Exhibit 10.1

 

EIGHTH AMENDMENT TO

 

AMENDED AND RESTATED CREDIT AGREEMENT

 

This Eighth Amendment to Amended and Restated Credit Agreement (the
“Amendment”), is made this 1st day of September, 2015 among CROCS, INC., a
corporation organized under the laws of the State of Delaware (“Crocs”), CROCS
RETAIL, LLC, a limited liability company organized under the laws of the State
of Colorado (“Retail”), OCEAN MINDED, INC., a corporation organized under the
laws of the State of Colorado (“Ocean”), JIBBITZ, LLC, a limited liability
company organized under the laws of the State of Colorado (“Jibbitz”),
BITE, INC., a corporation organized under the laws of the State of Colorado
(“Bite”, together with Crocs, Retail, Ocean, Jibbitz and each other Person
joined as a borrower from time to time to the Credit Agreement (as defined
below), collectively “Borrowers” and each a “Borrower”), the Lenders who have
executed this Amendment and constitute Required Lenders (collectively, the
“Consenting Lenders” and each individually a “Consenting Lender”) and PNC BANK,
NATIONAL ASSOCIATION (“PNC”), as agent for Lenders (PNC, in such capacity, the
“Administrative Agent”).  All capitalized terms used and not otherwise defined
herein shall have the meaning ascribed thereto in the below-defined Credit
Agreement, as amended hereby.

 

BACKGROUND

 

A.                                    On December 16, 2011, Borrowers, Lenders
and Administrative Agent entered into, inter alia, that certain Amended and
Restated Credit Agreement (as same has been or may hereafter be amended,
modified, renewed, extended, restated or supplemented from time to time,
including without limitation as amended by that certain First Amendment to
Amended and Restated Credit Agreement by and among the parties hereto dated as
of December 10, 2012, that certain Second Amendment to Amended and Restated
Credit Agreement by and among the parties hereto dated as of June 12, 2013, that
certain Third Amendment to Amended and Restated Credit Agreement by and among
the parties hereto dated as of December 27, 2013, that certain Fourth Amendment
to Amended and Restated Credit Agreement by and among the parties hereto dated
as of March 27, 2014, that certain Fifth Amendment to Amended and Restated
Credit Agreement by and among the parties hereto dated as of September 26, 2014,
that certain Sixth Amendment to Amended and Restated Credit Agreement by and
among the parties hereto dated as of April 2, 2015, and that certain Seventh
Amendment to Amended and Restated Credit Agreement by and among the parties
hereto dated as of April 21, 2015 the “Credit Agreement”) to reflect certain
financing arrangements among the parties thereto.

 

B.                                    Borrowers have requested and
Administrative Agent and Consenting Lenders have agreed to modify certain terms
and provisions of the Credit Agreement on the terms and subject to the
conditions contained in this Amendment.

 

NOW, THEREFORE, in consideration of the mutual promises contained herein, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto hereby agree as follows:

 

Section 1.                                          Amendments to Credit
Agreement.  Upon the Effective Date (as defined below):

 

(a)                                 The definition of Consolidated EBITDAR in
Section 1.1 of the Credit Agreement shall be amended and restated in its
entirety as follows:

 

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Consolidated EBITDAR shall mean for any period the sum of (i) net income (or
loss) of Borrowers on a Consolidated Basis for such period (excluding, in each
case to the extent incurred or charged during the applicable period:
(w) one-time non-cash charges with the consent of Administrative Agent in the
aggregate not to exceed $25,000,000 for any trailing twelve month period ending
after December 31, 2015, (x) any transaction costs associated with the Preferred
Stock Issuance in an amount not to exceed $30,000,000 in the aggregate to the
extent paid within 180 days of the closing of the Preferred Stock Issuance,
(y) cash and non-cash charges incurred during the period beginning January 1,
2013 and ending June 30, 2014 in connection with store closings or
restructuring, charges for inventory obsolescence, other corporate restructuring
activities or contingent liabilities, in an amount not to exceed $25,000,000 in
the aggregate or $10,000,000 with respect to cash charges), and (z) cash and
non-cash charges incurred during the period beginning July 1, 2014 and ending
December 31, 2015 in connection with legal settlements, asset impairments,
charges associated with ongoing U.S. customs audits, disbursements made to
invalid vendors and corporate restructuring activities, including, but not
limited to, retail restructuring, costs associated with the transition from a
direct to distribution model in foreign markets, inventory charges and
write-offs, global staff reductions and personnel charges, new office locations,
charges associated with the Borrowers’ SAP software system, charges relating to
the exit, sublease and other costs associated with the company plane, other
corporate restructuring activities or contingent liabilities, in an amount not
to exceed $85,000,000 in the aggregate or $65,000,000 with respect to cash
charges, plus (ii) all interest expense of Borrowers on a Consolidated Basis for
such period, plus (iii) all charges against income of Borrowers on a
Consolidated Basis for such period for federal, state and local taxes, plus
(iv) depreciation expenses for such period, plus (v) amortization expenses for
such period, plus (vi) non-cash share based compensation expenses, plus
(vii) Borrowers’ aggregate Rental Expenses for such period.

 

(b)                                 Clause (iii) of Section 8.2.5 of the Credit
Agreement shall be amended and restated in its entirety as follows:

 

(iii) purchases, redemptions or retirements of equity interests of any Borrower
(A) during the period from January 1, 2014 through December 31, 2014 in the
amount not exceeding $146,000,000; (B) during the period from July 1, 2015
through September 30, 2015, in the amount not exceeding $40,000,000 and (C) at
all times thereafter, so long as (1) the aggregate amount of all such purchases,
redemptions or retirements does not exceed (x) $350,000,000 in the aggregate
since January 1, 2014 and (y) $200,000,000 in the aggregate in any fiscal year,
(2) at the time of and after giving pro

 

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forma effect to such purchases, redemptions or retirements, (I) no Potential
Default or Event of Default has occurred and is continuing or would occur, and
(II) Revolver Availability is not less than $25,000,000, and (3) Administrative
Agent and Lenders shall have received the quarterly financial statements
required under Section 8.3.1 hereof for the fiscal quarter ending September 30,
2015 together with a Compliance Certificate evidencing that the Fixed Charge
Coverage Ratio for such fiscal quarter is not less than 1.00 to 1.00
(notwithstanding the minimum required Fixed Charge Coverage Ratio set forth in
Section 8.2.14 for such fiscal quarter); provided, that, if Borrowers do not
have a Fixed Charge Coverage Ratio of at least 1.00 to 1.00 for the fiscal
quarter ending September 30, 2015, Borrowers shall be permitted to make such
purchases, redemptions or retirements of equity interests of any Borrower upon
(X) satisfaction of the conditions set forth in clauses (I) and (II) of this
Section (C), and (Y) delivery to Administrative Agent and Lenders of the
quarterly financial statements required under Section 8.3.1 hereof for any
subsequent fiscal quarter together with a Compliance Certificate evidencing that
the Fixed Charge Coverage Ratio for such fiscal quarter is not less than the
ratio then required under Section 8.2.14 for such fiscal quarter;

 

(c)                                  Section 8.2.14 of the Credit Agreement
shall be amended and restated in its entirety as follows:

 

8.2.14 Minimum Fixed Charge Coverage Ratio.  When measured for the four fiscal
quarter period ending on each measurement date set forth below, the Loan Parties
shall maintain a Fixed Charge Coverage Ratio of not less than the ratio set
forth below opposite thereto:

 

Measurement Date

 

Minimum Fixed Charge
Coverage Ratio

March 31, 2015

 

1.00 to 1.00

June 30, 2015

 

1.00 to 1.00

September 30, 2015

 

0.95 to 1.00

December 31, 2015

 

1.00 to 1.00

March 31, 2016

 

1.15 to 1.00

June 30, 2016 and the last day of each fiscal quarter thereafter

 

1.25 to 1.00

 

Notwithstanding anything to the contrary, for purposes of calculating the Fixed
Charge Coverage Ratio for any applicable testing period, any costs incurred in
fiscal year 2014 by the Loan Parties in connection with the implementation of a
SAP software system, in an aggregate amount not to exceed $30,000,000 shall not
be deemed to be Unfunded Capital Expenditures or included in Fixed Charges.

 

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Section 2.                                          Acknowledgment of
Guarantors.  With respect to the amendments to the Credit Agreement effected by
this Amendment, each Guarantor signatory hereto hereby acknowledges and agrees
to this Amendment and confirms and agrees that its Guaranty Agreement (as
modified and supplemented in connection with this Amendment) and any other Loan
Document to which it is a party is and shall continue to be, in full force and
effect and is hereby ratified and confirmed in all respects except that, upon
the effectiveness of, and on and after the date of this Amendment, each
reference in such Guaranty or Loan Document to the Credit Agreement,
“thereunder”, “thereof” or words of like import referring to the Credit
Agreement, shall mean and be a reference to the Credit Agreement as amended or
modified by this Amendment.  Although Administrative Agent and the Consenting
Lenders have informed the Guarantors of the matters set forth above, and the
Guarantors have acknowledged the same, each Guarantor understands and agrees
that neither Administrative Agent nor any Lender has any duty under the Credit
Agreement, the Guaranty Agreements or any other Loan Document to so notify any
Guarantor or to seek such an acknowledgement, and nothing contained herein is
intended to or shall create such a duty as to any transaction hereafter.

 

Section 3.                                          Conditions Precedent.  This
Amendment shall be effective upon satisfaction of the following conditions (the
date of such satisfaction, the “Effective Date”):

 

(a)                                 Administrative Agent shall have received
this Amendment fully executed by the Borrowers, the Guarantors, Administrative
Agent and Consenting Lenders; and

 

(b)                                 Administrative Agent shall have received an
amendment fee of $30,000, to be allocated pro-rata among Agent and Consenting
Lenders, by wire transfer in immediately available funds.

 

Section 4.                                          Representations and
Warranties.  Each Loan Party:

 

(a)                                 reaffirms all representations and warranties
made to Administrative Agent and Lenders under the Credit Agreement and all of
the other Loan Documents and confirms that all are true and correct in all
material respects as of the date hereof (except (i) to the extent any such
representations and warranties specifically relate to a specific date, in which
case such representations and warranties were true and correct in all material
respects on and as of such other specific date, and (ii) to the extent any such
representations and warranties are qualified by materiality, in which case such
representations and warranties were true and correct in all respects);

 

(b)                                 reaffirms all of the covenants contained in
the Credit Agreement, covenants to abide thereby until satisfaction in full of
the Obligations and termination of the Credit Agreement and the other Loan
Documents;

 

(c)                                  represents and warrants to the
Administrative Agent and the Lenders that no Potential Default or Event of
Default has occurred and is continuing under any of the Loan Documents or will
result from this Amendment;

 

(d)                                 represents and warrants to the
Administrative Agent and the Lenders that it has the authority and legal right
to execute, deliver and carry out the terms of this Amendment, that such actions
were duly authorized by all necessary limited

 

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liability company or corporate action, as applicable, and that the officers
executing this Amendment on its behalf were similarly authorized and empowered,
and that this Amendment does not contravene any provisions of its certificate of
incorporation or formation, operating agreement, bylaws, or other formation
documents, as applicable, or of any contract or agreement to which it is a party
or by which any of its properties are bound; and

 

(e)                                  represents and warrants to the
Administrative Agent and the Lenders that this Amendment and all assignments,
instruments, documents, and agreements executed and delivered in connection
herewith, are valid, binding and enforceable in accordance with their respective
terms, except as such enforceability may be limited by any applicable
bankruptcy, insolvency, moratorium or similar laws affecting creditors’ rights
generally.

 

Section 5.                                          General Provisions.

 

(a)                                 Payment of Expenses.  Borrowers shall pay or
reimburse Administrative Agent and Lenders for their reasonable attorneys’ fees
and expenses in connection with the preparation, negotiation and execution of
this Amendment and the documents provided for herein or related hereto.

 

(b)                                 Reaffirmation.  Except as modified by the
terms hereof, all of the terms and conditions of the Credit Agreement, as
amended, and all of the other Loan Documents are hereby reaffirmed by each Loan
Party and shall continue in full force and effect as therein written.

 

(c)                                  Third Party Rights.  No rights are intended
to be created hereunder for the benefit of any third party donee, creditor, or
incidental beneficiary.

 

(d)                                 Headings.  The headings of any paragraph of
this Amendment are for convenience only and shall not be used to interpret any
provision hereof.

 

(e)                                  Modifications.  No modification hereof or
any agreement referred to herein shall be binding or enforceable unless in
writing and signed on behalf of the party against whom enforcement is sought.

 

(f)                                   Governing Law.  This Amendment shall be
governed by and construed in accordance with the laws of the State of New York
applied to contracts to be performed wholly within the State of New York.

 

(g)                                  Counterparts.  This Amendment may be
executed in any number of and by different parties hereto on separate
counterparts, all of which, when so executed, shall be deemed an original, but
all such counterparts shall constitute one and the same agreement.  Any
signature delivered by a party by facsimile transmission or PDF shall be deemed
to be an original signature hereto.

 

(Signature Pages Follow)

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed by their respective officers thereunto duly authorized as of the day
and year first above written.

 

 

BORROWERS:

 

 

 

CROCS, INC.

 

 

 

 

 

By:

/s/ Jeffrey J. Lasher

 

Name: Jeffrey J. Lasher

 

Title: Chief Financial Officer

 

 

 

 

 

CROCS RETAIL, LLC

 

 

 

 

 

By:

/s/ Jeffrey J. Lasher

 

Name: Jeffrey J. Lasher

 

Title: Chief Financial Officer

 

 

 

 

 

OCEAN MINDED, INC.

 

 

 

 

 

By:

/s/ Jeffrey J. Lasher

 

Name: Jeffrey J. Lasher

 

Title: Chief Financial Officer

 

 

 

 

 

JIBBITZ, LLC

 

 

 

 

 

By:

/s/ Jeffrey J. Lasher

 

Name: Jeffrey J. Lasher

 

Title: Manager

 

 

 

 

 

BITE, INC.

 

 

 

 

 

By:

/s/ Jeffrey J. Lasher

 

Name: Jeffrey J. Lasher

 

Title: Chief Financial Officer

 

[Signature Page to Eighth Amendment (Crocs)]

 

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GUARANTORS:

 

 

 

WESTERN BRANDS HOLDING COMPANY,
LLC

 

 

 

 

 

By:

/s/ Jeffrey J. Lasher

 

Name: Jeffrey J. Lasher

 

Title: Chief Financial Officer

 

[Signature Page to Eighth Amendment (Crocs)]

 

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PNC BANK, NATIONAL ASSOCIATION,

 

as a Lender and as Administrative Agent

 

 

 

 

 

By:

/s/ Steve C. Roberts

 

Name: Steve C. Roberts

 

Title: Vice President

 

[Signature Page to Eighth Amendment (Crocs)]

 

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JPMORGAN CHASE BANK, N.A.,

 

as a Lender

 

 

 

 

 

By:

/s/ Monica Popowczak

 

Name: Monica Popowczak

 

Title: Authorized Officer

 

[Signature Page to Eighth Amendment (Crocs)]

 

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HSBC BANK USA, N.A.,

 

as a Lender

 

 

 

 

 

By:

/s/ Jean Frammolino

 

Name: Jean Frammolino

 

Title: Vice President

 

[Signature Page to Eighth Amendment (Crocs)]

 

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