EX-10.73



 Exhibit 10.73 

The following tables detail unaudited reconciliations from non-GAAP amounts to U.S. GAAP and include reconciliations related to ASC Topic 470 as it relates to
accounting for convertible debt, incremental dilutive shares related to our convertible debt that are covered by our existing convertible note hedges, non-cash gains related to the re-measurement of investments, foreign currency translation and
special charges related to professional fees incurred as a result of the continuing correspondence with the SEC Staff and the Special Committee of the Board of Directors’ review, and costs related to the transition of Iconix management. 

Note: All items in the following reconciliation tables are attributable to Iconix Brand Group, Inc. and exclude results related to non-controlling
interests. 
 (in thousands, except per share data) 

Non-GAAP Net income reconciliation 
 (in
thousands) 
  

																									
	 	  	(Unaudited)	 	 	(Unaudited)	 
	 	  	Three Months Ended
Dec. 31	 	 	Year Ended
Dec. 31	 
	 	  	2015	 	 	2014	 	 	% Change	 	 	2015	 	 	2014	 	 	% Change	 
		  	  
	  
	 	 	  
	  
	 
	 Non-GAAP Net income (1)
	  	$	12,291	  	 	$	22,679	  	 	 	(46%	) 	 	$	66,403	  	 	$	103,619	  	 	 	(36%	) 
		  	  
	  
	 	 	  
	  
	 
	 GAAP net income (loss)
	  	$	(263,013	) 	 	$	17,525	  	 	 	—  	  	 	$	(189,303	) 	 	$	103,723	  	 	 	—  	  
	 Add: non-cash interest related to ASC 470
	  	 	7,343	  	 	 	6,647	  	 	 	10%	  	 	 	28,643	  	 	 	26,804	  	 	 	7%	  
	 non-cash gain related to investment in joint venture
	  	 	—  	  	 	 	—  	  	 	 	—  	  	 	 	(49,990	) 	 	 	(28,897	) 	 	 	73%	  
	 special charges
	  	 	1,646	  	 	 	—  	  	 	 	—  	  	 	 	11,136	  	 	 	—  	  	 	 	—  	  
	 foreign currency translation loss (gain)
	  	 	(2,051	) 	 	 	932	  	 	 	—  	  	 	 	(9,921	) 	 	 	1,343	  	 	 	—  	  
	 write-down of certain intangible assets
	  	 	420,800	  	 	 	—  	  	 	 	—  	  	 	 	420,800	  	 				 	 	—  	  
	 Deduct: Income taxes related to above
	  	 	(152,434	) 	 	 	(2,425	) 	 	 	—  	  	 	 	(144,962	) 	 	 	646	  	 	 	—  	  
		  	  
	  
	 	 	  
	  
	 
	 Net
	  	 	275,304	  	 	 	5,154	  	 	 	—  	  	 	 	255,706	  	 	 	(104	) 	 	 	—  	  
		  	  
	  
	 	 	  
	  
	 
	 Non-GAAP Net income
	  	$	12,291	  	 	$	22,679	  	 	 	(46%	) 	 	$	66,403	  	 	$	103,619	  	 	 	(36%	) 
		  	  
	  
	 	 	  
	  
	 

 Non-GAAP weighted average diluted shares reconciliation 

(in thousands) 
  

																									
	 	  	(Unaudited)	 	 	(Unaudited)	 
	 	  	Three Months Ended
Dec. 31	 	 	Year Ended
Dec. 31	 
	 	  	2015	 	  	2014	 	 	% Change	 	 	2015	 	 	2014	 	 	% Change	 
		  	  
	  
	 	 	  
	  
	 
	 Non-GAAP weighted average diluted shares
	  	 	49,957	  	  	 	50,352	  	 	 	(1%	) 	 	 	49,776	  	 	 	52,257	  	 	 	(5%	) 
		  	  
	  
	 	 	  
	  
	 
	 GAAP weighted average diluted shares
	  	 	48,310	  	  	 	54,552	  	 	 	(11%	) 	 	 	48,293	  	 	 	57,366	  	 	 	(16%	) 
	 Add: anti-dilutive shares resulting from net loss
	  	 	1,647	  	  	 	—  	  	 				 	 	2,070	  	 	 	—  	  	 			
	 Less: additional incremental dilutive shares covered by hedges for: (2)
	  				  				 				 				 				 			
	 2.50% Convertible Notes
	  	 	—  	  	  	 	(1,819	) 	 				 	 	(256	) 	 	 	(2,209	) 	 	 	—  	  
	 1.50% Convertible Notes
	  	 	—  	  	  	 	(2,381	) 	 				 	 	(331	) 	 	 	(2,900	) 	 	 	—  	  
		  	  
	  
	 	 	  
	  
	 
	 Subtotal
	  	 	—  	  	  	 	(4,200	) 	 				 	 	(587	) 	 	 	(5,109	) 	 	 	—  	  
		  	  
	  
	 	 	  
	  
	 
	 Non-GAAP weighted average diluted shares
	  	 	49,957	  	  	 	50,352	  	 	 	(1%	) 	 	 	49,776	  	 	 	52,257	  	 	 	(5%	) 
		  	  
	  
	 	 	  
	  
	 








 Non-GAAP Diluted EPS reconciliation 

 

																									
	 	  	(Unaudited)	 	 	(Unaudited)	 
	 	  	Three Months Ended
Dec. 31	 	 	Year Ended
Dec. 31	 
	 	  	2015	 	 	2014	 	  	% Change	 	 	2015	 	 	2014	 	 	% Change	 
		  	  
	  
	 	 	  
	  
	 
	 Non-GAAP diluted EPS (1)
	  	$	0.25	  	 	$	0.45	  	  	 	(45%	) 	 	$	1.33	  	 	$	1.98	  	 	 	(33%	) 
		  	  
	  
	 	 	  
	  
	 
	 GAAP diluted EPS
	  	$	(5.44	) 	 	$	0.32	  	  	 	—      	  	 	$	(3.92	) 	 	 	1.81	  	 	 	—      	  
	 Add:
	  				 				  				 				 				 			
	 non-cash gain related to investment in joint venture
	  	 	—  	  	 				  	 	—      	  	 	$	(0.67	) 	 	$	(0.33	) 	 	 	103%	  
	 special charges
	  	$	0.02	  	 	 	—  	  	  	 	—      	  	 	$	0.15	  	 	 	—  	  	 	 	—      	  
	 foreign currency translation gain
	  	$	(0.04	) 	 	$	0.02	  	  	 	—      	  	 	$	(0.19	) 	 	$	0.02	  	 	 	—      	  
	 Non-cash interest related to ASC 470, net of tax, and incremental dilutive shares covered by
hedges
	  	$	0.09	  	 	$	0.11	  	  	 	(18%	) 	 	$	0.34	  	 	$	0.48	  	 	 	(29%	) 
	 Write-down of certain intangible assets
	  	$	5.62	  	 	 	—  	  	  				 	$	5.62	  	 	 	—  	  	 			
		  	  
	  
	 	 	  
	  
	 
	 Non-GAAP diluted EPS
	  	$	0.25	  	 	$	0.45	  	  	 	(45%	) 	 	$	1.33	  	 	$	1.98	  	 	 	(33%	) 
		  	  
	  
	 	 	  
	  
	 

 Forecasted Non-GAAP Diluted EPS 
  

									
	 	  	Year Ending
Dec. 31, 2016	 
	 	  	Low	 	  	High	 
	 Forecasted Non-GAAP diluted EPS (1)
	  	$	1.15	  	  	$	1.30	  
		  	  
	  
	 
	 Forecasted GAAP diluted EPS
	  	$	0.75	  	  	$	0.90	  
	 Special charges, net of tax
	  	$	0.11	  	  	$	0.11	  
	 Adjustments for non-cash interest related to ASC 470, net of tax, and incremental dilutive shares
covered by hedges
	  	$	0.29	  	  	$	0.29	  
		  	  
	  
	 
	 Forecasted Non-GAAP Diluted EPS
	  	$	1.15	  	  	$	1.30	  
		  	  
	  
	 

  

	(1)	Non-GAAP net income and non-GAAP diluted EPS (along with non-GAAP weighted average diluted shares) are non-GAAP financial measures which represent net income excluding any non-cash interest related to ASC Topic 470,
non-cash non-recurring gains and charges, foreign currency translation gains and losses, and charges related to professional fees incurred as a result of the continuing correspondence with the Staff and the Special Committee’s review, all
net of tax, and any incremental dilutive shares related to our convertible notes that are covered by their respective hedges. The Company believes these are useful financial measures in evaluating its financial condition. 


	(2)	Based on the average closing stock price for the years ended December 31, 2015 and 2014 there were potential dilutive shares related to our convertible notes for GAAP purposes; however, the Company will
not be responsible for issuing a portion of these shares as they are covered by our convertible notes hedges. 

 Adjusted EBITDA
Reconciliation from Net Income
  

																									
	 	  	(Unaudited)	 	 	(Unaudited)	 
	 	  	Three Months Ended
Dec. 31	 	 	Year Ended
Dec. 31	 
	 	  	2015	 	 	2014	 	  	% Change	 	 	2015	 	 	2014	 	 	% Change	 
		  	  
	  
	 	 	  
	  
	 
	 Adjusted EBITDA (1)
	  	$	37,976	  	 	$	44,326	  	  	 	(14%	) 	 	$	172,668	  	 	$	211,073	  	 	 	(18%	) 
		  	  
	  
	 	 	  
	  
	 
	 Reconciliation of Adjusted EBITDA:
	  				 				  				 				 				 			
	 Net income (loss)
	  	$	(263,013	) 	 	$	17,525	  	  	 	—      	  	 	$	(189,303	) 	 	$	103,723	  	 	 	—      	  
	 Add: Provision for income taxes
	  	 	(140,427	) 	 	 	5,210	  	  	 	—      	  	 	 	(95,344	) 	 	 	48,288	  	 	 	—      	  
	 Net income (loss) before taxes
	  	 	(403,440	) 	 	 	22,735	  	  	 	—      	  	 	 	(284,647	) 	 	 	152,011	  	 	 	—      	  
	 Add, net of non-controlling interests:
	  				 				  				 				 				 			
	 Net interest expense
	  	 	20,034	  	 	 	19,306	  	  	 	4%	  	 	 	81,205	  	 	 	80,550	  	 	 	1%	  
	 Foreign currency translation
	  	 	(2,051	) 	 	 	932	  	  	 	—      	  	 	 	(9,921	) 	 	 	1,343	  	 	 	—      	  
	 Goodwill impairment
	  	 	28,957	  	 	 	—  	  	  	 	—      	  	 	 	28,957	  	 	 	—  	  	 	 	—      	  
	 Trademark impairment
	  	 	391,843	  	 	 	—  	  	  	 	—      	  	 	 	391,843	  	 	 	—  	  	 	 	—      	  
	 Re-measurement gain
	  	 	—  	  	 	 	—  	  	  	 	—      	  	 	 	(49,990	) 	 	 	(28,897	) 	 	 	73%	  
	 Special charges
	  	 	1,646	  	 	 	—  	  	  	 	—      	  	 	 	11,136	  	 	 	—  	  	 	 	—      	  
	 Depreciation and amortization attributable to Iconix
	  	 	988	  	 	 	1,354	  	  	 	(27%	) 	 	 	4,084	  	 	 	6,066	  	 	 	(33%	) 
		  	  
	  
	 	 	  
	  
	 
	 Adjusted EBITDA
	  	$	37,976	  	 	$	44,326	  	  	 	(14%	) 	 	$	172,668	  	 	$	211,073	  	 	 	(18%	) 
		  	  
	  
	 	 	  
	  
	 








 Adjusted EBITDA Reconciliation from Cash Flow from Operations

 

													
	 	  	(Unaudited)	 
	 	  	Year Ended
Dec 31	 
	 	  	2015	 	  	2014	 	  	% Change	 
		  	  
	  
	 
	 Adjusted EBITDA (3)
	  	$	172,668	  	  	$	211,073	  	  	 	(18%	) 
		  	  
	  
	 
	 Reconciliation of Adjusted EBITDA:
	  				  				  			
	 Net cash provided by operating activities
	  	$	186,135	  	  	$	160,009	  	  	 	16%	  
	 Add/(Less):
	  				  				  			
	 Gain from sale of trademarks & formation of joint ventures
	  	 	—  	  	  	 	6,399	  	  	 	—  	  
	 Cash interest expense, net
	  	 	45,722	  	  	 	45,935	  	  	 	0%	  
	 Current income tax provision
	  	 	17,492	  	  	 	16,164	  	  	 	8%	  
	 Special charges
	  	 	11,136	  	  	 	—  	  	  	 	—  	  
	 Accrued equity earnings on joint ventures, net of distributions
	  	 	1,127	  	  	 	4,180	  	  	 	(73%	) 
	 Other
	  	 	(1,639	) 	  	 	355	  	  	 	—  	  
	 Net income attributable to non-controlling interest, excluding impairment charges
	  	 	(17,097	) 	  	 	(15,099	) 	  	 	13%	  
	 Stock compensation expense
	  	 	(11,427	) 	  	 	(18,492	) 	  	 	(38%	) 
	 Provision for doubtful accounts
	  	 	(25,128	) 	  	 	(9,627	) 	  	 	161%	  
	 Net change in balance sheet items
	  	 	(33,653	) 	  	 	21,248	  	  	 	—  	  
		  	  
	  
	 
	 Adjusted EBITDA
	  	$	172,668	  	  	$	211,073	  	  	 	(18%	) 
		  	  
	  
	 

  

	(3)	Adjusted EBITDA, a non-GAAP financial measure, represents net income before income taxes, interest, other non -operating gains and losses, special charges, depreciation and amortization expenses. The Company believes
Adjusted EBITDA provides additional information for determining its ability to meet future debt service requirements, investing and capital expenditures, and is useful because it provides supplemental information to assist investors in evaluating
the Company’s financial condition. 

 Free Cash Flow Reconciliation 

 

													
	 	  	2015	 	  	2014	 	  	% Change	 
		  	  
	  
	 
	 Free Cash Flow (4)
	  	$	188,913	  	  	$	165,355	  	  	 	14%	  
		  	  
	  
	 
	 Net cash provided by operating activities
	  	 	188,234	  	  	 	160,009	  	  	 	18%	  
	 Less: Capital Expenditures
	  	 	(1,433	) 	  	 	(1,505	) 	  	 	(5%	) 
	 Add: Cash received from sale of trademarks and formation of joint ventures
	  	 	24,192	  	  	 	24,915	  	  	 	(3%	) 
	 Less: Distributions to non-controlling interests
	  	 	(22,080	) 	  	 	(18,064	) 	  	 	22%	  
		  	  
	  
	 
	 Free Cash Flow
	  	$	188,913	  	  	$	165,355	  	  	 	14%	  
		  	  
	  
	 

  

	(4)	Free Cash Flow, a non-GAAP financial measure, represents net cash provided by operating activities, plus cash received from the sale of trademarks and formation of joint ventures, less distributions to non-controlling
interests and capital expenditures. Free Cash Flow excludes notes receivable from sale of trademarks and the formation of joint ventures, cash used to acquire the membership interests of our joint venture partners, mandatory debt service
requirements, and other non-discretionary expenditures. Free Cash Flow should not be considered in isolation, as a measure of residual cash flow available for discretionary purposes, or as an alternative to operating results presented in accordance
with GAAP. The Company believes Free Cash Flow is useful because it provides information regarding actual cash received in a specific period from the Company’s comprehensive business strategy of maximizing the value of its brands through
traditional licensing, international joint ventures and other arrangements. We have excluded the cash used to buy back our joint venture membership interests from the above definition because we believe that, like other acquisitions, such actions
are capital transactions. It also provides supplemental information to assist investors in evaluating the Company’s financial condition and ability to pursue opportunities that enhance shareholder value.