Exhibit
10.1

    


    AMENDMENT
NO. 3

     

    TO

     

    AMENDED
AND RESTATED LOAN AND SECURITY AGREEMENT

    


    THIS
AMENDMENT NO. 3 (this “Amendment No. 3”) is entered into as of May 19, 2010, by
and among ROCKY BRANDS, INC., a corporation organized and existing under the
laws of the State of Ohio (“Parent”), LIFESTYLE FOOTWEAR, INC., a corporation
organized and existing under the laws of the State of Delaware, ROCKY BRANDS
WHOLESALE LLC, a limited liability company organized and existing under the laws
of the State of Delaware, LEHIGH OUTFITTERS, LLC, a limited liability company
organized and existing under the laws of the State of Delaware (and formerly
known as Rocky Brands Retail LLC), ROCKY BRANDS INTERNATIONAL, LLC, a limited
liability company organized and existing under the laws of the State of Ohio
(the foregoing entities, jointly and severally, as the context requires,
“Borrower” or “Borrowers”), the financial institution(s) listed on the signature
pages hereof and their respective successors and Eligible Assignees (each
individually a “Lender” and collectively, “Lenders”), GMAC COMMERCIAL FINANCE
LLC, a Delaware limited liability company (in its individual capacity, “GMAC
CF”), as administrative agent and sole lead arranger for the Lenders (in such
capacities, the “Agent”) and BANK OF AMERICA, N.A., as syndication agent (in
such capacity, the “Syndication Agent”) and CHARTER ONE BANK, N.A., as
documentation agent (in such capacity, the “Documentation Agent”).

     

    BACKGROUND

     

    Borrowers,
Lenders, Agent, Syndication Agent and Documentation Agent are parties to an
Amended and Restated Loan and Security Agreement, dated as of May 25, 2007 (as
amended by Joinder and Amendment No. 1 to Amended and Restated Loan and Security
Agreement dated as of November 12, 2008, by Amendment No. 2 to Amended and
Restated Loan and Security Agreement dated as of March 31, 2009, and as same my
hereafter be further amended, restated, modified and/or supplemented from time
to time, the “Loan Agreement”) pursuant to which Agent and Lenders provide
Borrowers with certain financial accommodations.

     

    Borrowers
have informed Agent and Lenders of their desire to prepay all or a portion of
the outstanding Second Priority Senior Secured Notes within the period
commencing on the date hereof and continuing through December 31, 2010 (the
“Prepayment Period”).  In addition to provisions under the existing
Loan Agreement that authorize the prepayment of all or any portion of the Second
Priority Senior Secured Notes, Borrowers have requested Agent and Lenders to
permit Borrowers, at any time during the Prepayment Period, to utilize up to
$15,225,000 in additional Loans, to be used to prepay a portion of the Second
Priority Senior Secured Notes.  Agent and Lenders have agreed to make
certain amendments to the Loan Agreement so as to permit Loans to be used for
such prepayment on the terms and conditions hereinafter set forth.

     

    NOW,
THEREFORE, in consideration of any loan or advance or grant of credit heretofore
or hereafter made to or for the account of Borrowers by Agent and Lenders, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto hereby agree as
follows:


    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    1.           Definitions.  All
capitalized terms not otherwise defined herein shall have the meanings given to
them in the Loan Agreement.

     

    2.           Amendments to Loan
Agreement.  Subject to satisfaction of the conditions precedent
set forth in Section 3 below, the Loan Agreement is hereby amended as
follows:

     

    (a)           Section
1.1 is amended by adding the following defined term in its appropriate
alphabetical order:

     

    “’Amendment
No. 3 Effective Date’ shall mean May 19, 2010.”

     

    (b)           Section
2.4(E) is amended by restating the proviso appearing in the first sentence
thereof as follows:

     

    “provided, however, that the
application of any proceeds from the issuance of securities described in Section
2.4(B)(3) may be utilized by Borrower, within a forty-five (45) day period
commencing on the date of receipt of such proceeds, to repay or prepay, in whole
or in part, the Second Priority Senior Secured Notes, with any excess not
utilized during such period to repay or prepay the Second Priority Senior
Secured Notes applied to reduce the outstanding balance of the Revolving Loans,
but not as a permanent reduction of the Revolving Loan Commitment”

     

    (c)           The
first sentence of Section 4.1(M) shall be amended and restated as
follows:

     

    “The Loan
Parties will use the proceeds from the Loans to provide for the ongoing working
capital and general corporate requirements of the Loan Parties; and to prepay
all or a portion of the Second Priority Senior Secured Notes in accordance with
the provisions of Section 5.2(R).”

     

    
      
        
        

      

      
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    (d)           Section
5.2(R) shall be amended and restated as follows:


    “(R)         Changes Relating to Note
Purchase Documents; Prepayments.  The Loan Parties shall not
change or amend the terms of the Note Purchase Agreement, or any Second Priority
Senior Secured Note, if such amendment shall not be permitted in accordance with
the terms of the Intercreditor Agreement, as amended from time to time, nor
shall Loan Parties make any prepayments in any Fiscal Year in respect of any
Second Priority Senior Secured Notes except (i) as contemplated in Section
2.4(E) and (ii) on and after the Amendment No. 3 Effective Date and continuing
through December 31, 2010, the Loan Parties may also use up to $15,225,000 of
the proceeds from the Loans (in the aggregate during such period) to prepay all
or a portion of the then remaining Second Priority Senior Secured Notes if (I)
Parent shall have delivered to Agent (w) the monthly financial statements
(pursuant to Section 5.1(E)(3)) for April 2010, (x) the monthly financial
statements for the latest month with respect to which monthly financial
statements are then required to have been delivered pursuant to Section
5.1(E)(3), if other than April 2010, (y) the Borrowing Base Certificate
(pursuant to Section 5.1(E)(7)) as of the end of April 2010 and (z) the
Borrowing Base Certificate for the latest month with respect to which a
Borrowing Base Certificate is then required to have been delivered pursuant to
Section 5.1(E)(7), if other than April 2010, (II) Undrawn Availability as of the
last day of the month then most recently ended shall not have been less than 90%
of the Undrawn Availability projected as of such date in the projections
delivered to Agent pursuant to Section 5.1(E)(5), and (III) after giving effect
to each such prepayment (x) Undrawn Availability is not less than $14,000,000,
and (y) no Default or Event of Default shall have occurred which is then
continuing.”

     

    (e)           Section
5.3(C) shall be amended and restated as follows:

     

    “(C)        Undrawn Availability.
At all times Undrawn Availability shall not be less than
$4,000,000.”

     

    3.           Conditions of
Effectiveness.  This Amendment No. 3 shall become effective
upon Agent’s receipt of:

     

    (a)           This
Amendment No. 3, duly executed by Borrowers, Agent and all Lenders;

     

    (b)           Payment
of an amendment fee in the amount of $150,000 for the ratable benefit of all
Lenders, which fee shall be fully earned and non-refundable on the date this
Amendment No. 3 is executed by all parties hereto; and

     

    (c)           such
other certificates, instruments, documents and agreements as may reasonably be
required by Agent or its counsel, each of which shall be in form and substance
satisfactory to Agent and its counsel.

     

    4.           Representations and
Warranties.  Each of the Borrowers hereby represents, warrants
and covenants as follows:

     

    (a)           This
Amendment No. 3, the Loan Agreement and the other Loan Documents are and shall
continue to be legal, valid and binding obligations of each of the Borrowers,
respectively, and are enforceable against each Borrower in accordance with their
respective terms except as enforceability may be limited by applicable
bankruptcy, insolvency, moratorium or other laws affecting the enforcement of
creditors’ rights generally and by general principles of equity.

     

    (b)           Upon
the effectiveness of this Amendment No. 3, each Borrower hereby reaffirms all
covenants, representations and warranties made in the Loan Agreement and the
other Loan Documents and agree that all such covenants, representations and
warranties shall be deemed to have been remade and are true and correct in all
material respects as of the effective date of this Amendment No. 3, except to
the extent that any representation or warranty expressly relates to an earlier
date, after giving effect to this Amendment No. 3.


    
      
         


      

      
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    (c)           Each
Borrower has the corporate power, and has been duly authorized by all requisite
corporate action, to execute and deliver this Amendment No. 3  and to
perform its obligations hereunder.  This Amendment No. 3 has been duly
executed and delivered by each Borrower.

     

    (d)           Each
Borrower has no defense, counterclaim or offset with respect to any of the Loan
Documents.

     

    (e)           The
Loan Documents are in full force and effect, and are hereby ratified and
confirmed.

     

    (f)           Agent
and Lenders have and will continue to have a valid first priority lien and
security interest in all Collateral except for liens permitted by the Loan
Agreement, and each Borrower expressly reaffirms all guarantees, security
interests and liens granted to Agent and Lenders pursuant to the Loan
Documents.

     

    (g)           No
Defaults or Events of Default are in existence.

     

    5.           Effect of
Agreement.

     

    (a)           Except
as specifically modified herein, the Loan Agreement, and all other documents,
instruments and agreements executed and/or delivered in connection therewith,
shall remain in full force and effect, and are hereby ratified and
confirmed.

     

    (b)           The
execution, delivery and effectiveness of Amendment No. 3  shall not
operate as a waiver of any right, power or remedy of Agent or any Lender, nor
constitute a waiver of any provision of the Loan Agreement, or any other
documents, instruments or agreements executed and/or delivered under or in
connection therewith.

     

    6.           Governing
Law.  This Amendment No. 3 shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
and shall be governed by and construed in accordance with the laws of the State
of New York.

     

    7.           Headings.  Section
headings in this Amendment No. 3 are included herein for convenience of
reference only and shall not constitute a part of this Amendment No. 3 for any
other purpose.

     

    8.           Counterparts;
Facsimile.  This Amendment No. 3 may be executed by the parties
hereto in one or more counterparts, each of which shall be deemed an original
and all of which when taken together shall constitute one and the same
agreement.  Any signature delivered by a party by facsimile or other
electronic transmission (including in “pdf” format) shall be deemed to be an
original signature hereto.

     

    [signature
pages follow]


    
      
         


      

      
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    IN
WITNESS WHEREOF, this Amendment No. 3 has been duly executed as of the day and
year first written above.

    


    
      
        
          
            
              
                
                  
                    
                      
                        	
                                ROCKY
      BRANDS, INC.

                              
	
                                LIFESTYLE
      FOOTWEAR, INC.

                              
	
                                ROCKY
      BRANDS WHOLESALE LLC

                              
	
                                LEHIGH
      OUTFITTERS, LLC

                              
	
                                ROCKY
      BRANDS INTERNATIONAL, LLC

                              
	 
      	 
      
	
                                By:

                              	
                                /s/ James E. McDonald

                              
	
                                Name:  

                              	
                                James
      E. McDonald

                              
	
                                Title:

                              	
                                Executive
      VP and Chief Financial
Officer

                              


                      

                    

                  

                

              

            

          

        

      

    


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    
      
        
          
            
              
                	
                        GMAC
      COMMERCIAL FINANCE LLC, as Agent

                        and
      as Lender

                      
	 
      	 
      
	
                        By:

                      	
                        /s/ Thomas Brent

                      
	
                        Name:  

                      	
                        Thomas
      Brent

                      
	
                        Title:

                      	
                        Director

                      


              

            

          

        

      

    


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    
      
        
          
            	
                    BANK
      OF AMERICA, N.A. , as Lender

                  
	 
      	 
      
	
                    By:

                  	
                    /s/ John D. Whetstone

                  
	
                    Name:  

                  	
                    John
      D. Whetstone

                  
	
                    Title:

                  	
                    Vice
      President

                  


          

        

      

    


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    
      
        
          
            
              	
                      CHARTER
      ONE BANK, NA, as Lender

                    
	 
      	 
      
	
                      By:

                    	
                      /s/ James G. Zamborsky

                    
	
                      Name:  

                    	
                      James
      G. Zamborsky

                    
	
                      Title:

                    	
                      Vice
      President

                    


            

          

        

      

    


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    
      
        
          
            
              	
                      PNC
      BANK, NATIONAL ASSOCIATION, as

                      Lender

                    
	 
      	 
      
	
                      By:

                    	
                      /s/ Eric L. Moore

                    
	
                      Name:  

                    	
                      Eric
      L. Moore

                    
	
                      Title:

                    	
                      Vice
      President

                    


            

          

        

      

    


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    
      
        
          
            
              	
                      COMERICA
      BANK, as Lender

                    
	 
      	 
      
	
                      By:

                    	
                      /s/ David R. Alexander

                    
	
                      Name:  

                    	
                      David
      R. Alexander

                    
	
                      Title:

                    	
                      Vice
      President