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Exhibit 10.12
October 24, 1996
PERSONAL AND CONFIDENTIAL
Xxxxxx X. Xxxxx
Xxxxxxxxxx, Inc.
0000 Xxxxxxxx Xxxxxx
Xxxxx Xxxx, Xxxxxxxxxx 00000-0000
Re: Employment at Quiksilver
Dear Xxxxx:
This letter ("Agreement") will confirm our understanding and
agreement regarding your continued employment at Quiksilver, Inc. ("Quiksilver"
or the "Company"), and completely supersedes and replaces any existing or
previous oral or written understandings or agreements, express or implied, we
have had. The terms contained in this letter are effective on and after October
24, 1996.
1. Your position will be Secretary, Treasurer and Chief
Financial Officer.
2. Your base salary will be $12,500.00 per month, 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 (up or down) at the
Company's discretion in light of the Company's
performance, your performance, market conditions and
other factors deemed relevant by the Company;
provided, however, that your base salary will not be
reduced below its initial level through March 31,
1999, should your employment continue through that
date.
3. For the fiscal year ending October 31, 1997, you
shall be eligible to receive a bonus based on the
criteria set forth on Addendum "A" attached hereto,
for that portion of the fiscal year(s) during which
you are so employed. Any bonus earned pursuant to
this paragraph shall be paid within ten (10) days
following the date the Company publicly releases its
annual audited financial statements (the "Bonus
Payment Date"). Any bonus payment shall be less
applicable withholdings and deductions. In the event
that your employment with the Company is terminated
prior to the end of the applicable fiscal year
(including by reason of termination, resignation,
disability or death), you shall be entitled to
receive a pro rata portion of the bonus otherwise
payable to you based upon the actual number of days
which you were employed by the Company during the
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October 24, 1996
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applicable fiscal year, which shall be paid on the
Bonus Payment Date. The Company has made no
representations or commitments regarding the
existence or components of any bonus program should
you remain employed with the Company after the close
of fiscal year 1997-1998.
4. Since Quiksilver does not have a vacation policy for
executives of your level, no vacation days will be
treated as earned or accrued.
5. You (and any eligible dependents you elect) will be
covered by the Company's group medical insurance
program on the same terms and conditions applicable
to comparable employees. The Company reserves the
right to change, modify, or eliminate such coverage
in its discretion.
6. Quiksilver will pay the premium on a term life
insurance policy on your life with a company of our
choice in the face amount determined by the Company
of not less than $500,000 payable to the beneficiary
or beneficiaries of your choice. Quiksilver's
obligation to obtain and maintain this insurance is
contingent upon your establishing and maintaining
insurability, and it is not required to pay premiums
for such a policy in excess of $1,250 annually.
7. The amount and terms of stock options to be granted
to you will be determined by the Board of Directors
in its discretion and covered in separate agreements.
8. Notwithstanding anything to the contrary in this
Agreement or in your prior employment relationship
with the Company, express or implied, your employment
continues to be for an unspecified term, and either
you or Quiksilver may terminate such employment at
will and with or without Cause at any time for any
reason. This aspect of your employment relationship
can only be changed by an individualized written
agreement signed by both you and the Chairman of the
Board of the Company.
The Company may also terminate your employment
immediately, without notice, and without further
obligation for Cause, which shall be defined as (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) violation of law,
(v) self-dealing, (vi) willful breach of duty, (vii)
habitual neglect of duty, (viii) a material breach by
you of your
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October 24, 1996
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obligations under Paragraphs 9 or 11 of this
Agreement, or (ix) sustained unsatisfactory
performance (determined by the Chairman of the Board
of the Company).
If Quiksilver elects to terminate your employment
without Cause, or if you terminate your employment
with the Company for Good Reason (as defined below)
within six (6) months of the action constituting Good
Reason, the Company will continue to pay your base
salary (but not any bonuses or employment benefits)
on its regular payroll dates for a period of twelve
(12) months.
"Good Reason" for you to terminate employment means a
voluntary termination following a Change in Control
(as defined in Addendum "B") 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, or (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.
9. Quiksilver 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, marketing strategies, 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 Quiksilver, including, but not limited
to, those items specifically mentioned above.
10. The Company will reimburse you for documented
reasonable and necessary business expenses incurred
by you while engaged in business
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October 24, 1996
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activities for the Company's benefit on such terms
and conditions as shall be generally available to
other executives of the Company.
11. 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.
12. This Agreement, its addenda, and any stock option
agreements Quiksilver may enter into with you contain
the entire integrated agreement between us regarding
these issues, and no modification to this letter will
be valid unless set forth in writing and signed by
both you and the Chairman of the Board of the
Company. To the fullest extent allowed by law, any
dispute, controversy or claim arising out of or
relating to this Agreement, the breach thereof, or
any aspect of your employment or the cessation
thereof must be settled exclusively by final and
binding arbitration before a single arbitrator
administered by JAMS/Endispute in Orange County,
California, whose fees and costs shall be evenly
divided by the parties. Judgment upon the award
rendered by the arbitrator may be entered in any
court having jurisdiction thereof. The Company
reserves the right, however, to seek judicial
provisional remedies and equitable relief regarding
any breach or threatened breach of your obligations
regarding trade secrets and proprietary information.
13. 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.
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October 24, 1996
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Please sign, date and return the enclosed copy of this letter
to me for our files to acknowledge your agreement with the above.
Best personal regards.
Very truly yours,
Xxxxxx X. XxXxxxxx, Xx.
Chief Executive Officer
Enclosures
ACKNOWLEDGED AND AGREED:
-----------------------------------
Xxxxxx X. Xxxxx
Dated Effective: October 24, 1996
