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Item 9A. Controls and Procedures

2025-03-17 compared with 2024-03-15 · 20 added, 65 removed, 125 unchanged (40% of the section changed)

6 unchanged sentences

There have been no material changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) promulgated under the Exchange Act) during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

We have made the necessary and appropriate updates to our internal controls as it relates to financial reporting over our Acquired Brands, none of which were material.

Management’s Report on Internal Control over Financial Reporting

5 unchanged sentences

Based upon that evaluation under the framework in Internal Control – Integrated Framework (2013), our management concluded that our internal control over financial reporting was effective as of December 31, 2024 .

Schneider Downs & Co., Inc., our independent registered public accounting firm has issued an attestation report on the effectiveness of our internal controls over financial reporting which is included within this report.

Deloitte & Touche LLP, our independent registered public accounting firm has issued an attestation report on the effectiveness of our internal controls over financial reporting which is included within this report.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of

Rocky Brands, Inc.

and Subsidiaries

Nelsonville, Ohio

To the shareholders and the Board of Directors of Rocky Brands, Inc.

Opinion on Internal Control over Financial Reporting

We have audited Rocky Brands, Inc.

and Subsidiaries’ (the "Company’s") internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

We have audited the internal control over financial reporting of Rocky Brands, Inc.

and subsidiaries (the "Company") as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the balance sheets and the related statements of income, comprehensive income, stockholders’ equity, and cash flows of the Company, and our report dated March 15, 2024 expressed an unqualified opinion.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2024, of the Company and our report dated March 17, 2025 expressed an unqualified opinion on those financial statements.

Basis for Opinion

5 unchanged sentences

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

Our audit also included performing such other procedures as we considered necessary in the circumstances.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances.

We believe that our audit provides a reasonable basis for our opinion.

6 unchanged sentences

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Schneider Downs & Co., Inc.

/s/ DELOITTE & TOUCHE LLP

Columbus, Ohio

24 unchanged sentences

● Notes to Consolidated Financial Statements

(2) The following financial statement schedule for the years ended December 31, 2023 and 2022 and is included in this Annual Report on Form 10-K and should be read in conjunction with the Consolidated Financial Statements contained in the Annual Report.

See Appendix A.

● Schedule II -- Consolidated Valuation and Qualifying Accounts.

Schedules not listed above are omitted because of the absence of the conditions under which they are required or because the required information is included in the Consolidated Financial Statements or the notes thereto.

(2) Exhibits:

Purchase Agreement, dated January 24, 2021, by and among Honeywell Safety Products USA, Inc., North Safety Products Limited, Honeywell Safety Products (UK) Limited, North Safety de Mexicali S de R.L.

de C.V., Honeywell (China) Co.

and Rocky Brands, Inc.

(incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K dated January 24, 2021, and filed on January 26, 2021).

Letter Agreement, dated March 14, 2021, by and among Honeywell Safety Products USA, Inc., North Safety Products Limited, Honeywell Safety Products (IK) Limited, North Safety de Mexicali S de R.L.

de C.V, Honeywell (China) Co.

and Rocky Brands, Inc.

(incorporated by reference to Exhibit 2.2 to the Company's Quarterly Report on form 10-Q for the fiscal quarter ended March 31, 2021).

Second Amended and Restated Articles of Incorporation of the Company (incorporated by reference to Exhibit 3.1 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006).

8 unchanged sentences

Schedule of directors and executive officers who have entered into the form of Indemnification Agreement.

(incorporated by reference to Exhibit 10.02 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023)

Amended and Restated Lease Agreement, dated March 1, 2002, between Rocky Shoes & Boots Co.

7 unchanged sentences

and the William Brooks Real Estate Company (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2004).

Form of Option Award Agreement under the Amended and Restated 2014 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.33 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014).

Form of Restricted Stock Unit Award Agreement under the Amended and Restated 2014 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.34 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014).

Form of Performance Stock Unit Award Agreement under the Amended and Restated Omnibus Incentive Plan (incorporated by reference to Exhibit 10.35 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014).

Form of Option Award Agreement under the 2024 Omnibus Incentive Plan

Form of Restricted Stock Unit Award Agreement under the 2024 Omnibus Incentive Plan

Form of Performance Stock Unit Award under the 2024 Omnibus Incentive Plan

Employment Agreement, dated January 1, 2019, by and between the Company and Jason Brooks (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated December 31, 2018, filed January 7, 2019).

1 unchanged sentence

Employment Agreement, dated January 1, 2019, by and between the Company and Byron Wortham (incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K dated December 31, 2018, filed January 7, 2019).

ABL Loan and Security Agreement dated March 15, 2021 between the Company and Bank of America, N.A.

(incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated March 15, 2021 and filed on March 16, 2021).

Term Credit Loan and Security Agreement dated March 15, 2021 between the Company and The Direct Lending Group of TCW Asset Management Company, LLC (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K dated March 15, 2021 and filed on March 16, 2021).

First Amendment to ABL Loan and Security Agreement, dated December 10, 2021, between the Company, Bank of America, N.A.

and the other lenders party thereto (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated December 10, 2021 and filed on December 15, 2021).

First Amendment to Term Loan and Security Agreement, dated December 10, 2021, between the Company, TCW Asset Management Company LLC and the other lenders party thereto (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K dated December 10, 2021 and filed on December 15, 2021).

Second Amendment to ABL Loan and Security Agreement, dated June 8, 2022, between the Company, Bank of America, N.A.

and the other lenders party thereto (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated June 6, 2022 and filed on June 10, 2022).

Second Amendment to Term Loan and Security Agreement, dated June 8, 2022, between the Company, TCW Asset Management Company, LC and the other leaders party thereto (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K dated June 6, 2022 and filed on June 10, 2022).

Third Amendment to ABL Loan and Security Agreement, dated November 2, 2022, between the Company, Bank of America, N.A.

and the other lenders party thereto (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated November 2, 2022 and filed on November 3, 2022).

Third Amendment to Term Loan and Security Agreement, dated November 2, 2022, between the Company, TCW Asset Management Company, LLC and the other lenders party thereto (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K dated November 2, 2022 and filed on November 3, 2022).

Fourth Amendment to Term Loan and Security Agreement, dated May 9, 2023, between the Company, TCW Asset Management Company, LLC and the other lenders party thereto (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated May 9, 2023 and filed on May 10, 2023).

Fourth Amendment to ABL Loan and Security Agreement, dated November 2, 2022, between the Company, Bank of America, N.A.

and the other lenders party thereto (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated May 19, 2023 and filed on May 24, 2023).

Fifth Amendment to Term Loan and Security Agreement, dated May 10, 2023, between the Company, TCW Asset Management Company, LLC and the other lenders party thereto (incorporated by reference to Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2023).

Fifth Amendment to ABL Loan and Security Agreement, dated November 2, 2022, between the Company, Bank of America, N.A.

and the other lenders party thereto (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated October 31, 2023 and filed on November 1, 2023).

Sixth Amendment to Term Loan and Security Agreement, dated October 31, 2023, between the Company, TCW Asset Management Company, LLC and the other lenders party thereto incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K dated October 31, 2023 and filed on November 1, 2023).

Amended and Restated ABL Loan and Security Agreement, dated April 26, 2024, between the Company and Bank of America, N.A.

as Agent, Sole Arranger and Sole Bookrunner and the other lenders party thereto (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated April 26, 2024 and filed April 30, 2024).

Rocky Brands, Inc.

2024 Omnibus Incentive Plan (incorporated by reference to Exhibit A to the Company's 2024 Proxy Statement filed April 29, 2024).

Letter of Schneider Downs & Co., Inc.

to the SEC dated January 10, 2024 (incorporated by reference to Exhibit 16.1 to the Company’s Current Report on Form 8-K filed on January 12, 2024).

Rocky Brands, Inc.

Securities Law Compliance Program

Subsidiaries of the Company.

Independent Registered Public Accounting Firm’s Consent of Deloitte & Touche LLP

Independent Registered Public Accounting Firm ’s Consent of Schneider Downs & Co., Inc.

41 unchanged sentences

Jason Brooks, Attorney-in-Fact

ROCKY BRANDS, INC.

AND SUBSIDIARIES

Consolidated Valuation and Qualifying Accounts for the Years Ended December 31, 2023 , 2022 , and 2021

($ in thousands)

Charged to Costs

Balance at End

ALLOWANCE FOR CREDIT LOSSES

Year ended December 31, 2023

Year ended December 31, 2022

Year ended December 31, 2021

VALUATION ALLOWANCE FOR DEFERRED TAX ASSETS

Year ended December 31, 2023

Year ended December 31, 2022

Year ended December 31, 2021

ALLOWANCE FOR DISCOUNTS AND RETURNS

Year ended December 31, 2023

Year ended December 31, 2022

Year ended December 31, 2021

Amount charged off, net of recoveries

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures