exv10w6



 






Exhibit 10.6




EMPLOYMENT AGREEMENT




     This Agreement is made effective as of June 1, 2005 by and between Circuit Research
Labs, Inc., an Arizona Corporation (the “Corporation”), and Gary D. Clarkson (the
“Employee”).



     WHEREAS, the Corporation desires to retain the services of the Employee in the capacity of its
Secretary, Vice President and General Manager; and



     WHEREAS, the Corporation wishes to prevent Employee from pursuing other employment
opportunities, which is only possible if the Corporation commits to employ Employee for an extended
term.


NOW THEREFORE, IT IS AGREED AS FOLLOWS:



Section 1. Employment. The Corporation agrees to employ the Employee and the Employee
agrees to accept the employment described in this Agreement.



1.1 Successors of Employer. The provisions of this Agreement shall bind any successor or
assign of Employer, which shall be obligated to employ Employee and to pay the compensation
provided herein.



1.2 Obligations of Employer. If Employer is a party to a merger or consolidation or sells
those assets and business for which Employee is employed, Employer will cause the purchaser or
other successor to assume the obligations of Employer set forth herein. Employer shall remain
liable hereunder unless and until the obligations of the Employer are assumed by a solvent
successor to Employer that will carry on the business for which Employee is employed.



Section 2. Duties. The Employee shall serve, as Secretary, Vice President and General
Manager of the Corporation, with such duties as are customarily associated with such position.
The Employee shall have such additional duties, including performance of such duties and holding
such offices or positions with subsidiaries and affiliates of the Corporation, as shall be
reasonably requested of him from time to time by the President or Board of Directors of the
Corporation.



Section 3. Extent of Services. The Employee shall devote substantially all of his working
time, attention, and energies to the performance of his duties. The Employee shall at all times
faithfully and to the best of his ability perform his duties under this Agreement. The duties
shall be rendered at the Corporation’s offices in Tempe, Arizona and San Leandro, California and at
such temporary locations as assigned by the Board of Directors of the Corporation for the purpose
of conducting company business.



Section 4. Term. The term of this Agreement shall begin on June 1, 2005 and,
unless sooner terminated for cause as set forth elsewhere in the Agreement, shall continue


 









 








Employment Agreement

Circuit Research Labs, Inc.

GARY D. CLARKSON



until
May 31, 2010. It shall thereafter continue until either Corporation or Employee terminates
this Agreement on 90 days notice to the other. This Agreement shall not give the Employee any
enforceable right to employment beyond this term.



Section 5. Compensation.



5.1 Base Compensation. The Employee will receive a base salary of not less than $79,502.50
per year. The Employee’s base salary will be payable in accordance with the Corporation’s standard
payroll procedures. The Employee is eligible for bonuses, but there is no assurance or expectation
that bonuses will be paid. Bonuses will be paid, if at all, at the sole discretion of the Board of
Directors.



5.2 Benefits. The Employee shall receive medical, dental and vision and to the extent
provided to all employees of the Corporation, life and disability Insurance. The Employee shall
also receive all other fringe benefits provided to full-time employees of the Corporation. The
Employee shall receive six (6) weeks of paid vacation per year.



5.3 Expenses. The Corporation shall reimburse the Employee for reasonable out-of-pocket
expenses incurred by the Employee in fulfilling his duties, including a housing allowance if the
Corporation requires Employee to perform his duties more than 50 miles from his home and an auto
allowance if the Corporation requires Employee to use his vehicle in the conduct of his duties.
The Corporation shall provide the employee with office facilities, equipment, supplies, and staff.



Section 6. Termination. 



6.1 For Cause. The Corporation may terminate the Employee’s employment at any time “for
cause” with immediate effect upon delivering written notice to the Employee. For purposes of this
Agreement, “for cause” shall be limited to: (a) embezzlement, theft, larceny, material fraud, or
other acts of dishonesty; (b) material violation by employee of any of his obligations under this
Agreement; (c) conviction of or entrance of a plea of guilty or nolo contendere to a felony or
other crime which has or may have a material adverse effect on the Employee’s ability to carry out
his duties under this Agreement or upon the reputation of the Corporation; (d) repeated
insubordination after written warning by the Board; or (e) material continuing failure by the
Employee to perform the duties described in Section 2 above in a quality and professional manner
for at least sixty days after written warning by the Board of Directors. Upon termination for
cause, the Corporation’s sole and exclusive obligation will be to pay the Employee his compensation
earned through the date of termination, and the Employee shall not be entitled to any compensation
after the date of termination.




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Employment Agreement

Circuit Research Labs, Inc.

GARY D. CLARKSON



6.2 Upon Death. In the event of the Employee’s death during the term of this Agreement,
the Corporation’s sole and exclusive obligation will be to pay to the Employee’s estate the
Employee’s compensation earned through the term of this agreement.



6.3 Upon Disability. The Corporation may terminate the Employee’s employment upon the
Employee’s total disability. The Employee shall be deemed to be totally disabled if he is unable
to perform his duties under this Agreement by reason of mental or physical illness or accident for
a period of three consecutive months (the date of finding of disability of Employee shall be three
months following the first day the Employee is unable to work). Upon termination by reason of the
Employee’s disability, the Corporation’s sole and exclusive obligation will be to pay the Employee
under the Corporation’s disability policy or his compensation for one year following such
termination, whichever is greater.



6.4 Without Cause. If the Corporation terminates Employee without cause, Employee shall
receive all compensation and benefits for the full term of this Agreement until May 31,
2010 as set forth in Section 4. Failure to pay such compensation and benefits shall relieve
Employee of his duties under section 7 of this Agreement, without limiting the rights of Employee
to recover all sums due under this section 6.4.



Section 7. Covenant Not to Compete.



7.1 Covenant. During the term of this Agreement, and for such period after the expiration
of the term as the Employee continues to be employed by the Corporation, and for a two year (2)
period after the Employee’s employment with the Corporation has been terminated by either party
(whichever constitutes the longer period), the Employee will not:



7.1.1 enter into or attempt to enter into the “Restricted Business” (as defined below)
worldwide:



7.1.2 use contracts, proprietary information, trade secrets, confidential information,
customer lists, mailing lists, goodwill, or other intangible property used or useful in connection
with the Corporation’s business.



7.2 Restricted Business. The term “Restricted Business” means the design and manufacture
of audio processing equipment and the design and manufacture of automation and PC based product and
equipment for the radio and television broadcast industry. Nevertheless, the Employee may own not
more than five percent of the outstanding equity securities of a corporation that is engaged in the
Restricted Business





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Employment Agreement

Circuit Research Labs, Inc.

GARY D. CLARKSON



if the equity securities are listed for trading on a national stock exchange or are registered
under the Securities Exchange Act of 1934.



Section 8. Confidentiality. The Employee acknowledges that he will develop and be exposed
to information that is or will be confidential and proprietary to the Corporation. The information
includes customer lists, marketing plans, pricing data, product plans, software, and other
intangible information. Such information shall be deemed confidential to the extent not generally
known within the trade. The Employee agrees to make use of such information only in the
performance of his duties under this Agreement, to maintain such information only in the
performance of his duties under this Agreement, to maintain such information in confidence and to
disclose the information only to persons with a need to know.



Section 9. Waiver. The waiver by the Corporation of the breach of any provision of this
Agreement by the Employee shall not operate or be construed as a waiver of any subsequent breach by
the Employee.



Section 10. Notices. Any notices permitted or required under this Agreement shall be
deemed given upon the date of personal delivery or forty-eight (48) hours after deposit in the
United States mail, postage fully prepaid, return receipt requested, addressed to the Corporation
at:



1302 W. Drivers Way

Tempe, AZ 85284



     Addressed to the Employee at:


750 S. Klondyke

Pima, AZ 85543


or any other address as any party may, from time to time, designate by notice given in compliance
with this Section.



Section 11. Law Governing and Jurisdiction. This Agreement shall be governed by and
construed in accordance with the laws of the State of Arizona, without the application of any law
of conflicts of laws that would require or permit the application of the laws of any other
jurisdiction. The parties hereto each hereby submit to the exclusive jurisdiction of the federal
and state courts for the state of Arizona and agree that venue shall be in such courts in Maricopa
County, Arizona.




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Employment Agreement

Circuit Research Labs, Inc.

GARY D. CLARKSON



Section 12. Titles and Captions. All section titles or captions contained in this
Agreement are for convenience only and shall not be deemed part of the context nor effect the
interpretation of this Agreement.



Section 13. Entire Agreement. This Agreement contains the entire understanding between
and among the parties with respect to the subject matter hereof and supersedes any other prior
understandings and agreements among them respecting the subject matter of this Agreement.



Section 14. Attorney Fees. In the event an arbitration, suit or action is brought by any
party under this Agreement to enforce any of its terms, or in any appeal therefrom, it is agreed
that the prevailing party shall be entitled to reasonable attorneys fees to be fixed by the trial
court, and or appellate court.



Section 15. Pronouns and Plurals. All pronouns and any variations thereof shall be deemed
to refer to the masculine, feminine, neuter, singular, or plural as the identity of the person or
persons may require.



Section 16. Arbitration. If at any time during the term of this Agreement any dispute,
difference, or disagreement shall arise upon or in respect of the Agreement, and the meaning and
construction hereof, every such dispute, difference, and disagreement shall be referred to a single
arbiter agreed upon by the parties, or if no single arbiter can be agreed upon, an arbiter or
arbiters shall be selected in accordance with the rules of the American Arbitration Association and
such dispute, difference, or disagreement shall be settled by arbitration in accordance with the
then prevailing commercial rules of the American Arbitration Association, and judgment upon the
award rendered by the arbiter may be entered in any court having jurisdiction thereof.



Section 17. Presumption. This Agreement or any section thereof shall not be construed
against any party due to the fact that said Agreement or any section thereof was drafted by such
party.



Section 18. Further Action. The parties hereto shall execute and deliver all documents,
provide all information and take or forbear from all such action as may be necessary or appropriate
to achieve the purposes of the Agreement.



Section 19. Parties in Interest. Nothing herein shall be construed to be to the benefit
of any third party, nor is it intended that any provision shall be for the benefit of any third
party.



Section 20. Separate Counsel. The parties acknowledge that the Corporation has been
represented in this transaction that any attorneys have not represented the




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Employment Agreement

Circuit Research Labs, Inc.

GARY D. CLARKSON



Employee in this transaction, and the Employee has been advised that it is important for the
Employee to seek separate legal advice and representation in this matter.



Section 21. Severability. In the event that any of the provisions of this Agreement or
the application of any such provisions to the parties hereto with respect to their obligations
hereunder shall be held by a court or other tribunal of competent jurisdiction to be unlawful or
unenforceable, the remaining provisions of this Agreement shall remain in full force and effect and
shall be construed so as to give the fullest effect to the intent of the parties expressed herein.




Circuit Research Labs, Inc.

An Arizona Corporation




	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 
	 	 
	 

	 	 	 	Gary D. Clarkson, Employee
	Name:
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Title:
	 	 	 	 
	 

	 	 	 	 






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