Form 8-K

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, HTFHl3BKf+2L9s0f0kdDNpQ9glwZ56fzf/t3k/5XaU9tM/Q/tWI+F2K6wajsAT8d GDMsoZMux/GK78N+Hy94OA== 0001193125-05-031942.txt : 20050217 0001193125-05-031942.hdr.sgml : 20050217 20050217152058 ACCESSION NUMBER: 0001193125-05-031942 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 9 CONFORMED PERIOD OF REPORT: 20050211 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Termination of a Material Definitive Agreement ITEM INFORMATION: Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers ITEM INFORMATION: Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year ITEM INFORMATION: Other Events ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050217 DATE AS OF CHANGE: 20050217 FILER: COMPANY DATA: COMPANY CONFORMED NAME: K2 INC CENTRAL INDEX KEY: 0000006720 STANDARD INDUSTRIAL CLASSIFICATION: [3949] IRS NUMBER: 952077125 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-04290 FILM NUMBER: 05623978 BUSINESS ADDRESS: STREET 1: 2051 PALOMAR AIRPORT ROAD CITY: CARLSBAD STATE: CA ZIP: 92009 BUSINESS PHONE: 7604941044 MAIL ADDRESS: STREET 1: 2051 PALOMAR AIRPORTR ROAD CITY: CARLSBAD STATE: CA ZIP: 92009 FORMER COMPANY: FORMER CONFORMED NAME: ANTHONY INDUSTRIES INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: ANTHONY POOLS INC DATE OF NAME CHANGE: 19720317 8-K 1 d8k.htm FORM 8-K Form 8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 11, 2005

K2 INC.

(Exact name of registrant as specified in its charter)

Delaware

1-4290

95-2077125

(State or other jurisdiction

of incorporation)

(Commission File Number)

(IRS Employer

Identification No.)

2051 Palomar Airport Road

Carlsbad, California

92009

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (760) 494-1000

N/A

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

On February 14, 2005, K2 Inc. (the “Company”) entered into employment agreements with and instituted a severance benefit plan for the following executive officers: Mr. Richard J. Heckmann, Chairman and Chief Executive Officer; J. Wayne Merck, President and Chief Operating Officer; John J. Rangel, President – European Operations; Dudley W. Mendenhall, Senior Vice President – Finance; and Monte H. Baier, Vice President and General Counsel (collectively, the “Executives”).

A copy of the form of employment agreement entered into with Mr. Heckmann is attached hereto as Exhibit 10.1 and is incorporated herein by reference; a copy of the form of employment agreement entered into with Messrs. Merck and Rangel is attached hereto as Exhibit 10.2 and is incorporated herein by reference; a copy of the form of employment agreement entered into with Messrs. Mendenhall and Baier is attached hereto as Exhibit 10.3 and is incorporated herein by reference; the severance benefit plan for the Executives is set forth as Exhibit 10.4 and is incorporated herein by reference. The following summary is qualified in its entirety by reference to the employment agreements set forth in Exhibits 10.1, 10.2 and 10.3 and the severance benefit plan set forth in Exhibit 10.4.

Employment Agreements

Under the terms of the employment agreements, if the Company becomes subject to a change in control transaction (“Change in Control”), and if any Executive is involuntarily terminated by the Company without cause (as defined in the employment agreements) (“Cause”) or there is termination with good reason (as defined in the employment agreements) (“Good Reason”), during the period four months prior or 12 months after such transaction, the Company will be obligated to pay a multiple of the salary and bonus as well as continue health insurance benefits and extend stock option vesting and exercise periods for the Executives.

If Mr. Heckmann is terminated without Cause or there is termination for Good Reason following a Change in Control or at the discretion of Mr. Heckmann within 90 days of a Change in Control, the Company will agree to pay Mr. Heckmann 2.99 times his salary and bonus and continue his health insurance coverage for 36 months from the date of termination. The Company will gross up payments under the agreement to compensate Mr. Heckmann for specified taxes. In addition, all stock options received by Mr. Heckmann before the Change in Control will accelerate and become exercisable in full for 36 months from the date of termination.

If either Mr. Merck or Mr. Rangel is terminated without Cause or there is termination for Good Reason following a Change in Control, the Company will agree to pay to such Executive 2.99 times his salary and bonus and continue his health insurance coverage for 36 months from the date of termination. The Company will gross up payments under the agreement to compensate such Executive for specified taxes. In addition, all stock options received by such Executive before the Change in Control will accelerate and become exercisable in full for 36 months from the date of termination.

If either Mr. Mendenhall or Mr. Baier is terminated without Cause or there is termination for Good Reason following a Change in Control, the Company will agree to pay such Executive two times his salary and bonus and continue his health insurance coverage for 24 months from the date of termination. If payments under the agreements are subject to specified taxes, the Company will pay to such Executive either a payment that is reduced so that there would be no tax or an amount (which shall be no more than the total payment), which after taking into account all applicable taxes, would provide such Executive with the greatest payment on an after-tax basis. In addition, all stock options received by such Executive before the Change in Control will accelerate and become exercisable in full for 24 months from the date of termination.

Severance Benefit Plan

Under the terms of the severance benefit plan, in the event the Executive is terminated by the Company without Cause, the Company will pay to such Executive as follows:

•

Mr. Heckmann, 2.5 times his salary and bonus, continue his health insurance coverage for 30 months from the date of termination, fully vest his stock options and extend his stock option exercise period for 30 months;

•

Each of Mr. Merck and Mr. Rangel, two times his salary and bonus, continue his health insurance coverage for 24 months from the date of termination, fully vest his stock options and extend his stock option exercise period for 24 months; and

•

Each of Mr. Mendenhall and Mr. Baier, one times his salary and bonus, continue his health insurance coverage for 12 months from the date of termination, fully vest his stock options and extend his stock option exercise period for 12 months.

If payments under the severance benefit plan are subject to specified taxes, the Company will pay to such Executive either a payment that is reduced so that there would be no tax or an amount (which shall be no more than the total payment), which after taking into account all applicable taxes, would provide such Executive with the greatest payment on an after-tax basis.

Item 1.02 Termination of Material Definitive Agreement.

As consideration for the Company entering into the employment agreement and severance benefit plan with Mr. Rangel as set forth above, as of February 14, 2005, Mr. Rangel and the Company have terminated Mr. Rangel’s prior employment agreement with the Company, dated as of May 8, 2001.

Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.

Effective February 11, 2005, Ann Meyers was elected to the Board of Directors of the Company. At this time, the Board of Directors has not yet determined to which committees Ms. Meyers shall be appointed, but the Company shall file an amendment to this Current Report on Form 8-K when such determination has been made. A copy of the Company’s press release announcing the election of Ms. Meyers, dated February 17, 2005, is attached hereto as Exhibit 99.1 and is incorporated into this Item 5.02 by reference.

Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

Effective February 11, 2005, the board of directors amended its By-Laws, specifically, to clarify that, in accordance with applicable Delaware corporate law, a majority of directors then in office could fill any vacancies and newly created directorships resulting from any increase in the authorized number of directors. A copy of Amended and Restated By-Laws of the Company is attached hereto as Exhibit 3.1.

Item 8.01 Other Events.

On February 17, 2005, the Company issued a press release announcing the that it has established record and meeting dates for its 2005 annual meeting of shareholders. A copy of the Company’s press release announcing the record and meeting dates is attached hereto as Exhibit 99.2 and is incorporated into this Item 8.01 by reference.

Item 9.01 Financial Statements and Exhibits


Exhibit Number		Reference
3.1		Amended and Restated By-Laws of the Company.

10.1		Form of Employment Agreement entered into by and between K2 Inc. and Mr. Heckmann.

10.2		Form of Employment Agreement entered into by and between K2 Inc. and each of Mr. Merck and Mr. Rangel.

10.3		Form of Employment Agreement entered into by and between K2 Inc. and each of Mr. Mendenhall and Mr. Baier.

10.4		Severance Benefit Plan dated February 14, 2005.

99.1		Press Release dated February 17, 2005 announcing the election of Ann Meyers to the Board of Directors.

99.2		Press Release dated February 17, 2005 announcing the record and meeting dates for the Company’s 2005 annual meeting of shareholders.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


		K2 INC.

Date: February 17, 2005		/s/ MONTE H. BAIER
		Monte H. Baier
		Vice President and General Counsel

EXHIBIT INDEX


Exhibit No.		Description
3.1		Amended and Restated By-Laws of the Company.

10.1		Form of Employment Agreement entered into by and between K2 Inc. and Mr. Heckmann.

10.2		Form of Employment Agreement entered into by and between K2 Inc. and each of Mr. Merck and Mr. Rangel.

10.3		Form of Employment Agreement entered into by and between K2 Inc. and each of Mr. Mendenhall and Mr. Baier.

10.4		Severance Benefit Plan dated February 14, 2005.

99.1		Press Release dated February 17, 2005 announcing the election of Ann Meyers to the Board of Directors.

99.2		Press Release dated February 17, 2005 announcing the record and meeting dates for the Company’s 2005 annual meeting of shareholders.

EX-3.1 2 dex31.htm AMENDED AND RESTATED BY-LAWS OF THE COMPANY Amended and Restated By-Laws of the Company

Exhibit 3.1

As amended February 11, 2005

AMENDED AND RESTATED

BY-LAWS

K2 INC.

ARTICLE I

Offices

The Corporation shall maintain a registered office in the State of Delaware as required by law. The Corporation may also have offices at other places, within and without the State of Delaware.

ARTICLE II

Stockholders

Section 1. Annual meetings of stockholders shall be held at such times and such places, within or without the State or Delaware, as may be fixed from time to time by the Board of Directors.

Section 2. Except as otherwise required by statute or the Corporation’s Certificate of Incorporation, special meetings of stockholders may be called by the Board of Directors or the Chairman of the Board. Special meetings of stockholders shall be held on such dates and at such times and such places, within or without the State of Delaware, as shall be stated in the notices of such meetings. Notice of any special meeting shall state the purpose or purposes for which the meeting is to be held and no other business shall be transacted except as stated in such notice.

Section 3. The holders of a majority of the issued and outstanding shares of the capital stock of the Corporation entitled to vote thereat, present in person or represented by proxy, shall constitute a quorum for the transaction of business at all meetings of stockholders.

As amended February 11, 2005

Section 4. Except as otherwise required by statute, the Corporation’s Certificate of Incorporation or these By-Laws, all matters coming before any meeting of stockholders shall be decided by the vote of the holders of a majority of the shares of capital stock of the Corporation present in person or represented by proxy at such meeting and voting thereon, a quorum being present.

Section 5. The Board of Directors, or, if the Board shall not have made the appointment, the chairman presiding at any meeting of stockholders, shall have power to appoint two or more persons to act as inspectors, to receive, canvass and report the votes cast by the stockholders at such meeting.

Section 6. The Chairman of the Board shall preside at all meetings of stockholders; and in his absence, the Board of Directors may appoint a person to act as chairman of the meeting.

Section 7. The Secretary or an Assistant Secretary shall act as secretary at all meetings of stockholders; and in their absence, the chairman of the meeting shall appoint a person to act as secretary of the meeting.

Section 8. At any meeting of the stockholders, only such business shall be conducted as shall have been brought before the meeting (i) by or at the direction of the Board or (ii) by any stockholder of the Corporation who complies with the notice procedures set forth in this Section 8 and Section 9 of Article II. For business to be properly brought before any meeting of the stockholders by a stockholder, the stockholder must have given notice thereof in writing to the Secretary of the Corporation not less than 90 days in advance of such meeting or, if later, the tenth day following the first public announcement of the date of such meeting, and such business must be a proper matter for stockholder action under the General Corporation Law of the State of Delaware. A stockholder’s notice to the Secretary shall set forth as to each matter the stockholder proposes to bring before the meeting (1) a brief description of the business desired to be brought before the meeting and the reasons for conducting such business at the meeting, (2) the name and address, as they appear on the Corporation’s books, of the stockholder proposing such business, (3) the class and number of shares of the Corporation that are beneficially owned

As amended February 11, 2005

by the stockholder, and (4) any material interest of the stockholder in such business. In addition, the stockholder making such proposal shall promptly provide any other information reasonably requested by the Corporation. The chairman of any such meeting shall have the power and the duty to determine whether any business proposed to be brought before the meeting has been made in accordance with the procedure set forth in these By-Laws and shall direct that any business not properly brought before the meeting shall not be considered. Notwithstanding anything in these By-Laws to the contrary, no business shall be conducted at any meeting of the stockholders except in accordance with the procedures set forth in this Section 8 and Section 9 of Article II. For purposes of this Section 8 and Section 9 of Article II, “public announcement” shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or a comparable national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Securities Exchange Act of 1934, as amended, or any successor provision.

Section 9. Nominations for the election of directors may be made by the Board or by any stockholder entitled to vote in the election of directors; provided, however, that a stockholder may nominate a person for election as a director at a meeting only if written notice of such stockholder’s intent to make such nomination has been given to the Secretary of the Corporation not later than 90 days in advance of such meeting or, if later, the tenth day following the first public announcement of the date of such meeting. Each such notice shall set forth: (i) the name and address of the stockholder who intends to make the nomination and of the person or persons to be nominated; (ii) a representation that the stockholder is a holder of record of stock of the Corporation entitled to vote at such meeting and intends to appear in person or by proxy at the meeting and nominate the person or persons specified in the notice; (iii) a description of all arrangements or understandings between the stockholder and each nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the stockholder, (iv) such other information regarding each nominee proposed by such stockholder as would be required to be included in a proxy statement filed pursuant to the proxy rules of the Securities and Exchange Commission had the nominee been nominated, or intended to be nominated, by the Board; and (v) the consent of each nominee to serve as a director of the Corporation if so elected. In addition, the stockholder making such nomination

As amended February 11, 2005

shall promptly provide any other information reasonably requested by the Corporation. Notwithstanding the foregoing provisions of this Section 9 of Article II, in the event that the number of directors to be elected to the Board is increased and there is no public announcement naming either all of the nominees for director or specifying the size of the increased Board made by the Corporation at least 100 days in advance of such meeting, a stockholder’s notice required by this Section 9 of Article II shall be considered timely, but only with respect to nominees for any new positions created by such increase, if it shall be delivered to the Secretary of the Corporation not later than the tenth day following the day on which such public announcement is first made by the Corporation. Notwithstanding the foregoing provisions of this Section 9 of Article II, any vacancy or newly created directorship resulting from any increase in the authorized number of directors elected by all of the stockholders having the right to vote as a single class may be filled by a majority of the directors then in office, although less than a quorum, or by a sole remaining director. No person shall be eligible for election as a director of the Corporation unless nominated in accordance with the procedures set forth in this Section 9 of Article II. The chairman of any meeting of stockholders shall have the power and the duty to determine whether a nomination has been made in accordance with the procedure set forth in this Section 9 of Article II and shall direct that any nomination not made in accordance with these procedures be disregarded.

ARTICLE III

Board of Directors

Section 1. The business and affairs of the Corporation shall be managed by or under direction of the Board of Directors. The directors shall elect one of their members to be Chairman of the Board, who shall perform such duties as are provided in these By-Laws or are from time to time assigned by the Board. The Chairman of the Board may, but need not, be an officer of the Corporation.

Section 2. Regular meetings of the Board of Directors shall be held on such dates and at such times and such places, within or without the State of Delaware, as shall be fixed from time to time by the Board.

As amended February 11, 2005

Section 3. Special meetings of the Board of Directors may be called by the Chairman of the Board and shall be called by the Chairman of the Board or the Secretary upon a request in writing by any four directors. Notice shall be given of the date, time and place of each special meeting (i) by mailing the same at least three days before the meeting to each director via first-class mail, (ii) by telephone, facsimile transmission or personal delivery of the same at least 24 hours before the meeting to each director or (iii) by sending the same at least two days before the meeting to each director via overnight courier for next-day delivery. Except as otherwise specified in the notice thereof, or as required by statute, any and all business may be transacted at any special meeting of the Board of Directors.

Section 4. The Chairman of the Board shall preside at all meetings of the Board of Directors; and in his absence, the Board of Directors may appoint any other person to act as chairman of the meeting. Less than a quorum of the Board may adjourn any meeting from time to time until a quorum shall be present, whereupon the meeting may be held, as adjourned, without further notice.

Section 5. With the consent of the Chairman or a majority of the Board of Directors, any director may participate in a meeting of the Board of Directors by telephone, and a meeting of the Board of Directors may be conducted entirely by telephone, provided that all of the directors can speak and hear one another.

ARTICLE IV

Committees

Section 1. The Board of Directors may, by resolution passed by a majority of the whole Board, designate from among its own members such committees as the Board may determine. Each such committee shall have such powers of the Board of Directors, not prohibited by statute, as the Board shall from time to time authorize.

As amended February 11, 2005

Section 2. A majority of a committee shall constitute a quorum for the transaction of business. Each committee shall keep regular minutes of its meetings and shall report the same to the Board of Directors when requested. The Board of Directors may discharge any committee or any member thereof either with or without cause at any time.

ARTICLE V

Officers

Section 1. The Board of Directors shall elect the following officers: Chief Executive Officer, President, one or more Vice Presidents, Treasurer and Secretary and such other officers as it may from time to time determine.

Section 2. The term of office of all officers shall be for one year and until their respective successors are elected and qualified. The Board of Directors may remove any officer either with or without cause at any time.

Section 3. The Chief Executive shall be the chief executive officer of the Corporation and shall have such powers and duties as generally pertain to the responsibilities of chief executive officer, including the management of the business and affairs of the Corporation, subject only to the Board of Directors. The President, (if he is not the Chief Executive Officer) subject and reporting to the Chief Executive Officer, shall be the chief operating officer of the Corporation, and shall have such powers and duties as generally pertain to the responsibilities of chief operating officer as may be determined from time to time by the Chief Executive Officer. The other officers of the Corporation, subject and reporting to the Chief Executive Officer and/or the President, as determined from time to time by the Chief Executive Officer, shall each have such powers and duties as generally pertain to their respective offices. Any officer of the Corporation shall in addition have such powers and duties as may be conferred by the Board of Directors.

Section 4. Unless otherwise ordered by the Board of Directors, the Chief Executive Officer and any other officer whom he may designate shall have full power and authority on

As amended February 11, 2005

behalf of the Corporation to attend and to vote at any meetings of stockholders of any corporation in which this Corporation may hold stock, and may exercise on behalf of this Corporation any and all of the rights and powers incident to the ownership of such stock at any such meeting, and shall have power and authority to execute and deliver proxies, waivers and consents on behalf of the Corporation in connection with the exercise by the Corporation of the rights and powers incident to the ownership of such stock. The Board of Directors may from time to time confer like powers upon any other person or persons.

ARTICLE VI

Capital Stock

Section 1. Certificates for stock of the Corporation shall be in such form as the Board of Directors may from time to time prescribe.

Section 2. The Board of Directors shall have power to appoint one or more transfer agents and/or registrars for the transfer and/or registration of certificates for shares of stock of any class or series and may require that stock certificates shall be countersigned and/or registered by one or more of such transfer agents and/or registrars.

Section 3. Shares of capital stock of the Corporation shall be transferable on the books of the Corporation only by the holder of record thereof in person or by his duly authorized attorney, upon surrender and cancellation of certificates for a like number of shares, with an assignment or power of transfer endorsed thereon or delivered therewith, duly executed, and with such proof of the authenticity of the signature and of authority to transfer, and of payment of transfer taxes, as the Corporation or its agents may require.

Section 4. In case any certificate for the capital stock of the Corporation shall be lost, stolen or destroyed, the Corporation may require such proof of the fact and such indemnity to be given to it and/or to its transfer agent and/or registrar, if any, as it shall deem necessary or advisable.

As amended February 11, 2005

Section 5. The Corporation shall be entitled to treat the holder of record of any share or shares of stock as the holder thereof in fact, and shall not be bound to recognize any equitable or other claim to or interest in such shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise expressly provided by law.

ARTICLE VII

Miscellaneous

Section 1. The seal of the Corporation shall be circular in form and shall contain the name of the Corporation and the year and state of incorporation.

Section 2. The Board of Directors shall have the power to fix, and from time to time to change, the fiscal year of the Corporation.

ARTICLE VIII

Amendment

The Board of Directors shall have the power to adopt, alter and repeal By-Laws of the Corporation at any regular or special meeting of the Board, subject to the power of the stockholders to alter or repeal any By-Law adopted or altered by the Board of Directors. By-Laws may be adopted, altered or repealed by the stockholders by the vote of the holders of 75% or more of the outstanding shares entitled to vote thereon provided that notice of the proposed adoption, alteration or repeal shall have been given in the notice of such meeting of stockholder.

Date of Adoption: As of February 11, 2005

CERTIFICATE OF SECRETARY

The undersigned, being the duly elected Secretary of K2 Inc., a Delaware corporation, hereby certifies that the Amended and Restated Bylaws to which this Certificate is attached were duly adopted by the Board of Directors of the corporation as of the 11^th day of February, 2005.

/s/ MONTE H. BAIER

Monte H. Baier, Secretary

EX-10.1 3 dex101.htm FORM OF EMPLOYMENT AGREEMENT BETWEEN K2 INC. AND MR. HECKMANN Form of Employment Agreement between K2 Inc. and Mr. Heckmann

Exhibit 10.1

FORM OF EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (the “Agreement”) is entered into effective as of (the “Effective Date”), by and between K2 Inc. (the “Company”) and (the “Executive”). The Company and the Executive are hereinafter collectively referred to as the “Parties,” and individually referred to as a “Party.”

RECITALS

A. The Company desires to retain the Executive’s experience, skills, abilities, background and knowledge and is willing to engage the Executive’s services on the terms and conditions set forth in this Agreement.

B. The Executive desires to be in the employ of the Company and is willing to accept such employment on the terms and conditions set forth in this Agreement.

AGREEMENT

In consideration of the foregoing Recitals and the mutual promises and covenants herein contained, and for other good and valuable consideration, the Parties, intending to be legally bound, agree as follows:

1. EMPLOYMENT.

1.1 Title. The Executive shall serve as the Company’s and shall serve in such other capacities as the Company may from time to time prescribe.

1.2 Duties. The Executive shall perform all services and actions necessary or advisable to conduct the business of the Company and which are normally associated with the positions the Executive holds in a corporation of the size and nature of the Company.

1.3 [INTENTIONALLY OMITTED]

2. LOYAL AND CONSCIENTIOUS PERFORMANCE; NONCOMPETITION.

2.1 Loyalty. During the Executive’s employment with the Company, the Executive shall devote the Executive’s full business energies, interest, abilities and productive time to the proper and efficient performance of the Executive’s duties under this Agreement; provided, however, that Executive may devote a reasonable amount of time and energies for personal investment and civic and charitable duties.

2.2 Agreement Not to Participate in Company’s Competitors. Except with the prior written consent of the Company’s Board of Directors (the “Board”), the Executive shall not, during the Executive’s employment with the Company and any Severance Period (as defined below), assume or participate in, directly or indirectly, any position, investment or interest known by the Executive to be adverse or antagonistic to the Company, its business or prospects, financial or otherwise, or in any company, person or entity that is, directly or indirectly, in competition with the business of the Company or any of its subsidiaries. Ownership by the Executive, as a passive investment, of less than five percent (5%) of the outstanding shares of capital stock of any corporation with one or more classes of its capital stock listed on a national securities exchange or publicly traded on the Nasdaq Stock Market or in the over-the-counter market shall not constitute a breach of this paragraph.

3. COMPENSATION OF THE EXECUTIVE.

3.1 Base Salary. The Company shall pay the Executive a base salary of Dollars ($ ) per year, payable in regular periodic payments in accordance with Company policy. Such base salary shall be prorated for any partial year of employment on the basis of a 365-day fiscal year.

3.2 Bonus. In addition to the Executive’s base salary, the Executive shall be eligible to receive an annual bonus (the “Bonus”). The Bonus (if any) will awarded based on the achievement of Company and personal milestones to be established by the Board or Compensation Committee thereof and communicated to the Executive. The good faith determinations of the Board (or its Compensation Committee) with respect to the payment of the Bonus shall be final and binding.

3.3 Changes to Compensation. The Executive’s compensation shall be reviewed from time to time by the Board or the Compensation Committee thereof as it deems appropriate and may be changed upon mutual written agreement between the Executive and the Board or the Compensation Committee thereof.

3.4 Employment Taxes. All of the Executive’s compensation (in any form) shall be subject to all required withholding taxes, employment taxes and other deductions required by law.

3.5 Benefits. The Executive shall, in accordance with Company policy and the terms of the applicable plan documents, be eligible to participate in benefits under any benefit plan or arrangement which may be in effect from time to time and made available to the Company’s employees. In addition, the Executive shall be eligible for paid vacation, in accordance with Company policy as in effect from time to time.

4. TERMINATION.

4.1 Termination By the Company. The Executive’s employment with the Company may be terminated under the following conditions:

4.1.1 Termination for Death or Disability. The Executive’s employment with the Company shall terminate effective upon the date of the Executive’s death or Complete Disability (as defined below).

4.1.2 Termination by the Company For Cause. The Company may terminate the Executive’s employment under this Agreement for Cause (as defined below). A notice of termination given pursuant to this Section 4.1.2 shall effect termination as of the date specified, or, in the event no such date is specified, on the date upon which the notice is given.

4.1.3 Termination by the Company For Any Reason Other Than Cause. The Executive’s employment by the Company shall be “at will.” The Company may terminate the Executive’s employment under this Agreement at any time, for any or no reason and with or without cause or advance notice. This is the full and complete agreement between the Executive and the Company on this term. Although the Executive’s duties, title, compensation and benefits may change, the “at will” nature of the Executive’s employment relationship with the Company may only be modified in an express written agreement signed by the Executive and the Board.

4.2 Termination by Mutual Agreement of the Parties. The Executive’s employment pursuant to this Agreement may be terminated at any time upon the mutual written agreement of the Parties. Any such termination of employment shall have the consequences specified in such writing.

4.3 Termination by the Executive. The Executive’s employment by the Company shall be “at will.” The Executive shall have the right to resign or terminate the Executive’s employment at any time, with or without cause, notice or Good Reason.

4.4 Compensation Upon Termination.

4.4.1 Termination Not in Connection With a Change in Control. If the Executive’s employment is terminated (either by the Company, by the Executive, or due to the Executive’s death or Complete Disability), then the Company shall pay the Executive’s base salary and any accrued and unused vacation benefits earned through the date of termination, and the Company shall thereafter have no further obligations to the Executive under this Agreement, except as expressly provided herein.

4.4.2 Termination in Connection With a Change in Control. If within four (4) months before or twelve (12) months following a Change in Control (as defined below), the Company terminates the Executive’s employment without Cause or the Executive resigns for Good Reason, then the Company shall pay the Executive’s base salary and any

accrued and unused vacation benefits earned through the date of termination. In addition, the Company shall provide the Executive with the following severance benefits:

4.4.2.1 The Company shall continue to pay the Executive’s base salary until the end of the a period following the termination of the Executive’s employment equal to 2.99 years (the “Severance Period”). Such severance payments shall be subject to standard deductions and withholdings and paid in accordance with the Company’s regular payroll policies and practices. For purposes of calculating the amount to be paid pursuant this Section 4.4.2.1, the Company shall use the greater of (x) the Executive’s base compensation in effect on the date of termination and (y) the Executive’s base compensation immediately prior to the Change in Control.

4.4.2.2 Each month during the Severance Period, the Company shall pay the Executive an amount equal to one-twelfth (1/12^th) of the greatest of (i) the average of the three (3) annual bonuses paid to the Executive by the Company prior to the date of termination, (ii) the last annual bonus paid to the Executive by the Company prior to the date of termination, (iii) the average of the three (3) annual bonuses paid to the Executive by the Company prior to the date of the Change in Control, and (iv) the last annual bonus paid to the Executive by the Company prior to the date of the Change in Control. Such payment shall be subject to standard deductions and withholdings and paid in equal monthly installments over the Severance Period in accordance with the Company’s regular payroll policies and practices.

4.4.2.3 All Company equity awards held by Executive shall vest immediately and, during the Severance Period, Executive shall have continued exercisability of all Company stock options held by the Executive (if any).

4.4.2.4 Assuming the Executive timely and accurately elects to continue his health insurance benefits under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), the Company shall reimburse him for the COBRA expenses he pays on behalf of himself and his family until the earliest of (i) the end of the Severance Period, (ii) the expiration of the Executive’s continuation coverage under COBRA and any applicable state COBRA-like statute that provides mandated continuation coverage or (iii) the date the Executive becomes eligible for health insurance benefits of a subsequent employer.

4.4.2.5 In the event that any of the benefits payable to Executive under this Section 4.4.2 are determined by the Company to constitute deferred compensation subject to Section 409A(a)(2)(B)(i) of the Code, then the amount such benefits so determined shall be payable to Executive in a manner that complies with the requirements of Section 409A, which may include, without limitation, deferring the payment of such benefit for six (6) months after Executive’s date of termination, provided however, that nothing in this paragraph shall require the payment of benefits to Executive earlier than they would otherwise be payable under this Agreement

waiver and release of claims (the “Release”) in a form acceptable to the Parties and substantially as attached hereto as Exhibit A. If a majority of the Board determines in good faith that the Executive has breached any provision of his Proprietary Information and Inventions Agreement or any provision of this Agreement or the Release, the Company shall be excused from the obligation to provide any severance payment under Section 4.4.2 and the Company shall be entitled to full recovery of any severance payment already provided to the Executive under Section 4.4.2.

4.5 Definitions. For purposes of this Agreement, the following terms shall have the following meanings:

4.5.1 Complete Disability. “Complete Disability” shall mean the inability of the Executive to perform the Executive’s duties under this Agreement because the Executive has become permanently disabled within the meaning of any policy of disability income insurance covering employees of the Company then in force. In the event the Company has no policy of disability income insurance covering employees of the Company in force when the Executive becomes disabled, the term “Complete Disability” shall mean the inability of the Executive to perform the Executive’s duties under this Agreement by reason of any incapacity, physical or mental, which the Board, based upon medical advice or an opinion provided by a licensed physician acceptable to the Board, determines to have incapacitated the Executive from satisfactorily performing all of the Executive’s usual services for the Company for a period of at least one hundred twenty (120) days during any twelve (12) month period (whether or not consecutive). Based upon such medical advice or opinion, the determination of the Board shall be final and binding and the date such determination is made shall be the date of such Complete Disability for purposes of this Agreement.

4.5.2 Cause. “Cause” for the Company to terminate Executive’s employment hereunder shall mean the occurrence of one or more of the following events if such event results in a demonstrably harmful impact on the Company’s business or reputation, or that of any of its subsidiaries, as reasonably determined by the Board:

(i) Executive’s conviction of, or plea of guilty or no contest to, any felony or any crime involving fraud, dishonesty or moral turpitude under the laws of the United States or any state thereof;

(ii) Executive’s commission of (or attempted commission of), or participation in, a fraud or act of dishonesty against the Company;

(iii) Executive’s material violation of any statutory duty owed to the Company or material violation of any policy or rule of the Company;

(iv) Executive’s unauthorized use or disclosure of the Company’s confidential information or trade secrets;

(v) Executive’s gross misconduct; or

(vi) Executive’s conduct that constitutes gross insubordination or habitual neglect of duties that is not cured within the reasonable period provided by the Board or a committee designated by the Board in its written notice to Executive of such conduct.

The determination that a termination is for Cause shall be made by the Board in good faith. Any determination that the Executive’s employment was terminated by reason of dismissal without Cause for the purposes of this Agreement shall have no effect upon any determination of the rights or obligations of the Company or the Executive for any other purpose.

4.5.3 Good Reason. “Good Reason” means, with respect to the Executive, the occurrence of one or more of the following, without the Executive’s express written consent and for which the Executive has given the Company express written notice within thirty (30) days following such occurrence:

(i) a material breach of the employment agreement by the Company;

(ii) a significant reduction in the Executive’s duties, position, authority or responsibilities relative to the duties, position, authority or responsibilities in effect immediately prior to such reduction (it being expressly understood that a change in the executive’s reporting responsibility so that he does not report directly or solely to the Company’s Chief Executive Officer will constitute “Good Reason”);

(iii) a reduction in the Executive’s base salary, bonus or other cash incentive compensation opportunity as in effect immediately prior to such reduction for any reason other than in connection with, and proportionate to, a company-wide pay reduction;

(iv) a substantial reduction in Executive’s long-term non-cash incentive opportunities (the value of which is measured as of the date of grant using a reasonable valuation methodology consistently applied), provided that the grant of a stock award covering the same number of shares as a similar stock award granted in the immediately preceding year shall not be deemed to be a substantial reduction of the Executive’s long-term incentive opportunities;

(v) the failure of the Company to timely pay Executive any portion of Executive’s compensation then due to Executive or the failure to pay or reimburse Executive for any business expenses incurred by Executive in accordance with Company policy in a reasonably timely manner;

(vi) a material reduction in Executive’s benefits for any reason other than in connection with any change to the Company’s benefit programs applicable to all Company employees generally made; and

(vii) a relocation of Executive’s principal workplace by more than fifty (50) miles.

“Good Reason” shall also exist if the Executive resigns his employment with the Company for any or no reason within ninety (90) days following a Change in Control (as defined below).

4.5.4 Change in Control. “Change in Control” shall mean a transaction (excluding in each case transactions in which securities are purchased from the Company for the principal purpose of raising capital for the Company) in which one of the following occurs:

(i) any person or related group of persons (other than the Company or an Affiliate of the Company) directly acquires beneficial ownership (within the meaning of Rule 13d-3 of the Securities Exchange Act of 1934) of securities possessing more than thirty-five percent (35%) of the total combined voting power of the Company’s outstanding securities;

(ii) the composition of the Board changes over a period of twenty-four (24) consecutive months or less in a way that results in a majority of the Board (rounded up to the next whole number) ceasing, by reason of one or more proxy contests for the election of Board members, to be comprised of individuals who either (A) have been Board members continuously since the beginning of the period or (B) have been elected or nominated for election as Board members during the period by at least two-thirds of the Board members described in clause (A) who were still in office at the time the election or nomination was approved by the Board;

(iii) (A) a merger or consolidation occurs in which the Company is not the surviving entity, or (B) any reverse merger occurs in which the Company is the surviving entity, or (C) any merger involving a subsidiary of the Company occurs in which the Company is a surviving entity, but in each case in which holders of the Company’s outstanding voting securities immediately prior to such transaction, as such, do not hold, immediately following such transaction, securities possessing fifty percent (50%) or more of the total combined voting power of the surviving entity’s outstanding securities (in the case of clause (A)) or the Company’s outstanding voting securities (in the case of clauses (B) and (C)); or

(iv) all or substantially all of the Company’s assets are sold of transferred other than in connection with an internal reorganization of the Company or the Company’s complete liquidation (other than a liquidation of the Company into a wholly-owned subsidiary).

4.6 Parachute Payments. If any payment or benefit the Executive would receive from the Company pursuant to this Agreement or otherwise (“Payment”) would (i) constitute a “parachute payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), and (ii) be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then the Executive will receive an additional payment (the “Gross-up”) from the Company such that after taking into account all applicable federal, state and local employment taxes, income taxes, the Excise Tax and all applicable taxes on the Gross-up (all computed at the highest applicable marginal rate), results in the Executive’s receipt, on an after-tax basis, of the full amount of the Payment.

The Company shall appoint a nationally recognized independent accounting firm to make the determinations required hereunder, which accounting firm shall not then be serving as accountant or auditor for the individual, entity or group that effected the Change in Control. The Company shall bear all expenses with respect to the determinations by such accounting firm required to be made hereunder.

The accounting firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to the Company and the Executive within fifteen (15) calendar days after the date on which the Executive’s right to a Payment is triggered (if requested at that time by the Company or the Executive) or such other time as requested by the Company or the Executive. The accounting firm shall furnish the Company and the Executive with an opinion reasonably acceptable to the Executive with respect to the application of the Excise Tax to such Payment. The Company shall be entitled to rely upon the accounting firm’s determinations, which shall be final and binding on all persons.

4.7 Exclusive Remedy. The rights, remedies and payments set forth in this Section 4 shall be the exclusive rights, remedies and payments available to the Executive upon termination of this Agreement and the Executive’s employment hereunder. Such rights remedies and payments shall supersede and replace any and all rights and remedies under state or federal law. The Company may deduct any amounts the Executive owes the Company at the time of the Executive’s termination of employment from any severance payments.

4.8 Survival of Certain Sections. Sections 2.2, 3.4, 4.4, 4.5, 4.6, 4.7, 4.8 and 5 - 16 of this Agreement shall survive the termination of this Agreement.

5. CONFIDENTIAL AND PROPRIETARY INFORMATION; NONSOLICITATION.

5.1 Proprietary Information and Inventions Agreement. As a condition of employment, the Executive agrees to execute and abide by the Proprietary Information and Inventions Agreement attached hereto as Exhibit B.

5.2 Non-Solicitation. During the Executive’s employment with the Company and any Severance Period, and for one (1) year after the termination of such periods, the Executive agrees that in order to protect the confidential and proprietary information of the Company and its subsidiaries from unauthorized use, the Executive shall not, either directly or through others, solicit or attempt to solicit (i) any employee, consultant or independent contractor of the Company or its subsidiaries to terminate his or her relationship with the Company (or the applicable subsidiary) in order to become an employee, consultant or independent contractor to or for any other person or business entity, or (ii) the business of any customer, supplier, service provider, vendor or distributor of the Company or a subsidiary which, at the time of termination or one (1) year immediately prior thereto, was doing business with the Company or one of its subsidiaries or listed on the customer, supplier, service provider, vendor or distributor list of the Company or one or more of its subsidiaries.

6. ASSIGNMENT AND BINDING EFFECT.

This Agreement shall be binding upon and inure to the benefit of the Executive and the Executive’s heirs, executors, personal representatives, assigns, administrators and legal representatives. Because of the unique and personal nature of the Executive’s duties under this Agreement, neither this Agreement nor any rights or obligations under this Agreement shall be assignable by the Executive. This Agreement shall be binding upon and inure to the benefit of the Company and its successors, assigns and legal representatives.

7. CHOICE OF LAW.

This Agreement is made and intended to be performed primarily within the state of California. This Agreement shall be construed and interpreted in accordance with the internal laws of the state of California (without giving effect to principles of conflicts of law).

8. INTEGRATION.

Except as may otherwise be provided herein, this Agreement, including Exhibit A and Exhibit B, contains the complete, final and exclusive agreement of the Parties relating to the terms and conditions of the Executive’s employment and the termination of Executive’s employment, and supersedes all prior and contemporaneous oral and written employment agreements or arrangements between the Parties. To the extent this Agreement conflicts with the Proprietary Information and Inventions Agreement attached as Exhibit B, the Proprietary Information and Inventions Agreement controls.

9. AMENDMENT.

This Agreement cannot be amended or modified except by a written agreement signed by the Executive and the Board.

10. WAIVER.

No term, covenant or condition of this Agreement or any breach thereof shall be deemed waived, except with the written consent of the Party against whom the waiver is claimed, and any waiver or any such term, covenant, condition or breach shall not be deemed to be a waiver of any preceding or succeeding breach of the same or any other term, covenant, condition or breach.

11. SEVERABILITY.

The finding by a court of competent jurisdiction or other authorized body of the unenforceability, invalidity or illegality of any provision of this Agreement shall not render any other provision of this Agreement unenforceable, invalid or illegal. The invalid or unenforceable term or provision shall be modified or replaced with a valid and enforceable term or provision which most accurately represents the Parties’ intention with respect to the invalid or unenforceable term or provision.

12. INTERPRETATION; CONSTRUCTION.

The headings set forth in this Agreement are for convenience of reference only and shall not be used in interpreting this Agreement. The Executive has been encouraged to consult with, and has consulted with, Executive’s own independent counsel and tax advisors with respect to the terms of this Agreement. The Parties acknowledge that each Party and its counsel has reviewed and revised, or had an opportunity to review and revise, this Agreement, and any rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement.

13. REPRESENTATIONS AND WARRANTIES.

The Executive represents and warrants that the Executive is not restricted or prohibited, contractually or otherwise, from entering into and performing each of the terms and covenants contained in this Agreement, and that the Executive’s execution and performance of this Agreement shall not violate or breach any other agreements between the Executive and any other person or entity.

14. COUNTERPARTS.

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

15. ARBITRATION.

To ensure the rapid and economical resolution of disputes that may arise in connection with the Executive’s employment with the Company, the Executive and the Company agree that any and all disputes, claims, or causes of action, in law or equity, arising from or relating to Executive’s employment, or the termination of that employment, will be resolved, to the fullest extent permitted by law, by final binding arbitration in San Diego, California conducted by the Judicial Arbitration and Mediation Services (“JAMS”), or its successors, under the then current rules of JAMS for employment disputes; provided that the arbitrator shall: (a) have the authority to compel adequate discovery for the resolution of the dispute and to award such relief as would otherwise be permitted by law and (b) issue a written arbitration decision including the arbitrator’s essential findings and conclusions and a statement of the award. Both the Executive and the Company shall be entitled to all rights and remedies that either the Executive or the Company would be entitled to pursue in a court of law. The Company shall pay all fees in excess of those which would be required if the dispute was decided in a court of law. Nothing in this Agreement is intended to prevent either the Executive or the Company from obtaining injunctive relief in court to prevent irreparable harm pending the conclusion of any such arbitration. Notwithstanding the foregoing, the Executive and the Company each have the right to resolve any and all issues or disputes involving confidential information, proprietary information, trade secrets or related information or intellectual property rights by court action instead of arbitration.

10.

16. TRADE SECRETS OF OTHERS.

It is the understanding of both the Company and the Executive that the Executive shall not divulge to the Company and/or its subsidiaries any confidential information or trade secrets belonging to others, including the Executive’s former employers, nor shall the Company and/or its subsidiaries seek to elicit from the Executive any such information. Consistent with the foregoing, the Executive shall not provide to the Company and/or its subsidiaries, and the Company and/or its subsidiaries shall not request, any documents or copies of documents containing such information.

* * * * * *

11.

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first shown above.

K2 INC.

Name:

Title:

EXECUTIVE

Name:

Title:

12.

EX-10.2 4 dex102.htm FORM OF EMPLOYMENT AGREEMENT BETWEEN K2 INC. AND MR. MERCK AND MR. RANGEL Form of Employment Agreement between K2 Inc. and Mr. Merck and Mr. Rangel

Exhibit 10.2

FORM OF EMPLOYMENT AGREEMENT

RECITALS

B. The Executive desires to be in the employ of the Company and is willing to accept such employment on the terms and conditions set forth in this Agreement.

AGREEMENT

1. EMPLOYMENT.

1.1 Title. The Executive shall serve as the Company’s and shall serve in such other capacities as the Company may from time to time prescribe. The Executive shall report solely and directly to the Chief Executive Officer of the Company.

1.3 [INTENTIONALLY OMITTED]

2. LOYAL AND CONSCIENTIOUS PERFORMANCE; NONCOMPETITION.

3. COMPENSATION OF THE EXECUTIVE.

3.4 Employment Taxes. All of the Executive’s compensation (in any form) shall be subject to all required withholding taxes, employment taxes and other deductions required by law.

4. TERMINATION.

4.1 Termination By the Company. The Executive’s employment with the Company may be terminated under the following conditions:

4.4 Compensation Upon Termination.

accrued and unused vacation benefits earned through the date of termination. In addition, the Company shall provide the Executive with the following severance benefits:

4.4.3 Release. Notwithstanding the foregoing, the Executive shall not receive any of the severance payments or benefits set forth under Section 4.4.2 unless upon Executive’s termination of employment the Executive furnishes the Company with an effective waiver and release of claims (the “Release”) in a form acceptable to the Parties and substantially as attached hereto as Exhibit A. If a majority of the Board determines in good faith that the Executive has breached any provision of his Proprietary Information and Inventions Agreement or any provision of this Agreement or the Release, the Company shall be excused from the obligation to provide any severance payment under Section 4.4.2 and the Company shall be entitled to full recovery of any severance payment already provided to the Executive under Section 4.4.2.

4.5 Definitions. For purposes of this Agreement, the following terms shall have the following meanings:

(ii) Executive’s commission of (or attempted commission of), or participation in, a fraud or act of dishonesty against the Company;

(iii) Executive’s material violation of any statutory duty owed to the Company or material violation of any policy or rule of the Company;

(iv) Executive’s unauthorized use or disclosure of the Company’s confidential information or trade secrets;

(v) Executive’s gross misconduct; or

(i) a material breach of the employment agreement by the Company;

(vii) a relocation of Executive’s principal workplace by more than fifty (50) miles.

4.8 Survival of Certain Sections. Sections 2.2, 3.4, 4.4, 4.5, 4.6, 4.7, 4.8 and 5 - 16 of this Agreement shall survive the termination of this Agreement.

5. CONFIDENTIAL AND PROPRIETARY INFORMATION; NONSOLICITATION.

6. ASSIGNMENT AND BINDING EFFECT.

7. CHOICE OF LAW.

8. INTEGRATION.

9. AMENDMENT.

This Agreement cannot be amended or modified except by a written agreement signed by the Executive and the Board.

10. WAIVER.

11. SEVERABILITY.

12. INTERPRETATION; CONSTRUCTION.

13. REPRESENTATIONS AND WARRANTIES.

14. COUNTERPARTS.

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

15. ARBITRATION.

10.

16. TRADE SECRETS OF OTHERS.

* * * * * *

11.

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first shown above.

K2 INC.

Name:

Title:

EXECUTIVE

Name:

Title:

12.

EX-10.3 5 dex103.htm FORM OF EMPLOYMENT AGREEMENT BETWEEN K2 INC. AND MR. MENDENHALL AND MR. BAIER Form of Employment Agreement between K2 Inc. and Mr. Mendenhall and Mr. Baier

Exhibit 10.3

FORM OF EMPLOYMENT AGREEMENT

RECITALS

B. The Executive desires to be in the employ of the Company and is willing to accept such employment on the terms and conditions set forth in this Agreement.

AGREEMENT

1. EMPLOYMENT.

1.2 Duties. The Executive shall perform all services and actions necessary or advisable to conduct the business of the Company and which are normally associated with the position(s) the Executive holds in a corporation of the size and nature of the Company.

1.3 [INTENTIONALLY OMITTED]

2. LOYAL AND CONSCIENTIOUS PERFORMANCE; NONCOMPETITION.

3. COMPENSATION OF THE EXECUTIVE.

3.4 Employment Taxes. All of the Executive’s compensation (in any form) shall be subject to all required withholding taxes, employment taxes and other deductions required by law.

4. TERMINATION.

4.1 Termination By the Company. The Executive’s employment with the Company may be terminated under the following conditions:

4.4 Compensation Upon Termination.

accrued and unused vacation benefits earned through the date of termination. In addition, the Company shall provide the Executive with the following severance benefits:

4.4.2.1 The Company shall continue to pay the Executive’s base salary until the end of the a period following the termination of the Executive’s employment equal to 2 years (the “Severance Period”). Such severance payments shall be subject to standard deductions and withholdings and paid in accordance with the Company’s regular payroll policies and practices. For purposes of calculating the amount to be paid pursuant this Section 4.4.2.1, the Company shall use the greater of (x) the Executive’s base compensation in effect on the date of termination and (y) the Executive’s base compensation immediately prior to the Change in Control.

4.5 Definitions. For purposes of this Agreement, the following terms shall have the following meanings:

(ii) Executive’s commission of (or attempted commission of), or participation in, a fraud or act of dishonesty against the Company;

(iii) Executive’s material violation of any statutory duty owed to the Company or material violation of any policy or rule of the Company;

(iv) Executive’s unauthorized use or disclosure of the Company’s confidential information or trade secrets;

(v) Executive’s gross misconduct; or

(i) a material breach of the employment agreement by the Company;

(vii) a relocation of Executive’s principal workplace by more than fifty (50) miles.

4.5.4 Change in Control. “Change in Control” shall mean a transaction (excluding in each case transactions in which securities are purchased from the

Company for the principal purpose of raising capital for the Company) in which one of the following occurs:

4.6 Parachute Payments. Anything in this Agreement to the contrary notwithstanding, if any payment or benefit the Executive would receive from the Company pursuant to this Agreement or otherwise (a “Payment”) would (i) constitute a “parachute payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then such Payment shall be equal to the Reduced Amount. The “Reduced Amount” shall be either (x) the largest portion of the Payment that would result in no portion of the Payment being subject to the Excise Tax or (y) the largest portion of the Payment, up to and including the total Payment, whichever amount, after taking into account all applicable federal, state and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate), results in the Executive’s receipt, on an after-tax basis, of the greater amount of the Payment notwithstanding that all or

some portion of the Payment may be subject to the Excise Tax. If a reduction in payments or benefits constituting “parachute payments” is necessary so that the Payment equals the Reduced Amount, reduction shall occur in the following order unless the Executive elects in writing a different order (provided, however, that such election shall be subject to Company approval if made on or after the date on which the event that triggers the Payment occurs): reduction of cash payments; cancellation of accelerated vesting of stock awards; reduction of employee benefits. If acceleration of vesting of stock award compensation is to be reduced, such acceleration of vesting shall be cancelled in the reverse order of the date of grant of the Executive’s stock awards unless the Executive elects in writing a different order for cancellation.

The accounting firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to the Company and the Executive within fifteen (15) calendar days after the date on which the Executive’s right to a Payment is triggered (if requested at that time by the Company or the Executive) or such other time as requested by the Company or the Executive. If the accounting firm determines that no Excise Tax is payable with respect to a Payment, either before or after the application of the Reduced Amount, it shall furnish the Company and the Executive with an opinion reasonably acceptable to the Executive that no Excise Tax will be imposed with respect to such Payment. The Company shall be entitled to rely upon the accounting firm’s determinations, which shall be final and binding on all persons.

4.8 Survival of Certain Sections. Sections 2.2, 3.4, 4.4, 4.5, 4.6, 4.7, 4.8 and 5 - 16 of this Agreement shall survive the termination of this Agreement.

5. CONFIDENTIAL AND PROPRIETARY INFORMATION; NONSOLICITATION.

Company and its subsidiaries from unauthorized use, the Executive shall not, either directly or through others, solicit or attempt to solicit (i) any employee, consultant or independent contractor of the Company or its subsidiaries to terminate his or her relationship with the Company (or the applicable subsidiary) in order to become an employee, consultant or independent contractor to or for any other person or business entity, or (ii) the business of any customer, supplier, service provider, vendor or distributor of the Company or a subsidiary which, at the time of termination or one (1) year immediately prior thereto, was doing business with the Company or one of its subsidiaries or listed on the customer, supplier, service provider, vendor or distributor list of the Company or one or more of its subsidiaries.

6. ASSIGNMENT AND BINDING EFFECT.

7. CHOICE OF LAW.

8. INTEGRATION.

9. AMENDMENT.

This Agreement cannot be amended or modified except by a written agreement signed by the Executive and the Board.

10. WAIVER.

11. SEVERABILITY.

12. INTERPRETATION; CONSTRUCTION.

13. REPRESENTATIONS AND WARRANTIES.

14. COUNTERPARTS.

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

15. ARBITRATION.

10.

Nothing in this Agreement is intended to prevent either the Executive or the Company from obtaining injunctive relief in court to prevent irreparable harm pending the conclusion of any such arbitration. Notwithstanding the foregoing, the Executive and the Company each have the right to resolve any and all issues or disputes involving confidential information, proprietary information, trade secrets or related information or intellectual property rights by court action instead of arbitration.

16. TRADE SECRETS OF OTHERS.

* * * * * *

11.

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first shown above.


K2 INC.


Name:
Title:

EXECUTIVE


Name:
Title:

12.

EX-10.4 6 dex104.htm SEVERANCE BENEFIT PLAN Severance Benefit Plan

Exhibit 10.4

K2 INC.

SEVERANCE BENEFIT PLAN

Section 1. INTRODUCTION.

The K2 Inc. Severance Benefit Plan (the “Plan”) was established effective February 14, 2005 (the “Effective Date”). The purpose of the Plan is to provide severance benefits to certain eligible employees of the Company and its subsidiaries upon selected terminations of service. This Plan document is also the Summary Plan Description for the Plan.

Section 2. DEFINITIONS.

The following shall be defined terms for purposes of the Plan:

(a) “Base Salary” means a Participant’s monthly base salary in effect immediately prior to the Covered Termination (including without limitation any compensation that is deferred by Participant into a Company-sponsored retirement or deferred compensation plan, exclusive of any employer matching contributions by the Company associated with any such retirement or deferred compensation plan and exclusive of any other Company contributions) and excludes all bonuses, commissions, expatriate premiums, fringe benefits (including without limitation car allowances), option grants, equity awards, employee benefits and other similar items of compensation.

(b) “Board” means the Board of Directors of the Company.

(c) “Bonus Amount” means, with respect to a Participant, one-twelfth (1/12^th) of the greater of (i) the average of the three (3) annual bonuses paid to the Participant by the Company prior to the date of such Participant’s Covered Termination and (ii) the last annual bonus paid to the Participant by the Company prior to the date of such Participant’s Covered Termination.

(d) “Cause” for the Company to terminate Executive’s employment hereunder shall mean the occurrence of one or more of the following events if such event results in a demonstrably harmful impact on the Company’s business or reputation, or that of any of its subsidiaries, as reasonably determined by the Board:

(1) Executive’s conviction of, or plea of guilty or no contest to, any felony or any crime involving fraud, dishonesty or moral turpitude under the laws of the United States or any state thereof;

(2) Executive’s commission of (or attempted commission of), or participation in, a fraud or act of dishonesty against the Company;

(3) Executive’s material violation of any statutory duty owed to the Company or material violation of any policy or rule of the Company;

(4) Executive’s unauthorized use or disclosure of the Company’s confidential information or trade secrets;

(5) Executive’s gross misconduct; or

(6) Executive’s conduct that constitutes gross insubordination or habitual neglect of duties that is not cured within the reasonable period provided by the Board or a committee designated by the Board in its written notice to Executive of such conduct.

(e) “Company” means K2 Inc.

(f) “Covered Termination” means, with respect to a Participant who immediately prior to a termination of employment was an employee of the Company, such Participant’s termination of employment by the Company without Cause.

(g) “Participant” means all individuals hereafter designated by the Board and listed on Exhibit A-1 or Exhibit A-2 attached hereto.

(h) “Plan Administrator” means K2 Inc.

(i) “Severance Period” means, with respect to a Participant, the period of time following the Participant’s Covered Termination for which a Participant may be eligible to receive the benefits provided in Section 4 herein. The Severance Period shall be the number of months corresponding to such Participant’s name on Exhibit A-1 or Exhibit A-2 attached hereto.

Section 3. ELIGIBILITY FOR BENEFITS.

Subject to the requirements set forth in this Section, the Company shall provide severance benefits under the Plan to the Participants. In order to be eligible to receive benefits under the Plan, a Participant must (i) experience an Covered Termination and (ii) execute a general waiver and release in substantially the form attached hereto as Exhibit B (or as then may be required by law to effect a release of claims), as appropriate, and such release must become effective in accordance with its terms. The Company, in its sole discretion, may at any time modify the forms of the required release and shall determine the appropriate form of release.

Section 4. AMOUNT OF BENEFIT.

Subject to the limitations and reductions provided in this Plan, benefits under this Plan, if any, shall be provided to the Participants described in Section 3 in the following amounts:

(a) Covered Termination Benefits. Upon a Participant’s Covered Termination, such Participant shall receive the following severance package:

(1) Cash Severance Benefits. At the end of each month during the term of the Participant’s Severance Period, each Participant listed on Exhibit A-1 will receive a cash payment in an amount equal to the sum of Participant’s Base Salary and Bonus Amount. At the end of each month during the term of the Participant’s Severance Period, each Participant listed on Exhibit A-2 will receive a cash payment in an amount equal to the Participant’s Base Salary.

(2) COBRA Benefits. If such Participant timely elects to continue coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), then for the term of the Participant’s Severance Period, the Company will reimburse all premiums for group medical, dental and vision coverage paid by such Participant under (a) COBRA and, to the extent applicable, any similar applicable state statute, and (b) to the extent that such coverage under COBRA and any such applicable state statute has been exhausted or is no longer available, then under any individual policy providing group medical, dental and vision benefits substantially similar to those provided to Participant immediately prior to his or her termination of Service.

(3) Stock Option Acceleration and Continued Post-Termination Exercise Period. The Participant will receive immediate full vesting of all stock options and other equity awards issued by the Company and held by such Participant. In addition, with respect to stock options issued to the Participant, the Participant shall be entitled to exercise all of his or her stock options for the number of months beyond the original post-termination exercise period provided in such Participant’s stock option agreement (but not beyond the original contractual life of the option) equal to the Severance Period.

(b) Certain Reductions. Notwithstanding any other provision of the Plan to the contrary, any benefits payable to a Participant under Sections 4(a)(1) and 4(a)(2) of this Plan shall be reduced (but not below zero) by any severance benefits payable by the Company or an affiliate of the Company to such Participant under any other policy, plan, program, agreement or arrangement, including, without limitation, an employment agreement between such Participant and any entity, covering such Participant. In addition, to the extent that any federal, state or local laws, including, without limitation the Worker Adjustment Retraining Notification Act, 29 U.S.C. Section 2101 et seq., or any similar state statute, require the Company to give advance notice or make a payment of any kind to a Participant because of that Participant’s involuntary termination due to a layoff, reduction in force, plant or facility closing, sale of business, change of control, or any other similar event or reason, the benefits payable under Sections 4(a)(1) and 4(a)(2) of this Plan shall either be reduced or eliminated by such required payments or notice. The benefits provided under this Plan are intended to satisfy any and all statutory obligations that may arise out of a Participant’s involuntary termination of employment for the foregoing reasons, and the Plan Administrator shall so construe and implement the terms of the Plan.

Section 5. LIMITATIONS ON BENEFITS.

(a) Mitigation. Except as otherwise specifically provided herein, a Participant shall not be required to mitigate damages or the amount of any payment provided under the Plan by seeking other employment or otherwise, nor shall the amount of any payment provided for under the Plan be reduced by any compensation earned by a Participant as a result of employment by another employer or any retirement benefits received by such Participant after the date of service or employment termination.

(b) Termination of Benefits. Benefits under the Plan shall terminate immediately if the Participant, at any time, (i) engages in the unauthorized use or disclosure of the Company’s material confidential information, material trade secrets or material proprietary information under any written agreement under which the Participant has a such an obligation to the Company that survives the Participant’s termination of service to the Company, (ii) engages in any prohibited or unauthorized competitive activities, or prohibited or unauthorized solicitation or recruitment of employees, in violation of any written agreement under which Participant has such an obligation to the Company that survives the Participant’s termination of service to the Company; (iii) violates any term or condition of this Plan or (iv) violates any term of the applicable general waiver and release referenced in Section 3 above.

(c) Non-Duplication of Benefits. No Participant is eligible to receive benefits under this Plan more than one time.

(d) Indebtedness of Participants. If a Participant is indebted to the Company or an affiliate of the Company on the date of his or her termination of employment or service, the Company reserves the right to offset any severance benefits payable in cash under the Plan by the amount of such indebtedness.

(e) Parachute Payments. If any payment or benefit a Participant would receive in connection with a Change in Control from the Company or otherwise (a “Payment”) would (i) constitute a “parachute payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then such Payment shall be equal to the Reduced Amount. The “Reduced Amount” shall be either (x) the largest portion of the Payment that would result in no portion of the Payment being subject to the Excise Tax or (y) the largest portion of the Payment, up to and including the total Payment, whichever amount, after taking into account all applicable federal, state and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate), results in the Participant’s receipt, on an after-tax basis, of the greater amount of the Payment notwithstanding that all or some portion of the Payment may be subject to the Excise Tax. If a reduction in payments or benefits constituting “parachute payments” is necessary so that the Payment equals the Reduced Amount, reduction shall occur in the following order unless the Participant elects in writing a different order (provided, however, that such election shall be subject to Company approval if made on or after the date on which the event that triggers the Payment occurs):

reduction of cash payments; cancellation of accelerated vesting of stock awards; reduction of employee benefits. If acceleration of vesting of stock award compensation is to be reduced, such acceleration of vesting shall be cancelled in the reverse order of the date of grant of the Participant’s stock awards unless the Participant elects in writing a different order for cancellation.

(f) Deferred Compensation. In the event that any of the benefits payable to Participant under this Section are determined by the Company to constitute deferred compensation subject to Section 409A(a)(2)(B)(i) of the Code, then the amount such benefits so determined shall be payable to Participant in a manner that complies with the requirements of Section 409A, which may include, without limitation, deferring the payment of such benefit for six (6) months after Participant’s date of termination, provided however, that nothing in this paragraph shall require the payment of benefits to Participant earlier than they would otherwise be payable under this Agreement.

The accounting firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to the Company and the Participant within ten (10) calendar days after the date on which the Participant’s right to a Payment is triggered (if requested at that time by the Company or the Participant) or such other time as requested by the Company or the Participant. If the accounting firm determines that no Excise Tax is payable with respect to a Payment, either before or after the application of the Reduced Amount, it shall furnish the Company and the Participant with an opinion reasonably acceptable to the Participant that no Excise Tax will be imposed with respect to such Payment. Any good faith determinations of the accounting firm made hereunder shall be final, binding and conclusive upon the Company and the Participant.

Section 6. RIGHT TO INTERPRET PLAN; AMENDMENT AND TERMINATION.

(a) Exclusive Discretion. The Plan Administrator shall have the exclusive discretion and authority to establish rules, forms, and procedures for the administration of the Plan and to construe and interpret the Plan and to decide any and all questions of fact, interpretation, definition, computation or administration arising in connection with the operation of the Plan, including, but not limited to, the eligibility to participate in the Plan and amount of benefits paid under the Plan. The rules, interpretations, computations and other actions of the Plan Administrator shall be binding and conclusive on all persons. Unless otherwise determined by the Board, the General Counsel of the Company shall perform the duties of the Plan Administrator under this Plan.

(b) Amendment or Termination. The Board, or the Compensation Committee thereof, reserves the right to amend or terminate this Plan or the benefits provided hereunder at any time; provided, however, that no such amendment or termination shall impair or

reduce the rights of a Participant unless such Participant consents to such amendment or termination of the Plan in writing. Notwithstanding the foregoing, the Plan shall automatically terminate on the tenth (10^th) anniversary from the date of its adoption by the Board, unless extended by the Board or the Compensation Committee thereof. Except with respect to the automatic termination provided in the prior sentence, any action amending, terminating or extending the Plan shall be in writing and executed by the Board or the Compensation Committee thereof.

Section 7. CONTINUATION OF CERTAIN EMPLOYEE BENEFITS.

(a) COBRA Continuation. Each Participant who is enrolled in a group medical, dental or vision plan sponsored by the Company or an affiliate of the Company may be eligible to continue coverage under such group medical, dental or vision plan (or to convert to an individual policy), at the time of the Participant’s termination of employment under COBRA. The Company will notify the Participant of any such right to continue group medical coverage at the time of termination. No provision of this Plan will affect the continuation coverage rules under COBRA. Therefore, the period during which a Participant may elect to continue the Company’s group medical, dental or vision coverage at his or her own expense under COBRA, the length of time during which COBRA coverage will be made available to the Participant, and all other rights and obligations of the Participant under COBRA will be applied in the same manner that such rules would apply in the absence of this Plan. At the conclusion of the COBRA premium reimbursements made by the Company, if any, the Participant will be responsible for the entire payment of premiums required under COBRA for the duration, if any, of the COBRA period.

(b) Other Employee Benefits. All non-health benefits (such as life insurance, disability and 401(k) plan coverage) terminate as of an employee’s termination date (except to the extent that a conversion privilege may be available thereunder).

Section 8. NO IMPLIED EMPLOYMENT CONTRACT.

The Plan shall not be deemed (i) to give any employee or other person any right to be retained in the employ or service of the Company or (ii) to interfere with the right of the Company to discharge any employee or other person at any time and for any reason, which right is hereby reserved.

Section 9. LEGAL CONSTRUCTION.

This Plan is intended to be governed by and shall be construed in accordance with the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) and, to the extent not preempted by ERISA, the laws of the State of California.

Section 10. CLAIMS, INQUIRIES AND APPEALS.

(a) Applications for Benefits and Inquiries. Any application for benefits, inquiries about the Plan or inquiries about present or future rights under the Plan must be submitted to the Plan Administrator in writing by an applicant (or his or her authorized representative). The Plan Administrator is:

K2 Inc.

2051 Palomar Airport Road

Suite 100

Carlsbad, CA 92009

Attn: General Counsel

(b) Denial of Claims. In the event that any application for benefits is denied in whole or in part, the Plan Administrator must provide the applicant with written or electronic notice of the denial of the application, and of the applicant’s right to review the denial. Any electronic notice will comply with the regulations of the U.S. Department of Labor. The written notice of denial will be set forth in a manner designed to be understood by the employee and will include the following:

(1) the specific reason or reasons for the denial;

(2) references to the specific Plan provisions upon which the denial is based;

(3) a description of any additional information or material that the Plan Administrator needs to complete the review and an explanation of why such information or material is necessary; and

(4) an explanation of the Plan’s review procedures and the time limits applicable to such procedures, including a statement of the applicant’s right to bring a civil action under section 502(a) of ERISA following a denial on review of the claim, as described in Section 10(d) below.

This written notice will be given to the applicant within ninety (90) days after the Plan Administrator receives the application, unless special circumstances require an extension of time, in which case, the Plan Administrator has up to an additional ninety (90) days for processing the application. If an extension of time for processing is required, written notice of the extension will be furnished to the applicant before the end of the initial ninety (90) day period.

This notice of extension will describe the special circumstances necessitating the additional time and the date by which the Plan Administrator is to render its decision on the application.

(c) Request for a Review. Any person (or that person’s authorized representative) for whom an application for benefits is denied, in whole or in part, may appeal the denial by submitting a request for a review to the Plan Administrator within sixty (60) days after the application is denied. A request for a review shall be in writing and shall be addressed to:

K2 Inc.

2051 Palomar Airport Road

Suite 100

Carlsbad, CA 92009

Attn: General Counsel

A request for review must set forth all of the grounds on which it is based, all facts in support of the request and any other matters that the applicant feels are pertinent. The applicant (or his or her representative) shall have the opportunity to submit (or the Plan Administrator may require the applicant to submit) written comments, documents, records, and other information relating to his or her claim. The applicant (or his or her representative) shall be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to his or her claim. The review shall take into account all comments, documents, records and other information submitted by the applicant (or his or her representative) relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.

(d) Decision on Review. The Plan Administrator will act on each request for review within sixty (60) days after receipt of the request, unless special circumstances require an extension of time (not to exceed an additional sixty (60) days), for processing the request for a review. If an extension for review is required, written notice of the extension will be furnished to the applicant within the initial sixty (60) day period. This notice of extension will describe the special circumstances necessitating the additional time and the date by which the Plan Administrator is to render its decision on the review. The Plan Administrator will give prompt, written or electronic notice of its decision to the applicant. Any electronic notice will comply with the regulations of the U.S. Department of Labor. In the event that the Plan Administrator confirms the denial of the application for benefits in whole or in part, the notice will set forth, in a manner calculated to be understood by the applicant, the following:

(1) the specific reason or reasons for the denial;

(2) references to the specific Plan provisions upon which the denial is based;

(3) a statement that the applicant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to his or her claim; and

(4) a statement of the applicant’s right to bring a civil action under section 502(a) of ERISA.

(e) Rules and Procedures. The Plan Administrator will establish rules and procedures, consistent with the Plan and with ERISA, as necessary and appropriate in carrying out its responsibilities in reviewing benefit claims. The Plan Administrator may require an applicant who wishes to submit additional information in connection with an appeal from the denial of benefits to do so at the applicant’s own expense.

(f) Exhaustion of Remedies. No legal action for benefits under the Plan may be brought until the claimant (i) has submitted a written application for benefits in accordance with the procedures described by Section 10(a) above, (ii) has been notified by the Plan Administrator that the application is denied, (iii) has filed a written request for a review of the application in accordance with the appeal procedure described in Section 10(c) above, and (iv) has been notified in writing that the Plan Administrator has denied the appeal. Notwithstanding the foregoing, if the Plan Administrator does not respond to a Participant’s claim or appeal within the relevant time limits specified in this Section 10, then the Participant may bring legal action for benefits under the Plan pursuant to Section 502(a) of ERISA.

Section 11. BASIS OF PAYMENTS TO AND FROM PLAN.

All benefits under the Plan shall be paid by the Company. The Plan shall be unfunded, and benefits hereunder shall be paid only from the general assets of the Company.

Section 12. OTHER PLAN INFORMATION.

(a) Employer and Plan Identification Numbers. The Employer Identification Number assigned to the Company (which is the “Plan Sponsor” as that term is used in ERISA) by the Internal Revenue Service is 95-2077125. The Plan Number assigned to the Plan by the Plan Sponsor pursuant to the instructions of the Internal Revenue Service is 507.

(b) Ending Date for Plan’s Fiscal Year. The date of the end of the fiscal year for the purpose of maintaining the Plan’s records is December 31.

(c) Agent for the Service of Legal Process. The agent for the service of legal process with respect to the Plan is K2 Inc., Attn: General Counsel, 2051 Palomar Airport Road, Suite 100, Carlsbad, CA 92009.

(d) Plan Sponsor and Administrator. The “Plan Sponsor” and the “Plan Administrator” of the Plan is K2 Inc., 2051 Palomar Airport Road, Suite 100, Carlsbad, CA 92009. The Plan Sponsor’s and Plan Administrator’s telephone number is (760) 494-1000. The Plan Administrator is the named fiduciary charged with the responsibility for administering the Plan.

Section 13. STATEMENT OF ERISA RIGHTS.

Participants in this Plan (which is a welfare benefit plan sponsored by the Company) are entitled to certain rights and protections under ERISA. If you are a Participant in the Plan, under ERISA you are entitled to:

Receive Information about the Plan and Your Benefits

(a) Examine, without charge, at the Plan Administrator’s office and at other specified locations, such as work sites, all documents governing the Plan and a copy of the latest annual report (Form 5500 Series) filed by the Plan Administrator with the U.S. Department of Labor and available at the Public Disclosure Room of the Pension and Welfare Benefit Administration;

(b) Obtain, upon written request to the Plan Administrator, copies of documents governing the operation of the Plan and copies of the latest annual report (Form 5500 Series). The Plan Administrator may make a reasonable charge for the copies; and

(c) Receive a summary of the Plan’s annual financial report. The Plan Administrator is required by law to furnish each Participant with a copy of this summary annual report.

Prudent Actions by Plan Fiduciaries

In addition to creating rights for Plan participants, ERISA imposes duties upon the people who are responsible for the operation of the employee benefit plan. The people who operate the Plan, called “fiduciaries” of the Plan, have a duty to do so prudently and in the interest of you and other Plan participants and beneficiaries.

Enforce Your rights

No one, including your employer or any other person, may fire you or otherwise discriminate against you in any way to prevent you from obtaining a Plan benefit or exercising your rights under ERISA.

Under ERISA, there are steps you can take to enforce the above rights. For instance, if you request a copy of Plan documents or the latest annual report from the Plan and do not receive them within 30 days, you may file suit in a Federal court. In such a case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator.

If you have a claim for benefits that is denied or ignored, in whole or in part, you may file suit in a state or Federal court. In addition, if you disagree with the Plan Administrator’s decision or lack thereof concerning the qualified status of a domestic relations order or a medical child support order, you may file suit in Federal court.

If it should happen that the Plan fiduciaries misuse the Plan’s money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in a Federal court. The court will decide who should pay court costs and legal fees. If you are successful, the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds your claim is frivolous.

Assistance with Your Questions

If you have any questions about the Plan, you should contact the Plan Administrator. If you have any questions about this statement or about your rights under ERISA, or if you need assistance in obtaining documents from the Plan Administrator, you should contact the nearest office of the Pension and Welfare Benefits Administration, U.S. Department of Labor, listed in your telephone directory or the Division of Technical Assistance and Inquiries, Pension and Welfare Benefits Administration, U.S. Department of Labor, 200

10.

Constitution Avenue N.W., Washington, D.C. 20210. You may also obtain certain publications about your rights and responsibilities under ERISA by calling the publications hotline of the Pension and Welfare Benefits Administration.

Section 14. EXECUTION.

To record the adoption of the Plan as set forth herein, effective as of the Effective Date, K2 Inc. has caused its duly authorized officer to execute the same this 14th day of February, 2005.

K2 Inc.

/s/ Richard J. Heckmann

Richard J. Heckmann,

Chairman of the Board and

Chief Executive Officer

11.

EX-99.1 7 dex991.htm PRESS RELEASE Press Release

Exhibit 99.1

NEWS RELEASE

Contacts:

Dudley W. Mendenhall, 760-494-1000

Integrated Corporate Relations, Inc.

Investor Relations:

Andrew Greenebaum/Chad Jacobs

(310) 395-2215/ (203) 222-9013

Media Relations:

John Flanagan/Mike Fox

(203) 222-9013

K2 INC. ANNOUNCES ELECTION OF ANN MEYERS

TO ITS BOARD OF DIRECTORS

Carlsbad, Calif., February 17, 2005 – K2 Inc. (NYSE: KTO), a leading consumer products company, announced today that Ann Meyers has been elected to K2’s board of directors effective February 11^th 2005. Since 1983, Meyers has served as a broadcaster for the major sports networks covering a variety of events including men’s and women’s NCAA basketball, softball and volleyball games, and the 1984, 2000 and 2004 Summer Olympics. Prior to commencing a career in broadcasting, Meyers had a distinguished record as a college and professional athlete.

“Ann brings a highly unique perspective to K2 as both an athlete and a professional spokeswoman for several major sports,” said Richard J. Heckmann, Chairman and Chief Executive Officer. “We have a deep commitment to women’s sports as demonstrated by several of our leading product lines including Worth softball, deBeer lacrosse, and the K2 T-Nine® ski series designed exclusively for women. Ann’s background and insights will be extremely beneficial as we expand our presence in women’s sports”.

Meyers was a four-time All-American in women’s basketball at UCLA, and led the team to the 1978 AIAW Championship. She was a member of the 1976 Olympic team, and in 1978 was the first player drafted in the Women’s Professional Basketball League and was MVP of the league in 1979-80 with the New Jersey Gems. In 1979, Meyers became the only woman to sign as a free agent to an NBA team, the Indiana Pacers. She is a member of the National Basketball Hall of Fame, the Women’s Sports Hall of Fame, and the first woman to be inducted into the UCLA Hall of Fame.

About K2 Inc.

K2 Inc. is a premier, branded consumer products company with a portfolio of leading brands including Rawlings®, Worth®, Shakespeare®, Pflueger®, Brass Eagle®, Stearns®, K2®, Volkl®, Ride®, Marmot®, Ex Officio® and Marker®. K2’s diversified mix of products is used primarily in team and individual sports activities such as baseball, softball, fishing, paintball, watersports activities, alpine skiing, snowboarding, in-line skating and mountain biking. Among K2’s other branded products are Planet Earth® apparel, Adio® and Hawk® skateboard shoes, Tubbs® and Atlas® snowshoes, JT® and Worr Games® paintball products and Dana Design® backpacks.

Rawlings®, Worth®, Shakespeare®, Pflueger®, Brass Eagle®, Stearns®, K2®, Volkl®, Ride®, Marmot®, Ex Officio®, Marker®, Planet Earth®, Adio®, Hawk® skateboard shoes, Tubbs®, Atlas®, JT®, Worr Games®, and Dana Designs®, are trademarks or registered trademarks of K2 Inc. or its subsidiaries in the United States or other countries.

K2 Inc

2-2-2

Safe Harbor Statement

This news release includes forward-looking statements. K2 cautions that these statements are qualified by important factors that could cause actual results to differ materially from those in the forward-looking statements, including but not limited to K2’s ability to successfully execute its acquisition plans and growth strategy, integration of a number of acquired businesses, weather conditions, consumer spending, continued success of manufacturing in China, global economic conditions, product demand, financial market performance, and other risks described in the company’s most recent annual report on Form 10-K, subsequent quarterly reports on Form 10-Q, and current reports on Form 8-K, each as filed with the Securities and Exchange Commission. The company cautions that the foregoing list of important factors is not exclusive, any forward-looking statements included in this news release is made as of the date of this news release, and the company does not undertake to update any forward-looking statement.

EX-99.2 8 dex992.htm PRESS RELEASE Press Release

Exhibit 99.2

NEWS RELEASE

Contacts: Dudley W. Mendenhall, 760-494-1000

Integrated Corporate Relations, Inc.

Investor Relations:

Andrew Greenebaum/Chad Jacobs

(310) 395-2215/ (203) 222-9013

Media Relations:

John Flanagan/Mike Fox

(203) 222-9013

K2 Inc. Sets Record and Meeting Dates for 2005 Annual Meeting of Shareholders

Carlsbad, California – February 17, 2005. K2 Inc. (NYSE: KTO) announced today that it has established record and meeting dates for its 2004 annual meeting of shareholders. K2 shareholders of record as the close of business on March 24, 2005, will be entitled to notice of the annual meeting and to vote upon matters considered at the meeting. The annual meeting will be held in Carlsbad, California on May 12, 2005.

K2 will send a definitive proxy statement to shareholders of record, which will contain important information about the meeting and the matters to be considered. Shareholders are urged to read the proxy statement when it becomes available.

About K2 Inc.

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