreement by delivery of written notice thereof to Executive. In the event that
Executive dies during the Employment Term, the Company shall be obligated to pay his estate or legal successor the following amounts: (i) promptly following his death, an amount equal to
one-half (1/2) of the amount of his Base Salary at the time of his death; and (ii) on the date that is six months following his death (or the next regular payroll
date, which is later), an amount equal to one-half (1/2) of the amount of his Base Salary at the time of his death. 



        5.2   Payment Upon Termination. 



        5.2.1     Generally. Upon any termination, the Company shall pay to Executive (or, if applicable, to Executive's
estate) all amounts accrued and unpaid as of the date of termination in respect of (i) Executive's Base Salary for periods through such date, (ii) vacation pay, and (iii) any
reimbursement for expenses owing to Executive pursuant to Section 4.1. In the event of a termination with Cause, Executive shall only be entitled to the payments specified in this
Section 5.2.1. 


        5.2.2     Termination Without Cause. If the Company terminates Executive other than for Cause, or if the Company
elects not to renew the Employment Term at the end of the initial or any subsequent five-year period, or if Executive resigns with Good Reason, then in addition 




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to
amounts that Executive is entitled to receive under Section 5.2.1, Executive shall be entitled to receive as a severance benefit (i) three times Executive's Base Salary, payment of
which shall be accelerated and paid in one lump sum as soon as practically possible within the next pay period, (ii) any and all health and life insurance benefits provided to Executive
pursuant to Sections 4.2 and 8.4 hereof for a period of three years from the Executive's date of termination, as well as the other insurance benefits specified in Section 8.4, and
(iii) accelerated vesting of any options or restricted stock granted to Executive. In the event of the death of Executive during the term of this Agreement while Executive continues to be
employed by the Company, Executive's spouse shall be entitled to receive a severance payment equal to one-half of Executive's Base Salary, payable in one sum as soon as practically
possible within the next pay period. 




        5.3   Exclusivity of Remedies. Executive agrees that the rights and entitlements set forth in this Section 5 are his
exclusive rights and entitlements from the Company and any affiliated entity upon the termination of Executive's employment with the Company, and upon termination the Company shall be released from
other obligations hereunder. 




        6.     Covenants. 



        6.1   Non-Interference Covenant. As a means reasonably designed to protect the Company's Confidential Information
(as hereinafter defined) (Executive hereby agreeing and acknowledging that the proscribed activities would necessarily involve the use of such Confidential Information), during the Employment Term and
for a period of one year thereafter, Executive shall not, directly, indirectly or as an agent on behalf of or in conjunction with any person, firm, partnership, corporation or other entity,
(a) hire any person who is then, or within the prior three months has been, an employee of the Company or its affiliated entities to leave the employment of the Company or its affiliated
entities, or (b) solicit or service any person or entity with whom the Company has a business relationship or who is or was during the Employment Term, a customer or client of the Company. 


        6.2   Employment Exclusive. Executive shall not, during the Employment Term, own any interest (other than up to 5% of the
voting securities of a publicly traded corporation) in, render financial assistance to, or offer personal services (for payment or otherwise), to any entity or individual that competes with the
Company in Company Business (as defined below) or that is a material supplier of the Company. In addition, Executive shall not engage in any activity which would interfere with the performance of
Executive's services to the Company. "Company Business" means the Company's business as it is currently conducted and any other business activity in
which the Company is engaged at any time during Executive's employment with the Company. 


        6.3   Confidential Information. Executive occupies a position of trust and confidence with respect to the Company's affairs and
business. Executive has and will have access to Confidential Information, which he acknowledges is proprietary to the Company and highly sensitive in nature. 



        6.3.1     Definition of Confidential Information. "Confidential
Information" means information disclosed to Executive or known to Executive as a consequence of or through his employment by the Company, whether or not related to his duties,
and includes trade secrets or any other like information relating to the business and/or field of interest of the Company or any business and/or field of interest seriously considered by the Company
during Executive's employment by the Company, including, but not limited to, information relating to Inventions (as defined below), disclosures, processes, systems, methods, formulas, patents, patent
applications, machinery, materials, research activities and plans, cost of production, contract forms, prices, volume of sales, marketing methods and plans, promotional methods, and lists of names or
classes of customers. Information shall for purposes of this Agreement be considered to be confidential if not known by the trade generally, even though such 




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information
may have been disclosed to one or more third parties pursuant to consulting agreements, joint research agreements, or other agreements entered into by the Company. 


        6.3.2     No Disclosure. During and after Executive's employment with the Company, Executive shall not
(a) use, disclose or otherwise permit any person or entity access to any of the Confidential Information
other than as required in the good faith performance of Executive's duties with the Company, or (b) sell, license or otherwise exploit any products or services which embody in whole or in part
any Confidential Information. During and after Executive's engagement with the Company, Executive shall take all reasonable precautions to prevent disclosure by Executive of the Confidential
Information to unauthorized persons or entities. 


        6.3.3     Return All Materials. Upon termination of Executive's employment with the Company, Executive shall
deliver to the Company all tangible materials in any way embodying the Confidential Information, including any documentation, records, listings, notes, data, sketches, drawings, memoranda, models,
videos, accounts, reference materials, samples, machine-readable media and equipment, and wire frame models. Executive shall not retain any copies of any of the above materials. 




        6.4   Assignment of Inventions. 



        6.4.1     Definition of Inventions. "Inventions" mean discoveries, developments, concepts, ideas, methods, designs,
improvements, inventions, formulas, processes, techniques, programs, know-how and data, whether or not patentable or registerable under copyright or similar statutes except, in accordance
with California Labor Code Section 2870, any such that (a) is not related to the business of the Company, or the Company's actual or demonstrable research or development, (b) does
not involve the use of any equipment, supplies, facility or trade secret information of the Company, (c) was developed entirely on Executive's own time, and (d) does not result from any
work performed by Executive for the Company. 


        6.4.2     Assignment. Executive agrees to and hereby does assign to the Company all his right, title and interest
in any and all Inventions he may make during his employment with the Company. 


        6.4.3     Duty to Disclose and Assist. Executive agrees to promptly disclose in writing all Inventions to the
Company, and to provide all assistance reasonably requested by the Company in the preservation of the Company's interests in the Inventions including obtaining patents in any country throughout the
world. Such services will be without additional compensation if Executive is then employed by the Company and for reasonable compensation and subjected to his reasonable availability if he is not. If
the Company cannot, after reasonable effort, secure Executive's signature on any document or documents needed to apply for or prosecute any patent, copyright, or other right or protection relating to
an Invention, whether because of his physical or mental incapacity or for any other reason whatsoever, Executive hereby irrevocably designates and appoints the Company and its duly authorized officers
and agents as his agent and attorney-in-fact, to act for and in his behalf and in his name and stead for the purpose of executing and filing any such application or
applications and taking all other lawfully permitted actions to further the prosecution and issuance of patents, copyrights, or similar protections thereon, with the same legal force and effect as if
executed by him. 




        6.5   Ownership of Copyrights. Executive agrees that any work prepared for the Company which is eligible for United States
copyright protection or protection under the Universal Copyright Convention, the Berne Copyright Convention and/or the Buenos Aires Copyright Convention shall be a work made for hire and ownership of
all copyrights (including all renewals and extensions) 



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therein
shall vest in the Company. If any such work is deemed not to be a work made for hire for any reason, Executive hereby grants, transfers and assigns all right, title and interest in such work
and all copyrights in such work and all renewals and extensions thereof to the Company, and agrees to provide all assistance reasonably requested by the Company in the establishment, preservation and
enforcement of the Company's copyright in such work, such assistance to be provided at the Company's expense but without any additional compensation to Executive. Executive hereby agrees to and does
hereby waive the enforcement of all moral rights with respect to the work developed or produced hereunder, including without limitation any and all rights of identification of authorship and any and
all rights of approval, restriction or limitation on use or subsequent modifications. 


        6.6   Litigation. Executive agrees to render assistance, advice and counsel to the Company at its request regarding any matter,
dispute or controversy with which the Company may become involved and of which Executive has or may have reason to have knowledge, information or expertise. Such services will be without additional
compensation if Executive is then employed by the Company and for reasonable compensation and subjected to his reasonable availability if he is not. 




        7.     Arbitration as the Exclusive Remedy. 



        7.1   Arbitration as the Exclusive Remedy. Except for actions seeking injunctive relief (which may be
brought before any court having jurisdiction under this Agreement), and except with respect to claims asserted in a proceeding initiated by an unrelated third party in which either the Company or
Executive is a defendant, any controversy or claim (whether against Executive or the Company or any parent, subsidiary or affiliate thereof, or any officer, director, employee or agent of any of the
foregoing) arising out of or relating to this Agreement, including, but not limited to, any claim relating to its validity, interpretation, enforceability or breach, and/or any other claim or
controversy arising out of the employment relationship or the commencement or termination of that relationship, including, but not limited to, claims which are brought against any of the Company's
directors, officers, employees and agents and claims for breach of covenant, for breach of an implied covenant, for intentional infliction of emotional distress, or under any applicable statute
(including, without limitation, claims for age or sex discrimination) which are not settled by agreement between the parties, shall be submitted to arbitration by the American Arbitration Association
in Temecula, California (or the nearest American Arbitration Association office, or such other place as the parties may mutually agree) before an arbitrator to be mutually agreed upon by the parties
or, failing their agreement, pursuant to the rules of the American Arbitration Association. In consideration of each party's agreement to submit to arbitration all disputes with regard to this
Agreement and/or with regard to any alleged contract or tort or other claim arising out of the employment relationship or the commencement or termination of that employment relationship, and in
consideration of the anticipated expedition and the minimizing of expense of this arbitration remedy, each agrees that the arbitration provisions of this Agreement shall provide it with its exclusive
remedy against the other
party (including its officers, directors, employees and agents) and each party expressly waives any right it might have to seek redress in any other forum except as provided
herein.



	 
	 	 
	 	 

	 	 	WHC, Sr.
	 	WHC, Jr.

	Initials:	 	Company	 	Officer






        7.2   Procedures. The party filing a claim must present it in writing to the other party in Temecula, California within six
months of the date the party filing the claim knew or should have known of it or the date of the termination, whichever is earlier. Any claim not brought within the required time period will be waived
forever. In the proceedings (i) all testimony of witnesses shall 



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be
taken under oath and (ii) upon conclusion of any proceedings hereunder, the arbitrator shall render findings of fact and conclusions of law in a written opinion setting forth the basis and
reasons for any decision reached and deliver such documents to each party to this Agreement along with a signed copy of the award in accordance with Section 1283.6 of the California Code of
Civil Procedure. The arbitrator shall have power to allocate between the parties in their award costs incurred in preparation for and as a result of any such arbitration, including, without
limitation, filing fees, attorneys' fees, the compensation to be paid to the arbitrator in any such arbitration and costs of transcripts. 




        8.     Miscellaneous. 



        8.1   Agreement Authorized. Executive hereby represents and warrants that he is free to enter into this Agreement and to render
his services pursuant to this Agreement, that he has resigned all offices with any other entities, and that he is not subject to any obligation or restriction that would prevent him from discharging
his duties under this Agreement, and agrees to indemnify and hold harmless the
Company from and with respect to any liability, damages or costs, including attorneys' fees, arising out of any breach by Executive of this representation and warranty. The Company hereby represents
and warrants that any required authorization of this Agreement by its Board of Directors has been obtained. 


        8.2   Notices. Any notice required or desired to be given to the Company or to Executive shall be given in writing, and shall
be addressed (i) to the Company at its principal place of business, and (ii) to Executive at his most recent home address in the records of the Company, or to such other address as that
party may hereafter designate in writing, and shall be sufficiently given by actual delivery thereof to the Company or Executive, as the case may be, or by facsimile or overnight or registered mail,
postage prepaid, return receipt requested, addressed to the other party as aforesaid, and the date of delivery, mailing or telegraphing shall be the date of the giving of such notice. 


        8.3   Payment of Taxes. To the extent that any taxes become payable by Executive by virtue of any payments made or benefits
conferred by the Company, the Company shall not be liable to pay or obligated to reimburse Executive for any such taxes or to make any adjustment under this Agreement. Any payments otherwise due under
this Agreement to Executive, including, but not limited to, the Base Salary and any bonus, shall be reduced by any required withholding for Federal, State and/or local taxes and other appropriate
payroll deductions. The Company shall be entitled to offset any payment obligations to Executive under this Agreement against any amounts it alleges in good faith that Executive owes to the Company. 


        8.4   Insurance. The Company shall apply for and take out, in its own name and at its own expense, the following insurance
policies on Executive for the Employment Term: (i) life insurance in the following amounts: (x) One Million Seven Hundred Fifty Thousand Dollars ($750,000) under a life insurance policy
as to which the Company shall be the beneficiary, and (y) One Million Seven Hundred Fifty Thousand Dollars ($750,000) under a personal life insurance policy as to which Executive shall be
entitled to designate one or more beneficiaries; and (ii) travel and accident insurance in the amount of One Million Dollars ($1,000,000) under a policy as to which Executive shall be entitled
to designate one or more beneficiaries. In addition, the Company shall apply for and take out, in its own name and at its own expense, a disability insurance policy on Executive as to which Executive
shall be the beneficiary, the terms and conditions of which shall be substantially the same as the disability policy in place as of the date hereof (as such terms and conditions may be amended or
modified under such policy or a replacement policy commercially available from time to time), in the amount of 662/3% of the Base Salary, payable in monthly installments (and in no
event less than the aggregate amount of Five Hundred Thousand Dollars ($500,000) annually). Regardless of the reason for termination, if Executive's employment with the 



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Company
terminates for any reason other than Cause during the Employment Term, the Company nonetheless shall maintain such disability insurance policy at its own expense until the date on which
Executive reaches age sixty-five (65). In addition to the foregoing, in the event of Executive's death while an employee of the Company or termination of employment due to disability as
provided in Section 5.1 hereof, the Company shall provide Executive's spouse, for the remainder of her life, with Company-paid medical insurance to the same extent such insurance is
made generally available to its senior executive officers. 




        Executive
shall aid and cooperate in all reasonable respects with the Company in procuring any and all such insurance pursuant to this Section 8.4, including, without limitation,
submitting to the usual and customary medical examinations, and by filling out, executing and delivering such applications and other instruments in writing as may be reasonably required by an
insurance company or companies to which an application or applications for such insurance may be made by or for the Company. In no event may the dollar amount of any and all insurance pursuant to this
Section 8.4 be raised or lowered without the mutual consent of the Company and Executive. 


        In
addition, the Company shall at all times during the Employment Term ensure that Executive is insured under a customary directors and officer insurance policy, with policy limits and
self-retention amounts reasonably appropriate to the Company's circumstances, as determined by the Board of Directors of the Company. Further, the Company shall indemnify Executive and
hold him harmless for all acts and omissions during the Employment Term, to the maximum extent permitted by applicable law. 



        8.5   Assignment. This Agreement is a personal contract, and the rights, interests and obligations of Executive under this
Agreement may not be sold, transferred, assigned, pledged or hypothecated, except that this Agreement may be assigned by the Company to any corporation or other business entity which succeeds to all
or substantially all of the business of the Company through merger, consolidation, corporate reorganization or by acquisition of all or substantially all of the assets of the
Company and which assumes the Company's obligations under this Agreement. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon any successor to the business of
the Company. 


        8.6   Entire Agreement. This Agreement sets forth the entire understanding of the parties with respect to the employment
relationship, including the commencement and termination of the employment relationship, and supersedes any and all prior agreements or understandings between the parties relating to such subject
matter. No person has any authority to make any representation or promise on behalf of any of the parties which is inconsistent with the representations set forth in the Agreement and the Agreement
has not been executed in reliance on any promise or representation not set forth in the Agreement. 



        8.7   Modification, Waiver and Amendment. None of the terms or provisions of this Agreement shall be modified or waived, and
this Agreement may not be amended or terminated, except by a written instrument signed by the party against which any modification, waiver, amendment or termination is to be enforced. No waiver of any
one provision shall be considered a waiver of any other provision, and the fact that an obligation is waived for a period of time or in one instance shall not be considered to be a continuing waiver. 


        8.8   Cooperation. Each party hereto agrees to execute any and all further documents and writings and perform such other
reasonable actions which may be or become necessary or expedient to effectuate and carry out the provisions hereof. 


        8.9   Governing Law. This Agreement has been negotiated and entered into in the State of California, concerns a business with
its principal offices in California and a California resident and all questions with respect to this Agreement and the rights and liabilities of the parties shall be 



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governed
by the laws of that state, regardless of the choice of law provisions of California or any other jurisdiction. 


        8.10     Equity. The parties hereto agree that the services to be rendered under the terms of this Agreement, and
the rights and privileges granted to the Company by Executive under its terms, are of a special, unique, unusual, extraordinary and intellectual character involving skill of the highest order which
gives them a peculiar value. In the event of the breach by Executive of any of the provisions of this Agreement, the Company, in addition and as a supplement to such other rights and remedies as may
exist in its favor, may apply to any court of law or equity having jurisdiction to enforce this Agreement, and/or may apply for injunctive relief against any act which would violate any of the
provisions of this Agreement. 



        8.10.1     Injunctive Relief; Profits. Executive understands that monetary damages will not be sufficient to avoid
or compensate for a breach of any of the covenants contained in Section 6 hereof and that injunctive relief would be appropriate to prevent any such actual or threatened breach. Such right to
obtain injunctive relief may be exercised, at the option of the Company, concurrently with, prior to, after, or in lieu of, the exercise of any other rights or remedies which the Company may have as a
result of any such breach or threatened breach. Executive shall account for and pay over to the Company all compensation, profits and other benefits, after taxes, inuring to Executive's benefit which
are derived or received by Executive or any other person or business entity controlled by Executive resulting from any action or transaction constituting a breach of any covenant contained in
Section 6. Executive shall similarly have the right to seek injunctive relief for any breach or threatened breach of this Agreement for which a court of competent jurisdiction would or might
provide such a remedy. 




        8.11     Rules of Construction. 



        8.11.1     Headings. The Section headings in this Agreement are inserted only as a matter of convenience, and in no
way define, limit, or extend or interpret the scope of this Agreement or of any particular Section. 


        8.11.2     Tense and Case. Throughout this Agreement, as the context may require, references to any word used in
one tense or case shall include all other appropriate tenses or cases. 


        8.11.3     Severability. Nothing contained in this Agreement shall be construed so as to require the commission of
any act contrary to law and whenever there is any conflict between any provision of this Agreement and any statute, law, ordinance, order or regulation, contrary to which the parties have no right to
contract, the latter shall prevail, but in such event any provision of this Agreement so affected shall be curtailed and limited only to the extent necessary to bring it within legal requirements. 




        8.12     Counterparts. This Agreement may be executed in two counterparts, each of which will be deemed an
original, but all of which together will constitute one and the same instrument. 




        EXECUTIVE ACKNOWLEDGES HAVING CAREFULLY READ, UNDERSTOOD AND CONSULTED WITH AND BEEN ADVISED BY HIS OWN COUNSEL REGARDING ALL OF THE PROVISIONS IN THIS AGREEMENT
AND HAVING NEGOTIATED SUCH PROVISIONS. EXECUTIVE KNOWS THAT HE CANNOT RELY ON ANY STATEMENT OUTSIDE OF (I) THIS AGREEMENT OR (II) A FORMAL WRITTEN AMENDMENT OF THIS
AGREEMENT.


10





 

        IN
WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and year first written above. 



	 
	 	 
	 	 

	 	 	/s/  WILLIAM H. CHANNELL, JR.      
 William H. Channell, Jr.	 	 
	

 	
 	

CHANNELL COMMERCIAL CORPORATION	
 	

 
	

 	
 	

/s/  WILLIAM H. CHANNELL, SR.      
 William H. Channell, Sr., Chairman	
 	

 




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   Exhibit A  


Principal Terms of LTIP  



	•
	Bonus
payment equal to 3% of the increase in market capitalization annually, commencing in 2004, provided that annual bonus may not exceed $500,000



	•
	Bonus
payment equal to 4% of the increase in market capitalization over the three-year period commencing January 1, 2004, provided that the
three-year bonus may not exceed $1,500,000



	•
	Annual
bonus not payable unless increase in market capitalization is at least 10%, and three-year bonus not payable unless increase in market capitalization is
at least 30%



	•
	If
annual bonus is not earned in a particular year, but growth in a subsequent year or years makes up the shortfall (in addition to qualifying for a bonus in that year),
then such bonus will be earned in that year



	•
	Increase
in market capitalization to be measured by reference to the average daily closing sales prices for the Company's stock on NASDAQ for the trading days falling in
August and September of each calendar year



	•
	"High
water" provision such that no additional annual bonuses can be earned until market capitalization exceeds 120% of the highest level at which bonuses were previously
earned



	•
	If
there is a change in the Company's capitalization (secondary offering, etc.), effect will be disregarded for purposes of annual bonuses until October 1 of the
following LTIP plan year, and a pro forma change will be made in the starting market capitalization for purposes of the three-year bonus



	•
	Bonus
payments to be 1/2 in stock and 1/2 in cash, unless Executive elects to take a greater percentage (up to 100%) in stock



	•
	Bonus
payments for each plan year shall be paid on or before December 31 of the year in which the applicable market capitalization calculation demonstrates the
earning of an award 



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Exhibit 10.20