AMENDMENT NO. 2 TO LOAN AGREEMENT

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Exhibit 10.4

[UNION BANK OF CALIFORNIA LOGO]

AMENDMENT NO. 2 TO LOAN AGREEMENT

        THIS AMENDMENT NO. 2 TO LOAN AGREEMENT (this "Amendment"), dated as of January 4, 2008, is entered into by and among Union Bank of California, N.A., ("Bank"), and Crocs, Inc., a Delaware corporation ("Borrower"), with reference to the following facts:

RECITALS

        A.    The Borrower and Bank are parties to that certain Loan Agreement, dated as of May 8, 2007, (the "Loan Agreement"), as amended from time to time, pursuant to which the Bank has provided the Borrower with certain credit facilities.

        B.    Borrower has requested that Bank increase the commitment amount of the existing credit facilities, amend financial covenants, and make certain other modifications to the Loan Agreement.

        C.    Bank is willing to grant such accommodations to Borrower on the terms and conditions set forth below.

        NOW, THEREFORE, the parties hereby agree as follows:

        1.     Defined Terms.    Any and all initially capitalized terms used in this Amendment (including, without limitation, in the recitals hereto) without definition shall have the respective meanings specified in the Loan Agreement.

        2.     Increase to Revolving Loan Amount.    Section 1.1.1 of the Loan Agreement is hereby amended by substituting the words "Fifty Million Dollars ($50,000,000)" for the words "Twenty-Five Million Dollars ($25,000,000)".

        3.     Decrease to Standby L/C Line and Commercial L/C Line.    Section 1.1.1 (a) and 1.1.1 (b) of the Loan Agreement are hereby amended by substituting the words "Four Million Five Hundred Thousand Dollars ($4,500,000)" for the words "Ten Million Dollars ($10,000,000)".

        4.     Amend Discrete Quarterly EBITDA covenant.    Section 4.6 of the Loan Agreement is hereby amended to read in full as follows:

        "4.6    Discrete Quarterly EBITDA.    Borrower will achieve EBITDA, determined on the last day of any fiscal quarter of Borrower, of not less than the correlative amount indicated below for such fiscal quarter:

Fiscal Quarter Ending		Minimum Quarterly EBITDA
March 31, 2007		$	20,000,000
June 30, 2007		$	20,000,000
September 30, 2007		$	20,000,000
December 31, 2007		$	30,000,000
March 31, 2008		$	40,000,000
and as of the last day of each fiscal quarter thereafter

"EBITDA" means earnings before interest, taxes, depreciation, amortization and non-cash stock-based compensation for the three (3) months immediately preceding the date of calculation."

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        5.     Amend Adjusted Quick Ratio covenant.    Section 4.7 of the Loan Agreement is hereby amended to read in full as follows:

        "4.7    Adjusted Quick Ratio.    Borrower will at all times maintain a ratio of (a) cash plus marketable securities plus net accounts receivable to (b) accounts payable plus Senior Debt of not less than the correlative amount indicated below for such fiscal quarter:

Fiscal Quarter Ending		Minimum Adjusted Quick Ratio
March 31, 2007		2.00 : 1.0
June 30, 2007		2.00 : 1.0
September 30, 2007		2.00 : 1.0
December 31, 2007		1.50 : 1.0
March 31, 2008		1.50 : 1.0
June 30, 2008		1.75 : 1.0
and as of the last day of each fiscal quarter thereafter

"Senior Debt" means the aggregate amount outstanding under the Loans plus all other senior debt obligations of Borrower."

        6.     Delete Minimum Domestic Accounts Receivable covenant.    Section 4.14 of the Loan Agreement is hereby deleted in its entirety.

        7.     Conditions Precedent.    The effectiveness of this Amendment shall be subject to the prior satisfaction of each of the following conditions:

(a)

This Amendment.    The Bank shall have received an original of this Amendment, duly executed by the Borrower and the Bank;



(b)

Other Bank Documents.    The Borrower shall have executed and delivered to the Bank the Revolving Note and such other documents and instruments as the Bank may reasonably require.



(c)

Loan Participation Agreement.    The Bank shall have received an original of that certain Loan Participation Agreement between Union Bank of California, N.A. and JPMorgan Chase Bank, N.A. dated as of January 7, 2008, duly executed by the respective parties.

        8.     Miscellaneous.

(a)

Survival of Representations and Warranties.    All representations and warranties made in the Loan Agreement or in any other document or documents relating thereto, including, without limitation, any Loan Documents furnished in connection with this Amendment, shall survive the execution and delivery of this Amendment and the other Loan Documents, and no investigation by the Bank or any closing shall affect the representations and warranties or the right of the Bank to rely thereon.



(b)

No Events of Default.    The Borrower is not aware of any events which now constitute, or with the passage of time or the giving of notice, or both, would constitute, an Event of Default under the Loan Agreement.



(c)

Reference to Loan Agreement.    The Loan Agreement, each of the other Loan Documents, and any and all other agreements, documents or instruments now or hereafter executed and delivered pursuant to the terms hereof, or pursuant to the terms of the Loan Agreement as amended hereby, are hereby amended so that any reference therein to the Loan Agreement shall mean a reference to the Loan Agreement as amended hereby.



(d)

Loan Agreement Remains in Effect.    The Loan Agreement and the other Loan Documents remain in full force and effect and the Borrower ratifies and confirms its agreements and

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covenants contained therein. The Borrower hereby confirms that, after giving effect to this Amendment, no Event of Default or Default exists as of such date.

(e)

Severability.    Any provision of this Amendment held by a court of competent jurisdiction to be invalid or unenforceable shall not impair or invalidate the remainder of this Amendment and the effect thereof shall be confined to the provision so held to be invalid or unenforceable.



(f)

APPLICABLE LAW.    THIS AMENDMENT AND ALL OTHER LOAN DOCUMENTS EXECUTED PURSUANT HERETO SHALL BE DEEMED TO HAVE BEEN MADE AND TO BE PERFORMABLE IN THE STATE OF CALIFORNIA AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.



(g)

Successors and Assigns.    This Amendment is binding upon and shall inure to the benefit of the Bank and the Borrower and their respective successors and assigns; provided, however, that the Borrower may not assign or transfer any of its rights or obligations hereunder without the prior written consent of the Bank.



(h)

Counterparts.    This Amendment may be executed in one or more counterparts, each of which when so executed shall be deemed to be an original, but all of which when taken together shall constitute one and the same instrument.



(i)

Headings.    The headings, captions and arrangements used in this Amendment are for convenience only and shall not affect the interpretation of this Amendment.



(j)

NO ORAL AGREEMENTS.    THIS AMENDMENT, TOGETHER WITH THE OTHER LOAN DOCUMENTS AS WRITTEN, REPRESENTS THE FINAL AGREEMENT BETWEEN THE LENDERS AND THE BORROWER AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE BANK AND THE BORROWER.

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        IN WITNESS WHEREOF, the parties have entered into this Amendment by their respective duly authorized officers as of the date first above written.

CROCS, INC.
By:		/s/ Xxxxx Xxxx Xxxxx Xxxx
Title:		Chief Financial Officer
Address: 0000 Xxxxxxx Xxxx Xxxxx Xxxxx, Xxxxxxxx 00000 Attention: Xxxxx Love, Treasury Manager Telecopier: (000) 000-0000 Telephone: (000) 000-0000
UNION BANK OF CALIFORNIA, N.A.
By:		/s/ Xxxxxxx X. Xxxxxxx Xxxxxxx X. Xxxxxxx
Title:		Vice President
Address: 000 X Xxxxxx, 0xx Xxxxx Xxx Xxxxx, Xxxxxxxxxx 00000 Attention: Xxxxxxx X. Xxxxxxx, VP Telecopier: (000) 000-0000 Telephone: (000) 000-0000

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COMMERCIAL PROMISSORY NOTE
(Base Rate)

[UNION BANK OF CALIFORNIA LOGO]

				Xxxx Xxxxx / IR / 6148
Debtor Name
Crocs, Inc., a Delaware corporation
Debtor Address		Office		Loan Number
0000 Xxxxxxx Xxxx Xxxxx Xxxxx, XX 00000		40061
		Maturity Date		Amount
		May 1, 2009		$50,000,000.00

$50,000,000.00 Date December 24, 2007

        FOR VALUE RECEIVED, on May 1, 2009, the undersigned ("Debtor") promises to pay to the order of UNION BANK OF CALIFORNIA, N.A. ("Bank"), as indicated below, the principal sum of Fifty Million and 00/100ths Dollars ($50,000,000.00), or so much thereof as is disbursed, together with interest on the balance of such principal from time to time outstanding, at the per annum rate or rates and at the times set forth below. Any letter of credit issued and outstanding in connection with this note shall result in reduction of the amount available to Debtor.

1.     INTEREST PAYMENTS.    Debtor shall pay interest on the 1st day of each month commencing January 1, 2008. Should interest not be paid when due, it shall become part of the principal and bear interest as herein provided. All computations of interest under this note shall be made on the basis of a year of 360 days, for actual days elapsed. If any interest rate defined in this note ceases to be available from Bank for any reason, then said interest rate shall be replaced by the rate then offered by Bank, which, in the sole discretion of Bank, most closely approximates the unavailable rate.

(a)   BASE INTEREST RATE.    At Debtor's option, amounts outstanding hereunder in minimum amounts of $500,000 shall bear interest at a rate, based on an index selected by Debtor, which is seven-eighths percent (00.875%) per annum in excess of Bank's LIBOR Rate for the Interest Period selected by Debtor, acceptable to Bank.

        No Base Interest Rate may be changed, altered or otherwise modified until the expiration of the Interest Period selected by Debtor. The exercise of interest rate options by Debtor shall be as recorded in Bank's records, which records shall be prima facie evidence of the amount borrowed under either interest option and the interest rate; provided, however, that failure of Bank to make any such notation in its records shall not discharge Debtor from its obligations to repay in full with interest all amounts borrowed. In no event shall any Interest Period extend beyond the maturity date of this note.

        To exercise this option, Debtor may, from time to time with respect to principal outstanding on which a Base Interest Rate is not accruing, and on the expiration of any Interest Period with respect to principal outstanding on which a Base Interest Rate has been accruing, select an index offered by Bank for a Base Interest Rate Loan and an Interest Period by telephoning an authorized lending officer of Bank located at the banking office identified below prior to 10:00 a.m., Pacific time, on any Business Day and advising that officer of the selected index, the Interest Period and the Origination Date selected (which Origination Date, for a Base Interest

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Rate Loan based on the LIBOR Rate, shall follow the date of such selection by no more than two (2) Business Days).

        Bank will mail a written confirmation of the terms of the selection to Debtor promptly after the selection is made. Failure to send such confirmation shall not affect Bank's rights to collect interest at the rate selected. If, on the date of the selection, the index selected is unavailable for any reason, the selection shall be void. Bank reserves the right to fund the principal from any source of funds notwithstanding any Base Interest Rate selected by Debtor.

(b)   VARIABLE INTEREST RATE.    All principal outstanding hereunder which is not bearing interest at a Base Interest Rate shall bear interest at a rate per annum of one-half percent (00.5%) less than the Reference Rate, which rate shall vary as and when the Reference Rate changes.

        At any time prior to the maturity date of this note, subject to the provisions of paragraph 4 below, Debtor may borrow, repay and reborrow hereunder so long as the total outstanding at any one time does not exceed the principal amount of this note.

        Debtor shall pay all amounts due under this note in lawful money of the United States at Bank's X.X. Xxx 00000, Xxx Xxxxxxx, XX 00000-0000 Office, or such other office as may be designated by Bank, from time to time.

2.     LATE PAYMENTS.    If any payment required by the terms of this note shall remain unpaid ten days after same is due, at the option of Bank, Debtor shall pay a fee of $100 to Bank.

3.     INTEREST RATE FOLLOWING DEFAULT.    In the event of default, at the option of Bank, and, to the extent permitted by law, interest shall be payable on the outstanding principal under this note at a per annum rate equal to five percent (5%) in excess of the interest rate specified in paragraph 1.b, above, calculated from the date of default until all amounts payable under this note are paid in full.

4.     PREPAYMENT.

(a)   Amounts outstanding under this note bearing interest at a rate based on the Reference Rate may be prepaid in whole or in part at any time, without penalty or premium. Debtor may prepay amounts outstanding under this note bearing interest at a Base Interest Rate in whole or in part provided Debtor has given Bank not less than five (5) Business Days prior written notice of Debtor's intention to make such prepayment and pays to Bank the prepayment fee due as a result. The prepayment fee shall also be paid, if Bank, for any other reason, including acceleration or foreclosure, receives all or any portion of principal bearing interest at a Base Interest Rate prior to its scheduled payment date. The prepayment fee shall be an amount equal to the present value of the product of: (i) the difference (but not less than zero) between (a) the Base Interest Rate applicable to the principal amount which is being prepaid, and (b) the return which Bank could obtain if it used the amount of such prepayment of principal to purchase at bid price regularly quoted securities issued by the United States having a maturity date most closely coinciding with the relevant Base Rate Maturity Date and such securities were held by Bank until the relevant Base Rate Maturity Date ("Yield Rate"); (ii) a fraction, the numerator of which is the number of days in the period between the date of prepayment and the relevant Base Rate Maturity Date and the denominator of which is 360; and (iii) the amount of the principal so prepaid (except in the event that principal payments are required and have been made as scheduled under the terms of the Base Interest Rate Loan being prepaid, then an amount equal to the lesser of (A) the amount prepaid or (B) 50% of the sum of (1) the amount prepaid and (2) the amount of principal scheduled under the terms of the Base Interest Rate Loan being prepaid to be outstanding at the relevant Base Rate Maturity Date). Present value under this note is determined by discounting the above product to present value using the Yield Rate as the annual discount factor.

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(b)   In no event shall Bank be obligated to make any payment or refund to Debtor, nor shall Debtor be entitled to any setoff or other claim against Bank, should the return which Bank could obtain under this prepayment formula exceed the interest that Bank would have received if no prepayment had occurred. All prepayments shall include payment of accrued interest on the principal amount so prepaid and shall be applied to payment of interest before application to principal. A determination by Bank as to the prepayment fee amount, if any, shall be conclusive.

(c)   Bank shall provide Debtor a statement of the amount payable on account of prepayment. Debtor acknowledges that (i) Bank establishes a Base Interest Rate upon the understanding that it apply to the Base Interest Rate Loan for the entire Interest Period, and (ii) Bank would not lend to Debtor without Debtor's express agreement to pay Bank the prepayment fee described above.

DEBTOR INITIAL HERE: /s/ P.C.

5.     DEFAULT AND ACCELERATION OF TIME FOR PAYMENT.    Default shall include, but not be limited to, any of the following: (a) the failure of Debtor to make any payment required under this note when due; (b) any breach, misrepresentation or other default by Debtor, any guarantor, co-maker, endorser, or any person or entity other than Debtor providing security for this note (hereinafter individually and collectively referred to as the "Obligor") under any security agreement, guaranty or other agreement between Bank and any Obligor; (c) the insolvency of any Obligor or the failure of any Obligor generally to pay such Obligor's debts as such debts become due; (d) the commencement as to any Obligor of any voluntary or involuntary proceeding under any laws relating to bankruptcy, insolvency, reorganization, arrangement, debt adjustment or debtor relief; (e) the assignment by any Obligor for the benefit of such Obligor's creditors; (f) the appointment, or commencement of any proceeding for the appointment of a receiver, trustee, custodian or similar official for all or substantially all of any Obligor's property; (g) the commencement of any proceeding for the dissolution or liquidation of any Obligor; (h) the termination of existence or death of any Obligor; (i) the revocation of any guaranty or subordination agreement given in connection with this note; (j) the failure of any Obligor to comply with any order, judgement, injunction, decree, writ or demand of any court or other public authority; (k) the filing or recording against any Obligor, or the property of any Obligor, of any notice of levy, notice to withhold, or other legal process for taxes other than property taxes; (l) the default by any Obligor personally liable for amounts owed hereunder on any obligation concerning the borrowing of money; (m) the issuance against any Obligor, or the property of any Obligor, of any writ of attachment, execution, or other judicial lien; or (n) the deterioration of the financial condition of any Obligor which results in Bank deeming itself, in good faith, insecure. Upon the occurrence of any such default, Bank, in its discretion, may cease to advance funds hereunder and may declare all obligations under this note immediately due and payable; however, upon the occurrence of an event of default under d, e, f, or g, all principal and interest shall automatically become immediately due and payable.

6.     ADDITIONAL AGREEMENTS OF DEBTOR.    If any amounts owing under this note are not paid when due, Debtor promises to pay all costs and expenses, including reasonable attorneys' fees, (including the allocated costs of Bank's in-house counsel and legal staff) incurred by Bank in the negotiation, documentation and modification of this note and all related documents and in the collection or enforcement of any amount outstanding hereunder. Debtor and any Obligor, for the maximum period of time and the full extent permitted by law, (a) waive diligence, presentment, demand, notice of nonpayment, protest, notice of protest, and notice of every kind; (b) waive the right to assert the defense of any statute of limitations to any debt or obligation hereunder; and (c) consent to renewals and extensions of time for the payment of any amounts due under this note. If this note is signed by more than one party, the term "Debtor" includes each of the undersigned and any successors in interest thereof; all of whose liability shall be joint and several. Any married person who signs this note agrees that recourse may be had against the separate property of that person for any obligations hereunder. The receipt of any check or other item of payment by Bank, at its option, shall not be

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considered a payment on account until such check or other item of payment is honored when presented for payment at the drawee bank. Bank may delay the credit of such payment based upon Bank's schedule of funds availability, and interest under this note shall accrue until the funds are deemed collected. In any action brought under or arising out of this note, Debtor and any Obligor, including their successors and assigns, hereby consent to the jurisdiction of any competent court within the State of California, as provided in any alternative dispute resolution agreement executed between Debtor and Bank, and consent to service of process by any means authorized by said state's law. The term "Bank" includes, without limitation, any holder of this note. This note shall be construed in accordance with and governed by the laws of the State of California. This note hereby incorporates any alternative dispute resolution agreement previously, concurrently or hereafter executed between Debtor and Bank.

7.     DEFINITIONS.    As used herein, the following terms shall have the meanings respectively set forth below. "Base Interest Rate" means a rate of interest based on the LIBOR Rate. "Base Interest Rate Loan" means amounts outstanding under this note that bear interest at a Base Interest Rate. "Base Rate Maturity Date" means the last day of the Interest Period with respect to principal outstanding under a Base Interest Rate Loan. "Business Day" means a day on which Bank is open for business for the funding of corporate loans, and, with respect to the rate of interest based on the LIBOR Rate, on which dealings in U.S. dollar deposits outside of the United States may be carried on by Bank. "Interest Period" means with respect to funds bearing interest at a rate based on the LIBOR Rate, any calendar period of 1, 3, 5, 9 or 12 months. In determining an Interest Period, a month means a period that starts on one Business Day in a month and ends on and includes the day preceding the numerically corresponding day in the next month. For any month in which there is no such numerically corresponding day, then as to that month, such day shall be deemed to be the last calendar day of such month. Any Interest Period which would otherwise end on a non-Business Day shall end on the next succeeding Business Day unless that is the first day of a month, in which event such Interest Period shall end on the next preceding Business Day. "LIBOR Rate" means a per annum rate of interest (rounded upward, if necessary, to the nearest 1/100 of 1%) at which dollar deposits, in immediately available funds and in lawful money of the United States would be offered to Bank, outside of the United States, for a term coinciding with the Interest Period selected by Debtor and for an amount equal to the amount of principal covered by Debtor's interest rate selection, plus Bank's costs, including the cost, if any, of reserve requirements. "Origination Date" means the first day of the Interest Period. "Reference Rate" means the rate announced by Bank from time to time at its corporate headquarters as its Reference Rate. The Reference Rate is an index rate determined by Bank from time to time as a means of pricing certain extensions of credit and is neither directly tied to any external rate of interest or index nor necessarily the lowest rate of interest charged by Bank at any given time.

DEBTOR:
Crocs, Inc., a Delaware corporation
By:		/s/ Xxxxx Xxxx
Title:		CFO

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Exhibit 10.4