e8vk

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

-----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, CLQUuH6CjoATyj0fl0FPz1SllyhKI5pLDEtG5uNtQ4FkTu49MoWdWkW1tkyazy9y VsRhgHojT4ePxyezyRczTg== 0000950148-06-000022.txt : 20060407 0000950148-06-000022.hdr.sgml : 20060407 20060407172624 ACCESSION NUMBER: 0000950148-06-000022 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20060403 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060407 DATE AS OF CHANGE: 20060407 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DECKERS OUTDOOR CORP CENTRAL INDEX KEY: 0000910521 STANDARD INDUSTRIAL CLASSIFICATION: RUBBER & PLASTICS FOOTWEAR [3021] IRS NUMBER: 953015862 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-22446 FILM NUMBER: 06749073 BUSINESS ADDRESS: STREET 1: 495A SOUTH FAIRVIEW AVENUE CITY: GOLETA STATE: CA ZIP: 93117 BUSINESS PHONE: 8059677611 MAIL ADDRESS: STREET 1: 495-A S FAIRVIEW AVE CITY: GOLETA STATE: CA ZIP: 93117 FORMER COMPANY: FORMER CONFORMED NAME: DECKERS FOOTWEAR CORP DATE OF NAME CHANGE: 19930811 8-K 1 v19441e8vk.htm DECKERS OUTDOOR CORPORATION e8vk

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): April 3, 2006

DECKERS OUTDOOR CORPORATION

(Exact name of registrant as specified in its charter)

Delaware

(State or other jurisdiction of incorporation)


0-22446		95-3015862

(Commission File Number)		(IRS Employer Identification No.)

495A South Fairview Avenue, Goleta, California		93117

(Address of principal executive offices)		(Zip code)

Registrant’s telephone number, including area code		(805) 967-7611


None

(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:

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

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

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

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

TABLE OF CONTENTS


Item 1.01. Entry Into a Material Definitive Agreement
Item 9.01. Financial Statements and Exhibits
SIGNATURE
INDEX TO EXHIBITS
Exhibit 10.1
Exhibit 10.2
Exhibit 10.3

Item 1.01. Entry Into a Material Definitive Agreement.

Douglas B. Otto, Chairman of the Board

On April 4, 2006, the Company entered into an amendment to Douglas B. Otto’s employment agreement pursuant to which Mr. Otto shall serve as the Chairman of the Board. The amendment is effective as of April 11, 2005. Mr. Otto’s employment with the Company is “at will,” but the term of his employment agreement ends December 31, 2007. For 2005, Mr. Otto was entitled to compensation based on an annual base salary of $345,000 pro rated for the period through April 11, 2005 and an annual salary of $104,00 pro rated for the period after April 11, 2005. Mr. Otto was also entitled to an incentive bonus of $103,000 in 2005, based on achievement of certain performance criteria. For 2006, Mr. Otto is entitled to an annual base salary of $52,000. Pursuant to his employment agreement, as amended, Mr. Otto is not entitled to a bonus or any grants of nonvested stock units. Mr. Otto will receive the normal fringe benefits available to other senior executives and will be entitled to severance pay under the circumstances described below.

If Mr. Otto is terminated by the Company for any reason or Mr. Otto terminates his employment for any reason, Mr. Otto or his beneficiaries will be entitled to payment of his accrued base salary, payment for his accrued vacation, reimbursement for certain expenses, receipt of accrued and vested benefits under the Company’s plans or programs and other benefits required to be paid by law, payment of three times his annual base salary plus the greater of three times the targeted incentive bonus immediately prior to the time such termination occurs or three times the average actual incentive bonus for the previous three years, if any, subject to Mr. Otto signing a release, receipt of health benefits for a period of three years following his termination or his attainment of alternative employment that provides health benefits, whichever is earlier, and the right to exercise all vested unexercised stock options and warrants outstanding as of the termination date.

Constance X. Rishwain, President of the UGG and Simple Divisions

On April 3, 2006, the Company entered into an employment agreement with Constance X. Rishwain pursuant to which serve as President of the UGG and Simple Divisions. The employment agreement is effective as of January 1, 2006. Ms. Rishwain’s employment with the Company is “at will,” but the term of her employment agreement ends December 31, 2007. For 2006, Ms. Rishwain will be entitled to an annual base salary of $225,000 and may be entitled to a performance bonus based on a target bonus of 100% of her annual base salary. The actual 2006 bonus paid, if any, to Ms. Rishwain will be based upon the achievement of certain performance targets. If the performance targets are surpassed or if they are not achieved, the bonus may be more or less, as applicable, than the amount of the target bonus. Ms. Rishwain may also be granted options or nonvested stock units to the extent approved by the Compensation Committee. Ms. Rishwain will also receive the normal fringe benefits available to other senior executives and will be entitled to severance pay under the circumstances described below.

If Ms. Rishwain is terminated by the Company for Cause or Ms. Rishwain terminates her employment, other than for Good Reasons, Ms. Rishwain or her beneficiaries will be entitled to payment of her accrued base salary, payment for her accrued vacation, reimbursement for certain expenses, receipt of accrued and vested benefits under the Company’s plans or programs and other benefits required to be paid by law, payment of any accrued but unpaid incentive bonus for the prior fiscal year and the right to exercise all vested unexercised stock options and warrants outstanding as of the termination date. If Ms. Rishwain is terminated by the Company due to her death or total disability, in addition to those rights described in the first sentence of this paragraph, Ms. Rishwain shall be entitled to payment of any accrued but unpaid incentive bonus for the current fiscal year based on actual performance. If Ms. Rishwain is terminated by the Company without Cause or Ms. Rishwain terminates her employment for Good Reason, in addition to those rights described in the first sentence of this paragraph, Ms. Rishwain will be entitled to payment of her base salary for six months following her termination, subject to Ms. Rishwain signing a release, and receipt of health benefits for a period of six months following her termination or her attainment of alternative employment that provides health benefits, whichever is earlier. If Ms. Rishwain is terminated within two years of a Change of Control of the Company without Cause or by Ms. Rishwain for Good Reason, in addition to those rights described in the first sentence of this paragraph, Ms. Rishwain will be entitled to payment of a pro-rata incentive bonus based on actual performance for the year of termination, payment of one and one-half times her annual base salary plus the greater of one and one-half times the targeted incentive bonus immediately prior to the termination or two times the average actual incentive bonus for the previous three years, subject to Ms. Rishwain signing a release, receipt of health benefits for a period of eighteen months following her termination or her attainment of alternative employment that provides health benefits, whichever is earlier.

As used in the previous paragraph, (1) Cause means (i) any willful breach of duty by Ms. Rishwain in the

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course of her employment or continued violation of written Company employment policies after written notice of such violation, (ii) violation of the Company’s insider trading policies, (iii) conviction of a felony or any crime involving fraud, theft, embezzlement, dishonesty or moral turpitude, (iv) engaging in activities which materially defame the Company, engaging in conduct which is material injurious to the Company or its affiliates, or any of their respective customer or supplier relationships, financially or otherwise, or (v) Ms. Rishwain’s gross negligence or incapacity to perform duties, excluding Ms. Rishwain’s total disability, (2) Good Reason means the occurrence of a material breach of the employment agreement by the Company, which breach is not cured within 15 calendar days after written notice thereof is received by the Company, or if within two years of a Change of Control, there is a reduction of Ms. Rishwain’s total compensation, benefits, and perquisites, the Company’s relocation is greater than 50 miles further from Ms. Rishwain’s home, or a material change in Ms. Rishwain’s position or duties, and (3) Change of Control means if there is a merger, consolidation, sale of all or a major portion of the assets of the Company (or a successor organization) or similar transaction or circumstance where any person or group (other than Douglas B. Otto) acquires or obtains the right to acquire, in one or more transactions, beneficial ownership of more than 50% of the outstanding shares of any class of voting stock of the Company (or a successor organization).

Patrick C. Devaney, Senior Vice President of Global Sourcing, Production and Development.

On April 3 2006, the Company entered into an employment agreement with Patrick C. Devaney pursuant to which Mr. Devaney shall serve as the Senior Vice President of Global Sourcing, Production and Development. The employment agreement is effective as of January 1, 2006. Mr. Devaney’s employment with the Company is “at will,” but the term of his employment agreement ends December 31, 2007. For 2006, Mr. Devaney will be entitled to an annual base salary of $200,000 and may be entitled to a performance bonus based on a target bonus of 67% of his annual base salary. The actual 2006 bonus paid, if any, to Mr. Devaney will be based upon the achievement of certain performance targets. If the performance targets are surpassed or if they are not achieved, the bonus may be more or less, as applicable, than the amount of the target bonus. Mr. Devaney may also be granted options or nonvested stock units to the extent approved by the Compensation Committee. Mr. Devaney will also receive the normal fringe benefits available to other senior executives and will be entitled to severance pay under the circumstances described below.

If Mr. Devaney is terminated by the Company for Cause or Mr. Devaney terminates his employment, other than for Good Reasons, Mr. Devaney or his beneficiaries will be entitled to payment of his accrued base salary, payment for his accrued vacation, reimbursement for certain expenses, receipt of accrued and vested benefits under the Company’s plans or programs and other benefits required to be paid by law, payment of any accrued but unpaid incentive bonus for the prior fiscal year and the right to exercise all vested unexercised stock options and warrants outstanding as of the termination date. If Mr. Devaney is terminated by the Company due to his death or total disability, in addition to those rights described in the first sentence of this paragraph, Mr. Devaney shall be entitled to payment of any accrued but unpaid incentive bonus for the current fiscal year based on actual performance. If Mr. Devaney is terminated by the Company without Cause or Mr. Devaney terminates his employment for Good Reason, in addition to those rights described in the first sentence of this paragraph, Mr. Devaney will be entitled to payment of his base salary for six months following his termination, subject to Mr. Devaney signing a release, and receipt of health benefits for a period of six months following his termination or his attainment of alternative employment that provides health benefits, whichever is earlier. If Mr. Devaney is terminated within two years of a Change of Control of the Company without Cause or by Mr. Devaney for Good Reason, in addition to those rights described in the first sentence of this paragraph, Mr. Devaney will be entitled to payment of a pro-rata incentive bonus based on actual performance for the year of termination, payment of one and one-half times his annual base salary plus the greater of one and one-half times the targeted incentive bonus immediately prior to the termination or two times the average actual incentive bonus for the previous three years, subject to Mr. Devaney signing a release, receipt of health benefits for a period of eighteen months following his termination or his attainment of alternative employment that provides health benefits, whichever is earlier.

As used in the previous paragraph, (1) Cause means (i) any willful breach of duty by Mr. Devaney in the course of his employment or continued violation of written Company employment policies after written notice of such violation, (ii) violation of the Company’s insider trading policies, (iii) conviction of a felony or any crime involving fraud, theft, embezzlement, dishonesty or moral turpitude, (iv) engaging in activities which materially defame the Company, engaging in conduct which is material injurious to the Company or its affiliates, or any of their respective customer or supplier relationships, financially or otherwise, or (v) Mr. Devaney’s gross negligence or incapacity to perform duties, excluding Mr. Devaney’s total disability, (2) Good Reason means the occurrence of a material breach of the employment agreement by the Company, which breach is not cured within 15 calendar days after written notice thereof is received by the Company, or if within two years of a Change of Control, there is a reduction of Mr. Devaney’s total compensation, benefits, and perquisites, the Company’s relocation is greater than

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50 miles further from Mr. Devaney’s home, or a material change in Mr. Devaney’s position or duties, and (3) Change of Control means if there is a merger, consolidation, sale of all or a major portion of the assets of the Company (or a successor organization) or similar transaction or circumstance where any person or group (other than Douglas B. Otto) acquires or obtains the right to acquire, in one or more transactions, beneficial ownership of more than 50% of the outstanding shares of any class of voting stock of the Company (or a successor organization).

A copy of each of the employment agreements and the amendment described above is attached as Exhibit 10.1, Exhibit 10.2 and Exhibit 10.3, respectively, to this Current Report on Form 8-K.

Item 9.01. Financial Statements and Exhibits.


Exhibit No.		Description

10.1		Amendment No. 1 to Amended and Restated Employment Agreement between Deckers Outdoor Corporation and Douglas B. Otto

10.2		Senior Executive Employment Agreement between Deckers Outdoor Corporation and Constance X. Rishwain

10.3		Senior Executive Employment Agreement between Deckers Outdoor Corporation and Patrick C. Devaney

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SIGNATURE

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.


	Deckers Outdoor Corporation
Date: April 7, 2006	/s/ Zohar Ziv
	Zohar Ziv, Chief Financial Officer and Executive Vice President of Finance and Administration

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INDEX TO EXHIBITS


Exhibit No.		Description

10.1		Amendment No. 1 to Amended and Restated Employment Agreement between Deckers Outdoor Corporation and Douglas B. Otto

10.2		Senior Executive Employment Agreement between Deckers Outdoor Corporation and Constance X. Rishwain

10.3		Senior Executive Employment Agreement between Deckers Outdoor Corporation and Patrick C. Devaney

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EX-10.1 2 v19441exv10w1.htm EXHIBIT 10.1 exv10w1

Exhibit 10.1

AMENDMENT NO. 1
TO
AMENDED AND RESTATED EMPLOYMENT AGREEMENT

THIS AMENDMENT NO. 1 TO AMENDED AND RESTATED EMPLOYMENT AGREEMENT dated January 1, 2004 is made and entered into on April 11, 2005, by and between DOUGLAS B. OTTO (hereinafter referred to as the “Executive”) and DECKERS OUTDOOR CORPORATION, a Delaware Corporation (hereinafter referred to as the “Company”).

WHEREAS:

A. The Executive and the Company are parties to that certain Amended and Restated Employment Agreement dated January 1, 2004 (the “Agreement”); and

B. The parties wish to amend the Agreement in certain respects, which amendment shall be effective as of April 11, 2005.

NOW, THEREFORE, the parties hereto, intending to be legally bound, do hereby agree as follows:

1. Section 1.2. Section 1.2 of the Agreement is hereby amended to read as follows:

“The Executive will serve as the Chairman of the Board of Directors and will report to the Company’s Board of Directors.”

2. Section 2.1. Section 2.1 of the Agreement is amended to provide that, effective as of April 11, 2005, the Executive’s salary is reduced to ONE HUNDRED AND FOUR THOUSAND DOLLARS ($104,000) per annum, and the Executive’s salary for 2006 is FIFTY TWO THOUSAND DOLLARS ($52,000) per annum, with no bonuses or stock-based awards.

3. Sections 2.2 and 2.3. Sections 2.2, 2.3, 4.1(e), 4.2(e), 4.3(e), 4.4(e), 6.1(c) and 6.1(g) and Exhibit A of the Agreement are hereby deleted in their entirety.

4. Sections 4.1(f), 4.2(f), 4.3(f) and 4.4(f). Sections 4.1(f), 4.2(f), 4.3(f) and 4.4(f) of the Agreement are hereby amended to read as follows:

(f) pay the Executive severance of three (3) times the Executive’s annual Base Salary in effect immediately prior to the time such termination occurs, plus the greater of (x) three (3) times the annual targeted incentive bonus established by the Compensation Committee and in

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effect immediately prior to the time such termination occurs or (y) three (3) times the average actual annual incentive bonus for the previous three (3) years, whichever is greater. The severance payment required under this subsection shall be conditioned upon the Executive confirming the release in Section 5.2 hereof;

5. RATIFICATION OF AGREEMENT. In all other respects, the Agreement is hereby ratified, confirmed and approved.

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IN WITNESS WHEREOF, the parties hereto have executed this Amendment on the date hereinabove set forth.


		“Company”

		DECKERS OUTDOOR CORPORATION

		By:		/s/ Angel Martinez
				Name: Angel Martinez
				Title: President and CEO.

		Address:
		495-A South Fairview Avenue
		Goleta, CA 93117

		“Executive”

		/s/ Douglas B. Otto

		DOUGLAS B. OTTO

		Address:
		6746 Breakers Way
		Ventura, CA 93001

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EX-10.2 3 v19441exv10w2.htm EXHIBIT 10.2 exv10w2

Exhibit 10.2

SENIOR EXECUTIVE
EMPLOYMENT AGREEMENT

THIS SENIOR EXECUTIVE EMPLOYMENT AGREEMENT (the “Agreement”) is to be effective as of January 1, 2006 by and between DECKERS OUTDOOR CORPORATION, a Delaware corporation (the “Company”), and CONNIE RISHWAIN (the “Executive”).

ARTICLE I
DUTIES AND TERM

1.1 EMPLOYMENT. In consideration of their mutual covenants, Executive’s continued employment with the Company and other good and valuable consideration, the receipt, adequacy, and sufficiency of which is hereby acknowledged, the Company agrees to enter into this Agreement with the Executive, who is currently an employee of the Company on an “at will” basis, and the Executive agrees to enter into this Agreement and remain in the employ of the Company upon the terms and conditions herein provided and in accordance with all applicable employment rules of the Company.

1.2 POSITION AND RESPONSIBILITIES. The Executive will continue to serve in the Executive’s current position as Brand President for Simple and Ugg, and continue to report to the Executive’s current supervisor.

1.3 TERM. The term of the Executive’s employment under this Agreement will commence on the effective date of this Agreement as first written above and will continue, unless sooner terminated, until December 31, 2007. Employment of the Executive is at will and will continue until such time as written notice of termination is given by the Company or written notice is given by the Executive.

1.4 AT-WILL EMPLOYMENT. Executive will continue to be employed as an at-will employee of the Company. Subject to the provisions of Articles III and IV, as an at-will employee, Executive is free to terminate his/her employment with the Company at any time, for any reason, and the Company has the similar right to terminate Executive’s employment at any time, for any reason. Although the Company may choose to terminate Executive’s employment for cause, Executive’s employment is at-will and cause is not required.

1.5 REVIEW OF AGREEMENT. It is the parties intention that the terms of this Agreement will be reviewed prior to December 31, 2007 to determine whether any modifications are appropriate. This review of the Agreement terms may occur at an earlier or later date, is not mandatory and does not impose any binding obligations on either party.

ARTICLE II
COMPENSATION

For all services rendered by the Executive in any capacity during the Executive’s employment under this Agreement, the Company will compensate the Executive as follows:

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2.1 BASE SALARY. Effective as of January 1, 2006, and for a period of two (2) years thereafter, the Company will pay to the Executive an annual base salary of TWO HUNDRED TWENTY FIVE THOUSAND DOLLARS ($225,000) to be paid in equal installments in accordance with the Company’s general payment policies in effect during the term hereof (the “Base Salary”). Executive’s annual base salary may be reviewed prior to December 31, 2007 and appropriate adjustments to salary implemented. If Executive’s annual base salary is not revised effective January 1, 2008, her existing salary will continue on a monthly basis until changed. This provision does not alter the at-will nature of Executive’s employment or the provisions of Articles III and IV below.

2.2 INCENTIVE BONUS. The Executive shall be eligible to receive a targeted annual bonus based on performance criteria established annually by the Compensation Committee (the “Incentive Bonus”). The Incentive Bonus criteria for the year ending December 31, 2006 is set forth on Exhibit A hereto.

2.3 STOCK COMPENSATION. The Executive may be granted options to purchase shares of Company Common Stock or Restricted Stock Units to purchase shares of Company Common Stock in accordance with the Company’s Stock Option Plan. Any grants must be approved by the Compensation Committee.

2.4 ADDITIONAL BENEFITS. The Executive will be entitled to participate in all benefit and welfare programs, plans, and arrangements that are from time to time made available to the Company’s like-level executive employees.

ARTICLE III
TERMINATION OF EMPLOYMENT

3.1 GENERAL. While Executive is an at-will employee as provided at Section 1.3 above, the follow conditions for termination of employment are set forth in order to determine the nature of Executive compensation entitlement upon termination of employment as discussed in Article IV below. Neither the provisions of Article III or Article IV of this Agreement shall alter the at-will nature of Executive’s employment with the Company.

3.2 DEATH OR RETIREMENT OF EXECUTIVE. The Executive’s employment under this Agreement will automatically terminate upon the death or Retirement (as defined in Section 6.1) of the Executive.

3.3 BY EXECUTIVE. The Executive may terminate the Executive’s employment under this Agreement by giving Notice of Termination (as defined in Section 6.1 hereof) to the Company:

(a) for Good Reason (as defined in Section 6.1 hereof); and

(b) at any time without Good Reason.

3.4 BY COMPANY. The Company may terminate the Executive’s employment under this Agreement by giving Notice of Termination to the Executive:

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(a) in the event of Executive’s Total Disability (as defined in Section 6.1 hereof);

(b) for Cause (as defined in Section 6.1 hereof); and

ARTICLE IV
COMPENSATION UPON TERMINATION OF EMPLOYMENT

If the Executive’s employment hereunder is terminated, in accordance with the provisions of Article III hereof, and except for any other rights or benefits specifically provided for herein to be effective following the Executive’s period of employment, the Company will provide compensation and benefits to the Executive only as follows:

4.1 UPON TERMINATION FOR DEATH OR DISABILITY. If the Executive’s employment hereunder is terminated by reason of the Executive’s death or Total Disability, the Company will:

(a) pay the Executive (or the Executive’s estate) or beneficiaries any Base Salary that has accrued but was not paid as of the termination date (the “Accrued Base Salary”);

(b) pay the Executive (or the Executive’s estate) or beneficiaries for unused vacation days accrued as of the termination date in an amount equal to the Executive’s Base Salary multiplied by a fraction the numerator of which is the number of accrued unused vacation days and the denominator of which is 260 (the “Accrued Vacation Payment”);

(c) reimburse the Executive (or the Executive’s estate) or beneficiaries for expenses incurred by him prior to the date of termination that are subject to reimbursement pursuant to this Agreement (the “Accrued Reimbursable Expenses”);

(d) provide to the Executive (or the Executive’s estate) or beneficiaries any accrued and vested benefits required to be provided by the terms of any Company-sponsored benefit plans or programs (the “Accrued Benefits”), together with any benefits required to be paid or provided in the event of the Executive’s death or Total Disability under applicable law;

(e) pay the Executive (or the Executive’s estate) or beneficiaries any Incentive Bonus with respect to a prior fiscal year that has accrued but has not been paid together with any Accrued Incentive Bonus for the current fiscal year based upon actual performance (the “Accrued Incentive Bonus”); and

(f) the Executive (or the Executive’s estate) or beneficiaries shall have the right to exercise all vested unexercised stock options and warrants outstanding at the termination date in accordance with terms of the plans and agreements pursuant to which such options or warrants were issued.

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4.2 UPON TERMINATION BY COMPANY FOR CAUSE OR BY EXECUTIVE WITHOUT GOOD REASON. If the Executive’s employment is terminated by the Company for Cause, or if the Executive terminates the Executive’s employment with the Company other than (x) upon the Executive’s death or Total Disability or (y) for Good Reason, the Company will:

(a) pay the Executive the Accrued Base Salary;

(b) pay the Executive the Accrued Vacation Payment;

(d) pay the Executive the Accrued Benefits, together with any benefits required to be paid or provided under applicable law;

(e) pay the Executive any earned Accrued Incentive Bonus, but excluding any Accrued Incentive Bonus for the year of termination; and

(f) the Executive will have the right to exercise vested options and warrants in accordance with Section 4.1(f) hereof.

4.3 UPON TERMINATION BY THE COMPANY WITHOUT CAUSE OR BY EXECUTIVE FOR GOOD REASON. If the Executive’s employment is terminated by the Company without Cause or by the Executive for Good Reason, the Company will:

(a) pay the Executive the Accrued Base Salary;

(b) pay the Executive the Accrued Vacation Payment;

(d) pay the Executive the Accrued Benefits, together with any benefits required to be paid or provided under applicable law;

(e) pay the Executive any earned Accrued Incentive Bonus;

(f) pay the Executive severance, commencing on the thirtieth (30^th) day following the termination date, of six (6) monthly payments equal to one-twelfth (1/12^th) of the Executive’s Annual Base Salary in effect immediately prior to the time such termination occurs. Severance will be mitigated on a dollar for dollar basis for any income received by Executive for duties performed for Company or any third party during the six (6) months following termination. The severance payment required under this subsection shall be conditioned upon the Executive confirming the release in Section 5.2 hereof; and

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the six (6) month anniversary of termination of employment, the benefits provided pursuant to Company-sponsored benefit plans, programs, or other arrangements in which the Executive was entitled to participate as a full-time employee immediately prior to such termination in accordance with Section 2.4 hereof, subject to the terms and conditions of participation as provided under the general terms and provisions of such plans, programs, and arrangements, or in the alternate, the Company will arrange to provide the Executive with continued benefits substantially similar to those which the Executive would have been entitled to receive under such plans, programs, and arrangements;

(h) the Executive shall have the right to exercise vested options and warrants in accordance with Section 4.1(f).

4.4 UPON CHANGE OF CONTROL AND TERMINATION BY THE COMPANY WITHOUT CAUSE OR BY EXECUTIVE FOR GOOD REASON. If the Executive’s employment is terminated within two (2) years of a Change of Control by the Company without Cause or by the Executive for Good Reason, the Company will:

(a) pay the Executive the Accrued Base Salary;

(b) pay the Executive the Accrued Vacation Payment;

(d) pay the Executive the Accrued Benefits, together with any benefits required to be paid or provided under applicable law;

(e) pay the Executive any Accrued Incentive Bonus; plus the pro rata Incentive Bonus based on actual performance for the year of termination.

(f) pay the Executive severance of one and one-half (1.5) times Executive’s Annual Base Salary in effect immediately prior to the time such termination occurs plus the greater of (x) one and one-half (1.5) times the targeted Incentive Bonus immediately prior to the time such termination occurs or (y) one and one-half (1.5) times the average actual Incentive Bonus for the previous three (3) years, whichever is greater. The severance payment required under this subsection shall be conditioned upon the Executive confirming the release in Section 5.2 hereof;

(g) maintain in full force and effect, for the Executive’s and the Executive’s eligible beneficiaries, until the first to occur of (x) the Executive’s attainment of alternative employment if such employment includes health insurance benefits or (y) the eighteen (18) month anniversary of termination, the benefits provided pursuant to Company-sponsored benefit plans, programs, or other arrangements in which the Executive was entitled to participate as a full-time employee immediately prior to such termination in accordance with Section 2.4 hereof, subject to the terms and conditions of participation as provided under the general terms and provisions of such plans, programs, and arrangements, or in the alternate, the Company will arrange to provide the Executive

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with continued benefits substantially similar to those which the Executive would have been entitled to receive under such plans, programs, and arrangements;

(h) any payments will be grossed up for Internal Revenue Code Section 280G excise tax penalty on “excess parachute payments;” and

(i) the Executive shall have the right to exercise vested options and warrants in accordance with Section 4.1(f).

ARTICLE V
ADDITIONAL AGREEMENTS

5.1 OTHER AGREEMENTS. As further material consideration for the Company entering into this Agreement, the Executive will also execute the Company’s standard employee confidentially agreement, inventions assignment agreement, and any other agreements required to be executed by all like level executives of the Company.

5.2 EMPLOYEE’S RESTRICTIVE COVENANTS UPON TERMINATION. If the Executive’s employment is terminated for any reason, Executive agrees:

(a) To keep all of the Company’s Confidential Information confidential in perpetuity in accordance with the Company’s policy;

(b) To not hire or solicit for hire or consultation employees of the Company for a period of one and one-half (1 1/2) years after termination of employment; and

(c) To release the Company from any and all claims, whether known or unknown, except for those based upon this Agreement. Such release shall include the rights of Section 1542 of the California Civil Code, which provides:

“A general release does not extend to claims which the creditor does not know or suspect to exist in the Executive’s favor at the time of executing the release, which if known by him must have materially affected the Executive’s settlement with the debtor.”

ARTICLE VI
MISCELLANEOUS

6.1 DEFINITIONS. For purposes of this Agreement, the following terms will have the following meanings:

(a) “Accrued Base Salary” — as defined in Section 4.1(a) hereof.

(b) “Accrued Benefits” — as defined in Section 4.1(d) hereof.

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(d) “Accrued Reimbursable Expenses” — as defined in Section 4.1(c) hereof.

(e) “Accrued Vacation Payment” — as defined in Section 4.1(b) hereof.

(f) “Affiliate” of a Person means a Person that directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, the first Person. “Control” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ownership of voting securities, by contract or credit arrangement, as trustee or executor, or otherwise.

(g) “Incentive Bonus” as defined in Section 2.2 hereof.

(h) “Base Salary” as defined in Section 2.1 hereof.

(i) “Cause” will mean any willful breach of duty by the Executive in the course of the Executive’s employment, continued violation of written Company employment policies after written notice of such violation, violation of the Company’s Insider Trading Policies, conviction of a felony or any crime involving fraud, theft, embezzlement, dishonesty or moral turpitude, engaging in activities which materially defame the Company, engaging in conduct which is material injurious to the Company or its Affiliates, or any of their respective customer or supplier relationships, financially or otherwise, or the Executive’s gross negligence or continued failure to perform Executive’s duties or his/her continued incapacity to perform such duties.

(j) “Change of Control” will mean if there is a merger, consolidation, sale of all or a major portion of the assets of the Company (or a successor organization) or similar transaction or circumstance where any person or group (other than Douglas B. Otto) acquires or obtains the right to acquire, in one or more transactions, beneficial ownership of more than Fifty Percent (50%) of the outstanding shares of any class of voting stock of the Company (or a successor organization).

(k) “Compensation Committee” means the Compensation Committee of the Company’s Board of Directors.

(l) “Continued Benefits” as defined in Section 4.3(g) hereof.

(m) “Good Reason” will mean (1) the occurrence of material breach of this Agreement by the Company, which breach is not cured within fifteen (15) calendar days after written notice thereof is received by the Company, or (2) if within two (2) years of a Change of Control, there is a reduction of the Employee’s total compensation, benefits, and perquisites, the Company’s relocation is greater than fifty (50) miles further from the Employee’s home, or a material change in the Employee’s position or duties.

(n) “Notice of Termination” will mean a notice which shall indicate the specific termination provision of this Agreement relied upon and shall generally set

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forth the basis for termination of the Executive’s employment under the provision so indicated.

(o) “Person” means any natural person, firm, partnership, association, corporation, company, limited liability company, limited partnership, trust, business trust, governmental authority, or other entity.

(p) “Retirement” will mean normal retirement at age 65.

(q) “Severance” will mean payments after termination of Executive’s employment.

(r) “Total Disability” will mean the Executive’s failure substantially to perform the Executive’s duties hereunder on a full-time basis for a period exceeding one hundred eighty (180) consecutive days or for periods aggregating more than one hundred eighty (180) days during any twelve (12) month period as a result of incapacity due to physical or mental illness. If there is a dispute as to whether the Executive is or was physically or mentally unable to perform the Executive’s duties under this Agreement, such dispute will be submitted for resolution to a licensed physician agreed upon by the Company and the Executive, or if an agreement cannot be promptly reached, the Company and the Executive will promptly each select a physician, and if these physicians cannot agree, the physicians will promptly select a third physician whose decision will be binding on all parties. If such a dispute arises, the Executive will submit to such examinations and will provide such information as such physician(s) may request, and the determination of the physician(s) as to the Executive’s physical or mental condition will be binding and conclusive. Notwithstanding the foregoing, if the Executive participates in any group disability plan provided by the Company, which offers long-term disability benefits, “Total Disability” will mean total disability as defined therein.

6.2 KEY MAN INSURANCE. The Company will have the right, in its sole discretion, to purchase “key man” insurance on the life of the Executive. The Company shall be the owner and beneficiary of any such policy. If the Company elects to purchase such a policy, the Executive will take such physical examinations and supply such information as may be reasonably requested by the insurer.

6.3 SUCCESSORS; BINDING AGREEMENT. This Agreement will be binding upon any successor to the Company and will inure to the benefit of and be enforceable by the Executive’s personal or legal representatives, beneficiaries, designees, executors, administrators, heirs, distributees, devisees and legatees.

6.4 MODIFICATION; NO WAIVER. This Agreement may not be modified or amended except by an instrument in writing signed by the parties hereto. No term or condition of this Agreement will be deemed to have been waived, nor will there be any estoppel against the enforcement of any provision of this Agreement, except by written instrument by the party charged with such waiver or estoppel. No such written waiver will be deemed a continuing waiver unless specifically stated therein, and each such waiver will operate only as to the specific

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term or condition waived and will not constitute a waiver of such term or condition for the future or as to any other term or condition.

6.5 SEVERABILITY. The covenants and agreements contained herein are separate and severable and the invalidity or unenforceability of any one or more of such covenants or agreements, if not material to the employment arrangement that is the basis for this Agreement, will not affect the validity or enforceability of any other covenant or agreement contained herein.

6.6 FORM OF NOTICE TO PARTIES. All notices, requests, demands, waivers and other communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given if (a) delivered personally, (b) mailed by first-class, registered or certified mail, return receipt requested, postage prepaid, or (c) sent by next-day or overnight mail or delivery or (d) sent by telecopy or telegram, to the following address:


		If to Executive:		Connie Rishwain
				1486 Corsica Drive
				Santa Maria, CA 93455

		If to Company:		Deckers Outdoor Corporation
				495-A South Fairview Avenue
				Goleta, CA 93117
				Attn: Angel Martinez
				Facsimile #805-681-9886

or, in each case, at such other address as may be specified in writing to the other parties hereto.

All such notices, requests, demands, waivers and other communications shall be deemed to have been received (w) if by personal delivery on the day after such delivery, (x) if by certified or registered mail, on the seventh business day after the mailing thereof, (y) if by next-day or overnight mail or delivery, on the day delivered, (z) if by telecopy or telegram, on the next day following the day on which such telecopy or telegram was sent, provided that a copy is also sent by certified or registered mail.

6.7 ASSIGNMENT. This Agreement and any rights hereunder will not be assignable by either party without the prior written consent of the other party except as otherwise specifically provided for herein.

6.8 ENTIRE UNDERSTANDING. This Agreement constitutes the entire understanding between the parties hereto and no agreement, representation, warranty or covenant has been made by either party except as expressly set forth herein.

6.9 EXECUTIVE’S REPRESENTATIONS. The Executive represents and warrants that neither the execution and delivery of this Agreement nor the performance of the Executive’s duties hereunder violates the provisions of any other agreement to which he is a party or by which he is bound.

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6.10 GOVERNING LAW . This Agreement will be construed in accordance with the laws of the State of California, without regard to the conflict of laws provisions thereof, with venue proper only in the County of Santa Barbara, California.

6.11 ARBITRATION.

(a) Except as provided in Section 6.11(c) below, the parties hereto agree that any dispute or controversy arising out of, relating to, or in connection with this Agreement, or the interpretation, validity, construction, performance, breach, or termination thereof, shall be finally settled by binding arbitration, unless otherwise required by law, to be held in Santa Barbara, California under the National Rules for the Resolution of Employment Disputes of the American Arbitration Association as then in effect (the “Rules”). The arbitrator(s) may grant injunctions or other relief in such dispute or controversy. The decision of the arbitrator(s) shall be final, conclusive and binding on the parties to the arbitration, and judgment may be entered on the decision of the arbitrator(s) in any court having jurisdiction.

(b) The arbitrator(s) shall apply California law to the merits of any dispute or claim, without reference to rules of conflicts of law.

(c) The parties may apply to any court of competent jurisdiction for a temporary restraining order, preliminary injunction, or other interim or conservatory relief, as necessary, without breach of this arbitration agreement and without abridgement of the powers of the arbitrator.

(d) EMPLOYEE HAS READ AND UNDERSTANDS THIS SECTION, WHICH DISCUSSES ARBITRATION. EMPLOYEE UNDERSTANDS THAT BY SIGNING THIS AGREEMENT, EMPLOYEE AGREES TO SUBMIT ANY CLAIMS ARISING OUT OF, RELATING TO, OR IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION, VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH OR TERMINATION THEREOF TO BINDING ARBITRATION, UNLESS OTHERWISE REQUIRED BY LAW, AND THAT THIS ARBITRATION CLAUSE CONSTITUTES A WAIVER OF EMPLOYEE’S RIGHT TO A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO EMPLOYEE’S RELATIONSHIP WITH THE COMPANY, INCLUDING BUT NOT LIMITED TO, CLAIMS OF HARASSMENT, DISCRIMINATION, WRONGFUL TERMINATION AND ANY STATUTORY CLAIMS.

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


COMPANY: DECKERS OUTDOOR CORPORATION
By:	/s/ Angel Martinez
	Name:	Angel Martinez Date: April 3, 2006
	Title:	Chief Executive Officer


	EXECUTIVE:
	/s/ Constance Rishwain
	Name:	Connie Rishwain Date: April 3, 2006
	Title:	Brand President, Simple and UGG

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EXHIBIT A

SENIOR EXECUTIVE EMPLOYMENT AGREEMENT

2006 Incentive Bonus Criteria

Executive: Connie Rishwain

Target bonus: Potential 100% of base salary @ 100% level

Incentive Bonus Allocation:

Incentive bonus to be calculated and paid in accordance with the attached Exhibit B.

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EXHIBIT B

SENIOR EXECUTIVE EMPLOYMENT AGREEMENT

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EX-10.3 4 v19441exv10w3.htm EXHIBIT 10.3 exv10w3

Exhibit 10.3

SENIOR EXECUTIVE
EMPLOYMENT AGREEMENT

ARTICLE I
DUTIES AND TERM

1.2 POSITION AND RESPONSIBILITIES. The Executive will continue to serve in the Executive’s current position as Senior Vice President of Global Sourcing and Production, and continue to report to the Executive’s current supervisor.

ARTICLE II
COMPENSATION

For all services rendered by the Executive in any capacity during the Executive’s employment under this Agreement, the Company will compensate the Executive as follows:

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2.1 BASE SALARY. Effective as of January 1, 2006, and for a period of two (2) years thereafter, the Company will pay to the Executive an annual base salary of TWO HUNDRED THOUSAND DOLLARS ($200,000) to be paid in equal installments in accordance with the Company’s general payment policies in effect during the term hereof (the “Base Salary”). Executive’s annual base salary may be reviewed prior to December 31, 2007 and appropriate adjustments to salary implemented. If Executive’s annual base salary is not revised effective January 1, 2008, his existing salary will continue on a monthly basis until changed. This provision does not alter the at-will nature of Executive’s employment or the provisions of Articles III and IV below.

ARTICLE III
TERMINATION OF EMPLOYMENT

3.2 DEATH OR RETIREMENT OF EXECUTIVE. The Executive’s employment under this Agreement will automatically terminate upon the death or Retirement (as defined in Section 6.1) of the Executive.

3.3 BY EXECUTIVE. The Executive may terminate the Executive’s employment under this Agreement by giving Notice of Termination (as defined in Section 6.1 hereof) to the Company:

(a) for Good Reason (as defined in Section 6.1 hereof); and

(b) at any time without Good Reason.

3.4 BY COMPANY. The Company may terminate the Executive’s employment under this Agreement by giving Notice of Termination to the Executive:

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(a) in the event of Executive’s Total Disability (as defined in Section 6.1 hereof);

(b) for Cause (as defined in Section 6.1 hereof); and

ARTICLE IV
COMPENSATION UPON TERMINATION OF EMPLOYMENT

4.1 UPON TERMINATION FOR DEATH OR DISABILITY. If the Executive’s employment hereunder is terminated by reason of the Executive’s death or Total Disability, the Company will:

(a) pay the Executive (or the Executive’s estate) or beneficiaries any Base Salary that has accrued but was not paid as of the termination date (the “Accrued Base Salary”);

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(a) pay the Executive the Accrued Base Salary;

(b) pay the Executive the Accrued Vacation Payment;

(d) pay the Executive the Accrued Benefits, together with any benefits required to be paid or provided under applicable law;

(e) pay the Executive any earned Accrued Incentive Bonus, but excluding any Accrued Incentive Bonus for the year of termination; and

(f) the Executive will have the right to exercise vested options and warrants in accordance with Section 4.1(f) hereof.

(a) pay the Executive the Accrued Base Salary;

(b) pay the Executive the Accrued Vacation Payment;

(d) pay the Executive the Accrued Benefits, together with any benefits required to be paid or provided under applicable law;

(e) pay the Executive any earned Accrued Incentive Bonus;

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(h) the Executive shall have the right to exercise vested options and warrants in accordance with Section 4.1(f).

(a) pay the Executive the Accrued Base Salary;

(b) pay the Executive the Accrued Vacation Payment;

(d) pay the Executive the Accrued Benefits, together with any benefits required to be paid or provided under applicable law;

(e) pay the Executive any Accrued Incentive Bonus; plus the pro rata Incentive Bonus based on actual performance for the year of termination.

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with continued benefits substantially similar to those which the Executive would have been entitled to receive under such plans, programs, and arrangements;

(h) any payments will be grossed up for Internal Revenue Code Section 280G excise tax penalty on “excess parachute payments;” and

(i) the Executive shall have the right to exercise vested options and warrants in accordance with Section 4.1(f).

ARTICLE V
ADDITIONAL AGREEMENTS

5.2 EMPLOYEE’S RESTRICTIVE COVENANTS UPON TERMINATION. If the Executive’s employment is terminated for any reason, Executive agrees:

(a) To keep all of the Company’s Confidential Information confidential in perpetuity in accordance with the Company’s policy;

(b) To not hire or solicit for hire or consultation employees of the Company for a period of one and one-half (1 1/2) years after termination of employment; and

ARTICLE VI
MISCELLANEOUS

6.1 DEFINITIONS. For purposes of this Agreement, the following terms will have the following meanings:

(a) “Accrued Base Salary” — as defined in Section 4.1(a) hereof.

(b) “Accrued Benefits” — as defined in Section 4.1(d) hereof.

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(d) “Accrued Reimbursable Expenses” — as defined in Section 4.1(c) hereof.

(e) “Accrued Vacation Payment” — as defined in Section 4.1(b) hereof.

(g) “Incentive Bonus” as defined in Section 2.2 hereof.

(h) “Base Salary” as defined in Section 2.1 hereof.

(k) “Compensation Committee” means the Compensation Committee of the Company’s Board of Directors.

(l) “Continued Benefits” as defined in Section 4.3(g) hereof.

(n) “Notice of Termination” will mean a notice which shall indicate the specific termination provision of this Agreement relied upon and shall generally set

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forth the basis for termination of the Executive’s employment under the provision so indicated.

(p) “Retirement” will mean normal retirement at age 65.

(q) “Severance” will mean payments after termination of Executive’s employment.

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term or condition waived and will not constitute a waiver of such term or condition for the future or as to any other term or condition.


		If to Executive:		Pat Devaney
				4523 Vieja Drive
				Santa Barbara, CA 93110

		If to Company:		Deckers Outdoor Corporation
				495-A South Fairview Avenue
				Goleta, CA 93117
				Attn: Angel Martinez
				Facsimile #805-681-9886

or, in each case, at such other address as may be specified in writing to the other parties hereto.

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6.10 GOVERNING LAW. This Agreement will be construed in accordance with the laws of the State of California, without regard to the conflict of laws provisions thereof, with venue proper only in the County of Santa Barbara, California.

6.11 ARBITRATION.

(b) The arbitrator(s) shall apply California law to the merits of any dispute or claim, without reference to rules of conflicts of law.

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


		COMPANY:

		DECKERS OUTDOOR CORPORATION

		By:		/s/ Angel Martinez

		Name:		Angel Martinez Date: April 3, 2006
		Title:		Chief Executive Officer

		EXECUTIVE:

		/s/ Patrick Devaney

		Name: Pat Devaney Date: April 3, 2006
		Title: Senior Vice President of Global Sourcing and
		Production

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EXHIBIT A

SENIOR EXECUTIVE EMPLOYMENT AGREEMENT

2006 Incentive Bonus Criteria

Executive: Pat Devaney

Target bonus: Potential 67% of base salary @ 100% level

Incentive Bonus Allocation:

60% Company Profit Component
40% Management Business Objective (MBO) Component
100%

Incentive bonus to be calculated and paid in accordance with the attached Exhibit B.

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EXHIBIT B

SENIOR EXECUTIVE EMPLOYMENT AGREEMENT

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-----END PRIVACY-ENHANCED MESSAGE-----

Company Profit Component

Management Business Objective (MBO) Component