exv10w3



 








Exhibit 10.3




Agreement to Establish a Rule 10b5-1 Selling Plan




     This Agreement to Establish a Rule 10b5-1 Selling Plan (this “Selling Plan”),
dated August 2, 2006, between THE TIFFANY JADE OTTO TRUST CREATED APRIL 7, 1998 (the
“Seller”), and RBC DAIN RAUSCHER INC. (the “Broker”).



     WHEREAS, Seller desires to enter into this Selling Plan to sell shares of common stock, par
value $0.01 per share (the “Stock”), of Deckers Outdoor Corporation (the “Issuer”)
in accordance with the terms set forth on Annex A hereto;



     WHEREAS, Seller desires to engage Broker to effect sales of shares of Stock in accordance with
this Selling Plan; and



     WHEREAS, Issuer has provided its consent as provided in Annex B hereto.



     NOW, THEREFORE, the Seller and Broker hereby agree as follows:


1. Broker shall effect all sales (each a “Sale”) of Stock under this Selling Plan in
accordance with it terms, including those terms set forth on Annex A.



2. Seller understands that Broker may not be able to effect a Sale in the event of: (i) a market
disruption; (ii) a legal, regulatory or contractual restriction applicable to Issuer or Broker;
(iii) the receipt by Broker of written notice from counsel for the Issuer advising it that this
Selling Plan is no longer in effect, or alternatively, that Sales to be made under this Selling
Plan are suspended until further notice. If any Sale cannot be executed as required by this
Selling Plan for any of these reasons, Broker shall effect such Sale as promptly as practical after
the cessation or termination of any market disruption, restriction, or suspension described above,
or as promptly as possible after receipt of written affirmation of the continuing effect or
validity of this Selling Plan or an amended or substituted Selling Plan.



3. Seller represents and warrants that, as of the date hereof, he is not aware of material,
nonpublic information with respect to the Issuer or any securities of the Issuer (including the
Stock) and is entering into this Selling Plan in good faith and not as part of a plan or scheme to


-1-









 






evade the prohibitions of Rule 10b-5 and Rule 10b5-1 under the Securities Exchange Act of 1934 (the
“Exchange Act”).



4. It is the intent of the parties that this Selling Plan comply with the requirements of Rule
l0b5-1(c)(1) under the Exchange Act and that this Selling Plan shall be interpreted to comply with
the requirements of Rule 10b5-1(c)(1).



5. Where applicable, Broker agrees to effect all Sales in accordance with the manner of sale
requirements of Rule 144 under the Securities Act of 1933, and in no event shall Broker effect any
Sale if such Sale would exceed the then applicable volume limitation under Rule 144, assuming that
Sales effected by Broker for Seller under this Selling Plan are the only sales subject to that
limitation. Seller agrees not to take, and agrees to cause any person or entity with which he or
she would be required to aggregate sales of Stock pursuant to paragraph (a)(2) or (e) of Rule 144
not to take, any action that would cause the Sales not to comply with Rule 144. Broker will be
responsible for completing and filing on behalf of Seller the required Form 144.



6. Seller agrees to make all filings, if any, required under Sections 13(d), 13(g) and 16 of the
Exchange Act.



7. Seller agrees to identify to Broker all orders or instructions that will or could result in
Sales under this Selling Plan as “Rule 10b5-1 Orders” or “Rule 10b5-1 Instructions” and understands
and further agrees that he may not amend, substitute or otherwise alter any such Order or
Instruction without the prior written permission of Issuer, which written permission shall be
provided to Broker directly from Issuer. Seller further understands and agrees that he bears all
legal and regulatory risks associated with any such amendment, substitution or alteration.



8. Seller understands and acknowledges that this is his Selling Plan, further represents that he
has had full opportunity to consult with his legal counsel with respect to the validity of this
Selling Plan, and that he is not relying on Broker for such counsel.



9. This Selling Plan shall terminate when Issuer’s insider trading policies are no longer in effect
with respect to Seller, and Seller agrees to promptly advise Broker upon occurrence of such event.




-2-









 







10. This Selling Plan may be suspended or terminated by Seller at any time upon five (5) business
days prior written notice sent to Broker. Seller agrees that Seller shall not terminate this
Selling Plan except upon consultation with Seller’s own legal counsel.



11. This Selling Plan shall be suspended or, at Broker’s option, terminated, within five (5)
business days of receipt by Broker of written notice from the Issuer of the occurrence of a legal,
contractual or regulatory restriction that is applicable to Seller, including, but not limited to,
any restriction related to a merger or acquisition of Issuer or a stock offering requiring an
affiliate lock-up.



12. This Selling Plan, shall be governed by and construed in accordance with the laws of the State
of California and may be modified or amended only by a writing signed by the parties hereto.



13. Proceeds from each Sale effected under the Selling Plan will be delivered to Seller’s account
with Broker on a normal three (3) day settlement basis, less any commission or other expenses of
sale to be paid to Broker.



14. This Selling Plan constitutes the entire agreement between the parties with respect to this
Selling Plan and supersedes any prior agreements or understandings with regard to the Selling Plan.



15. All notices under this Selling Plan shall be sent by facsimile or certified mail as follows:



If to Seller:

The Tiffany Jade Otto Trust created April 7, 1998

495-A S. Fairview Avenue

Goleta, CA 93117

Attn: Douglas B. Otto



If to Broker:

RBC Dain Rauscher Inc.

2 Embarcadero Center, Suite 1200

San Francisco, CA 94111




-3-









 







16. This Selling Plan may be executed in counterparts, each of which shall be deemed an original.



17. If any provision of this Selling Plan is or becomes inconsistent with applicable present or
future law, rule or regulation, including Rule 10b5-1, that provision will be deemed modified or,
if necessary, rescinded in order to comply with the relevant law, rule or regulation.




-4-









 







IN WITNESS WHEREOF, the undersigned have signed this Selling Plan as of the date first written
above.




	 	 	 	 	 
	 	THE TIFFANY JADE OTTO TRUST

CREATED APRIL 7, 1998

 	 
	 	By:  	/s/ Douglas B. Otto
 	 
	 	 	Name:  	Douglas B. Otto 	 
	 	 	Title:  	Trustee 	 
	 
	 	RBC DAIN RAUSCHER INC.

 	 
	 	By:  	/s/ Justin James
 	 
	 	 	Name:  	Justin James 	 
	 	 	Title:  	Vice President – Sales Trader 	 



-5-









 






	 	 	 	 	 



Annex A

to

Agreement to Establish a Rule10b5-1 Selling Plan



Deckers Outdoor Corporation (“Deckers”)


This is Annex A to the Selling Plan between Seller and Broker dated August _2_,
2006. The provisions hereof are incorporated into the Selling Plan and made a part thereof.





	 	1.	 	Beginning on August _2_, 2006, and on the first (1st) trading day (a
“Trading Day” is any day on which Deckers Stock trades on the Nasdaq National
Market) of each quarter thereafter, Broker shall effect sales of Deckers Stock for Seller
as follows:






	 	a.	 	5,000 shares of Deckers Stock at a limit price of at least $20.00 per
share;
	 
	 	b.	 	an additional 5,000 shares of Deckers Stock at a limit price of at
least $30.00 per share;
	 
	 	c.	 	an additional 10,000 shares of Deckers Stock at a limit price of at
least $40.00 per share;
	 
	 	d.	 	an additional 10,000 shares of Deckers Stock at a limit price of at
least $50.00 per share;
	 
	 	e.	 	an additional 10,000 shares of Deckers Stock at a limit price of at
least $60.00 per share; and
	 
	 	f.	 	an additional 10,000 shares of Deckers Stock at a limit price of at
least $70.00 pre share.






	 	2.	 	If, consistent with ordinary principles of best execution or for any other reason,
Broker cannot effect all sales as set forth above (hereafter, a “Shortfall”),
Broker shall sell the Shortfall as soon as practicable (consistent with the limit prices
and quantities set forth above) in accordance with ordinary principles of best execution.






	 	3.	 	The pricing guidelines outlined in paragraph 1. above shall be followed each quarter;
provided however, that:






	 	a.	 	If Deckers Stock price is such that the above formula results in no
sales being made for an entire calendar quarter, then the limit prices in
paragraphs 1(a) – (f) above shall all be reduced by $2.00 for the next
succeeding Sell Date and shall continue at these new reduced levels for all
subsequent quarters; and






	 	b.	 	The limit price reducing feature in paragraph 3(a) above shall be
repeated each quarter that no sales occur, which may result in further limit price
reductions; provided however, that






	 	c.	 	The limit price in paragraph 1(a) shall not be reduced below $15.00 per
share; the limit price in paragraph 1(b) shall not be reduced below $25.00 per
share; the limit price in paragraph 1(c) shall not be reduced below $35.00 per
share; the limit price in paragraph 1(d) shall not be reduced below $45.00 per
share; the limit price in paragraph 1(e) shall not be reduced below $55.00 per
share; and the limit price in paragraph 1(f) shall not be reduced below $65.00 per
share.






	 	4.	 	The Selling Plan shall terminate on June 30, 2008.




-6-









 












	 	5.	 	All limit prices above are net of commissions to the Broker.
	 
	 	6.	 	The share amounts and limit prices set forth in paragraph 1 above shall be
appropriately increased or decreased to reflect any stock splits and recapitalizations.
	 
	 	7.	 	Subject to the conditions of paragraphs 1 through 7 above, Broker is granted absolute
discretion to determine how, when and whether to sell Shares under the Plan. Apart from
the instructions set forth in the Plan, Seller shall not exercise any influence over how,
when or whether to effect sales of Shares under the Plan, whether through communications
with Broker or otherwise.





* * *



The undersigned have signed this Annex A as of the date of the Selling Plan.





Dated: August 2, 2006



 

THE TIFFANY JADE OTTO TRUST

CREATED APRIL 7, 1998






	 	 	 	 	 
	By:

	 	/s/Douglas B. Otto
	 	 
	 

	 	 	 	 
	 

	 	Name: Douglas B. Otto	 	 
	 

	 	Title: Trustee	 	 







RBC DAIN RAUSCHER, INC.




	 	 	 	 	 
	By:

	 	/s/ Justin James
	 	 
	 

	 	 	 	 
	 

	 	Name: Justin James	 	 
	 

	 	Title: Vice President – Sales Trader	 	 






-7-









 






Annex B

to

Agreement to Establish a Rule10b5-1 Selling Plan



1. Deckers Outdoor Corporation (the “Issuer”) represents that it has pre-cleared, as
permitted under its insider trading policy, the Agreement to Establish a Rule 10b5-1 Selling Plan
dated August 2, 2006 (the “Selling Plan”) between THE TIFFANY JADE OTTO TRUST
CREATED APRIL 7, 1998 (“Seller”) and RBC DAIN RAUSCHER INC. relating to the common stock,
par value $0.01 per share, of the Issuer.



2. Pre-clearance of the Selling Plan constitutes permission only under the Issuer’s insider trading
policy. In no event will Issuer or any of its officers, employees, directors or agents be
responsible for Seller’s compliance with applicable securities laws.





Dated: August 7, 2006





Deckers Outdoor Corporation






	 	 	 	 	 
	By:

	 	/s/ Zohar Ziv
	 	 
	 

	 	 	 	 
	 

	 	Zohar Ziv, Chief Financial Officer and Executive Vice President of
Finance and Administration	 	 
	 

	 	Print Name and Title	 	 







-8-