Exhibit 10.1
 
Execution

AMENDMENT NO. 1 TO CREDIT AGREEMENT

AMENDMENT NO. 1 TO CREDIT AGREEMENT, dated as of April 30, 2013 (this “Amendment
No. 1”), is by and among Wells Fargo Bank, National Association, a national
banking association, as agent for the Lenders (as hereinafter defined) pursuant
to the Credit Agreement as defined below (in such capacity, together with its
successors and assigns, and any replacement, in such capacity, “Agent”), the
parties to the Credit Agreement as lenders (individually, each a “Lender” and
collectively, “Lenders”), K∙Swiss Inc., a Delaware corporation (“Parent”),
K-Swiss Sales Corp., a Delaware corporation (“KS Sales”), K-Swiss Direct Inc., a
California corporation (“KS Direct” and, together with Parent and KS Sales, each
individually a “Borrower” and collectively, “Borrowers”),  K-Swiss Pacific Inc.,
a Massachusetts corporation (“KS Pacific”), Royal Elastics Inc., a California
corporation (“RE Inc.”), Royal Elastics, LLC, a Delaware limited
liability  company (“RE LLC”), and K-Swiss NS Inc., a Delaware corporation (“KS
NS” and, together with KS Pacific, RE Inc. and RE LLC, each individually a
“Guarantor”  and collectively “Guarantors).
 
W I T N E S S E T H :
 
WHEREAS, Agent, Lenders, Borrowers and Guarantors have entered into financing
arrangements pursuant to which Lenders (or Agent on behalf of Lenders) may make
loans and advances and provide other financial accommodations to Borrowers as
set forth in the Credit Agreement dated as of April 25, 2012, by and among
Agent, Lenders, Borrowers and Guarantors (as the same now exists or may
hereafter be amended, modified, supplemented, extended, renewed, restated,
restructured, refinanced or replaced, the “Credit Agreement”) and the other Loan
Documents;
 
WHEREAS, Parent has entered into the Agreement and Plan of Merger, dated as of
January 16, 2013 (as the same now exists or may hereafter be amended, modified
or supplemented in accordance with the terms of the Loan Documents, the “Merger
Agreement”), by and among Parent, E-Lend World Limited, a corporation organized
under the laws of the Republic of Korea (the “Buyer”), and Ian Acquisition Sub,
Inc., a Delaware corporation that is an indirect wholly-owned subsidiary of
Buyer (the “Merger Sub”), pursuant to which Merger Sub will be merged with and
into the Parent (the “Merger”) with the Parent being the surviving entity in the
Merger;
 
WHEREAS, Borrowers and Guarantors have requested that Agent and Lenders agree to
make certain amendments to the Credit Agreement, and Agent and Lenders are
willing to so agree, subject to the terms and conditions set forth herein, to
make such amendments as more specifically set forth herein; and
 
WHEREAS, by this Amendment No. 1, Agent, Lenders, Borrowers and Guarantor intend
to evidence such amendments;
 
NOW, THEREFORE, in consideration of the foregoing and the mutual agreements and
covenants contained herein, the parties hereto agree as follows:
 
 
 

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1.      Definitions.
 
(a)      Additional Definition. As used herein or in the Credit Agreement or any
of the other Loan Documents, the following terms shall have the meanings given
to them below and the Credit Agreement shall be deemed and is hereby amended to
include, in addition and not in limitation, the following terms:
 
(i)           “Buyer” shall mean E-Land World Limited, a corporation organized
under the laws of the Republic of Korea.
 
(ii)          “Merger” shall mean the merger of Merger Sub with and into Parent
in accordance with the terms of the Merger Agreement, with Parent as the
surviving entity in the Merger.
 
(iii)         “Merger Agreement” shall mean the Agreement and Plan of Merger,
dated as of January 16, 2013, by and among Parent, Buyer and Merger Sub, as the
same now exists or may hereafter be amended, modified or supplemented in
accordance with the terms of the Loan Documents.
 
(iv)         “Merger Documents” shall mean the Merger Agreement and all material
agreements, documents and instruments executed by any Borrower or Guarantor in
connection therewith.
 
(v)          “Merger Sub” shall mean Ian Acquisition Sub, Inc., a Delaware
corporation that is an indirect wholly-owned subsidiary of Buyer.
 
(vi)         “Permitted Merger” shall mean the Merger; provided, that, (A) the
Merger shall be consummated on or prior to June 26, 2013, (B) Borrowers and
Guarantors shall promptly notify Agent in writing of the effectiveness of the
Merger and (C) Borrowers and Guarantors shall not, directly or indirectly,
amend, modify or otherwise change the terms of any of the Merger Documents if
such amendment, modification or change could reasonably be expected to be
adverse to the interests of any Borrower or Guarantor in any material respect.
 
(b)      Amendments to Definitions.
 
(i)           The definition of “Permitted Holders” contained in Schedule 1.1 to
the Credit Agreement is hereby amended by inserting the following phrase
immediately before the period appearing at the end of such definition: “;
provided, that, from and after the effectiveness of the Permitted Merger,
Permitted Holders shall mean the collective reference to Buyer and any
Subsidiaries of Buyer.”
 
(c)      Interpretation.  For purposes of this Amendment No. 1, all terms used
herein which are not otherwise defined herein, including but not limited to,
those terms used in the recitals hereto, shall have the respective meanings
assigned thereto in the Credit Agreement as amended by this Amendment No. 1.
 
2.      Restrictions on Fundamental Changes.  Section 6.3(a) of the Credit
Agreement is hereby amended by deleting the phrase “and (iii) any merger between
Subsidiaries of Parent that are not Loan Parties” and replacing it with “(iii)
any merger between Subsidiaries of Parent that are not Loan Parties, and (iv)
the Permitted Merger”.
 
 
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3.      Representations and Warranties.  Borrowers and Guarantors, jointly and
severally, represent and warrant to Agent and Lenders as follows, which
representations and warranties shall be true and correct in all material
respects (except that such materiality qualifier shall not be applicable to any
representations and warranties that already are qualified or modified by
materiality in the text thereof) on and as of the date hereof and on and as of
the date of each extension of credit under the Credit Agreement, as though made
on and as of such date (in each case except to the extent that such
representations and warranties relate solely to an earlier date, in which case
such representations and warranties shall be true and correct in all material
respects (except that such materiality qualifier shall not be applicable to any
representations and warranties that already are qualified or modified by
materiality in the text thereof) as of such earlier date):
 
(a)      Each of this Amendment, each agreement, document or instrument executed
by a Loan Party in connection herewith (collectively, with this Amendment the
“Amendment Documents”) and each Merger Document has been duly authorized,
executed and delivered by all necessary action on the part of each Loan Party
which is a party hereto or thereto and, if necessary, their respective members
or stockholders, as the case may be, and is in full force and effect as of the
date hereof, and the agreements and obligations of Loan Parties contained herein
and therein constitute legal, valid and binding obligations of Loan Parties
enforceable against them in accordance with their terms, except as such
enforceability may be limited by (i) bankruptcy, insolvency, reorganization,
moratorium or similar laws of general applicability affecting the enforcement of
creditors’ rights and (ii) the application of general principles of equity.
 
(b)      As of the date hereof, all of the representations and warranties set
forth in the Loan Agreement and the other Loan Documents are true and correct in
all material respects (except that such materiality qualifier shall not be
applicable to any representation or warranty that is already qualified or
modified by materiality in the text thereof)  on and as of the date hereof as if
made on the date hereof, except to the extent any such representation or
warranty is made as of a specified date, in which case such representation or
warranty shall have been true and correct as of such date.
 
(c)      Neither the execution, delivery and performance of any Amendment
Document or any Merger Document, nor the consummation of any of the transactions
contemplated therein (i) are in contravention of law or any indenture, agreement
or undertaking to which any Loan Party is a party or by which any Loan Party or
its property are bound, except where such contravention could not individually
or in the aggregate reasonably be expected to have a Material Adverse Effect, or
(ii) violates any provision of the certificate of incorporation, certificate of
formation, operating agreement, by-laws or other governing documents of any Loan
Party.
 
(d)      As of the date of this Amendment No. 1, no Default or Event of Default
exists or has occurred and is continuing.
 
 
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(e)      Parent has delivered, or caused to be delivered, to Agent true and
complete copies of the Merger Documents.
 
4.      Conditions Precedent.  The provisions contained herein shall be
effective as of the date hereof, but only upon the satisfaction of each of the
following conditions precedent:
 
(a)      Agent shall have received this Amendment No. 1, duly authorized,
executed and delivered by Borrowers, Guarantors and the Required Lenders;
 
(b)      Agent shall have received, in form and substance reasonably
satisfactory to Agent, the Merger Agreement and the other Merger Documents, duly
authorized, executed and delivered by the parties thereto; and
 
(c)      No Default or Event of Default shall exist or shall have occurred and
be continuing.
 
5.      Effect of this Amendment; Entire Agreement.  Except as expressly set
forth herein, no other changes or modifications to the Loan Documents are
intended or implied, and in all other respects the Loan Documents are hereby
specifically ratified, restated and confirmed by all parties hereto as of the
date hereof.  This Amendment No. 1 and the other Amendment Documents represent
the entire agreement and understanding concerning the subject matter hereof and
thereof among the parties hereto, and supersede all other prior agreements,
understandings, negotiations and discussions, representations, warranties,
commitments, proposals, offers and contracts concerning the subject matter
hereof and thereof, whether oral or written.  To the extent of conflict between
the terms of this Amendment No. 1 and the other Loan Documents, the terms of
this Amendment No. 1 shall control.  The Credit Agreement and this Amendment No.
1 shall be read and construed as one agreement.
 
6.      Governing Law.  The validity, interpretation and enforcement of this
Amendment No. 1 and any dispute arising out of the relationship between the
parties hereto, whether in contract, tort, equity or otherwise, shall be
governed by the laws of the State of California.
 
7.      Binding Effect.  This Amendment No. 1 shall be binding upon and inure to
the benefit of each of the parties hereto and their respective successors and
assigns.
 
8.      Headings.  The headings listed herein are for convenience only and do
not constitute matters to be construed in interpreting this Amendment No. 1.
 
9.      Counterparts.  This Amendment No. 1 may be executed in any number of
counterparts, but all of such counterparts shall together constitute but one and
the same agreement.  In making proof of this Amendment No. 1, it shall not be
necessary to produce or account for more than one counterpart thereof signed by
each of the parties hereto.  This Amendment No. 1 may be executed and delivered
by telecopier or other electronic method of transmission with the same force and
effect as if it were a manually executed and delivered counterpart.
 
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to be
duly executed and delivered by their authorized officers as of the day and year
first above written.
 

 
BORROWERS
         
K•SWISS INC.
         
 
By:
  /s/ George Powlick       Name:  George Powlick       Title:    Chief Financial
Officer  

 

 
K-SWISS SALES CORP.
         
 
By:
  /s/ George Powlick       Name:  George Powlick       Title:    Vice President
 

 

 
K-SWISS DIRECT INC.
         
 
By:
  /s/ David Nichols       Name:  David Nichols       Title:    President  

 
 

 
GUARANTORS
         
K-SWISS PACIFIC INC.
         
 
By:
  /s/ George Powlick       Name:  George Powlick       Title:    Assistant
Secretary  

 

 
ROYAL ELASTICS, LLC
   
By its Manager:
   
K•SWISS INC.
         
 
By:
  /s/ Steven Nichols       Name:  Steven Nichols       Title:    Management
Committee  

 
 
By:
  /s/ David Nichols       Name:  David Nichols       Title:    Management
Committee  

 
 
By:
  /s/ George Powlick       Name:  George Powlick       Title:    Management
Committee  

 
 
Amendment No. 1 to Credit Agreement

 
 

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ROYAL ELASTICS INC.
         
 
By:
  /s/ David Nichols       Name:  David Nichols       Title:    President  

 

 
K-SWISS NS INC.
         
 
By:
  /s/ Cheryl Kuchinka       Name:  Cheryl Kuchinka       Title:    President  

 

 
AGENT AND LENDERS
         
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Agent and as a Lender
         
 
By:
  /s/ Paras Shah       Name:  Paras Shah       Title:    Vice President  

 
 
Amendment No. 1 to Credit Agreement