Document:

exv10w1

 

Exhibit 10.1

April 12, 2007

PERSONAL AND CONFIDENTIAL

Mr. Joseph Scirocco

c/o Quiksilver, Inc.

15202 Graham Street

Huntington Beach, California 92649

Re: Employment at Quiksilver, Inc.

Dear Joe:

     This letter (“Agreement”) will confirm our understanding and agreement regarding your
employment with Quiksilver, Inc. (“Quiksilver” or the “Company”), commencing Monday, April 16,
2007. This Agreement 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 Letter of Intent provided to you earlier this month.

	 	1.	 	Position; Exclusivity. The Company hereby agrees to
employ you as its Executive Vice President and Chief Financial Officer,
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 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 without the prior written consent of the President or Chief
Executive Officer.
	 
	 	2.	 	Base Salary. Your base salary will be $45,833.33 per
month ($550,000 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 $45,833.33 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, 2007,
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 on the same basis as other comparable executives of the Company. 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 become and 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
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.

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	 	9.	 	Unspecified Term; At Will Employment; Termination

(a) Notwithstanding anything to the contrary in this Agreement, 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) pay
the full amount of any unpaid discretionary bonus from the preceding fiscal
year, if any, (ii) continue to pay your base salary (but not any employment
benefits) on its regular payroll dates for a period of eighteen (18) months,
(iii) 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 withholdings and deductions, and (iv) 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)

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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 Revenue Code of 1986, as
amended (the “Code”), then the following limitation shall apply:

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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.

(e) Notwithstanding the foregoing, to the extent the Company reasonably
determines that any payment or benefit under this Agreement is subject to
Section 409A of the Code, such payment or benefit shall be made at such
times and in such forms as the Company reasonably determines are required to
comply with Code Section 409A (including, without limitation, in the case of
a “specified employee” within the meaning of Code Section 409A, any payments
that would otherwise be made during the six-month period following
separation of service will be paid in a lump sum after the end of the
six-month period) and the Treasury Regulations and the transitional relief
thereunder; provided, however, that in no event will the Company be required
to provide you with any additional payment or benefit in the event that any
of your payments or benefits trigger additional income tax under Code
Section 409A or in the event that the Company changes the time or form of
your payments or benefits in accordance with this paragraph.

	 	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

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	 	 	 	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.
	 
	 	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, restricted stock, stock appreciation rights or other similar
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”) Employment Arbitration Rules, 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

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

	 	 	 	 	 
	 	Very truly yours,

	 
	 	 	 
	 	Charles S. Exon	 
	 	Executive Vice President, Business & Legal	 
	 	Affairs, Secretary and General Counsel	 
	 	 	 
	 	 	 
	 	 	 
	 

Enclosure

ACKNOWLEDGED AND AGREED:

———————————————

Joseph Scirocco

———————————————

          Dated

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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.

-Addendim A-exv10w2

 

Exhibit 10.2

April 13, 2007

PERSONAL AND CONFIDENTIAL

VIA HAND DELIVERY

Mr. Steven L. Brink

c/o Quiksilver, Inc.

15202 Graham Street

Huntington Beach, California 92649-1109

     Re: Transition From Employment

Dear Steve:

This letter (“Agreement”) will confirm the agreement and understanding we have reached regarding
your departure from Quiksilver, Inc. (“Quiksilver” or the “Company”), and the transition of your
duties and responsibilities. In that regard, we have agreed as follows:

	1.	 	Transition Period.

	 	A.	 	Effective April 16, 2007, you are resigning as Chief Financial Officer and
Treasurer of the Company and as a director and officer of any subsidiaries of the
Company where you serve in such capacities. Beginning April 16, 2007, and continuing
through July 31, 2007 or, if earlier, the date you become employed with another
employer (“Separation Date”) (the “Transition Period”), you will continue as an
employee of the Company providing transition services to the Company on an as-needed
basis as requested by Bob McKnight, Bernard Mariette, Charlie Exon, David Morgan or Joe
Scirocco (“Transition Services”). The Transition Services may include, but not be
limited to, providing organizational transition assistance and historical
financial/accounting information, assistance with required SEC filings and related
matters. During the Transition Period, you are expected to conduct yourself in a
positive and professional manner in support of the Company’s initiatives, as well as
all business and personnel matters related to Quiksilver.
	 
	 	B.	 	During the Transition Period, provided you satisfactorily perform the
Transition Services, the Company shall continue to compensate you on its regular
payroll dates at a rate of $29,166.67 per month (“Salary Continuation”), less legally
required withholdings and deductions. Although the Transition Services represent

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	 	 	 	a significant reduction in the scope of duties you were performing as Chief
Financial Officer, and will require significantly less time, the Salary Continuation
is in part consideration for your general release of claims as referenced in
Paragraph 7 below. You authorize us to mail you your final Salary Continuation
payment on the Company’s regular payroll date covering the payroll period which
includes the Separation Date.
	 
	 	C.	 	During the Transition Period, and subject to subparagraph (E) below, you will
be eligible for the same Company-provided health and welfare benefits you have been
receiving as of the date of this Agreement.
	 
	 	D.	 	During the Transition Period, upon receipt of such expense reports and mileage
reimbursement forms as are customarily required by the Company, Quiksilver will (i)
reimburse you for business mileage, and (ii) pay those amounts reflected on your
expense reports incurred as and for business expenses. All business expenses must be
pre-approved by Bob McKnight, Bernard Mariette, David Morgan, Joe Scirocco or me.
	 
	 	E.	 	During the Transition Period, you are free to commence employment with another
entity. All Salary Continuation and Company-provided health and welfare benefits will,
however, cease upon your eligibility for such benefits pursuant to another employer’s
benefit plan(s). Please notify me promptly upon your re-employment with another
company.
	 
	 	F.	 	Other than the Severance Pay referenced in Paragraph 2 below, and the stock
options referenced in Paragraph 3 below, you are not eligible for, and will not
receive, any other compensation or benefit (including, but not limited to, any
additional bonuses or stock option grants) following the Separation Date.

	2.	 	Termination of Employment/Severance Pay Period.

	 	A.	 	Your employment (and the Transition Period) will terminate for all purposes on
the Separation Date.
	 
	 	B.	 	The Company will pay you severance pay in the total amount of $1,500,000, less
required tax deductions and withholdings (“Severance Pay”), payable as follows:

	 	(i)	 	A lump sum payment of $750,000, less required tax deductions
and withholdings, payable between February 2 and 11, 2008;
	 
	 	(ii)	 	Beginning February 1, 2008, and continuing through January 31,
2009 (the “Severance Pay Period”), the Company shall compensate you on its
regular payroll dates in the monthly amount of $62,500, less legally required
withholdings and deductions. Checks will be sent to your home address.

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	 	C.	 	Except for any consulting services provided pursuant to Paragraph 4, you will
not be required to perform any duties during the Severance Pay Period. Through the end
of the Severance Pay Period, you are expected to conduct yourself in a positive and
professional manner in support of the Company’s initiatives, as well as all business
and personnel matters related to Quiksilver.
	 
	 	D.	 	Your health insurance coverage will cease after the Separation Date, unless you
timely elect and pay for continued coverage under the Consolidated Omnibus Budget
Reconciliation Act of 1985 (“COBRA”). If you desire such continued health coverage
under COBRA, the Company will be responsible for the premiums for such coverage, up to
a maximum of $1,300 per month, through the earlier of (i) the Services Cessation Date
(as defined below) and (ii) January 31, 2009. You will be responsible for all other
premiums.
	 
	 	E.	 	The Company will pay the remaining premium of $16,740 on your $2 million life
insurance policy (expiring April 27, 2016) maintained by the Company through John
Hancock.
	 
	 	F.	 	Nothing in this Agreement shall constitute a waiver of any benefits which are
already vested as of the Separation Date, under any Company 401(k) or employee welfare
benefit plan, and you shall remain fully entitled to all such benefits, if any, in
accordance with the terms of the applicable plan.
	 
	 	G.	 	Except for any continuing and surviving obligations of yours thereunder
(e.g., protection of Quiksilver’s trade secrets and proprietary and
confidential information), any and all employment agreements you may have with
Quiksilver (including, without limitation, that certain agreement dated May 25, 2005,
and amended December 21, 2006) are deemed fully terminated and of no further force or
effect. You have no right to any additional compensation, equity or benefits under any
such employment agreement.
	 
	 	H.	 	After the Separation Date, you are not eligible for, and will not receive, any
other compensation or benefit except as specifically provided herein (including, but
not limited to, any additional bonuses, incentives, stock option grants, expense
reimbursement or employee benefits).
	 
	 	I.	 	Employment references should be directed to me, and I will verify your dates of
employment and position(s) held. If you wish me to confirm your compensation (salary,
bonuses, etc.), please check the box at the end of this sentence, and that will
constitute your authorization for me to do so.  ̈ Yes, I so authorize.

	3.	 	Stock Options and Restricted Stock.

	 	A.	 	Attached hereto as Attachment ”A” is a schedule of your vested and
unvested stock options and restricted stock as of the date of this Agreement. It is
anticipated that following the Transition Period, you will continue to provide Services
(as defined in your stock option agreements) to the Company for some limited period of
time as provided in Paragraph 4 below. The date upon which

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	 	 	 	you cease to provide Services to the Company, whether at the end of the Transition
Period or, if you continue to provide Services pursuant to Paragraph 4 hereof, upon
termination of your consulting services thereunder, is referred to as the “Services
Cessation Date.” All of your unvested stock options which have not previously
expired will accelerate and vest on the Services Cessation Date. Any unexercised
stock options on the Services Cessation Date which have not previously expired will
remain exercisable for a period of (i) ninety (90) days with respect to stock
options granted to you prior to May 25, 2005 and (ii) twelve (12) months with
respect to stock options granted to you on or after May 25, 2005, (commencing with
the Services Cessation Date) after which they will expire and cease to be
exercisable; provided, however, that in no event may such stock options be exercised
after their expiration date and they may terminate and cease to be exercisable
earlier in the event of a corporate transaction as provided in your individual stock
option agreements. All other terms of your stock options shall continue to be
governed by the applicable plan pursuant to which they were issued and the
applicable stock option agreements.
	 	 	 	 
	 	B.	 	On April 16, 2007, all 40,000 shares of restricted stock of the Company held by
you shall expire and be surrendered to the Company.
	 
	 	C.	 	Please note that all “blackout” periods under the Company’s Policy Prohibiting
Insider Trading will continue to apply to you through the Services Cessation Date and
you will continue to be subject to federal and state securities laws which prohibit the
purchase or sale of shares while in possession of material, non-public information.

	4.	 	Consulting Services.
	 
	 	 	You agree that following the Transition Period, you shall make yourself available on an
as-requested basis to the Company’s officers and agents, to consult with the Company on such
matters as the Company may reasonably request. It is anticipated that you will provide most
of such consulting services telephonically or electronically. Your primary contact with
respect to such services shall be me. For such services, you shall receive a consulting fee
of $300 per hour. You acknowledge and agree that your services pursuant to this Paragraph 4
shall be provided as an independent contractor and such services shall not be construed to
create the relationship of employer and employee or principal and agent between you and the
Company. During the period you are providing consulting services pursuant to this Paragraph
4, you shall not be entitled to participate in any of the medical, dental, insurance or any
other benefits provided by the Company for the benefit of its employees. You will maintain
and pay all federal, state and local disability, worker’s compensation, payroll taxes,
self-employment insurance, and income and other taxes, and the Company will not withhold or
pay any such taxes or insurance on your behalf with respect to compensation for such
services. Also, during the period you are providing consulting services pursuant to this
Paragraph 4, you shall be entitled to a clothing allowance of $350 per month and you shall
be permitted to purchase products from the Company at its wholesale price, not to exceed
$500 in the aggregate per month. Provided that such expenses are authorized in advance by
an executive officer of the

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	 	 	Company, the Company will reimburse you for any reasonable travel expenses (at business
class or comparable rates) or other expenses incurred by you in connection with providing
such consulting services. The agreement to provide consulting services as set forth in this
Paragraph 4 may be terminated by you or the Company on thirty (30) days advance written
notice; provided, however, that such services may be terminated immediately by the Company
at any time after you accept employment with, or provide consulting or other advisory
services to, any other entity without the Company’s prior approval.
	 	 	 
	5.	 	Full Understanding and Voluntary Acceptance.
	 	 	 
	 	 	Quiksilver advises you to consult an attorney prior to executing this Agreement. In
entering into this Agreement, you agree that you have had the opportunity to seek the advice
of an independent attorney of your own choice and that you understand all the terms of this
Agreement. You are executing this Agreement voluntarily with full knowledge of its
significance.

6. Return of Property/Non-Solicitation.

	 	A.	 	Except as otherwise provided below, all Company Property must be returned prior
to the end of the Transition Period. By signing this Agreement, you confirm that you
will return all keys, magnetic access cards and all other means of access to the
property or offices of the Company, and all other Company property, equipment and
documents in your possession or under your control, including, but not limited to,
credit cards, cell phones, PDA’s, BlackBerries, fax machines, pagers, files, personnel
forms, accounting information and spreadsheets, budgets, compensation data, business
plans, documents and any other property of the Company (“Company Property”) and that
you will not copy or download any such materials after the end of the Transition
Period.
	 
	 	 	 	Notwithstanding the foregoing, you may retain your laptop computer and printer,
provided that you deliver these items to the Company on or before the Services
Cessation Date to have the memory erased and software removed by the Company. You
also agree (i) to preserve in confidence and not disclose any confidential,
proprietary, or trade secret information relating to Quiksilver, or its products,
personnel, or financial data, and (ii) not to download, copy or transfer any
documents or software from the Company’s computers.
	 
	 	B.	 	Through the end of the Severance Pay Period, you agree not to recruit, or
solicit for employment, any person then employed by Quiksilver or any of the Released
Parties (as defined below).

	7.	 	Release of Claims.

	 	A.	 	In exchange for the consideration provided herein, you agree to, and by signing
this Agreement do, forever waive and release Quiksilver and each of its affiliated or
related entities, divisions, subsidiaries, foundations, licensees, shareholders,
officers, directors, employees, agents, successors and assigns (collectively,

-5-

 

	 	 	 	“Released Parties”), from all known and unknown claims, rights, actions, complaints,
charges, liabilities, obligations, promises, agreements, causes of action, suits,
demands, damages, costs, losses, debts, and expenses of any nature whatsoever which
you ever had, now have, or may claim to have against any of the Released Parties,
including, without limitation, any claim arising out of (i) any aspect of your
employment or the termination of your employment with the Company; (ii) any
restrictions on the right of Quiksilver to terminate your employment or any
employment agreement with you; (iii) any agreement, understanding or inducement,
oral or written, express or implied, between you and any of the Released Parties,
including any employment agreement (including, without limitation, that certain
agreement dated May 25, 2005, and amended December 21, 2006); (iv) any stock options
or restricted stock (other than as provided in Paragraph 3 of this Agreement);
and/or (v) any federal, state or governmental constitution, statute, regulation or
ordinance, including, without limitation, Title VII of the Civil Rights Act of 1964,
the Age Discrimination in Employment Act, and the California Fair Employment and
Housing Act; provided, however, that this release does not (a) affect rights
or claims that may arise after the date it is executed, (b) waive rights or claims
arising out of this Agreement, or (c) waive any rights you may have to indemnity,
under Labor Code § 2802 or otherwise. In addition, the Released Parties hereby
agree to forever waive and release you from all known and unknown claims, rights,
actions, complaints, charges, liabilities, obligations, promises, agreements, causes
of action, suits, demands, damages, costs, losses, debts, and expenses of any nature
whatsoever which they ever had, now have, or may claim to have against you.
	 
	 	B.	 	Further, each party waives and relinquishes all rights and benefits they may
have under Section 1542 of the California Civil Code. Section 1542 reads as follows:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES
NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE
MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”

	8.	 	Non-Admission.
	 
	 	 	Nothing contained in this Agreement shall be considered an admission of any liability
whatsoever. If you elect not to sign this Agreement, this Agreement is inadmissible in
evidence to prove any liability or damage.
	 
	9.	 	Severability.
	 
	 	 	Should any portion, word, clause, phrase, sentence or paragraph of this Agreement be
declared void or unenforceable, such portion shall be considered independent and severable
from the remainder, the validity of which shall remain unaffected.

-6-

 

	10.	 	Entire Agreement and Arbitration.
	 
	 	 	This Agreement constitutes the entire agreement between you and Quiksilver pertaining to the
subject matter hereof and supersedes any and all prior agreements, understandings,
negotiations and discussions, whether oral or written, pertaining to the subject matter
hereof. After the execution of this Agreement, to the fullest extent allowed by law, any
controversy, claim or dispute between you and the Company (and/or any of the Released
Parties) relating to or arising out of this Agreement or 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 applicable rules of the American
Arbitration Association. The Company shall pay the arbitrator’s fees and any American
Arbitration Association administrative expenses.
	 
	11.	 	Signature and Revocation Periods.
	 
	 	 	So that you can review this Agreement as you deem appropriate, the Company advises you as
follows: (i) this Agreement does not waive any rights or claims that may arise after it is
executed by you; (ii) you will have twenty-one (21) days to consider this Agreement,
although you may sign it sooner than that if you so desire; (iii) you should consult with an
attorney if you desire before executing this Agreement; and (iv) you also retain the right
to revoke this Agreement at any time during the seven (7)-day period following execution of
the Agreement. This Agreement shall not become effective or enforceable until such seven
(7)-day period has expired.

By signing below, you voluntarily accept the terms contained in this Agreement.

Steve, Quiksilver thanks you for your service and wishes you well as you transition to a role in a
new organization.

Best regards.

Sincerely,

QUIKSILVER, INC.

	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Charles S. Exon
	 	 
	 

	 	Executive Vice President, Business & Legal Affairs,	 	 
	 

	 	Secretary and General Counsel	 	 

I HAVE READ, UNDERSTAND AND VOLUNTARILY

AGREE TO THE ABOVE.

	 	 	 
	 

	 	 
	Steven L. Brink

	 	Date

-7-

 

ATTACHMENT “A”

STOCK OPTIONS AND RESTRICTED STOCK — STEVEN L. BRINK

Stock Options

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Currently	 	Currently
	      Grant Date	 	Expiration Date	 	Granted	 	Grant Price	 	Outstanding	 	Exercisable
	12/15/98
	 	 	12/16/08	 	 	 	90,000	 	 	$	3.9271	 	 	 	70,000	 	 	 	70,000	 
	  2/11/00
	 	 	02/12/10	 	 	 	160,000	 	 	$	2.9844	 	 	 	160,000	 	 	 	160,000	 
	12/22/00
	 	 	12/23/10	 	 	 	80,000	 	 	$	4.6094	 	 	 	80,000	 	 	 	80,000	 
	12/03/01
	 	 	12/04/11	 	 	 	80,000	 	 	$	3.5250	 	 	 	80,000	 	 	 	80,000	 
	12/19/02
	 	 	12/20/12	 	 	 	88,000	 	 	$	6.6575	 	 	 	88,000	 	 	 	88,000	 
	11/12/03
	 	 	11/13/13	 	 	 	80,000	 	 	$	8.7250	 	 	 	80,000	 	 	 	80,000	 
	05/03/04
	 	 	05/04/14	 	 	 	20,000	 	 	$	11.1250	 	 	 	20,000	 	 	 	13,333	 
	01/25/05
	 	 	01/26/15	 	 	 	104,000	 	 	$	14.3050	 	 	 	104,000	 	 	 	69,333	 
	12/27/05
	 	 	12/28/15	 	 	 	30,000	 	 	$	13.7700	 	 	 	30,000	 	 	 	10,000	 
	12/20/06
	 	 	12/20/16	 	 	 	20,000	 	 	$	15.5500	 	 	 	20,000	 	 	 	0	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Optionee Totals
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	732,000	 	 	 	650,666	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

Restricted Stock

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Grant Date	 	Expiration Date	 	Granted	 	Grant Price	 	Outstanding	 	Exercisable
	09/29/06
	 	 	N/A	 	 	 	40,000	 	 	$	0.0000	 	 	 	40,000	 	 	 	N/A

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