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 JANICE HOWELL (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 Vice President of Operations, 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:
          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 ONE

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HUNDRED FIFTY THOUSAND DOLLARS ($150,000) 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:
     (a) in the event of Executive’s Total Disability (as defined in Section 6.1
hereof);

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     (b) for Cause (as defined in Section 6.1 hereof); and
     (c) at any time without Cause.
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.
          4.2 UPON TERMINATION BY COMPANY FOR CAUSE OR BY EXECUTIVE WITHOUT GOOD
REASON. If the Executive’s employment is terminated by

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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;
     (c) pay the Executive the Accrued Reimbursable Expenses;
     (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;
     (c) pay the Executive the Accrued Reimbursable Expenses;
     (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 (30th) day
following the termination date, of six (6) monthly payments equal to one-twelfth
(1/12th) 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
     (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 six (6) month anniversary of termination of
employment, the benefits provided pursuant to Company-sponsored benefit plans,
programs, or other arrangements in which

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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;
     (c) pay the Executive the Accrued Reimbursable Expenses;
     (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 with continued benefits substantially similar to those
which the Executive would have been entitled to receive under such plans,
programs, and arrangements;

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

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

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     (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 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.

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          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:         Janice Howell               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   4/18/06
 
       
 
  Name:   Angel Martinez   Date
 
  Title:   Chief Executive Officer    
 
           
 
  EXECUTIVE:

   
 
  /s/ Janice Howell   4/18/06
 
   
 
  Name:   Janice Howell   Date
 
  Title:   Vice President of Operations    

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EXHIBIT A
TO
SENIOR EXECUTIVE EMPLOYMENT AGREEMENT
2006 Incentive Bonus Criteria

     
Executive:
  Janice Howell
 
   
Target bonus:
  Potential 50% 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
TO
SENIOR EXECUTIVE EMPLOYMENT AGREEMENT

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