Exhibit 10.2

 

EXECUTION VERSION

 

FOURTH AMENDMENT TO AMENDED AND RESTATED
CREDIT AGREEMENT

 

This Fourth Amendment to Amended and Restated Credit Agreement (the
“Amendment”), is made this 27th day of March, 2014 among CROCS, INC., a
corporation organized under the laws of the State of Delaware (“Crocs”), CROCS
RETAIL, INC., a corporation 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 financial institutions which are now party to the Credit
Agreement as lenders and who execute this Amendment  (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”).

 

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, and
that certain Third Amendment to Amended and Restated Credit Agreement by and
among the parties hereto dated as of December 27, 2013, the “Credit Agreement”)
to reflect certain financing arrangements among the parties thereto.  The Credit
Agreement and all other documents executed in connection therewith to the date
hereof are collectively referred to as the “Existing Financing Agreements”.  All
capitalized terms used and not otherwise defined herein shall have the meaning
ascribed thereto in the Credit Agreement, as amended hereby.

 

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.  For the avoidance of doubt, the
Consenting Lenders are sufficient to constitute Required Lenders.

 

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.

 

(a)                                 Definitions. Upon the Effective Date, the
following definitions in Section 1.1 of the Credit Agreement shall be amended
and restated in their 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 such period and non-cash share based
compensation expenses, (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, and
(y) cash and non-cash charges incurred during fiscal years 2013 and 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), 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) Borrowers’ aggregate Rental
Expenses for such period.

 

Fixed Charges  shall mean for any period of determination the sum of cash
interest expense, cash income taxes, scheduled principal installments on
Indebtedness (as adjusted for prepayments), Unfunded Capital Expenditures and
payments under Capitalized Leases, Rental Expenses and cash dividends and
distributions (including tax distributions) when actually paid, in each case, of
the Borrowers on a Consolidated Basis; provided however that to the extent paid
in the applicable testing period, Fixed Charges shall not include any payments
made in connection with a tax settlement with the Canadian tax authorities in an
amount not to exceed $10,000,000 in the aggregate.

 

(b)                                 Definitions. Upon the Effective Date, the
following definition shall be added to  Section 1.1 of the Credit Agreement in
the appropriate alphabetical sequence:

 

Unfunded Capital Expenditures  shall mean, as to any Borrower, without
duplication, a Capital Expenditure funded (a) from such Borrower’s internally
generated cash flow or (b) with the proceeds of a Revolving Credit Loan or a
Swing Loan.

 

(c)                                  Section 8.2.14                   Minimum
Fixed Charge Coverage Ratio.                    Upon the Effective Date,
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.  The Loan Parties shall
not permit the Fixed Charge Coverage Ratio to be less than the following ratios
for the following time periods, in each case calculated as of the end of each
fiscal quarter for the four (4) fiscal quarters then ended:

 

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Period

 

Minimum Fixed Charge Coverage
Ratio

Fiscal Quarter Ending March 31, 2014

 

1.15 to 1.00

Fiscal Quarter Ending June 30, 2014

 

1.15 to 1.00

Fiscal Quarter Ending September 30, 2014

 

1.20 to 1.00

Fiscal Quarter Ending December 31, 2014

 

1.20 to 1.00

Fiscal Quarter Ending March 31, 2015 and 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.

 

Section 2.                                          Acknowledgment of
Guarantors.  By execution of this Amendment, each Guarantor hereby covenants and
agrees that each of the Amended and Restated  Guaranty and Suretyship Agreements
dated December 16, 2011 shall remain in full force and effect and shall continue
to cover the existing and future Obligations of Borrowers to Administrative
Agent and Lenders under the Credit Agreement.

 

Section 3.                                          Conditions Precedent.  This
Amendment shall be effective upon (the “Effective Date”):

 

(a)                                 Administrative Agent’s receipt of this
Amendment fully executed by the Borrowers, the Guarantors, Administrative Agent
and Consenting Lenders;

 

(b)                                 Administrative Agent shall have received a
non refundable amendment fee in the amount of $30,000, which fee shall be fully
earned upon execution hereof and payable pro rata to all Consenting Lenders who
consent to this Amendment in accordance with such Consenting Lender’s Commitment
percentage; and

 

(c)                                  Receipt by Administrative Agent of
resolutions (authorizing their respective guarantees) and incumbency
certificates for Western Brands Holding Company, LLC and RA Footwear, LLC.

 

Section 4.                                          Representations and
Warranties.  Each Borrower:

 

(a)                                 reaffirms all representations and warranties
made to Administrative Agent and Lenders under the Credit Agreement and all of
the other Existing Financing Agreements and confirms that all are true and
correct in all material respects as of the date hereof (except 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);

 

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(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;

 

(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 Existing Financing
Agreements;

 

(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 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 of Credit Agreement.  Except
as modified by the terms hereof, all of the terms and conditions of the Credit
Agreement, as amended, and all of the other Existing Financing Agreements are
hereby reaffirmed 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.

 

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(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, INC.

 

 

 

 

 

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 Fourth Amendment]

 

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GUARANTORS:

 

 

 

WESTERN BRANDS HOLDING COMPANY, LLC

 

 

 

 

 

By:

/s/ Jeffrey J. Lasher

 

Name:

Jeffrey J. Lasher

 

Title:

Chief Financial Officer and Manager

 

 

 

 

 

 

 

RA FOOTWEAR, LLC

 

 

 

 

 

By:

/s/ Jeffrey J. Lasher

 

Name:

Jeffrey J. Lasher

 

Title:

Authorized Representative

 

 

 

 

 

FURY, INC.

 

 

 

 

 

By:

/s/ Jeffrey J. Lasher

 

Name:

Jeffrey J. Lasher

 

Title:

Chief Financial Officer

 

[Signature Page to Fourth Amendment]

 

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ADMINISTRATIVE AGENT AND LENDERS:

 

 

 

PNC BANK, NATIONAL ASSOCIATION, As Lender and as Administrative Agent

 

 

 

 

 

By:

/s/ Steve C. Roberts

 

Name:

Steve C. Roberts

 

Title:

Vice President

 

 

 

 

 

JPMORGAN CHASE BANK, N.A., as Lender

 

 

 

 

 

By:

/s/ Monica Popowczak

 

Name:

Monica Popowczak

 

Title:

Underwriter

 

 

 

 

 

WELLS FARGO BANK, N.A., as Lender

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

[Signature Page to Fourth Amendment]

 

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