Document:

ex10-4.htm

EXHIBIT 10.4

 

HYPERCOM CORPORATION

8888 E. Raintree Drive, Suite 300

Scottsdale, Arizona 85260

August 6, 2009

Shawn Rathje

Chief Accounting Officer

Hypercom Corporation 

8888 E. Raintree Drive, Suite 300

Scottsdale, Arizona 85260

Re: Change of Control  

 

Dear Shawn:

 

In consideration of your execution and return of the attached Confidentiality, Non-Solicitation & Non-Compete Agreement and other good and valuable consideration, the sufficiency of which hereby is acknowledged, you and Hypercom Corporation (the “Company”) hereby agree that this letter modifies the terms of your employment
by the Company effective upon the date of your signature below.  

 

In the event of a Change of Control (as defined below) within eighteen (18) months after the date of your signature on this letter, and if, within a period of twelve (12) months following such a Change of Control, you are involuntarily terminated by the Company without Cause (as defined below), and provided that the Company’s customary
form of release for terminated employees is executed by you and becomes effective in accordance with its terms on or before the thirtieth (30th) day following the date of your termination of employment, you will be entitled to:

 

(a) an amount equal to six (6) months of your Base Salary at the rate then in effect, which amount will be paid in the form of salary continuation in accordance with the Company’s usual bi-weekly payroll cycle; and

 

(b) immediate vesting of all of your shares of restricted stock and all of your options to purchase common stock of the Company (or its successor), and such options shall remain exercisable until the expiration date of their original terms.

 

“Change of Control” means and includes each of the following:

 

(1) the acquisition of beneficial ownership, directly or indirectly, of securities having 50% or more of the combined voting power of the Company’s then outstanding securities by any “Unrelated Person” or “Unrelated Persons” acting in concert with one another either at one time or over a series of purchases.  For
purposes of this definition, the term “Person” shall mean and include any individual, partnership, joint venture, association, trust, corporation, or other entity (including a “group” as referred to in Section 13(d)(3) of the Securities Exchange Act of 1934.  For purposes of this Section, the term “Unrelated Person” shall mean and include any Person other than the Company, or an employee benefit plan of the Company, or any officer, director, or 10% or more shareholder
of the Company as of the date of this Agreement

 

(2) the consummation of any consolidation or merger of the Company in which the Company is not the continuing or surviving entity, or pursuant to which common stock would be converted into cash, securities or other property, other than a merger of the Company in which the holders of the Company’s common stock immediately prior to
the merger have at least 50% ownership of beneficial interest of common stock or other voting securities of the surviving entity immediately after the merger;

 

(3) the consummation of any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of assets or earning power aggregating more than 50% of the assets or earning power of the Company and its subsidiaries (taken as a whole), other than pursuant to a sale-leaseback, structured finance or other form
of financing transaction;

 

(4) the stockholders of the Company shall approve any plan or proposal for liquidation or dissolution of the Company; or

 

(5) during any period of two consecutive years, individuals who at the beginning of such period constituted a majority of the Board of Directors (“Board”) shall fail to constitute a majority thereof, unless the election, or the nomination for election by the Company’s stockholders, of each new director was approved by
a vote of at least two-thirds of the directors then still in office who were directors at the beginning of the period.

 

“Cause” means if the Board, in its reasonable and good faith discretion, determines that you (i) have developed or pursued interests
substantially adverse to the Company, (ii) have materially breached any employment or confidentiality agreement, (iii) have not devoted a majority of your business time, effort and attention to the affairs of the Company (or such lesser amount as has been agreed to in writing by the Company), (iv) are charged by any governmental entity with any felony (excluding traffic violations) that is reasonably determined by the Board to be true and to adversely reflect upon the Company’s standing in the
community, or (v) have engaged in gross misconduct or other material omissions that are significantly detrimental to the well-being of the Company.

 

All other terms and conditions of your employment remain unchanged.

 

If you agree to the addition of the foregoing to your terms of employment, please indicate your acceptance below.

 

 

Sincerely,

 

/s/ Thomas B. Sabol         

 

Thomas B. Sabol    

Chief Financial Officer   

ACCEPTED AND AGREED

/s/ Shawn Rathje           

Shawn Rathje

Date:  August 6, 2009         

 

  

  

  

CONFIDENTIALITY, NON-SOLICITATION

& NON-COMPETE AGREEMENT

This Confidentiality, Non-Solicitation & Non-Compete Agreement (“Agreement”) is entered into by and between Hypercom Corporation, its subsidiaries, affiliates, successors and assigns (the “Company”),
and Shawn Rathje (“Employee”).

Section One

Background to the Agreement

 

1.1           The Company is in the business of  providing electronic payment solutions, including card payment terminals and peripherals, networking equipment and software applications for e-commerce, smart cards and traditional payment applications (“Company
Business”).  What distinguishes the Company from its competitors is the knowledge and expertise which the Company has developed over time to determine, evaluate, and service its customers’ needs

1.2           Employee performs essential services for the Company.  As part of these essential services, Employee will meet and develop close working relationships with the Company’s Business Associates (as defined below).  In addition, Employee will work
with and have access to the Company’s Confidential Information (as defined below).

1.3           This Agreement is important to protecting the Company’s business interests.  If Employee  violates any of the terms of this Agreement, it would harm the goodwill and diminish the value of the Company.

1.4           The compensation and professional growth opportunities made available to Employee through employment with the Company is fair and adequate consideration for entry into this Agreement.  Employee need not accept or continue employment with the Company.  Employee’s
compliance with this Agreement is a condition of Employee’s employment or continued employment with the Company.

1.5           For these and other reasons, and because there are many other employment opportunities available to Employee if his/her employment with the Company should end, Employee agrees that the terms of this Agreement are fair, reasonable and voluntarily entered into.

Section Two

The Covenants

 

2.1.           Exclusivity of Services; Conflict of Interest.  While employed by the Company, Employee will devote his/her full business time and best efforts to the Company and not engage in any activity that
creates an actual or potential conflict of interest with the Company.  A conflict of interest includes Employee directly or indirectly, competing with the Company in any way, or acting as an officer, director, executive, consultant, stockholder, volunteer, lender, or agent of any business engaged in Company Business.  Should any matter of dealing in which Employee is or becomes involved appear to present a conflict of interest, Employee will promptly disclose the facts to the Company’s
General Counsel so that a determination can be made as to whether a conflict of interest does exist.

 

2.2.           Company Property.  Employee will not remove any equipment, materials,  property, records, documents, notes, diskettes, manuals, lists, data files, or any other tangible items (whether
in duplicate or original form) (collectively “Company Property”) from the Company’s premises, except as is needed in the ordinary course of conducting Company business.  At the time of Employee’s separation, or at any other time upon the Company’s request, Employee will immediately deliver to the Company any Company Property in Employee’s possession or control.  To the maximum extent permitted by law,
the Company reserves the right to deduct the cost of unreturned or damaged Company Property from any compensation owed to Employee.

 

2.3.           Inventions.

 

a.           While employed by the Company, and for twelve (12) months thereafter, Employee will disclose promptly, completely and in writing to the Company, and hereby assigns and agrees to assign and bind Employee's heirs, executors, or administrators to assign to the Company, any
and all inventions, concepts, processes, diagrams, methods, apparatus, improvements, or any other technological “know how” (collectively “Company Inventions”), whether patentable, copyrightable, or otherwise subject to exclusive rights, which are discovered, conceived, and/or developed, either individually or jointly with others, (i) in connection with the performance of Employee's
duties for the Company, (ii) using or influenced by the Company’s time, data, facilities, materials, and/or proprietary information or technology, or (iii) that relate to Company Business.  All such Company Inventions will be deemed "works for hire" commissioned by the Company to the fullest extent permitted by the copyright laws of the United States.  Employee's obligations under this paragraph apply without regard to whether an idea for an Invention or a solution to a problem occurs
to Employee on the job, at home, or elsewhere. All such Company Inventions are the Company’s exclusive property, whether or not patent, trademark or copyright applications are filed thereon.  This paragraph 2.3 does not apply to any patents, copyrights, trademarks, inventions, concepts, processes, diagrams, methods, apparatus, improvements, or any other technological “know how” filed, discovered, conceived, and/or developed by Employee, alone or jointly with others,  prior
to Employee's employment with the Company (collectively “Prior Inventions”).

 

b.           Employee represents that there are no currently existing Prior Inventions belonging to Employee or any third party, except that which he/she discloses in Schedule 1 to this Agreement.  The absence
of anything set forth on Schedule 1, or the absence of Schedule 1 entirely, constitutes Employee’s representation that there are no such Prior Inventions.

c.           While employed by the Company, and at all times thereafter, Employee will assist the Company, at the Company’s expense, in the preparation, execution, and delivery of any disclosures, patent, trademark or copyright applications or papers within the scope and intent
of this Agreement required to obtain patents in this or in other countries and in connection with such other proceedings as may be necessary to enforce the Company’s rights in such Inventions against others or to vest title thereto in the Company.  If such assistance takes place after Employee's employment ends, Employee shall be paid by the Company at a reasonable rate for any time that Employee actually spends in such work at the Company’s request.

 

2.4.           Confidentiality.

 

a.           While employed by the Company, and at all times thereafter, Employee will not, directly or indirectly, disclose, utilize, or authorize any disclosure of Confidential Information (as defined below) to any third person, except as expressly permitted in writing by the Company’s
General Counsel.

 

b.           For purposes of this Agreement, “Confidential Information” includes, but is not limited to, the following information relating to the Company or entrusted to the Company by its Business Associates (as
defined below):

 

(i)  customer lists, consultant lists, vendor information, and customer information as compiled by the Company, including customer orders, product usage, product volumes, pricing, customer technology, sale and contract terms, contract expiration dates, and other compiled customer and vendor information;

 

(ii) internal practices and procedures, compensation and payroll information, and personnel data;

 

(iii) financial condition and financial results of operations;

 

(iv) supply of materials information, including sources and costs;

 

(v) information relating to designs, formula, developmental or experimental work, know-how, products, processes, computer programs, source codes, data bases, designs, schematics, inventions, creations, original works of authorship, or other subject matter relating to research and development, strategic planning, manufacturing, engineering,
purchasing, finance, marketing, promotion, distribution, licensing, and selling activities; and

 

(vi) any and all information, whether in oral or written form, having independent economic value to the Company that is not generally known to, and not readily ascertainable by proper means by a person who can obtain economic value from its disclosure or use.

 

Excluded from this definition is information that (i) is in or enters the public domain without breach of this Agreement; (ii) is received from a third party without restriction on disclosure and without breach of a nondisclosure obligation; or (iii) is required to be disclosed by order of
a court or other governmental agency; provided that the Company shall first be given reasonable notice and opportunity to obtain a protective order against disclosure of such information.

 

2.5.           Nonsolicitation.

 

a.           During Employee’s employment and during the Time Period (as defined below), Employee, whether personally or on behalf of any person or entity, will not:

 

(i) directly or indirectly solicit, accept business from, call upon, handle, deliver products or render services to any customer of the Company with whom Employee, alone or in conjunction with others, has corresponded, talked, solicited, or otherwise entered into or pursued a business relationship
within the twelve (12) month period immediately preceding Employee’s separation for the purpose of selling such customer the same, similar, or related services or products that Employee provided on behalf of the Company; or

 

(ii) directly or indirectly solicit, encourage, induce, or convince any Business Associate to end, reduce, or change his/her/its relationship with the Company.

 

b.           For the purpose of this Agreement:

 

(i) “Time Period” means the period beginning from Employee’s separation date and ending twelve (12) months thereafter; and

 

(ii) “Business Associate” means any individual or entity doing business with or rendering services to the Company within the twelve (12) month period immediately preceding Employee’s separation, including customers, employees, investors, independent contractors,
vendors, suppliers, or joint venture partners.

 

2.6.           Non-Competition.

a.           While employed by the Company and during the Time Period (as defined above), Employee, whether personally or on behalf of any person or entity, will not engage in a Competitive Activity (as defined below) within the Territory (as defined below).

b.           For purposes of this paragraph:

(i)   “Time Period” means the period beginning from Employee’s separation date and ending twelve (12) months thereafter;

(ii) “Competitive Activity” means engaging in or planning to engage in any business activity which is in competition with the products or services being developed, manufactured or sold by the Company at the time of Employee’s separation, including without limitation,
working as a officer, director, partner, consultant, advisor, or independent contractor with VeriFone, Ingenico, CAM Commerce Solutions, Cybernet, ExaDigm, Gemalto, Micros Systems, PAR Technology, Radiant Systems, Retalix, RDM Corp., Symbol, or Way Systems; and

(iii) “Territory” means any country in which the Company does business on the Employee’s separation date.

2.7.           Authority to Contract; Warranties and Representations.  Employee has no power to, and will not, obligate the Company in any manner whatsoever to any contract, agreement, undertaking or commitment,
unless specifically authorized and directed to do so by an executive officer of the Company.  Employee will not, without specific approval of an executive officer of the Company, borrow on behalf of the Company, purchase capital equipment, or sell any capital assets of the Company.  Employee is prohibited from communicating with or responding to any inquiries from the media, investors, or potential investors regarding the Company or any of its Business Associates (as defined above).  Any
such inquiries or communications should be directed to the executive officer or manager in charge of Employee’s business unit

 

2.8           Non-Disparagement.  Employee will not at any time disparage the Company or any of its employees, products, services, operations, policies, decisions,
or programs, if the effect of such disparagement reasonably could be anticipated to cause material harm to the Company’s reputation, business, interests or to the morale among its work force, or the reputation of any Company employee.

2.9.           Lack of Prior Conflict.  You represent that: (i) you are not prohibited from contacting the Company or entering into any employment arrangement with the Company; (ii) you rightfully possess
any and all information that has been discussed or may be discussed with the Company in the future; (iii) no other person or entity has any interest in such information, arising out of any current or previous employment relationship or otherwise; and (iv) you have the lawful right to disclose such information to the Company, that such disclosure or any employment arrangement with the Company, will not violate the terms of any employment, non-compete, non-solicitation, confidentiality or non-disclosure agreement,
or any other similar agreement, contract, law, code, regulation, or other rights, obligations or prohibitions applicable to such information, and that such information could not be considered in any way a trade secret in any jurisdiction.

 

2.10.           Notification.  During the Time Period, Employee will inform any new employer or Business Associate (as defined above), prior to entering into an employment or business relationship, of the existence
of this Agreement and will provide such new employer or Business Associate with a copy of this Agreement.  Employee authorizes the Company to notify others, including Business Associates and Employee’s future employers, of Employee’s obligations under this Agreement.

 

2.11.           Continuing Cooperation.  Provided the Company reimburses Employee for any reasonable and necessary out-of-pocket expenses, Employee will fully cooperate with the Company and its legal counsel
in connection with any action, proceeding, or dispute arising out of matters with which Employee was directly or indirectly involved while serving as an Employee of the Company.  This cooperation  includes meeting with, and providing information to, the Company and its legal counsel, maintaining the confidentiality of any past or future privileged communications with the Company’s legal counsel, and being  available to testify truthfully by affidavit, in depositions, or in
any other forum on behalf of the Company.

 

Section Three

 

Miscellaneous Provisions

3.1           Survival.  The covenants contained in Section Two of this Agreement shall survive the end of  Employee’s employment, regardless of the manner of or reason for such separation.

3.2.           Extension of Time.  If Employee has breached or threatened to breach any of the covenants in this Agreement, and if the Company brings legal action for injunctive or other relief, such relief
shall have the duration specified in Section Two, commencing from the date such relief is granted, but reduced by the period of time elapsed between Employee’s separation and Employee’s first breach of this Agreement.

3.3.           Injunctive Relief; Attorney Fees.  If Employee breaches the covenants in this Agreement, irreparable injury will result to the Company and its remedy at law for damages will be inadequate.  As
a result, the Company shall be entitled to an injunction to restrain the continuing breach by Employee, or any other persons or entities acting for or with Employee, without the necessity of proving actual damages or posting any bond or other security, in addition to any other rights and remedies which the Company may have at law or in equity.  The prevailing party in any legal action relating or touching upon this Agreement is entitled to recover reasonable attorneys’ fees and costs.

 

3.4.           At-Will Employment.  Nothing in this Agreement affects Employee’s status as an employee at will.  Employment of Employee by the Company may be terminated by either Employee or
the Company for any lawful reason at any time with or without cause.  Any representation to the contrary is unauthorized and not valid unless obtained in writing and signed by the Company’s Chief Executive Officer.

 

3.5.           Binding Affect/Assignment.  This Agreement shall inure to the benefit of and be enforceable by the successors and assigns of the Company without the consent of Employee.  None of the
rights or obligations under this Agreement shall be assigned or transferred by Employee.

 

3.6.           Governing Law; Forum.  This Agreement shall be governed and construed in accordance with the laws of the State of Arizona.  Employee consents to venue and jurisdiction in the Superior
Court of Maricopa County, State of Arizona, and in the United States District Court for the District of Arizona, and to service of process under Arizona law, in any action commenced to enforce this Agreement.

 

3.7.           Entire Agreement.  This Agreement constitutes the entire agreement of the parties and supersedes any prior agreements and understandings regarding the subject matter covered herein.  This
Agreement may not be modified or amended except by a written document signed by the parties.

 

3.8.           Severability.  If any provisions of this Agreement shall be held to be invalid or unenforceable for any reason, the remaining provisions shall continue to be valid and enforceable. If a Court
finds that any provision of this Agreement is overbroad with regard to its subject matter, geographic scope or duration, it may  modify that provision to the extent necessary to make the provision enforceable.

 

3.9.           Waiver.  The Company’s failure to enforce any provisions of this Agreement shall not constitute a waiver of the Company’s right to pursue any prior or subsequent breach, violation
or default of the Agreement.

 

The parties have had a reasonable opportunity to review and consider this Agreement with counsel of their choosing and, by their signatures below, enter into the Agreement willingly.

 

SHAWN RATHJE                                                                            HYPERCOM
CORPORATION

/s/ Shawn Rathje                                                        By: /s/ Thomas
B. Sabol      

 

Date: August 6, 2009                                                             Its: CFO             

          Date: August 6, 2009       

 

  

  

  

SCHEDULE 1

TO

CONFIDENTIALITY, NON-SOLICITATION & NON-COMPETE AGREEMENT

This Schedule 1 to the Employee Confidentiality, Non-Solicitation & Non-Compete Agreement entered into between Hypercom Corporation and Shawn Rathje ertain exclusions and prior assignments or grants as referenced in paragraph 2.3 of the Agreement.

	
I.  
	
EXCLUSIONS

Please describe below any Prior Inventions (as defined in paragraph 2.3 of the Agreement) that currently exist and which you wish to exclude from operation of this Agreement.  Any such exclusion must be stated with sufficient specificity to distinguish Prior Inventions from Company Inventions (as defined in paragraph 2.3) which
will be covered by operation of the Agreement (attach additional pages if necessary).

________________________None.__________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

II. PRIOR ASSIGNMENTS OR GRANTS

Please describe below any contracts to assign or grant any rights in Prior Inventions now in existence between Employee and any other person or entity (attach additional pages if necessary).

________________________None.__________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

ACCEPTED AND AGREED TO:

 

"Employee"                                                                         HYPERCOM
CORPORATION

/s/ Shawn Rathje                                                        By: /s/ Thomas
B. Sabol      

 

Date: August 6, 2009                                                             Its: CFO            

 

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  Exhibit 10.4    
    

As
of July 1, 2009                        

Mr. Bruce
Churchill

1 Rockefeller Plaza

New York, New York 10012 

Dear
Bruce: 

        This
letter agreement ("Agreement") provides the terms of your employment with The DIRECTV Group, Inc. (the "Company") and replaces the letter agreement between us dated as of
January 1, 2007 (the "Prior Agreement").  

	1.
	(a) The
Company hereby employs you for a period commencing as of the date hereof and ending on December 31, 2011 (the "Term"). 

(b) If
you continue in the employ of the Company after the end of the Term and an extension of your employment has not been negotiated, your employment shall be on an at-will basis
at the weekly salary rate paid during your last regular pay period hereunder and shall otherwise be in accordance with this Agreement and the provisions of such policies of the Company as are then in
effect for comparable executives of the Company.  

	2.
	(a) For
your services hereunder the Company will, on regular pay dates as then in effect under applicable Company policy, pay you a base salary at the
rate of $1,300,000 per annum, subject to annual increase (effective March 1 of each calendar year during the Term) generally commensurate with other senior executives of the Company, with the
actual salary increase for any year to be subject to the approval of the Compensation Committee of the Board of Directors of the Company ("Committee") if required under applicable Company policies. 

(b) Subject
to approval by the Committee if required under applicable Company policies, for each calendar year during the Term, (i) an annual target cash bonus ("Target Bonus"), set as a
percentage of your then current salary, will be established and provided to you in writing prior to the end of the first quarter of such year, and (ii) you shall receive at the time annual
bonuses are paid for the prior year pursuant to applicable Company policy, payment of your annual cash bonus based on your Target Bonus for such prior year and your achievement of certain targets
established by the Chief Executive Officer of the Company. Your Target Bonus for the 2009 calendar year shall be 125% of your base salary for such year, and for each subsequent year during the Term,
your Target Bonus shall not be less than such percentage and shall otherwise be appropriate to your position in the Company and generally commensurate with the target bonus of other senior executives
of the Company, taking into account your role in the Company as compared to such other senior executives. 

(c) Subject
to approval by the Committee if required under applicable Company policies, you shall also receive equity compensation, (e.g., options or restricted stock units) appropriate
to your position in the Company and generally commensurate with grants to other senior executives of the Company, taking into account your role in the Company as compared to such other senior
executives. In any event, under current circumstances, your annual grant of equity compensation is expected to have a target grant date value at least equal to 130% of your base salary. 

(d) You
shall receive vacation and other perquisites and all other benefits generally commensurate with comparable executives of the Company.  

	3.
	(a) You
shall serve as President—New Enterprises and President of DIRECTV Latin America, reporting directly to the President and Chief
Executive Officer of the Company. You shall be based in New York, New York, subject to such travel as the rendering of the services hereunder may require. 

(b) If
you are elected a member of the Board of Directors or to any other office of the Company or any of its affiliates, you agree to serve in such capacity or capacities without 

 

additional
compensation, unless additional compensation or benefits are paid to comparable executives. 

(c) You
hereby accept such employment and agree to devote your full time and attention as necessary to fulfill all of the duties of your employment hereunder. During the term of your
employment, and for a period of twelve months thereafter, you will not, in any manner directly or indirectly, engage in any MVPD Business (as defined below) and will not directly or indirectly own,
manage, operate, join, control or participate in the ownership, management, operation or control of, or be employed by, or connected in any manner with any corporation, firm or business that is so
engaged. The foregoing does not prohibit you from owning less than five percent (5%) of the outstanding common stock of any company whose shares are publicly traded. 

"MVPD
Business" shall mean any multi-channel video programming distribution business in the United States, or any country in the Caribbean or Latin America, which has in excess of one million
subscribers.  

	4.
	(a) Notwithstanding
anything to the contrary contained in paragraph 1(a) above, this Agreement may be terminated by the Company for cause
if:

	(i)
	you
are convicted of, or plead guilty or nolo contendere to a felony;

	(ii)
	you
engage in conduct that constitutes continued willful neglect or willful misconduct in carrying out your duties under this Agreement, resulting, in
either case, in economic harm to or damage to the reputation of the Company or any of its affiliates; or

	(iii)
	you
breach any material affirmative or negative covenant or undertaking hereunder, which breach is not substantially cured within fifteen days after
written notice to you specifying such breach. 

If
you are terminated for cause, you shall be entitled only to payment of your base salary and accrued vacation pay (if any) through the date of termination of your employment for cause. 

(b) If
your employment is terminated due to death, your estate or beneficiaries, as the case may be, shall be entitled to: 

	(i)
	payment
of base salary through the date of termination;

	(ii)
	payment
of the pro-rated portion of the annual bonus that you received for the fiscal year immediately preceding the date of termination; and

	(iii)
	other
or additional benefits in accordance with applicable plans and programs of the Company. 

(c) If
your employment is terminated due to disability (as defined below), you shall be entitled to the following (but in no event less than the benefits due to you under the then current
disability program of the Company): 

	(i)
	payment
of base salary through the date of termination;

	(ii)
	payment
of the pro-rated portion of the annual bonus that you received for the fiscal year immediately preceding the date of termination;

	(iii)
	until
the earlier of the end of such disability and the end of the Term, continued participation in medical, dental, hospitalization and life insurance
coverage and in all other employee plans and programs in which you were participating on the date of termination; and

	(iv)
	other
or additional benefits in accordance with applicable plans and programs of the Company. 

2

 

For
purposes of this Agreement, "disability" shall mean your inability to substantially perform your duties and responsibilities under this Agreement for a period of 120 consecutive days. 

(d) If
the Company terminates your employment for any reason other than those defined in paragraphs 4 (a), (b) or (c) above, or if you terminate your employment due to an Effective
Termination (as defined below), then you shall be entitled to: 

	(i)
	payment
of your then current base salary through the date of termination;

	(ii)
	payment
of your pro-rated Target Bonus for the calendar year in which your employment is terminated;

	(iii)
	payment
of an amount equal to (A) one and one-half (11/2) times your then current base salary and Target Bonus, if your
employment is terminated under this paragraph 4(d) at any time prior to the expiration of the Term, or (B) one (1) times your then current base salary and Target Bonus, if your
employment is terminated under this paragraph 4(d) at any time after the expiration of the Term;

	(iv)
	vesting
of equity awards as if you had remained employed through the end of the calendar year in which your employment is terminated or, if your employment
is terminated in December of a year, for one additional calendar year, subject to the other terms and conditions of the applicable equity awards; and

	(v)
	continued
participation in Company-sponsored medical plans in which you were participating on the date of termination, through either (a) the longer
of the end of the Term or 12 months from the date of termination of your employment, or (b) until you receive coverage through another employer, whichever first occurs. 

For
purposes of this Agreement, "Effective Termination" shall mean the occurrence of any of the following, without your consent: (i) any adverse change in your reporting relationship;
(ii) a reduction in your base salary or Target Bonus, or in your aggregate total direct compensation opportunity (i.e., base salary, bonus opportunity, and equity compensation
opportunity); (iii) the assignment to you by the Company of duties inconsistent with, or the significant reduction of the titles, powers, duties and functions associated with, your position,
titles or offices; or (iv) the relocation of your principal office to a location outside the New York City metropolitan area; provided, that any
of the events described in clauses (i) - (iv) above shall constitute an Effective Termination only if the Company fails to cure such event within 30 days after receipt from you of
written notice of the event which constitutes an Effective Termination; and provided further, that you shall cease to have a right to terminate due to
Effective Termination on the 60th day following the later of the occurrence of the event or your knowledge thereof, unless you have given the Company notice thereof prior to such
date. All payments under this paragraph 4(d) shall be conditioned upon your execution of a release agreement in the Company's customary form or otherwise acceptable to the Company. 

(e) Notwithstanding
anything in this Agreement to the contrary, in the event that the Company adopts a severance plan applicable to comparable executives which provides for payments or benefits
which are more favorable to executives than the provisions of this Agreement, then you shall automatically be entitled to such more favorable payments or benefits, subject to the terms and conditions
of such plan, unless you otherwise agree in writing after adoption of any such plan.  

	5.
	(a) You
have previously received a copy of the Company's Code of Ethics and Business Conduct. You agree to abide by the provisions of this Code (as
amended and posted on the Company's website from time to time) at all times during your employment by the Company. 

(b) You
will not during the term of your employment and for a period of one year thereafter, directly or indirectly, induce or attempt to induce any managerial, sales or supervising 

3

 

employee
of the Company or its affiliates to render services to any other person, firm or corporation. 

(c) You
acknowledge that the relationship between the parties hereto is exclusively that of employer and employee and that the Company's obligations to you are exclusively contractual in
nature. The Company shall be the sole owner of all the fruits and proceeds of your services hereunder, including, but not limited to, all ideas, concepts, formats, suggestions, developments,
arrangements, designs, packages, programs, promotions and other intellectual properties which you may create in connection with and during your term of your employment hereunder, free and clear of any
claims by you (or anyone claiming under you) of any kind or character whatsoever (other than your right to compensation hereunder). You shall, at the request of the Company, execute such assignments,
certificates or other instruments as the Company may from time to time deem necessary or desirable to evidence, establish, maintain, perfect, protect, enforce or defend its right, title and interest
in or to any such properties. 

(d) All
memoranda, notes, records and other documents made or compiled by you, or made available to you during the term of this Agreement concerning the business of the Company or it affiliates
shall be the Company's property and shall be delivered to the Company on the termination of this Agreement or at any other time on request. You shall keep in confidence and shall not use for yourself
or others, or divulge to others, any information concerning the business not publicly available and which is obtained by you as a result of your employment, including but not limited to, trade secrets
or processes and information deemed by the Company to be proprietary in nature, unless disclosure is permitted by the Company or required by law. 

(e) The
Company shall have the right to use your name, biography and likeness in connection with its business, including in advertising its products and services, and may grant this right to
others, but not for use as a direct endorsement. 

(f) The
covenants set forth in sub paragraphs (b), (c) and (d) above shall survive the termination of this Agreement.  

	6.
	The
services to be furnished by you hereunder and the rights and privileges granted to the Company by you are of a special, unique, unusual, extraordinary,
and intellectual character which gives them a peculiar value, the loss of which cannot be reasonably or adequately compensated in damages in any action or law, and a breach by you of any of the
provisions contained herein will cause the Company irreparable injury and damage. You expressly agree that the Company shall be entitled to seek injunctive and other equitable relief, to prevent a
breach of this Agreement by you. Resort to equitable relief however, shall not be construed as a waiver of any preceding or succeeding breach of the same or any other term or provision. The various
rights and remedies of the Company hereunder shall be construed to be cumulative and no one of them shall be exclusive to any other or of any other or of any right or remedy allowed by law.

	7.
	In
consideration of the making of the Agreement, as well as of the other consideration stated herein, you expressly agree that (a) the Company's
Employee Statements and Agreements and Mutual Agreement to Arbitrate Claims (copies of which you have received and which are incorporated herein by reference) shall apply to this Agreement; and
(b) if you continue in the employ of the Company after the end of the Term, your employment shall be at-will and shall otherwise be in accordance with the provisions of this
Agreement and such then existing Company policies and benefit plans as may then be in effect applicable to comparable executives of the Company.

	8.
	This
Agreement shall be governed by the laws of the State of New York applicable to contracts performed entirely therein. This Agreement supersedes all prior
agreements and understandings (including verbal agreements) between you and the Company and/or its 

4

 

affiliates
regarding the terms and conditions of your employment with the Company and/or its affiliates including, without limitation, the Prior Agreement.  

	9.
	Notwithstanding
anything herein to the contrary, (i) if, at the time of your termination of employment with the Company, you are a "specified
employee" as defined in Section 409A of the Internal Revenue Code of 1986, as amended (the "Code"), and the deferral of the commencement of any payments or benefits otherwise payable hereunder
as a result of such termination of employment is necessary in order to prevent the imposition of any accelerated or additional tax under Section 409A of the Code, then the Company will defer
commencement of the payment of any such payments or benefits hereunder (without any reduction in such payments or benefits ultimately paid or provided to you) until the date that is six months
following your termination of employment with the Company (or the earliest date that is permitted under Section 409A of the Code) and (ii) if any other payments of money or other
benefits due to you hereunder would cause the application of an accelerated or additional tax under Section 409A of the Code, such payments or other benefits shall be deferred if deferral will
make such payment or other benefits compliant under Section 409A of the Code, or otherwise such payment or other benefits shall be restructured, to the extent possible, in a manner, determined
by or at the direction of the Compensation Committee, that does not cause such an accelerated or additional tax or result in additional cost to the Company. The Company shall consult with its legal
counsel and tax advisors in good faith regarding the implementation of this paragraph 9, which shall be done only in a manner that is reasonably acceptable to you; provided, however, that
neither the Company, any subsidiary or other affiliate of the Company, nor any of their employees or representatives, shall have any liability to you with respect thereto.

	10.
	This
Agreement shall inure to the benefit of the successors and general assigns of the Company and to the benefit of any other corporation or entity which
is a parent, subsidiary or affiliate of the Company to which this Agreement is assigned, and any other corporation or entity into which the Company may be merged or with which it may be consolidated.
Except as herein provided, this Agreement shall be nonassignable. 

					
	 	 	Sincerely,
	

 	
 	
The DIRECTV Group, Inc.
	

 	
 	
 By:	
 	
/s/ Larry D. Hunter

  Larry D. Hunter

Chief Executive Officer

 

			
	THE FOREGOING IS AGREED TO:	 	 
	
/s/ Bruce Churchill

  Bruce Churchill	
 	

 
	
July 27, 2009

  Date	
 	

 

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QuickLinks

Exhibit 10.4

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