 Benitez (left) will be disappointed by Hicks' revelations |
Mixed performances and a row with Hicks and co-owner George Gillett on transfer policy put Benitez's position in doubt.
"We attempted to negotiate an option as an insurance policy... if Rafa left for Real Madrid or other clubs rumoured, " Hicks told the Liverpool Echo.
He added: "Or in case our communication spiralled out of control."
Hicks was alluding to the criticism of Hicks and Gillett by Benitez over their transfer policy which angered the American duo and put the Spaniard's position in jeopardy.
Klinsmann's services have now been secured by Bayern Munich and he will take over the German club at the end of this season.
The confirmation of talks between Klinsmann and his bosses will come as a blow to Benitez, although Hicks said the negotiations took place in November when the club were in danger of going out of the Champions League at the group stages and suffering indifferent league form.
Liverpool needed a 4-1 win over Marseille in their final group game on 11 December to book their place in the knockout stages.
The American owners and Benitez had clear-the-air talks after the Premier League loss to Manchester United on 16 December and Hicks now insists the Reds manager has their full support.
"After George and I had our long and productive meeting with Rafa following the Manchester United match, we put all of our issues behind us and received Rafa's commitment that he wanted to stay with Liverpool," said Hicks.
"We never reached agreement on an option with Jurgen, and we are both pleased for him that he has a great opportunity to return to Germany and coach a great club team.
"Rafa has both of our support, and our communication has greatly improved."
But Liverpool's form has not improved and they are currently 12 points off the top of the Premier League table,.
They were knocked out of the Carling Cup by Chelsea and have been taken to a replay by struggling Luton in the FA Cup third round.
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