Fossil extends revolver to 2014, increases size to $350 million

By Angela McDaniels

Tacoma, Wash., April 4 - Fossil, Inc. amended its revolving credit facility on Monday and received lender consent to acquire Skagen Designs, Ltd., Skagen Designs Limited and Skagen Designs Holding A/S, according to an 8-K filing with the Securities and Exchange Commission.

The amendment

• Increased the size of the revolver to $350 million from $300 million;

• Extended the stated maturity date to Dec. 17, 2014 from Dec. 17, 2013;

• Increased the maximum permitted amount of capital expenditures from $125 million per fiscal year to $200 million for fiscal year 2012 and $150 million for each subsequent fiscal year; and

• Clarified that permitted liens will not affect any capital stock of any subsidiary of the company.

In addition, the amendment added a $50 million uncommitted incremental revolving credit commitment under which the company may, subject to the satisfaction of some terms and conditions, request increases in the amount of at least $15 million.

The company paid a $50,000 upfront fee in connection with the increase and a $175,000 amendment fee.

The acquisition was completed on Monday, and Skagen Designs, Ltd. became a subsidiary guarantor of the facility.

Fossil paid $231.7 million of cash and 150,000 shares of common stock. In addition, the sellers may receive up to 100,000 additional shares if the company's net sales of Skagen-branded products exceed certain thresholds.

Wells Fargo Bank NA is the administrative agent.

Fossil designs and markets consumer fashion accessories and is based in Richardson, Texas. Skagen designs contemporary Danish accessories.

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