EX-10.1






Exhibit 10.1




March 5, 2007



Mr. Eric R. Hohl


1963 Port Chelsea


Newport Beach, CA 92660



Re: Employment at Ashworth, Inc.



Dear Mr. Hohl:



In accordance with our recent discussions, we are pleased to confirm our offer to you of a position
with Ashworth, Inc. (the “Company”) upon the following terms and conditions:




	1.	 	Position; Reporting; Commencement: The position and title shall be Chief Financial
Officer & Executive Vice President and you shall report to the Chief Executive Officer. You
shall commence employment effective March 19, 2007. You will be required to observe the
Company’s personnel and business policies and procedures. In the event of any conflict, the
terms of this letter will control.






	2.	 	Base Salary; Bonus; Reviews: You will receive a salary of $240,000 per annum and be
eligible for up to a 40% target bonus per annum with bonus payment subject to the Board of
Directors’ discretion and in accordance with any applicable Bonus Plan, less applicable
withholding and deductions. Salary is payable every other Friday. Employees are given annual
performance reviews in or about May of each year which are a part of the bases for evaluating
annual salary adjustments.






	3.	 	Business Expenses; Automobile Allowance; Clothing Allowance: You will receive
reimbursement for normal, ordinary and reasonable business expenses upon your submission of
receipts substantiating the expenses claimed in accordance with Company policy. You will be
entitled to an automobile expense allowance of one thousand dollars ($1,000) per month to
defray the cost of business automobile expense. You will receive a Clothing Allowance in
accordance with Company policy.






	4.	 	Stock Options: The Company will grant you 40,000 stock options to purchase shares of
the Company’s common stock at an exercise price equal to 100% of fair market value of the
common stock on the date of grant (i.e., the first day of your employment). The
options will be incentive stock options up to the limits imposed by IRS regulations, with the
balance being non-qualified options. The options will vest over a two-year period,
i.e., one-half vesting on the one-year anniversary of employment commencement and
one-half vesting on the two-year anniversary of employment commencement. In the event of
termination of your employment by the Company without Cause (as defined below), the option
vesting for the foregoing will be accelerated. Vested options will be exercisable for ten
(10) years after the grant date (following termination of employment, the options are only
exercisable for 90 days if they are ISO’s and 180 days if they are NQ’s, but in no case after
10 years from grant date). You have the opportunity, subject to the Board of Directors’
discretion, to receive additional stock options each year during the annual review process.






	5.	 	Savings Plan: You will be eligible to participate in the Company’s 401(k) Plan at
the first entry date following the completion of six months continuous employment with the
Company. Under the current provisions, you will be eligible as of July 1, 2007.






	6.	 	Insurance Benefits: The Company will provide you with coverage under its group
medical, dental and life insurance policies as more specifically described in the group
insurance materials which will be provided to you upon your commencement of employment. The
cost of the medical and dental coverage will be shared between you and the Company, depending
on your plan and coverage elections. Under the current provisions, you will be eligible as of
April 1, 2007. In addition, you will be eligible for Ashworth’s Exec-U-Care health benefits.
This benefit reimburses you and your eligible dependents for medical expenses not covered by
your group major health plan or by any other group health plan. The Company reserves the
right to change, modify or eliminate such benefits or coverages in its discretion.






	7.	 	Severance: If you are terminated by the Company without Cause, and if you deliver
and do not revoke a fully executed release and waiver of all claims against the Company in the
form attached hereto as Exhibit A (the “Release Agreement”), then, upon expiration of any
applicable revocation period contained in the Release Agreement, the Company agrees to pay you
a lump sum as follows:






	 	(a)	 	If such termination occurs on or prior to your six-month anniversary of
employment with the Company, then the lump sum severance payment shall equal
twenty-five percent (25%) of your then-current annual base salary.






	 	(b)	 	If such termination occurs after your six-month anniversary of employment with
the Company but on or prior to your one-year anniversary of employment with the
Company, then the lump sum severance payment shall equal forty percent (40%) of your
then-current annual base salary.






	 	(c)	 	If such termination occurs after your one-year anniversary of employment with
the Company, then the lump sum severance payment shall equal fifty percent (50%) of
your then-current annual base salary.






The foregoing lump sum severance payment shall constitute the entirety of the Company’s
severance obligations.




Notwithstanding any provision of this letter to the contrary, if, at the time of your
termination of employment with the Company, you are a “specified employee” as defined in
Section 409A of the Internal Revenue Code (the “Code”), and one or more of the payments
received or to be received by you pursuant to this letter would constitute deferred
compensation subject to Section 409A, no such payment or benefit will be provided under this
letter until the earliest of (A) the date which is six (6) months after your “separation
from service” for any reason, other than death or “disability” (as such terms are used in
Section 409A(a)(2) of the Code), (B) the date of your death or “disability” (as such term is
used in Section 409A(a)(2)(C) of the Code) or (C) the effective date of a “change in the
ownership or effective control” of the Company (as such term is used in
Section 409A(a)(2)(A)(v) of the Code) (the “Deferred Payment”).  The provisions of this
paragraph shall only apply to the extent required to avoid your incurrence of any penalty
tax or interest under Section 409A of the Code or any regulations or Treasury guidance
promulgated thereunder.  In addition, if any provision of this letter would cause you to
incur any penalty tax or interest under Section 409A of the Code or any regulations or
Treasury guidance promulgated thereunder, the Company shall reform such provision to
maintain to the maximum extent practicable the original intent of the applicable provision
without violating the provisions of Section 409A of the Code.




	8.	 	Confidentiality; Use of Licensed Software; Solicitation of Customers and Employees;
Return of Property; Termination: You acknowledge that, in the course of your employment
with the Company, you will have access to confidential information concerning the organization
and functioning of the business of the Company, and that such information is a valuable trade
secret and the sole property of the Company. Accordingly, except as required by law, legal
process, or in connection with your employment duties or any litigation between the parties
hereto with respect to matters arising out of this agreement, you agree that you will not, at
any time during your employment with the Company or after such employment, whether such
employment is terminated as a result of your resignation or discharge, disclose or furnish any
such information to any person other than an officer or director of the Company, and you will
make no use of any such information for your personal benefit.






The Company licenses the use of computer software from a variety of outside companies and,
unless authorized by the software developer, does not have the right to reproduce it. You
may use software only in accordance with the license agreement, whether on local area
networks or on multiple machines.




You agree that for a period of two years from the date of voluntary or involuntary
termination of employment, you will not directly or indirectly (a) solicit, induce, or
attempt to influence any person or business that is an account, customer or client of the
Company to restrict or cancel the business of any such account, customer or client with the
Company, or (b) solicit on your behalf, or on behalf of a third party, any then-current
employee of the Company or its affiliates, to leave his or her employment with the Company
or its affiliates; provided, however, that nothing herein shall be deemed to
prohibit a general employment solicitation directed at the public.




You further agree that in the event of such termination, whether voluntary or involuntary,
you will not remove from the offices of the Company any personal property that does not
rightfully and legally belong to you and that you will return on the date of your said
termination, to an authorized representative of the Company, any and all property belonging
to the Company, including all copies of confidential information. You also agree that you
will provide passwords on request for personal computer files.




	9.	 	At-Will Employment. You understand and agree that you are being employed for an
unspecified term and that this is an “at-will” employment relationship. This means that
either you or the Company may terminate your employment at will at any time with or without
Cause or notice. This at-will aspect of your employment, which includes the right of the
Company to transfer, discipline, demote and/or reassign, may not be modified, amended or
rescinded except by an individual written agreement signed by both you and the Company’s Chief
Executive Officer or Chairman of the Board. This letter sets forth the entire agreement
between the parties and there are no prior or contemporaneous representations, promises or
conditions, whether oral or written, to the contrary.





10. Definition of “Cause.” For the purpose of this agreement, “Cause” shall mean:




	 	1.	 	Willful and deliberate refusal to comply with a lawful, instruction of the
Board of Directors or of the Chief Executive Officer, which refusal is not remedied by
you within a reasonable period of time after receipt of written notice from the Company
identifying the refusal, so long as the instruction is consistent with the scope and
responsibilities of your position;






	 	2.	 	Your act or acts of personal dishonesty;






	 	3.	 	Your conviction of a felony;






	 	4.	 	Your violation of the Company’s policies and/or code of conduct;






	 	5.	 	Your violation of any confidentiality or non-competition agreement with the
Company or any affiliate of the Company; or






	 	6.	 	The willful engaging by you in misconduct which injurious to the Company.





This offer of employment is contingent upon the satisfactory completion of a background check,
verifying that the information provided by you on your application and resume is accurate and
correct. The Company reserves the right to withdraw an offer of employment, or to terminate
employment, at any time based on information arising from the background check.



If you are in agreement with the terms of this letter, please sign and return one copy to the Human
Resource Department and retain one copy for your files to effect the commencement of your
employment. If you have any questions, please contact me at your earliest convenience.



Sincerely,



ASHWORTH, INC.



/s/ Peter M. Weil


Peter M. Weil

Chief Executive Officer



ACCEPTED AND AGREED TO THIS



 5th DAY OF MARCH, 2007



/s/ Eric R. Hohl


Eric R. Hohl



1



EXHIBIT A – RELEASE AGREEMENT




I, Eric R. Hohl, hereby enter into this Release Agreement (this “Agreement”), pursuant to
Paragraph 7 of the letter agreement, dated March      , 2007, with Ashworth, Inc., a Delaware
corporation (the “Company”), in consideration for which the Company shall make the severance
payment as described in the letter agreement (the “Employment Agreement”).



1. The date of my employment termination is      , and I have received a final
paycheck for all wages due, including all accrued vacation, through that date. Other than the
severance payment as described in my Employment Agreement, the foregoing payments are the only
amounts which I am entitled to receive from the Company, and I hereby waive all other payments or
claims for payments.



2. As consideration for the severance payment as described in my Employment Agreement, I
hereby release the Company, its successors, affiliates, directors, employees and agents from any
and all claims or lawsuits (including but not limited to any and all claims or demands relating to
salary, wages, bonuses, commissions, stock, stock options, vacation pay, fringe benefits, expense
reimbursements, any and all tort claims, contract claims (express or implied), wrongful termination
claims, public policy claims, whistleblower claims, implied covenant of good faith and fair dealing
claims, retaliation claims, personal injury claims, emotional distress claims, invasion of privacy
claims, defamation claims, fraud claims, attorneys’ fees claims, all claims arising under any
federal, state or other governmental statue, law, regulation or ordinance including, but not
limited to, Title VII of the Civil Rights Act of 1964, as amended, the Americans with Disabilities
Act, the Family and Medical Leave Act, the California Fair Employment & Housing Act, the California
Labor Code, the Age Discrimination in Employment Act of 1967 (“ADEA”), the Older Workers’ Benefit
Protection Act (“OWBPA”)) which I may have based either on my employment, my termination, or any
other event occurring prior to the date of this Agreement. This Release is intended to settle any
and all claims that I may have against the Company. Accordingly, I waive any and all rights
conferred under 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 his favor at the time
of executing the release which if known by him must have materially affected his settlement with
the debtor.”



3. The foregoing release shall not serve as a waiver of my rights to (a) vested benefits such
as 401(K), (b) workers compensation or unemployment benefits, (c) statutorily-required
indemnification under California Labor Code Section 2802, (d) the right to file a complaint or
charge with the Equal Employment Opportunity Commission, or (e) any other benefits, rights or
claims that cannot be released as a matter of law.



4. I acknowledge and understand my continuing obligation (a) to maintain the confidentiality
of the Company’s trade secrets, confidential and proprietary information and (b) not to solicit the
Company’s customers or employees, as set forth in Paragraph 8 of my Employment Agreement. I also
warrant and represent that I have returned all Company materials as required in Paragraph 8 of my
Employment Agreement.



5. I acknowledge that I fully understand my right to discuss this Agreement with an attorney,
and I have carefully read and fully understand this entire Agreement, and I am entering into this
Agreement voluntarily.



6. I understand that I shall have twenty-one (21) days from the date of receipt of this
Agreement to consider this Agreement, I shall have seven (7) days following the signing of this
Agreement to revoke it in writing, and this Agreement shall not be effective or enforceable until
this revocation period has expired.



	 	 	 
	Dated:

	 	ERIC R. HOHL

By:
	
 
	 	 
	Dated:

	 	ASHWORTH, INC.

By:
	
 
	 	 
	
 
	 	Title:
	
 
	 	 
	 
	 	 







2