Exhibit 10.3

May 25, 2005

PERSONAL AND CONFIDENTIAL

Charles S. Exon, Esq.
c/o Quiksilver, Inc.
15202 Graham Street
Huntington Beach, California 92649

Re:     Employment at Quiksilver, Inc.

Dear Charlie:

     This letter (“Agreement”) will confirm our understanding and agreement
regarding your continued employment with Quiksilver, Inc. (“Quiksilver” or the
“Company”). This Agreement is effective May 25, 2005, and completely supersedes
and replaces any existing or previous oral or written understandings or
agreements, express or implied, between you and the Company regarding your
employment, including, without limitation, the August 1, 2004 agreement.

  1.   Position; Exclusivity. The Company hereby agrees to employ you as its
Executive Vice President, Business and Legal Affairs-International, reporting to
the President or Chief Executive Officer. During your employment with
Quiksilver, you will devote your full professional and business time, interest,
abilities and energies to the Company and will not render any services to any
other person or entity, whether for compensation or otherwise, or engage in any
business activities competitive with or adverse to the Company’s business or
welfare, whether alone, as an employee, as an attorney, as a partner, as a
member, or as a shareholder, officer or director of any other corporation, or as
a trustee, fiduciary or in any other similar representative capacity of any
other entity. The Company agrees that you will be insured against, indemnified
or otherwise covered for legal malpractice or similar claims that may arise out
of your carrying out your duties and responsibilities hereunder.     2.   Base
Salary. Your base salary, retroactive to November 1, 2004, will be $33,333.33
per month ($400,000 on an annualized basis), less applicable withholdings and
deductions, paid on the Company’s regular payroll dates. Your salary will be
reviewed at the time management salaries are reviewed periodically and may be
adjusted (but not below $33,333.33 per month) at the Company’s discretion in
light of the Company’s performance, your performance, market conditions and
other factors deemed relevant by the Company.

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  3.   Bonus. For the fiscal year ending October 31, 2005 and each fiscal year
thereafter, you shall be eligible to receive a discretionary bonus under the
terms approved by the Board of Directors for such bonus. Any such bonus shall be
paid within thirty (30) days following the date the Company publicly releases
its annual audited financial statements (the “Bonus Payment Date”). In the event
that your employment with the Company terminates prior to the end of the
applicable fiscal year, your eligibility to receive a pro rata portion of the
bonus is governed by Paragraph 9 below. Any bonus payments shall be less
applicable withholdings and deductions.     4.   Vacation. Since Quiksilver does
not have a vacation policy for executives of your level, no vacation days will
be treated as earned or accrued.     5.   Health and Disability Insurance. You
(and any eligible dependents you elect) will be covered by the Company’s group
health insurance programs on the same terms and conditions applicable to
comparable employees. You will also be covered by the long-term disability plan
for senior executives on the same terms and conditions applicable to comparable
employees. The Company reserves the right to change, modify, or eliminate such
coverages in its discretion.     6.   Clothing Allowance. You will be provided a
clothing allowance of $4,000 per year at the Company’s wholesale prices.    
7.   Stock Options. You shall continue to be a participant in Quiksilver’s Stock
Incentive Plan, or any successor equity plan. The amount and terms of any
restricted stock, stock options, stock appreciation rights or other interests to
be granted to you will be determined by the Board of Directors in its discretion
and covered in separate agreements, but shall be substantially similar to those
granted to other senior executives of Quiksilver of equivalent level. Stock
options granted to you after the date hereof through the termination of your
employment shall provide that if you are terminated by the Company without Cause
(as hereinafter defined), as a result of your death or permanent disability, or
you terminate your employment for Good Reason (as hereinafter defined), any such
options outstanding will automatically vest in full on an accelerated basis so
that the options will immediately prior to such termination become exercisable
for all option shares and remain exercisable until the earlier to occur of
(i) the first anniversary of such termination, (ii) the end of the option term,
or (iii) termination pursuant to other provisions of the applicable option plan
or agreement (e.g., a corporate transaction).     8.   Life Insurance. The
Company will pay the premium on a term life insurance policy on your life with a
company and policy of our choice, and a beneficiary of your choice, in the face
amount determined by the

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      Company of not less than $2,000,000. Our obligation to obtain and maintain
this insurance is contingent upon your establishing and maintaining
insurability, and we are not required to pay premiums for such a policy in
excess of $5,000 annually.     9.   Unspecified Term; At Will Employment;
Termination.         (a) Notwithstanding anything to the contrary in this
Agreement or in your prior employment relationship with the Company, express or
implied, your employment is for an unspecified term and either you or Quiksilver
may terminate your employment at will and with or without Cause (as defined
below) or notice at any time for any reason; provided, however, that you agree
to provide the Company with thirty (30) days advance written notice of your
resignation (during which time the Company may elect, in its discretion, to
relieve you of all duties and responsibilities). This at-will aspect of your
employment relationship can only be changed by an individualized written
agreement signed by both you and an authorized officer of the Company.        
(b) The Company may also terminate your employment immediately, without notice,
for Cause, which shall include, but not be limited to, (i) your death, (ii) your
permanent disability which renders you unable to perform your duties and
responsibilities for a period in excess of three consecutive months,
(iii) willful misconduct in the performance of your duties, (iv) commission of a
felony or violation of law involving moral turpitude or dishonesty,
(v) self-dealing, (vi) willful breach of duty, (vii) habitual neglect of duty,
or (viii) a material breach by you of your obligations under this Agreement. If
the Company terminates your employment for Cause, or you terminate your
employment other than for Good Reason (as defined below), you (or your estate or
beneficiaries in the case of your death) shall receive your base salary and
other benefits earned and accrued prior to the termination of your employment
and, in the case of a termination pursuant to subparagraphs (i) or (ii) only, a
pro rata portion of your bonus, if any, as provided in Paragraph 3 for the
fiscal year in which such termination occurs, less applicable withholdings and
deductions, and you shall have no further rights to any other compensation or
benefits hereunder on or after the termination of your employment.         (c)
If Quiksilver elects to terminate your employment without Cause, or if you
terminate your employment with the Company for Good Reason within six (6) months
of the action constituting Good Reason, the Company will (i) continue to pay
your base salary (but not any employment benefits) on its regular payroll dates
for a period of eighteen (18) months, (ii) pay you a pro rata portion of a bonus
adopted pursuant to Paragraph 3, if any, for the fiscal year in which such
termination occurs, less applicable

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      withholdings and deductions, and (iii) pay you an amount equal to two (2)
times the average annual bonus earned by you pursuant to Paragraph 3 during the
two (2) most recently completed fiscal years of the Company, payable over an
eighteen (18) month period following termination in equal installments on the
Company’s regular payroll dates, less applicable withholdings and deductions.
Notwithstanding the foregoing, if such termination without Cause or for Good
Reason occurs within twelve (12) months immediately following a Change of
Control (as defined in Addendum “A”), the Company will instead (i) continue to
pay your base salary (but not any employment benefits) on its regular payroll
dates for a period of twenty-four (24) months, (ii) pay you a pro rata portion
of a bonus, if any, for the fiscal year in which such termination occurs, less
applicable withholdings and deductions, and (iii) pay you an amount equal to two
(2) times the average annual bonus earned by you pursuant to Paragraph 3 during
the two (2) most recently completed fiscal years of the Company, payable over a
twenty-four (24) month period following termination in equal installments on the
Company’s regular payroll dates, less applicable withholdings and deductions. In
order for you to be eligible to receive the payments specified in this
Paragraph 9(c), you must execute a general release of claims in a form
reasonably acceptable to the Company. You shall have no further rights to any
other compensation or benefits hereunder on or after the termination of your
employment. You shall not have a duty to seek substitute employment, and the
Company shall not have the right to offset any compensation due you against any
compensation or income received by you after the date of such termination.    
    “Good Reason” for you to terminate employment means a voluntary termination
as a result of (i) the assignment to you of duties materially inconsistent with
your position as set forth above without your consent, (ii) a material change in
your reporting level from that set forth in this Agreement without your consent,
(iii) a material diminution of your authority without your consent, (iv) a
material breach by the Company of its obligations under this Agreement, (v) a
failure by the Company to obtain from any successor, before the succession takes
place, an agreement to assume and perform the obligations contained in this
Agreement, or (vi) the Company requiring you to be based (other than
temporarily) at any office or location outside of the Southern California area
without your consent. Notwithstanding the foregoing, Good Reason shall not exist
unless you provide the Company notice of termination on account thereof and, if
such event or condition is curable, the Company fails to cure such event or
condition within thirty (30) days of such notice.         (d) In the event that
any payment or benefit received or to be received by you (collectively, the
“Payments”) would constitute a parachute payment within the meaning of
Section 280G of the Internal

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      Revenue Code of 1986, as amended (the “Code”), then the following
limitation shall apply:         The aggregate present value of those Payments
shall be limited in amount to the greater of the following dollar amounts (the
“Benefit Limit”):         (i) 2.99 times your Average Compensation (as defined
below), or (ii) the amount which yields you the greatest after-tax amount of
Payments under this Agreement after taking into account any excise tax imposed
under Code Section 4999 on those Payments.         The present value of the
Payments will be measured as of the date of the Change in Control and determined
in accordance with the provisions of Code Section 280G(d)(4).         Average
Compensation means the average of your W-2 wages from the Company for the five
(5) calendar years completed immediately prior to the calendar year in which the
Change in Control is effected. Any W-2 wages for a partial year of employment
will be annualized, in accordance with the frequency which such wages are paid
during such partial year, before inclusion in Average Compensation.     10.  
Trade Secrets; Confidential and/or Proprietary Information. The Company owns
certain trade secrets and other confidential and/or proprietary information
which constitute valuable property rights, which it has developed through a
substantial expenditure of time and money, which are and will continue to be
utilized in the Company’s business and which are not generally known in the
trade. This proprietary information includes the list of names of the customers
and suppliers of Quiksilver, and other particularized information concerning the
products, finances, processes, material preferences, fabrics, designs, material
sources, pricing information, production schedules, sales and marketing
strategies, sales commission formulae, merchandising strategies, order forms and
other types of proprietary information relating to our products, customers and
suppliers. You agree that you will not disclose and will keep strictly secret
and confidential all trade secrets and proprietary information of the Company,
including, but not limited to, those items specifically mentioned above.    
11.   Expense Reimbursement. The Company will reimburse you for documented
reasonable and necessary business expenses incurred by you while engaged in
business activities for the Company’s benefit on such terms and conditions as
shall be generally available to other executives of the Company.

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  12.   Compliance With Business Policies. You will devote your full business
time and attention to Quiksilver and will not be involved in other business
ventures without written authorization from the Company’s Board of Directors.
You will be required to observe the Company’s personnel and business policies
and procedures as they are in effect from time to time. In the event of any
conflicts, the terms of this Agreement will control.     13.   Entire Agreement.
This Agreement, its addenda, and any stock option agreements the Company may
enter into with you contain the entire integrated agreement between us regarding
these issues, and no modification or amendment to this Agreement will be valid
unless set forth in writing and signed by both you and an authorized officer of
the Company.     14.   Arbitration as Exclusive Remedy. To the fullest extent
allowed by law, any controversy, claim or dispute between you and the Company
(and/or any of its affiliates, owners, shareholders, directors, officers,
employees, volunteers or agents) relating to or arising out of your employment
or the cessation of that employment will be submitted to final and binding
arbitration in Orange County, California, for determination in accordance with
the American Arbitration Association’s (“AAA”) National Rules for the Resolution
of Employment Disputes, as the exclusive remedy for such controversy, claim or
dispute. In any such arbitration, the parties may conduct discovery to the same
extent as would be permitted in a court of law. The arbitrator shall issue a
written decision, and shall have full authority to award all remedies which
would be available in court. The Company shall pay the arbitrator’s fees and any
AAA administrative expenses. Any judgment upon the award rendered by the
arbitrator(s) may be entered in any court having jurisdiction thereof. Possible
disputes covered by the above include (but are not limited to) unpaid wages,
breach of contract, torts, violation of public policy, discrimination,
harassment, or any other employment-related claims under laws including but not
limited to, Title VII of the Civil Rights Act of 1964, the Americans With
Disabilities Act, the Age Discrimination in Employment Act, the California Fair
Employment and Housing Act, the California Labor Code and any other statutes or
laws relating to an employee’s relationship with his/her employer, regardless of
whether such dispute is initiated by the employee or the Company. Thus, this
bilateral arbitration agreement fully applies to any and all claims that the
Company may have against you, including (but not limited to) claims for
misappropriation of Company property, disclosure of proprietary information or
trade secrets, interference with contract, trade libel, gross negligence, or any
other claim for alleged wrongful conduct or breach of the duty of loyalty.
Nevertheless, claims for workers’ compensation benefits or unemployment
insurance, those arising under the National Labor Relations Act, and any other
claims where mandatory arbitration is prohibited by law, are not covered by this
arbitration

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      agreement, and such claims may be presented by either the Company or you
to the appropriate court or government agency. BY AGREEING TO THIS BINDING
ARBITRATION PROVISION, BOTH YOU AND THE COMPANY GIVE UP ALL RIGHTS TO TRIAL BY
JURY. This mutual arbitration agreement is to be construed as broadly as is
permissible under applicable law.     15.   Successors and Assigns. This
Agreement will be assignable by the Company to any successor or to any other
company owned or controlled by the Company, and will be binding upon any
successor to the business of the Company, whether direct or indirect, by
purchase of securities, merger, consolidation, purchase of all or substantially
all of the assets of the Company or otherwise.

Please sign and return the enclosed copy of this letter to me for our files to
acknowledge your agreement with the above.

     
 
  Very truly yours,  
 
   

  /s/ Robert B. McKnight, Jr.

  Robert B. McKnight, Jr.

  Chief Executive Officer  
 
   

  /s/ Bernard Mariette

  Bernard Mariette

  President

Enclosure

ACKNOWLEDGED AND AGREED:

     
/s/ Charles S. Exon
   
Charles S. Exon
   

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ADDENDUM A

DEFINITION OF CHANGE IN CONTROL

     “Change in Control” means the occurrence of one or more of the following
events: (i) any corporation, partnership, person, other entity, or group (as
defined in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended)
(collectively, a “Person”) acquires shares of capital stock of the Company
representing more than 50% of the total number of shares of capital stock that
may be voted for the election of directors of the Company, (ii) a merger,
consolidation, or other business combination of the Company with or into another
Person is consummated, or all or substantially all of the assets of the Company
are acquired by another Person, as a result of which the stockholders of the
Company immediately prior to the consummation of such transaction own,
immediately after consummation of such transaction equity securities possessing
less than 50% of the voting power of the surviving or acquiring Person (or any
Person in control of the surviving or acquiring Person, the equity securities of
which are issued or transferred in such transaction), or (iii) the stockholders
of the Company approve a plan of complete liquidation, dissolution or winding up
of the Company.

-Addendum A-