MARINEMAX INC (Form: 10-Q, Received: 02/05/2015 16:06:48)

Large accelerated filer

Accelerated filer

Non-accelerated filer

¨ (Do not check if a smaller reporting company)

Smaller reporting company

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 2014.

Commission File Number. 1-14173

MARINEMAX, INC.

(Exact Name of Registrant as Specified in Its Charter)


Delaware		59-3496957
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification Number)

2600 McCormick Drive, Suite 200 Clearwater, Florida		33759
(Address of Principal Executive Offices)		(ZIP Code)

727-531-1700

(Registrant’s Telephone Number, Including Area Code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

The number of outstanding shares of the registrant’s Common Stock on January 31, 2015 was 25,189,885.

MARINEMAX, INC. AND SUBSIDIARIES

Table of Contents


Item No.		Page

PART I FINANCIAL INFORMATION
1.	Financial Statements (Unaudited):
	Condensed Consolidated Statements of Operations for the Three Months Ended December 31, 2013 and 2014		3
	Condensed Consolidated Balance Sheets as of September 30, 2014 and December 31, 2014		4
	Condensed Consolidated Statement of Stockholders’ Equity for the Three Months Ended December 31, 2014		5
	Condensed Consolidated Statements of Cash Flows for the Three Months Ended December 31, 2013 and 2014		6
	Notes to Condensed Consolidated Financial Statements		7

2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		15

3.	Quantitative and Qualitative Disclosures About Market Risk		22

4.	Controls and Procedures		22

PART II OTHER INFORMATION
1.	Legal Proceedings		24
1A.	Risk Factors		24
2.	Unregistered Sales of Equity Securities and Use of Proceeds		24
3.	Defaults Upon Senior Securities		24
4.	Mine Safety Disclosures		24
5.	Other Information		24
6.	Exhibits		24

SIGNATURES			26

EX – 10.20(f)
EX – 10.20(g)
EX – 10.20(h)
EX – 31.1
EX – 31.2
EX – 32.1
EX – 32.2
EX – 101 INSTANCE DOCUMENT
EX – 101 SCHEMA DOCUMENT
EX – 101 CALCULATION LINKBASE DOCUMENT
EX – 101 DEFINITION LINKBASE DOCUMENT
EX – 101 LABEL LINKBASE DOCUMENT
EX – 101 PRESENTATION LINKBASE DOCUMENT

PART I FINANCIAL INFORMATION

ITEM 1.

Financial Statements

MARINEMAX, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(Amounts in thousands, except share and per share data)

(Unaudited)


	Three Months Ended December 31,
	2013			2014
Revenue	$	109,592		$	158,126
Cost of sales		79,682			120,671

Gross profit		29,910			37,455
Selling, general, and administrative expenses		32,282			36,095

(Loss) income from operations		(2,372	)		1,360
Interest expense		997			1,146

(Loss) income before income taxes		(3,369	)		214
Income taxes		—			—

Net (loss) income	$	(3,369	)	$	214

Basic net (loss) income per common share	$	(0.14	)	$	.01

Diluted net (loss) income per common share	$	(0.14	)	$	.01

Weighted average number of common shares used in computing net (loss) income per common share:
Basic		23,715,945			24,278,586

Diluted		23,715,945			24,947,968

See accompanying notes to condensed consolidated financial statements.

MARINEMAX, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Amounts in thousands, except share data)

(Unaudited)


	September 30, 2014			December 31, 2014
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	27,839		$	17,764
Accounts receivable, net		12,547			17,597
Inventories, net		244,151			278,119
Prepaid expenses and other current assets		4,415			4,632

Total current assets		288,952			318,112
Property and equipment, net		101,878			107,992
Other long-term assets, net		11,851			5,833

Total assets	$	402,681		$	431,937

LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	7,823		$	4,619
Customer deposits		10,979			12,609
Accrued expenses		19,600			15,903
Short-term borrowings		124,424			157,228

Total current liabilities		162,826			190,359
Long-term liabilities		560			422

Total liabilities		163,386			190,781
STOCKHOLDERS’ EQUITY:
Preferred stock, $.001 par value, 1,000,000 shares authorized, none issued or outstanding as of September 30, 2014 and December 31, 2014		—			—
Common stock, $.001 par value, 40,000,000 shares authorized, 25,002,807 and 25,104,728 shares issued and 24,211,907 and 24,313,828 shares outstanding as of September 30, 2014 and December 31, 2014, respectively		25			25
Additional paid-in capital		227,939			229,586
Retained earnings		27,141			27,355
Treasury stock, at cost, 790,900 shares held as of September 30, 2014 and December 31, 2014		(15,810	)		(15,810	)

Total stockholders’ equity		239,295			241,156

Total liabilities and stockholders’ equity	$	402,681		$	431,937

See accompanying notes to condensed consolidated financial statements.

MARINEMAX, INC. AND SUBSIDIARIES

Condensed Consolidated Statement of Stockholders’ Equity

(Amounts in thousands, except share data)

(Unaudited)


					Additional Paid-in Capital		Retained Earnings		Treasury Stock			Total Stockholders’ Equity
	Common Stock
	Shares		Amount
BALANCE, September 30, 2014		25,002,807	$	25	$	227,939	$	27,141	$	(15,810	)	$	239,295

Net income		—		—		—		214		—			214
Shares issued pursuant to employee stock purchase plan		22,973		—		297		—		—			297
Shares issued upon vesting of equity awards, net of tax withholding		3,340		—		—		—		—			—
Shares issued upon exercise of stock options		48,502		—		338		—		—			338
Stock-based compensation		27,106		—		1,012		—		—			1,012

BALANCE, December 31, 2014		25,104,728	$	25	$	229,586	$	27,355	$	(15,810	)	$	241,156

See accompanying notes to condensed consolidated financial statements

MARINEMAX, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(Amounts in thousands)

(Unaudited)


	Three Months Ended December 31,
	2013			2014
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income	$	(3,369	)	$	214
Adjustments to reconcile net (loss) income to net cash used in operating activities:
Depreciation and amortization		1,762			1,898
(Gain) loss on sale of property and equipment		(30	)		47
Gain on insurance settlements		(214	)		—
Stock-based compensation expense		1,152			1,012
Decrease (increase) in —
Accounts receivable, net		5,826			(5,050	)
Inventories, net		(10,011	)		(33,968	)
Prepaid expenses and other assets		31			(219	)
(Decrease) increase in —
Accounts payable		(3,291	)		(3,204	)
Customer deposits		2,180			1,630
Accrued expenses and long-term liabilities		(5,413	)		(3,835	)

Net cash used in operating activities		(11,377	)		(41,475	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment		(1,625	)		(2,041	)
Proceeds from sale of property and equipment		50			2

Net cash used in investing activities		(1,575	)		(2,039	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings on short-term borrowings		3,443			32,804
Net proceeds from issuance of common stock under incentive compensation and employee purchase plans		1,657			635

Net cash provided by financing activities		5,100			33,439

NET DECREASE IN CASH AND CASH EQUIVALENTS		(7,852	)		(10,075	)
CASH AND CASH EQUIVALENTS, beginning of period		23,756			27,839

CASH AND CASH EQUIVALENTS, end of period	$	15,904		$	17,764

Supplemental Disclosures of Cash Flow Information:
Cash paid for interest	$	859		$	1,029
Cash paid for income taxes	$	—		$	36
Non-cash exchange of note receivable for property and equipment	$	—		$	6,020

See accompanying notes to condensed consolidated financial statements.

MARINEMAX, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1.	COMPANY BACKGROUND:

We are the largest recreational boat retailer in the United States. We engage primarily in the retail sale, brokerage, and service of new and used boats, motors, trailers, marine parts and accessories and offer slip and storage accommodations in certain locations. In addition, we arrange related boat financing, insurance, and extended service contracts. We recently implemented programs to increase sales of boats, boating parts, and accessories, as well as the offer of finance and insurance, or F&I, products at various offsite locations; and the charter of power and sailing yachts in the British Virgin Islands. None of these recently implemented programs have had a material effect on our condensed consolidated financial statements. As of December 31, 2014, we operated through 54 retail locations in 17 states, consisting of Alabama, Arizona, California, Connecticut, Florida, Georgia, Maryland, Minnesota, Missouri, New Jersey, New York, North Carolina, Ohio, Oklahoma, Rhode Island, Tennessee, and Texas. Our MarineMax Vacations operations maintain a facility in Tortola, British Virgin Islands.

We are the nation’s largest retailer of Sea Ray, Boston Whaler, and Meridian recreational boats and yachts, all of which are manufactured by Brunswick Corporation (“Brunswick”). Sales of new Brunswick boats accounted for approximately 40% of our revenue in fiscal 2014. Sales of new Sea Ray and Boston Whaler boats, both divisions of Brunswick, accounted for approximately 26% and 10%, respectively, of our revenue in fiscal 2014. Brunswick is the world’s largest manufacturer of marine products and marine engines. We believe we represented approximately 43% of Brunswick’s Sea Ray boat sales, during our fiscal 2014.

We have dealership agreements with Sea Ray, Boston Whaler, Meridian, and Mercury Marine, all subsidiaries or divisions of Brunswick. We also have dealer agreements with Italy-based Azimut-Benetti Group’s product line for Azimut Yachts. These agreements allow us to purchase, stock, sell, and service these manufacturers’ boats and products. These agreements also allow us to use these manufacturers’ names, trade symbols, and intellectual properties in our operations.

We have multi-year dealer agreements with Brunswick covering Sea Ray products that appoints us as the exclusive dealer of Sea Ray boats in our geographic markets. We are the exclusive dealer for Boston Whaler through multi-year dealer agreements for many of our geographic markets. In addition, we are the exclusive dealer for Azimut Yachts for the entire United States through a multi-year dealer agreement. Sales of new Azimut boats accounted for approximately 14% of our revenue in fiscal 2014. We believe non-Brunswick brands offer a migration for our existing customer base or fill a void in our product offerings, and accordingly, do not compete with the business generated from our other prominent brands.

As is typical in the industry, we deal with manufacturers, other than Sea Ray, Boston Whaler, Meridian, and Azimut Yachts, under renewable annual dealer agreements, each of which gives us the right to sell various makes and models of boats within a given geographic region. Any change or termination of these agreements, or the agreements discussed above, for any reason, or changes in competitive, regulatory, or marketing practices, including rebate or incentive programs, could adversely affect our results of operations. Although there are a limited number of manufacturers of the type of boats and products that we sell, we believe that adequate alternative sources would be available to replace any manufacturer other than Sea Ray and Azimut as a product source. These alternative sources may not be available at the time of any interruption, and alternative products may not be available at comparable terms, which could affect operating results adversely.

General economic conditions and consumer spending patterns can negatively impact our operating results. Unfavorable local, regional, national, or global economic developments or uncertainties regarding future economic prospects could reduce consumer spending in the markets we serve and adversely affect our business. Economic conditions in areas in which we operate dealerships, particularly Florida in which we generated approximately 49%, 51%, and 52% of our revenue during fiscal 2012, 2013, and 2014, respectively, can have a major impact on our operations. Local influences, such as corporate downsizing, military base closings, inclement weather such as Hurricane Sandy, environmental conditions, and specific events, such as the BP oil spill in the Gulf of Mexico, also could adversely affect, and in certain instances have adversely affected, our operations in certain markets.

In an economic downturn, consumer discretionary spending levels generally decline, at times resulting in disproportionately large reductions in the sale of luxury goods. Consumer spending on luxury goods also may decline as a result of lower consumer confidence levels, even if prevailing economic conditions are favorable. As a result, an economic downturn could impact us more than certain of our competitors due to our strategic focus on a higher end of our market. Although we have expanded our operations during periods of stagnant or modestly declining industry trends, the cyclical nature of the recreational boating industry or the lack of industry growth may adversely affect our business, financial condition, and results of operations. Any period of adverse economic conditions or low consumer confidence has a negative effect on our business.

Lower consumer spending resulting from a downturn in the housing market and other economic factors adversely affected our business in fiscal 2007, and continued weakness in consumer spending and depressed economic conditions had a substantial negative effect on our business in each subsequent fiscal year. These conditions have caused us to substantially reduce our acquisition program, delay new store openings, reduce our inventory purchases, engage in inventory reduction efforts, close a number of our retail locations, reduce our headcount, and amend and replace our credit facility. Acquisitions and new store openings remain important strategies to our company, and we plan to accelerate our growth through these strategies when more normal economic conditions return. However, we cannot predict the length or severity of these unfavorable economic or financial conditions or the extent to which they will continue to adversely affect our operating results nor can we predict the effectiveness of the measures we have taken to address this environment or whether additional measures will be necessary.

2.	BASIS OF PRESENTATION:

These unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information, the instructions to Quarterly Report on Form 10-Q, and Rule 10-01 of Regulation S-X and should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended September 30, 2014. Accordingly, these unaudited condensed consolidated financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. All adjustments, consisting of only normal recurring adjustments considered necessary for fair presentation, have been reflected in these unaudited condensed consolidated financial statements. As of December 31, 2014, our financial instruments consisted of cash and cash equivalents, accounts receivable, accounts payable, customer deposits, and short-term borrowings. The carrying amounts of our financial instruments reported on the balance sheet as of December 31, 2014 approximated fair value due either to length to maturity or existence of variable interest rates, which approximate prevailing market rates. The operating results for the three months ended December 31, 2014 are not necessarily indicative of the results that may be expected in future periods.

The preparation of unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the unaudited condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. Significant estimates made by us in the accompanying unaudited condensed consolidated financial statements include valuation allowances, valuation of goodwill and intangible assets, valuation of long-lived assets, and valuation of accruals. Actual results could differ from those estimates.

Unless the context otherwise requires, all references to “MarineMax” mean MarineMax, Inc. prior to its acquisition of five previously independent recreational boat dealers in March 1998 (including their related real estate companies) and all references to the “Company,” “our company,” “we,” “us,” and “our” mean, as a combined company, MarineMax, Inc. and the 24 recreational boat dealers, two boat brokerage operations, and two full-service yacht repair operations acquired to date (the “acquired dealers,” and together with the brokerage and repair operations, “operating subsidiaries” or the “acquired companies”).

The unaudited condensed consolidated financial statements include our accounts and the accounts of our subsidiaries, all of which are wholly owned. All significant intercompany transactions and accounts have been eliminated.

3.	NEW ACCOUNTING PRONOUNCEMENTS:

In May 2014, the FASB issued Accounting Standards Update No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (ASU 2014-9), a converged standard on revenue recognition. The new pronouncement requires revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also specifies the accounting for some costs to obtain or fulfill a contract with a customer, as well as enhanced disclosure requirements. ASU 2014-9 is effective for annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. Early adoption is not permitted. We currently do not believe the adoption of this standard will have a material impact on our consolidated financial statements.

4.	REVENUE RECOGNITION:

We recognize revenue from boat, motor, and trailer sales, and parts and service operations at the time the boat, motor, trailer, or part is delivered to or accepted by the customer or the service is completed. We recognize deferred revenue from service operations and slip and storage services on a straight-line basis over the term of the contract or when service is completed. We recognize commissions earned from a brokerage sale at the time the related brokerage transaction closes. We recognize commissions earned by us for placing notes with financial institutions in connection with customer boat financing when we recognize the related boat sales. We recognize marketing fees earned on credit life, accident, disability, gap, and hull insurance products sold by third-party insurance companies at the later of customer acceptance of the insurance product as evidenced by contract execution or when the related boat sale is recognized. Pursuant to negotiated agreements with financial and insurance institutions, we are charged back for a portion of these fees should the customer terminate or default on the related finance or insurance contract before it is outstanding for a stipulated minimum period of time. We base the chargeback allowance, which was not material to the unaudited condensed consolidated financial statements taken as a whole as of December 31, 2014, on our experience with repayments or defaults on the related finance or insurance contracts.

We also recognize commissions earned on extended warranty service contracts sold on behalf of third-party insurance companies at the later of customer acceptance of the service contract terms as evidenced by contract execution or recognition of the related boat sale. We are charged back for a portion of these commissions should the customer terminate or default on the service contract prior to its scheduled maturity. We determine the chargeback allowance, which was not material to the unaudited condensed consolidated financial statements taken as a whole as of December 31, 2014, based upon our experience with terminations or defaults on the service contracts.

5.	INVENTORIES:

6.	IMPAIRMENT OF LONG-LIVED ASSETS:

FASB Accounting Standards Codification 360-10-40, “Property, Plant, and Equipment - Impairment or Disposal of Long-Lived Assets” (“ASC 360-10-40”), requires that long-lived assets, such as property and equipment and purchased intangibles subject to amortization, be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of the asset is measured by comparison of its carrying amount to undiscounted future net cash flows the asset is expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds its fair market value. Estimates of expected future cash flows represent our best estimate based on currently available information and reasonable and supportable assumptions. Any impairment recognized in accordance with ASC 360-10-40 is permanent and may not be restored. Based upon our most recent analysis, we believe no impairment of long-lived assets existed as of December 31, 2014.

7.	INCOME TAXES:

We account for income taxes in accordance with FASB Accounting Standards Codification 740, “Income Taxes” (“ASC 740”). Under ASC 740, we recognize deferred tax assets and liabilities for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. We measure deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which we expect those temporary differences to be recovered or settled. We record valuation allowances to reduce our deferred tax assets to the amount expected to be realized by considering all available positive and negative evidence.

Pursuant to ASC 740, we must consider all positive and negative evidence regarding the realization of deferred tax assets. ASC 740 provides for four possible sources of taxable income to realize deferred tax assets: 1) taxable income in prior carryback years; 2) reversals of existing deferred tax liabilities; 3) tax planning strategies and 4) projected future taxable income. As of December 31, 2014, we have no available taxable income in prior carryback years, reversals of existing deferred tax liabilities or prudent and feasible tax planning strategies. Therefore, the recoverability of our deferred tax assets is dependent upon generating future taxable income. Although as of December 31, 2014, we were no longer in a three year cumulative loss position for financial reporting purposes in our significant jurisdictions, we believe there is sufficient negative evidence concerning our projected future taxable income and, therefore, the realization of our deferred tax assets. Our future taxable income is inherently difficult to project and subject to uncertainty due to many factors including the impact of general economic conditions and the cyclical nature of our operations which historically has resulted in losses in the first half of our fiscal year. Additionally, historically it has been difficult to project our industry’s trends and therefore our results. Based on our analysis of the available evidence we determined that our deferred tax assets needed a full valuation allowance as of December 31, 2014. We will continue to evaluate the need for a valuation allowance. If the full valuation allowance is reversed, we will start recording a tax provision.

8.	SHORT-TERM BORROWINGS:

In August 2014, we entered into an amendment to our Inventory Financing Agreement (the “Amended Credit Facility”), originally entered into in June 2010, as subsequently amended, with GE Commercial Distribution Finance Corporation. The August 2014 amendment extended the maturity date of the Credit Facility to August 2017, subject to additional extension for two one-year periods, with lender approval. The August 2014 amendment, among other things, modified the amount of borrowing availability and maturity date of the Credit Facility. The Amended Credit Facility provides a floor plan financing commitment of up to $235 million, an increase from the previous limit of $205 million, subject to borrowing base availability resulting from the amount and aging of our inventory.

The Amended Credit Facility has certain financial covenants as specified in the agreement. The covenants include provisions that our leverage ratio must not exceed 2.75 to 1.0 and that our current ratio must be greater than 1.2 to 1.0. The interest rate for amounts outstanding under the Amended Credit Facility is 345 basis points above the one-month London Inter-Bank Offering Rate (“LIBOR”). There is an unused line fee of ten basis points on the unused portion of the Amended Credit Facility.

Advances under the Amended Credit Facility are initiated by the acquisition of eligible new and used inventory or are re-advances against eligible new and used inventory that have been partially paid-off. Advances on new inventory will generally mature 1,080 days from the original invoice date. Advances on used inventory will mature 361 days from the date we acquire the used inventory. Each advance is subject to a curtailment schedule, which requires that we pay down the balance of each advance on a periodic basis starting after six months. The curtailment schedule varies based on the type and value of the inventory. The collateral for the Amended Credit Facility is all of our personal property with certain limited exceptions. None of our real estate has been pledged for collateral for the Amended Credit Facility.

As of December 31, 2014, our indebtedness associated with financing our inventory and working capital needs totaled approximately $157.2 million. As of December 31, 2013 and 2014, the interest rate on the outstanding short-term borrowings was approximately 3.6%. As of December 31, 2014, our additional available borrowings under our Amended Credit Facility were approximately $36.9 million based upon the outstanding borrowing base availability.

As is common in our industry, we receive interest assistance directly from boat manufacturers, including Brunswick. The interest assistance programs vary by manufacturer, but generally include periods of free financing or reduced interest rate programs. The interest assistance may be paid directly to us or our lender depending on the arrangements the manufacturer has established. We classify interest assistance received from manufacturers as a reduction of inventory cost and related cost of sales as opposed to netting the assistance against our interest expense incurred with our lenders.

The availability and costs of borrowed funds can adversely affect our ability to obtain adequate boat inventory and the holding costs of that inventory as well as the ability and willingness of our customers to finance boat purchases. As of December 31, 2014, we had no long-term debt. However, we rely on our Amended Credit Facility to purchase our inventory of boats. The aging of our inventory limits our borrowing capacity as defined curtailments reduce the allowable advance rate as our inventory ages. Our access to funds under our Amended Credit Facility also depends upon the ability of our lenders to meet their funding commitments, particularly if they experience shortages of capital or experience excessive volumes of borrowing requests from others during a short period of time. Unfavorable economic conditions, weak consumer spending, turmoil in the credit markets, and lender difficulties, among other potential reasons, could interfere with our ability to utilize our Amended Credit Facility to fund our operations. Any inability to utilize our Amended Credit Facility could require us to seek other sources of funding to repay amounts outstanding under the credit agreements or replace or supplement our credit agreements, which may not be possible at all or under commercially reasonable terms.

Similarly, decreases in the availability of credit and increases in the cost of credit adversely affect the ability of our customers to purchase boats from us and thereby adversely affect our ability to sell our products and impact the profitability of our finance and insurance activities.

9.	STOCK-BASED COMPENSATION:

During the three months ended December 31, 2013 and 2014, we recognized stock-based compensation expense of approximately $1.2 million and $1.0 million, respectively, in selling, general, and administrative expenses in the unaudited condensed consolidated statements of operations. There were no tax benefits realized for tax deductions from option exercises for the three months ended December 31, 2013 and 2014.

Cash received from option exercises under all share-based compensation arrangements for the three months ended December 31, 2013 and 2014, was approximately $1.7 million and $635,000, respectively. We currently expect to satisfy share-based awards with registered shares available to be issued.

10.

THE INCENTIVE STOCK PLANS:

During February 2013, our stockholders approved a proposal to amend the 2011 Stock-Based Compensation Plan (“2011 Plan”) to increase the 1,200,456 share threshold by 1,000,000 shares to 2,200,456 shares. During January 2011, our stockholders approved a proposal to authorize our 2011 Plan, which replaced our 2007 Incentive Compensation Plan (“2007 Plan”). Our 2011 Plan provides for the grant of stock options, stock appreciation rights, restricted stock, stock units, bonus stock, dividend equivalents, other stock related awards, and performance awards (collectively “awards”), that may be settled in cash, stock, or other property. Our 2011 Plan is designed to attract, motivate, retain, and reward our executives, employees, officers, directors, and independent contractors by providing such persons with annual and long-term performance incentives to expend their maximum efforts in the creation of stockholder value. Subsequent to the February 2013 amendment described above, the total number of shares of our common stock that may be subject to awards under the 2011 Plan is equal to 2,000,000 shares, plus: (i) any shares

available for issuance and not subject to an award under the 2007 Plan, which was 200,456 shares at the time of approval of the 2011 Plan; (ii) the number of shares with respect to which awards granted under the 2011 Plan and the 2007 Plan terminate without the issuance of the shares or where the shares are forfeited or repurchased; (iii) with respect to awards granted under the 2011 Plan and the 2007 Plan, the number of shares that are not issued as a result of the award being settled for cash or otherwise not issued in connection with the exercise or payment of the award; and (iv) the number of shares that are surrendered or withheld in payment of the exercise price of any award or any tax withholding requirements in connection with any award granted under the 2011 Plan or the 2007 Plan. The 2011 Plan terminates in January 2021, and awards may be granted at any time during the life of the 2011 Plan. The date on which awards vest are determined by the Board of Directors or the Plan Administrator. The Board of Directors has appointed the Compensation Committee as the Plan Administrator. The exercise prices of options are determined by the Board of Directors or the Plan Administrator and are at least equal to the fair market value of shares of common stock on the date of grant. The term of options under the 2011 Plan may not exceed ten years. The options granted have varying vesting periods. To date, we have not settled or been under any obligation to settle any awards in cash.

The following table summarizes option activity from September 30, 2014 through December 31, 2014:


	Shares Available for Grant			Options Outstanding			Aggregate Intrinsic Value (in thousands)		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life
Balance as of September 30, 2014		1,350,709			2,226,319		$	15,980	$	11.70		6.6
Options authorized		—			—					—
Options granted		(290,000	)		290,000				$	15.91
Options cancelled/forfeited/expired		50,002			(50,002	)			$	23.42
Restricted stock awards issued		(111,000	)		—					—
Options exercised		—			(48,502	)			$	6.95

Balance as of December 31, 2014		999,711			2,417,815		$	21,473	$	12.05		6.8

Exercisable as of December 31, 2014					1,507,791		$	16,525	$	10.50		5.5

The weighted average grant date fair value of options granted during the three months ended December 31, 2013 and 2014 was $6.24 and $5.79, respectively. The total intrinsic value of options exercised during the three months ended December 31, 2013 and 2014 was $1.4 million and $573,000, respectively.

As of December 31, 2013 and 2014, there was approximately $3.2 million of unrecognized compensation costs related to non-vested options that are expected to be recognized over a weighted average period of 2.6 years and 2.2 years, respectively. The total fair value of options vested during the three months ended December 31, 2013 and 2014 was approximately $1.0 million and $283,000, respectively.

We used the Black-Scholes model to estimate the fair value of options granted. The expected term of options granted is derived from the output of the option pricing model and represents the period of time that options granted are expected to be outstanding. Volatility is based on the historical volatility of our common stock. The risk-free rate for periods within the contractual term of the options is based on the U.S. Treasury yield curve in effect at the time of grant.

The following are the weighted average assumptions used for each respective period:


	Three Months Ended December 31,
	2013			2014
Dividend yield		0.0	%		0.0	%
Risk-free interest rate		0.7	%		0.8	%
Volatility		55.7	%		47.4	%
Expected life		3.2 years			3.0 years

11.

EMPLOYEE STOCK PURCHASE PLAN:

During February 2012, our stockholders approved a proposal to amend our 2008 Employee Stock Purchase Plan (“Stock Purchase Plan”) to increase the number of shares available under that plan by 500,000 shares. The Stock Purchase Plan as amended provides for up to 1,000,000 shares of common stock to be available for purchase by our regular employees who have completed at least one year of continuous service. In addition, there were 52,837 shares of common stock available under our 1998 Employee Stock Purchase Plan, which have been made available for issuance under our Stock Purchase Plan. The Stock Purchase Plan provides for implementation of up to 10 annual offerings beginning on the first day of October starting in 2008, with each offering terminating on September 30 of the following year. Each annual offering may be divided into two six-month offerings. For each offering, the purchase price per share will be the lower of: (i) 85% of the closing price of the common stock on the first day of the offering or (ii) 85% of the closing price of the common stock on the last day of the offering. The purchase price is paid through periodic payroll deductions not to exceed 10% of the participant’s earnings during each offering period. However, no participant may purchase more than $25,000 worth of common stock annually.

We used the Black-Scholes model to estimate the fair value of options granted to purchase shares issued pursuant to the Stock Purchase Plan. The expected term of options granted is derived from the output of the option pricing model and represents the period of time that options granted are expected to be outstanding. Volatility is based on the historical volatility of our common stock. The risk-free rate for periods within the contractual term of the options is based on the U.S. Treasury yield curve in effect at the time of grant.

The following are the weighted average assumptions used for each respective period:


	Three Months Ended December 31,
	2013			2014
Dividend yield		0.0	%		0.0	%
Risk-free interest rate		0.1	%		0.1	%
Volatility		41.3	%		30.0	%
Expected life		six months			six months

As of December 31, 2014, we had issued 647,115 shares of common stock under our Stock Purchase Plan.

12.

RESTRICTED STOCK AWARDS:

We have granted non-vested (restricted) stock awards (“restricted stock”) and restricted stock units (“RSUs”) to certain key employees pursuant to the 2011 Plan and the 2007 Plan. The restricted stock awards have varying vesting periods, but generally become fully vested between two and four years after the grant date, depending on the specific award. We accounted for the restricted stock awards granted using the measurement and recognition provisions of ASC 718. Accordingly, the fair value of the restricted stock awards is measured on the grant date and recognized in earnings over the requisite service period for each separately vesting portion of the award.

The following table summarizes restricted stock award activity from September 30, 2014 through December 31, 2014:


	Shares			Weighted Average Grant Date Fair Value
Non-vested balance as of September 30, 2014		3,340		$	6.10
Changes during the period
Awards granted		111,000		$	19.23
Awards vested		(3,340	)	$	6.10

Non-vested balance as of December 31, 2014		111,000		$	19.23

As of December 31, 2014, we had approximately $2.0 million of total unrecognized compensation cost related to non-vested restricted stock awards assuming applicable performance conditions are met. We expect to recognize that cost over a weighted average period of 2.8 years.

13.

NET INCOME (LOSS) PER SHARE:

The following is a reconciliation of the shares used in the denominator for calculating basic and diluted net income (loss) per share:


	Three Months Ended December 31,
	2013		2014
Weighted average common shares outstanding used in calculating basic income (loss) per share		23,715,945		24,278,586
Effect of dilutive options and non-vested restricted stock awards		—		669,382

Weighted average common and common equivalent shares used in calculating diluted income (loss) per share		23,715,945		24,947,968

For the three months ended December 31, 2014, there were 806,086 weighted average shares of options outstanding, respectively, that were not included in the computation of diluted income per share because the options’ exercise prices were greater than the average market price of our common stock, and therefore, their effect would be anti-dilutive. For the three months ended December 31, 2013 no options or non-vested restricted stock awards were included in the computation of diluted loss per share because we reported a net loss and the effect of their inclusion would be anti-dilutive.

14.

COMMITMENTS AND CONTINGENCIES:

We are party to various legal actions arising in the ordinary course of business. We believe that these matters should not have a material adverse effect on our consolidated financial condition, results of operations, or cash flows.

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Management’s Discussion and Analysis of Financial Condition and Results of Operations contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements include statements relating to our plans to resume our growth through acquisitions and new store openings when more normal economic conditions return; our ability to capitalize on our core strengths to substantially outperform the industry and result in market share gains; our ability to align our retailing strategies with the desire of consumers; our belief that the steps we have taken to address weak market conditions will yield an increase in future revenue; and our expectations that our core strengths and retailing strategies will position us to capitalize on growth opportunities as they occur and will allow us to emerge from the current challenging economic environment with greater earnings potential. Actual results could differ materially from those currently anticipated as a result of a number of factors, including those set forth under “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended September 30, 2014.

General

We are the largest recreational boat retailer in the United States with fiscal 2014 revenue in excess of $620 million. Through our current 54 retail locations in 17 states, we sell new and used recreational boats and related marine products, including engines, trailers, parts, and accessories. We also arrange related boat financing, insurance, and extended service contracts; provide boat repair and maintenance services; offer yacht and boat brokerage sales; and, where available, offer slip and storage accommodations. We recently implemented programs to increase sales of boats, boating parts, and accessories, as well as the offer of finance and insurance, or F&I, products at various offsite locations; and the charter of power and sailing yachts in the British Virgin Islands. None of these recently implemented programs have had a material effect on our consolidated financial statements.

MarineMax was incorporated in January 1998. We commenced operations with the acquisition of five independent recreational boat dealers on March 1, 1998. Since the initial acquisitions in March 1998, we have acquired 24 recreational boat dealers, two boat brokerage operations, and two full-service yacht repair facilities. As a part of our acquisition strategy, we frequently engage in discussions with various recreational boat dealers regarding their potential acquisition by us. Potential acquisition discussions frequently take place over a long period of time and involve difficult business integration and other issues, including, in some cases, management succession and related matters. As a result of these and other factors, a number of potential acquisitions that from time to time appear likely to occur do not result in binding legal agreements and are not consummated. We completed a relatively small acquisition in each of the fiscal years ended September 30, 2012, 2013, and 2014.

General economic conditions and consumer spending patterns can negatively impact our operating results. Unfavorable local, regional, national, or global economic developments or uncertainties regarding future economic prospects could reduce consumer spending in the markets we serve and adversely affect our business. Economic conditions in areas in which we operate dealerships, particularly Florida in which we generated approximately 49%, 51%, and 52% of our revenue during fiscal 2012, 2013, and 2014, respectively, can have a major impact on our operations. Local influences, such as corporate downsizing, military base closings, and inclement weather such as Hurricane Sandy, environmental conditions, and specific events, such as the BP oil spill in the Gulf of Mexico, also could adversely affect, and in certain instances have adversely affected, our operations in certain markets.

economic conditions had a substantial negative effect on our business in each subsequent fiscal year. These conditions have caused us to substantially reduce our acquisition program, delay new store openings, reduce our inventory purchases, engage in inventory reduction efforts, close a number of our retail locations, reduce our headcount, and amend and replace our credit facility. Acquisitions and new store openings remain important strategies to our company, and we plan to accelerate our growth through these strategies as more normal economic conditions return. However, we cannot predict the length or severity of these unfavorable economic or financial conditions or the extent to which they will continue to adversely affect our operating results nor can we predict the effectiveness of the measures we have taken to address this environment or whether additional measures will be necessary.

Although economic conditions have adversely affected our operating results, we have capitalized on our core strengths to substantially outperform the industry, resulting in market share gains. Our ability to capture such market share supports the alignment of our retailing strategies with the desires of consumers. We believe the steps we have taken to address weak market conditions will yield an increase in future revenue. As general economic trends improve, we expect our core strengths and retailing strategies will position us to capitalize on growth opportunities as they occur and will allow us to emerge from this challenging economic environment with greater earnings potential.

Application of Critical Accounting Policies

We have identified the policies below as critical to our business operations and the understanding of our results of operations. The impact and risks related to these policies on our business operations is discussed throughout Management’s Discussion and Analysis of Financial Condition and Results of Operations when such policies affect our reported and expected financial results.

In the ordinary course of business, we make a number of estimates and assumptions relating to the reporting of results of operations and financial condition in the preparation of our financial statements in conformity with accounting principles generally accepted in the United States. We base our estimates on historical experiences and on various other assumptions that we believe are reasonable under the circumstances. The results form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ significantly from those estimates under different assumptions and conditions. We believe that the following discussion addresses our most critical accounting policies, which are those that are most important to the portrayal of our financial condition and results of operations and require our most difficult, subjective, and complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.

Revenue Recognition

We recognize revenue from boat, motor, and trailer sales and parts and service operations at the time the boat, motor, trailer, or part is delivered to or accepted by the customer or the service is completed. We recognize deferred revenue from service operations and slip and storage services on a straight-line basis over the term of the contract or when service is completed. We recognize commissions earned from a brokerage sale at the time the related brokerage transaction closes. We recognize commissions earned by us for placing notes with financial institutions in connection with customer boat financing when we recognize the related boat sales. We recognize marketing fees earned on credit, life, accident, disability, gap, and hull insurance products sold by third-party insurance companies at the later of customer acceptance of the insurance product as evidenced by contract execution or when the related boat sale is recognized. We also recognize commissions earned on extended warranty service contracts sold on behalf of third-party insurance companies at the later of customer acceptance of the service contract terms as evidenced by contract execution or recognition of the related boat sale.

Certain finance and extended warranty commissions and marketing fees on insurance products may be charged back if a customer terminates or defaults on the underlying contract within a specified period of time. Based upon our experience of terminations and defaults, we maintain a chargeback allowance that was not material to our financial statements taken as a whole as of December 31, 2014. Should results differ materially from our historical experiences, we would need to modify our estimate of future chargebacks, which could have a material adverse effect on our operating margins. We do not believe there is a reasonable likelihood that there will be a change in the future estimates or assumptions we use to calculate our estimate of future chargebacks which would result in a material effect on our operating results.

Vendor Consideration Received

We account for consideration received from our vendors in accordance with FASB Accounting Standards Codification 605-50, “Revenue Recognition - Customer Payments and Incentives” (“ASC 605-50”). ASC 605-50 requires us to classify interest assistance received from manufacturers as a reduction of inventory cost and related cost of sales as opposed to netting the assistance against our interest expense incurred with our lenders. Pursuant to ASC 605-50, amounts received by us under our co-op assistance programs from our manufacturers are netted against related advertising expenses. Our consideration received from our vendors contains uncertainties because the calculation requires management to make assumptions and to apply judgment regarding a number of factors, including our ability to collect amounts due from vendors and the ability to meet certain criteria stipulated by our vendors. We do not believe there is a reasonable likelihood that there will be a change in the future estimates or assumptions we use to calculate our vendor considerations which would result in a material effect on our operating results.

Inventories

Inventory costs consist of the amount paid to acquire inventory, net of vendor consideration and purchase discounts, the cost of equipment added, reconditioning costs, and transportation costs relating to acquiring inventory for sale. We state new and used boat, motor, and trailer inventories at the lower of cost, determined on a specific-identification basis, or market. We state parts and accessories at the lower of cost, determined on an average cost basis, or market. We utilize our historical experience, the aging of the inventories, and our consideration of current market trends as the basis for determining a lower of cost or market valuation allowance. Our lower of cost or market valuation allowance contains uncertainties because the calculation requires management to make assumptions and to apply judgment regarding the amount at which the inventory will ultimately be sold which considers forecasted market trends, model changes, and new product introductions. We do not believe there is a reasonable likelihood that there will be a change in the future estimates or assumptions we use to calculate our lower of cost or market valuation allowance which would result in a material effect on our operating results. As of September 30, 2014 and December 31, 2014, our lower of cost or market valuation allowance for new and used boat, motor, and trailer inventories was $2.2 million and $2.7 million, respectively. If events occur and market conditions change, causing the fair value to fall below carrying value, the lower of cost or market valuation allowance could increase.

Goodwill

We account for goodwill in accordance with FASB Accounting Standards Codification 350, “Intangibles - Goodwill and Other” (“ASC 350”), which provides that the excess of cost over net assets of businesses acquired is recorded as goodwill. The acquisitions of Bassett Marine, LLC and Parker Boat Company resulted in goodwill of $802,000. In accordance with ASC 350, we review goodwill for impairment at least annually and whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Our annual impairment test is performed during the fourth fiscal quarter. If the carrying amount of goodwill exceeds its fair value we would recognize an impairment loss in accordance with ASC 350. As of December 31, 2014, and based upon our most recent analysis, we determined through our qualitative assessment that it is not “more likely than not” that the fair values of our reporting units are less than their carrying values. As a result, we were not required to perform the two-step goodwill impairment test. The qualitative assessment requires us to make judgments and assumptions regarding macroeconomic and industry conditions, our financial performance, and other factors. We do not believe there is a reasonable likelihood that there will be a change in the judgments and assumptions used in our qualitative assessment which would result in a material effect on our operating results.

Impairment of Long-Lived Assets

circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of the asset is measured by comparison of its carrying amount to undiscounted future net cash flows the asset is expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds its fair market value. Estimates of expected future cash flows represent our best estimate based on currently available information and reasonable and supportable assumptions. Our impairment loss calculations contain uncertainties because they require us to make assumptions and to apply judgment in order to estimate expected future cash flows. Any impairment recognized in accordance with ASC 360-10-40 is permanent and may not be restored. Based upon our most recent analysis, we believe no impairment of long-lived assets existed as of December 31, 2014. We do not believe there is a reasonable likelihood that there will be a change in the future estimates or assumptions used to test for recoverability which would result in a material effect on our operating results.

Stock-Based Compensation

We account for our stock-based compensation plans following the provisions of FASB Accounting Standards Codification 718, “Compensation — Stock Compensation” (“ASC 718”). In accordance with ASC 718, we use the Black-Scholes valuation model for valuing all stock-based compensation and shares purchased under our Employee Stock Purchase Plan. We measure compensation for restricted stock awards and restricted stock units at fair value on the grant date based on the number of shares expected to vest and the quoted market price of our common stock. For restricted stock units with market conditions, we utilize a Monte Carlo simulation embedded in a lattice model to determine the fair value. We recognize compensation cost for all awards in operations, net of estimated forfeitures, on a straight-line basis over the requisite service period for each separately vesting portion of the award. Our valuation models and generally accepted valuation techniques require us to make assumptions and to apply judgment to determine the fair value of our awards. These assumptions and judgments includes estimating the volatility of our stock price, expected dividend yield, employee turnover rates and employee stock option exercise behaviors. We do not believe there is a reasonable likelihood that there will be a change in the future estimates or assumptions we use to calculate our stock-based compensation which would result in a material effect on our operating results.

Income Taxes

Recent Accounting Pronouncements

Consolidated Results of Operations

The following discussion compares the three months ended December 31, 2014 with the three months ended December 31, 2013 and should be read in conjunction with the unaudited condensed consolidated financial statements, including the related notes thereto, appearing elsewhere in this report.

Three Months Ended December 31, 2014 Compared with Three Months Ended December 31, 2013

Revenue. Revenue increased $48.5 million, or 44.3%, to $158.1 million for the three months ended December 31, 2014 from $109.6 million for the three months ended December 31, 2013. Of this increase, $48.8 million was attributable to a 44.6% increase in comparable-store sales, which was partially offset by an approximate $0.3 million net decrease related to stores closed that were not eligible for inclusion in the comparable-store base. The increase in our comparable-store sales was due to incremental increases in new and used boat sales, including larger traditionally lower gross margin boats, and incremental increases in brokerage sales. Improving industry conditions resulting from improved economic conditions contributed to our comparable-store sales growth.

Gross Profit. Gross profit increased $7.5 million, or 25.2%, to $37.5 million for the three months ended December 31, 2014 from $29.9 million for the three months ended December 31, 2013. Gross profit as a percentage of revenue decreased to 23.7% for the three months ended December 31, 2014 from 27.3% for the three months ended December 31, 2013. The decrease in gross profit as a percentage of revenue was primarily a result of the significant mix shift in our revenue to boat sales, including larger traditionally lower gross margin boats. The increase in boat sales relative to our overall revenues caused our higher margin brokerage, finance and insurance products, service, parts and accessories products, and storage services to decrease as a percentage of revenue, contributing to our overall margins decreasing accordingly. The increase in gross profit dollars was primarily attributable to the increase in comparable-store sales.

Selling, General, and Administrative Expenses. Selling, general, and administrative expenses increased $3.8 million, or 11.8%, to $36.1 million for the three months ended December 31, 2014 from $32.3 million for the three months ended December 31, 2013. Selling, general, and administrative expenses as a percentage of revenue decreased to 22.8% for the three months ended December 31, 2014 from 29.5% for the three months ended December 31, 2013. The overall increase in selling, general, and administrative expenses was primarily attributable to increased commissions resulting from increased boat sales.

Interest Expense. Interest expense increased $149,000, or 14.9%, to $1.1 million for the three months ended December 31, 2014 from $997,000 for the three months ended December 31, 2013. Interest expense as a percentage of revenue decreased to 0.7% for the three months ended December 31, 2014 from 0.9% for the three months ended December 31, 2013. The increase in interest expense was primarily a result of increased borrowings.

Income Taxes. We had no income tax expense or benefit for the three months ended December 31, 2014 and 2013. Our effective income tax rate was zero for both the three months ended December 31, 2014 and 2013. For the three months ended December 31, 2014 and 2013 we generated a loss for tax purposes; however, we could not record the benefit for the net operating loss carryforward due to the required valuation allowance. We will continue to evaluate the need for a valuation allowance. If the full valuation allowance is reversed, we will start recording a tax provision.

Liquidity and Capital Resources

Our cash needs are primarily for working capital to support operations, including new and used boat and related parts inventories, off-season liquidity, and growth through acquisitions and new store openings. Acquisitions and new store openings remain important strategies to our company, and we plan to accelerate our growth through these strategies as more robust economic conditions return. However, we cannot predict the length or severity of these unfavorable economic or financial conditions. We regularly monitor the aging of our inventories and current market trends to evaluate our current and future inventory needs. We also use this evaluation in conjunction with our review of our current and expected operating performance and expected business levels to determine the adequacy of our financing needs.

These cash needs have historically been financed with cash generated from operations and borrowings under our credit facility. Our ability to utilize our credit facility to fund operations depends upon the collateral levels and compliance with the covenants of the credit facility. Turmoil in the credit markets and weakness in the retail markets may interfere with our ability to remain in compliance with the covenants of the credit facility and therefore our ability to utilize the credit facility to fund operations. As of December 31, 2014, we were in compliance with all covenants under our credit facility. We currently depend upon dividends and other payments from our dealerships and our credit facility to fund our current operations and meet our cash needs. As 100% owner of each of our dealerships, we determine the amounts of such distributions, and currently, no agreements exist that restrict this flow of funds from our dealerships.

For the three months ended December 31, 2014 and 2013, cash used in operating activities was approximately $41.5 million and $11.4 million, respectively. For the three months ended December 31, 2014, cash used in operating activities was primarily related to an increase of inventory driven by timing of boats received, an increase in accounts receivable as a result of our relatively successful sales efforts at the end of the quarter ended December 31, 2014, and seasonal declines in accounts payable and accrued expenses, partially offset by an increase in customer deposits as a result of large yachts that were sold on order. For the three months ended December 31, 2013, cash used in operating activities was primarily related to our net loss, an increase of inventory driven by timing of boats received and seasonal declines in accounts payable and accrued expenses, partially offset by an increase in customer deposits as a result of large yachts that were sold on order.

For the three months ended December 31, 2014 and 2013, cash used in investing activities was approximately $2.0 million and $1.6 million, respectively. For the three months ended December 31, 2014 and 2013, cash used in investing activities was primarily used to purchase property and equipment associated with improving existing retail facilities.

For the three months ended December 31, 2014 and 2013, cash provided by financing activities was approximately $33.4 million and $5.1 million, respectively, and was primarily attributable to net short-term borrowings as a result of increased inventory levels and proceeds from the issuance of common stock from our stock based compensation plans.

In August 2014, we entered into an amendment to our Inventory Financing Agreement (the “Amended Credit Facility”), originally entered into in June 2010, as subsequently amended, with GE Commercial Distribution Finance Corporation. The August 2014 amendment extended the maturity date of the Credit Facility to August 2017, subject to additional extension for two one-year periods, with lender approval. The August 2014 amendment, among other things, modified the amount of borrowing availability and maturity date of the Credit Facility. The Amended Credit Facility provides a floor plan financing commitment of up to $235.0 million, an increase from the previous limit of $205.0 million, subject to borrowing base availability resulting from the amount and aging of our inventory.

requires that we pay down the balance of each advance on a periodic basis starting after six months. The curtailment schedule varies based on the type and value of the inventory. The collateral for the Amended Credit Facility is all of our personal property with certain limited exceptions. None of our real estate has been pledged for collateral for the Amended Credit Facility.

Except as specified in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in the attached unaudited condensed consolidated financial statements, we have no material commitments for capital for the next 12 months. We believe that our existing capital resources will be sufficient to finance our operations for at least the next 12 months, except for possible significant acquisitions.

Impact of Seasonality and Weather on Operations

Our business, as well as the entire recreational boating industry, is highly seasonal, with seasonality varying in different geographic markets. With the exception of Florida, we generally realize significantly lower sales and higher levels of inventories, and related short-term borrowings, in the quarterly periods ending December 31 and March 31. The onset of the public boat and recreation shows in January generally stimulates boat sales and typically allows us to reduce our inventory levels and related short-term borrowings throughout the remainder of the fiscal year. Our business could become substantially more seasonal if we acquire dealers that operate in colder regions of the United States or close retail locations in warm climates.

Our business is also subject to weather patterns, which may adversely affect our results of operations. For example, prolonged winter conditions, drought conditions (or merely reduced rainfall levels) or excessive rain, may limit access to area boating locations or render boating dangerous or inconvenient, thereby curtailing customer demand for our products and services. In addition, unseasonably cool weather and prolonged winter conditions may lead to a shorter selling season in certain locations. Hurricanes and other storms could result in disruptions of our operations or damage to our boat inventories and facilities, as has been the case when Florida and other markets were affected by hurricanes. Although our geographic diversity is likely to reduce the overall impact to us of adverse weather conditions in any one market area, these conditions will continue to represent potential, material adverse risks to us and our future financial performance.

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As of December 31, 2014, all of our short-term debt bore interest at a variable rate, tied to LIBOR as a reference rate. Changes in the underlying LIBOR interest rate on our short-term debt could affect our earnings. For example, a hypothetical 100 basis point increase in the interest rate on our short-term debt would result in an increase of approximately $1.6 million in annual pre-tax interest expense. This estimated increase is based upon the outstanding balance of our short-term debt as of December 31, 2014 and assumes no mitigating changes by us to reduce the outstanding balances and no additional interest assistance that could be received from vendors due to the interest rate increase.

Products purchased from European-based and Chinese-based manufacturers are subject to fluctuations in the U.S. dollar exchange rate, which ultimately may impact the retail price at which we can sell such products. Accordingly, fluctuations in the value of the other currencies compared with the U.S. dollar may impact the price points at which we can profitably sell such foreign products, and such price points may not be competitive with other product lines in the United States. Accordingly, such fluctuations in exchange rates ultimately may impact the amount of revenue, cost of goods sold, cash flows, and earnings we recognize for such foreign product lines. We cannot predict the effects of exchange rate fluctuations on our operating results. In certain cases, we may enter into foreign currency cash flow hedges to reduce the variability of cash flows associated with forecasted purchases of boats and yachts from European-based and Chinese-based manufacturers. We are not currently engaged in foreign currency exchange hedging transactions to manage our foreign currency exposure. If and when we do engage in foreign currency exchange hedging transactions, we cannot assure that our strategies will adequately protect our operating results from the effects of exchange rate fluctuations.

ITEM 4.

CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that material information required to be disclosed by us in Securities Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Our Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report. Based on such evaluation, such officers have concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective at the reasonable assurance level.

Changes in Internal Controls

During the quarter ended December 31, 2014, there were no changes in our internal controls over financial reporting that materially affected, or were reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Controls

Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures and internal controls over financial reporting will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Although our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, a control may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

CEO and CFO Certifications

Exhibits 31.1 and 31.2 are the Certifications of the Chief Executive Officer and Chief Financial Officer, respectively. The Certifications are required in accordance with Section 302 of the Sarbanes-Oxley Act of 2002 (the “Section 302 Certifications”). This Item of this report, which you are currently reading is the information concerning the Evaluation referred to in the Section 302 Certifications and this information should be read in conjunction with the Section 302 Certifications for a more complete understanding of the topics presented.

PART II

OTHER INFORMATION

ITEM 1.

LEGAL PROCEEDINGS

Not applicable.

ITEM 1A.

RISK FACTORS

Not applicable.

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Not applicable.

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES

Not applicable.

ITEM 4.

MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5.

OTHER INFORMATION

Not applicable.

ITEM 6.

EXHIBITS



10.20(f)†		Boston Whaler Sales and Service Agreement, executed December 5, 2014, by and between MarineMax East, Inc. and Boston Whaler, a Division of Brunswick Corporation.

10.20(g)†		Boston Whaler Sales and Service Agreement, executed December 5, 2014, by and between MarineMax Northeast, LLC, and Boston Whaler, a Division of Brunswick Corporation.

10.20(h)†		Boston Whaler Sales and Service Agreement, executed December 5, 2014, by and between MarineMax, Inc. and Boston Whaler, a Division of Brunswick Corporation.

31.1		Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a), promulgated under the Securities Exchange Act of 1934, as amended.

31.2		Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a), promulgated under the Securities Exchange Act of 1934, as amended.



32.1		Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		XBRL Instance Document

101.SCH		XBRL Taxonomy Extension Schema Document

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		XBRL Taxonomy Extension Label Linkbase Document

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

†	Certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		MARINEMAX, INC.

February 5, 2015	By:	/s/ Michael H. McLamb
		Michael H. McLamb
		Executive Vice President,
		Chief Financial Officer, Secretary, and Director
		(Principal Accounting and Financial Officer)

Exhibit 10.20 (f)

NOTE: PORTIONS OF THIS EXHIBIT INDICATED BY “[****]” ARE SUBJECT TO A CONFIDENTIAL TREATMENT REQUEST, AND HAVE BEEN OMITTED FROM THIS EXHIBIT. COMPLETE, UNREDACTED COPIES OF THIS EXHIBIT HAVE BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION AS PART OF THIS COMPANY’S CONFIDENTIAL TREATMENT REQUEST.

SALES AND SERVICE AGREEMENT

This Sales and Service Agreement (“ Agreement ”) is entered into as of September 1, 2014 by Boston Whaler, Inc. (“Boston Whaler” or “Company”) MarineMax, Inc. (“MarineMax”), and MarineMax East, Inc. (“Dealer”), in consideration of the mutual covenants contained in this Agreement, and subject to and incorporating herein the Sales and Service Agreement Terms and Conditions attached hereto. Pursuant to this Agreement, Company hereby appoints Dealer through its Dealer Locations identified in Exhibit A as its dealer for the sale of Products in the Territory identified in such Exhibit. Dealer represents and warrants to Company that MarineMax, Inc. is the sole and exclusive parent of Dealer.

DEFINED TERMS

In this Agreement, the following words and expressions that are not defined elsewhere in this Agreement shall have the following meaning, except where the context requires otherwise:

Dealer and Dealer’s Principal Address:

MarineMax East, Inc., 2600 McCormick Drive, Suite 200, Clearwater, Florida 33759

Dealer Location: Each Dealer facility as listed on Exhibit A attached hereto.

Territory: Identified for each Dealer Location in attached Attachment 1 to Exhibit A

Product(s): Full line of Boston Whaler Boats (Including related parts and accessories)

Performance Standards: See attached Exhibit B.

Term: The Term of this Agreement shall be September 1, 2014 to August 31, 2017, provided however that, except as otherwise provided below or in Section 16 of this Agreement, at the end of each twelve (12) month period of the Term, the Term of this Agreement shall be extended by another twelve (12) month period so that the Term of this Agreement remains three (3) years. Notwithstanding the above, (i) either party may provide written notice to the other no less than one hundred and twenty (120) days before the end of any twelve (12) month period that it will not agree to an additional extension due to the failure by such other party to remedy a material breach of this Agreement following written notice thereof and the expiration of the applicable cure period without cure or failure to reach agreement through good faith efforts to do so by the parties and (ii) on or within sixty (60) days after the fourth (4 ^th ) anniversary of this Agreement, either party may provide written notice to the other party to terminate this Agreement effective at the end of the then current contract year (i.e., August 31, 2019). If neither party provides notice to terminate this Agreement on or within sixty (60) days after the fourth (4 ^th ) anniversary as described above, this Agreement will automatically renew for two (2) year terms beginning on the fifth (5 ^th ) anniversary, unless otherwise terminated pursuant to this Agreement; provided that on or within sixty (60) days after the first (1st) year of any such two (2) year renewal term, either party may provide written notice to the other party to terminate this Agreement effective as of August 31 of the then current contract year.

IN WITNESS WHEREOF, Company, MarineMax and Dealer have executed this Agreement and the parties and the individual(s) signing for each party respectively below represent and warrant that the individual(s) signing this Agreement is(are) duly authorized to do so.


Boston Whaler, Inc.				MarineMax, Inc.


By:				By:
Title:				Title:
Date:				Date:

MarineMax East, Inc.


By:
Title:
Date:

SALES AND SERVICE AGREEMENT

TERMS AND CONDITIONS

1. Appointment of Dealer : Boston Whaler hereby appoints Dealer as a dealer for the retail sale, display, and servicing of all Boston Whaler product(s), parts and accessories (hereinafter “Product” or “Products”) as identified in the Defined Terms and subject to Boston Whaler’s then current policies and programs applicable to all domestic Boston Whaler dealers selling comparable Products, from the authorized Dealer Location(s) identified in the attached Exhibit A, which Products shall be purchased only from Boston Whaler or an authorized Boston Whaler dealer located in the country in which Dealer is located. Dealer Locations are set forth in the Defined Terms and Exhibit A.

During the Term of this Agreement, Boston Whaler shall not appoint other dealers to sell Products from a dealer location within the Territory set forth in the Defined Terms; provided, however, that (i) Boston Whaler reserves the right to modify the Territory or appoint other dealers to sell, display and service Product from dealer locations within the Territory at any time if Dealer closes a Dealer Location without prior written notice to Boston Whaler and prior written approval thereof by Boston Whaler, which approval shall not be unreasonably withheld upon a review by Boston Whaler of Dealer’s abilities to perform the Agreement obligations and as further provided in Section 2, and (ii) Boston Whaler shall have the right to appoint other dealers to sell, display and service Product from dealer locations within the applicable Territory to replace Dealer Locations to which this Agreement no longer applies as a result of the termination of this Agreement as to a specific Dealer Location pursuant to this Section 1 or Section 16 hereof. In addition, notwithstanding the provisions of Section 16D of this Agreement, Boston Whaler shall have the right to appoint other dealers to sell, display and service Product from dealer locations in Dealer’s Territory (related to the applicable Dealer Location(s)) if a Dealer Location (i) sells, displays, or advertises products that are competitive with the Products (other than products of another Brunswick Corporation brand), including without limitation, products of Scout, Grady White, Everglades, Edgewater, or Pursuit, (ii) is failing to meet the Performance Standards for reasons other than failure by Boston Whaler to have Product available for purchase, and (iii) does not cure its failure to meet the Performance Standards within sixty (60) days (or six (6) months, if applicable, as referenced below) after written notice of the same from Boston Whaler and good faith efforts by the parties to agree on an appropriate cure during such time period. For purposes of the previous sentence, for those matters related to which a cure cannot be completed within the sixty (60) day time period, Dealer shall have up to six (6) months from the written notice from Boston Whaler to complete the cure, so long as Dealer begins good faith efforts to cure during the initial sixty (60) day time period and continues such efforts during the six (6) month time period.

Provided that similar restrictions apply to all domestic Boston Whaler dealers selling comparable Products, Dealer shall not sell, advertise, solicit for sale or offer for resale Products outside of the Territory except as otherwise provided by Boston Whaler’s Advertising Policy or other applicable policy. Dealer may advertise in recognized and established marine publications with cross-territorial distribution provided that when Dealer does so, it specifically identifies its authorized locations as defined in this Agreement and complies with Boston Whaler’s Advertising Policy. Boston Whaler reserves the right in

its sole discretion to monitor or otherwise enforce its policies and procedures applicable to all domestic Boston Whaler dealers and will do so on a fair and equitable basis. There are no third party beneficiary rights to such policies and procedures or this Agreement or other dealer agreements.

Boston Whaler reserves the right to make sales or provide service in the Territory based upon legitimate business purposes and to appoint other dealers or service providers to sell, display, and/or service products, from any other location outside the Territory. Boston Whaler may also display Products within the Territory for general display and promotional purposes.

Boston Whaler shall have the right to adopt and modify policies and programs related to the Products from time to time in its sole discretion and in accordance with its own reasonable business judgment and it will enforce such policies and programs on a fair and equitable basis. Dealer agrees to comply with such policies and programs following receipt of notice thereof from Boston Whaler, including without limitation, through inclusion in Boston Whaler’s Dealer Manual and/or Programs.

2. Location : Dealer shall sell at retail, display, and service Products only at and from the authorized Dealer Location(s) referenced in Exhibit A, as may be amended from time to time as provided herein. Dealer Location(s) are both sales and service unless otherwise specified in writing. Dealer shall concentrate its sales, display and service efforts within the designated Territory.

Dealer shall not delete, change, or add to the above Dealer Location(s) without the prior written consent of Boston Whaler, which consent shall not be unreasonably withheld, and Boston Whaler may consider any relevant factors and consequences as part of the approval process, including but not limited to the Dealer’s qualifications and abilities to perform the Agreement obligations from the proposed Dealer Location, the effect such a grant would have on the resulting Territory configuration and adjacent Boston Whaler dealer sales, the Dealer’s financial capabilities to successfully operate the business from the Dealer Location, and whether the Dealer will have adequate personnel to manage the business at the Dealer Location. Dealer shall not, directly or indirectly, sell Products for use by or to a purchaser located outside of the country in which the Dealer is located, and shall not sell Products to a third party who Dealer knows or should know will resell the Products outside of the country in which the Dealer is located. Dealer shall not sell to others for the purpose of resale without the prior written consent of Boston Whaler. Dealer shall not utilize the services of a broker or similar agent to sell Product unless such broker is an affiliated third party of Dealer that is located within the Territory, consummates the sale of any Product in concert with Dealer and pursuant to Dealer’s standard practices, and otherwise complies with the requirements of this Agreement. Dealer agrees to provide appropriate facilities and to assume full and complete managerial authority and responsibility for the service of the Products at and from those Dealer Location(s) specified in this Agreement and for the display and retail sale of the Products at and from each Dealer Location. Additionally, Dealer may engage in temporary off-site display and sales activity within the Territory.

3. Responsibilities of the Parties :

3.1 Dealer’s Responsibilities :

Dealer agrees to:

A. Devote its best efforts to aggressively promote, display, advertise and sell Products at each Dealer Location and in the Territory in accordance with the terms of this Agreement and all applicable federal, state and local laws. Dealer shall display and utilize at each Dealer Location signs, graphics and image elements with Boston Whaler’s Identification as defined herein, subject to approval by Boston Whaler, that will positively reflect the Boston Whaler image and promote the retail sale of the Products.

B. Achieve the performance standards set forth as follows and in the related Exhibit B (collectively, “Performance Standards”) for each Dealer Location. Boston Whaler, in collaboration with Dealer , will establish fair and reasonable Performance Standards for each of the Dealer Locations under this Agreement which Performance Standards shall be established in a manner similar to those applied to domestic Boston Whaler dealers. Performance Standards shall include minimum requirements relating to inventory stocking levels, provision of annual sales forecasts, submission of orders pursuant to the terms of Boston Whaler’s then current buying program, unit retail sales based on Product registrations for Products in each Dealer Location, customer satisfaction (e.g., Net Promoter Scores) and Product marketing support. Boston Whaler, in collaboration with Dealer, will establish the Performance Standards taking into consideration factors such as population, sales potential, market share percentage of the Products sold in the Territory as compared to competitive products sold in the Territory, product availability, economic conditions in the Dealer Location(s) and Territory, competition from other marine dealerships in the area, past sales history, historical Product mix and stocking practices, existing Product Inventory, adequacy and ability of the Products to meet customer demand in the Territory, number of locations, and any special circumstances that may affect the sale of Products or the Dealer. The Performance Standards for the first Product Model Year of this Agreement are agreed to and identified in Exhibit B. Boston Whaler, in collaboration with Dealer, will, in subsequent years, substitute the updated and amended Performance Standards for the current Exhibit B. The Performance Standards on Exhibit B will continue to apply until replaced with updated and amended Performance Standards.

C. Maintain at each Dealer Location (unless a sales location only, and then service shall be provided at another Dealer Location) a service department that Dealer agrees to staff, train, and equip to promptly and professionally service Products; and to maintain at each Dealer Location parts and supplies to properly service Products on a timely basis.

D. Perform any and all necessary Product rigging, installation, and inspection services prior to delivery to the purchaser as required by Boston Whaler’s current written policy applicable to domestic Boston Whaler dealers and perform post-sale service of all Products originally sold by Dealer and brought to Dealer for service. Dealer will be required to provide or arrange for warranty and service work for Product regardless of the selling dealer of the Product or condition of sale. Boston Whaler will exercise reasonable efforts as to this Section 3.1D. to address circumstances in which another dealer has made a sale to an original retail purchaser who permanently resides within Dealer’s Territory where such sale is contrary to the terms of the selling dealer’s Sales and Service Agreement. Dealer will provide appropriate instructions to purchasers on how to obtain warranty and service work from the Dealer. Dealer will secure all Product inventory against weathering and other damage, and maintain inventory in a like new and unused condition.

E. Furnish each Product purchaser with Boston Whaler’s limited warranty on new Products and with information and training as to the safe and proper operation and maintenance of the Product.

F. Complete and submit Boston Whaler’s Product registration card (or applicable electronic form) and In-Service Checklist promptly upon delivery of the Products to the purchaser and assist Boston Whaler in performing Product defect and recall campaigns. In the event Dealer fails to return the card or submit the other documentation to Boston Whaler as required, Dealer shall indemnify Boston Whaler against any liability, loss, or damage which Boston Whaler may sustain directly as a result of such failure.

G. Maintain complete Product sales, warranty and service records, and report to Boston Whaler upon request the name and address of each Product purchaser to the extent required by applicable law. Dealer further agrees to provide Boston Whaler with access to its applicable books and records at reasonable times and upon reasonable prior notice to verify the accuracy of information submitted for participation and eligibility in promotions and other programs.

H. [Intentionally omitted.]

I. Submit to Boston Whaler upon request any additional information or clarifying information regarding Dealer’s financial statements and allow full and open disclosure of financial information concerning Dealer between Boston Whaler and any financial institution or company which may finance or propose to finance all or part of Dealer’s Product inventory.

J. Conduct business in a manner that preserves and enhances the reputation and goodwill of both Boston Whaler and Dealer for providing quality products and services, and refrain from using any false, misleading or deceptive advertising. Submit truthful and accurate statements, reports and information to Boston Whaler and any financial institution financing or proposing to finance Dealer’s Product inventory or any purchaser.

K. Maintain an ability to purchase Product inventory for each Dealer Location via flooring and/or self-financing that is customary to carry on hand and display Boston Whaler’s current Product models as indicated in the Defined Terms and the performance standards set forth herein.

L. [Intentionally omitted.]

M. Use its best efforts to maintain and improve scores or other customer satisfaction rating (e.g., Net Promoter Scores) in compliance with the Performance Standards for such applicable ratings.

N. Comply with those Dealer obligations that may be imposed or established by Boston Whaler applicable to all domestic Boston Whaler Dealers including but not limited to those included in Boston Whaler’s policies and programs and Boston Whaler’s Advertising Policy.

O. Maintain a financial condition which is adequate to satisfy and perform its obligations under this Agreement.

P. Provide prior written notice to Boston Whaler if Dealer desires to make any material change in Dealer’s financing of its Product inventory or business and give Boston Whaler sufficient time to discuss and review with Dealer the effect of the proposed change.

Q. Notify Boston Whaler of the addition or deletion of any Dealer Location(s) which notification Dealer agrees shall not be deemed a consent by Boston Whaler to such a proposed change.

R. Provide Boston Whaler with prior notice of any proposed appointment of sub-dealers. All appointments of authorized sub-dealers are subject to prior written approval by Boston Whaler (“Authorized Sub-dealers”). Dealer will set its own resale price to Authorized Sub-dealers and assume all risk of non-payment by the Authorized Sub-dealers. The Authorized Sub-dealers are not parties to any agreement between Boston Whaler and Dealer and Dealer will ensure that the Authorized Sub-dealers do not take any actions that violate any policies and programs of Boston Whaler or are inconsistent with the terms of this Agreement. Dealer is responsible for any losses incurred by Boston Whaler as a result of Authorized Sub-dealer’s performance including, but without limitation, Authorized Sub-dealer’s failure to pay Boston Whaler for any Product or to pay any financial institution that finances Products purchased by the Authorized Sub-dealers. Dealer will not enter into any agreement with Authorized Sub-dealers that is inconsistent with the terms and conditions of this Agreement.

S. Notify Boston Whaler in writing of the applicable brand and boat type at least ninety (90) days before Dealer begins to sell, display or advertise a new boat brand.

3.2 Company Responsibilities :

Company Agrees to:

A. Sell Products to Dealer in accordance with Company’s then-current terms and conditions of sale applicable to domestic Boston Whaler dealers, limited warranties, and the price list published from time to time by Company, less any applicable discounts allowed by Company’s programs applicable to Dealer and consistent with the provisions of Section 5 hereof. Company shall have the right to modify its terms and conditions of sale, limited warranties, price lists and programs from time to time in its sole discretion and in compliance with the terms of this Agreement; provided, however, that Company will provide reasonable prior written notice to Dealer after the beginning of the Model Year of such modifications and that changes in the limited warranty and pricing will apply only to future retail purchases. Company will make available its current policies and programs in electronic format or in a manual or other format Company deems appropriate. Dealer should contact Company for a copy of the policies and programs if it does not have access to or did not receive a copy.

B. Provide to Dealer reasonable quantities of catalogs, specification sheets, and other advertising, merchandising or promotional material to assist Dealer in the sale of Products as Company deems appropriate.

C. Make available to Dealer in electronic format or otherwise reasonable quantities of parts books, warranty claim forms, order forms or procedures, maintenance and service manuals and other materials of a technical nature as Company deems appropriate.

D. Furnish Dealer with written instructions and/or policies for the use of trademarks, trade names, logos and other trade designations of Company that correspond to the Products as Company deems appropriate.

E. Furnish a Limited Warranty for the Products and provide warranty support and process warranty claims in accordance with Company’s warranty policy, which may be modified from time to time by Company in its sole discretion. Company shall notify Dealer of changes to Company’s warranty policy and make available current versions of its warranty policy to Dealer.

F. Promote sales of the Products via the Internet and other marine related publications or by other means as Company deems appropriate.

G. Ship parts related to the Products in accordance with Company’s policy on shipping parts.

H. Accept payment for Product and credit Dealer’s account within a reasonable time.

I. Furnish detailed invoices upon shipment and periodic statements thereafter, provide prompt communication regarding account status upon request, and administer credit policies in a non-discriminatory manner.

J. Identify Dealer’s name and address in listing of authorized dealers on Company’s website dealer locator (if available). Company reserves the right to create, update and modify such a website locator from time to time in its sole discretion.

K. Provide reasonable technical assistance and procedures for handling of technical questions of Dealer related to the Products.

L. Maintain communication channels in order to receive Dealer feedback from time to time.

M. Provide reasonable consultative assistance to Dealer for operational, sales and customer service support as Company deems appropriate.

N. Provide reasonable supportive informational materials for new models of Products as Company deems appropriate.

O. Provide owner’s manual for Products and similar materials for other components or accessories that are made available to Company.

P. Supply Dealer with proper quantities of Product consistent with Boston Whaler’s quality standards to allow Dealer to meet the Performance Standards set forth in Section 3.1.B.

Q. Provide Dealer with two (2) seats on Boston Whaler’s concept review teams to consult with Boston Whaler regarding the Products and, at least annually, conduct a portfolio product review with appropriate Dealer managers.

4. Orders : Dealer agrees to submit orders to Boston Whaler in a manner and format prescribed by Boston Whaler, applicable to all domestic Boston Whaler dealers which orders shall be subject to Boston Whaler’s then current terms and conditions of sale which may be modified by Boston Whaler at any time for all domestic dealers as deemed reasonably necessary. Any order which does not comply with Boston Whaler’s terms and conditions need not be filled by Boston Whaler provided, however, that Boston Whaler shall promptly notify Dealer of such noncompliance. Any additional or different terms submitted by Dealer will be deemed rejected and will also be void and of no effect. Dealer cancellation of orders will be subject to Boston Whaler’s then current cancellation policy applicable to all domestic Boston Whaler dealers. All orders submitted by Dealer are subject to acceptance by Boston Whaler.

5. Prices : The Products sold to the Dealer by Boston Whaler shall be on the basis of price lists published by Boston Whaler from time to time for its domestic dealers, less any applicable discounts allowed by Boston Whaler’s programs. Boston Whaler shall have the right to revise the price lists or applicable discounts or programs applicable to all of its domestic dealers at any time and agrees to promptly notify Dealer of any such change. The Product prices charged to Dealer will be the lowest price then charged to other domestic dealers subject to Dealer meeting all the requirements and conditions of Boston Whaler’s applicable programs, and provided that Boston Whaler may in good faith, charge lesser prices to other dealers to meet existing competitive circumstances, for unusual and limited duration non-ordinary business circumstances, or for limited duration promotional programs. Boston Whaler shall have no obligation to reimburse Dealer for any loss which Dealer may sustain by reason of any change in price, program, or discount for which notice was provided in accordance herewith. Terms of payment will be as specified from time to time by Boston Whaler. Dealer will pay Boston Whaler the lesser of 1.5% late charges per month or the maximum permitted by applicable law on any past due invoice except as to any specific amount of an invoice that is disputed in good faith by the Dealer. Boston Whaler may refuse shipment for any credit reason, including Dealer’s failure to pay for a prior shipment or to pay any financial institution who finances Dealer’s purchases, or for Dealer’s failure to maintain its Product inventory in accordance with the terms of this Agreement. Boston Whaler shall immediately notify Dealer if Boston Whaler refuses shipment to Dealer so that Dealer has a reasonable opportunity to cure any issue. Dealer will reimburse Boston Whaler for all reasonable and necessary costs in collecting past due accounts, including attorney fees and court costs. Dealer hereby grants to

Boston Whaler and Boston Whaler hereby retains a security interest in all Products sold to Dealer and all proceeds arising out of the sale of the Products until such Products are paid for in full. Dealer agrees to sign, file, authenticate, and authorize the signing, filing and authenticating by Boston Whaler of such financing statements and other documents and do such other acts, as Boston Whaler may request to establish and maintain a valid and protected security interest in the Products.

6. Shipments : All shipments of Products shall be made FOB the Boston Whaler factory designated by Boston Whaler, and title shall pass to Dealer at the time the Products or parts are tendered to the designated carrier or the Dealer or Dealer’s representative at the Boston Whaler factory. Dealer shall pay all applicable shipping, transportation, delivery, and handling charges for Products ordered. If Dealer fails to accept delivery of any Products ordered, other than material non-conforming Products that must be returned to Boston Whaler for repair, Dealer shall reimburse Boston Whaler for any costs incurred, including returning such Products to Boston Whaler. If Boston Whaler ships Products not ordered by Dealer, Dealer shall have the right to refuse delivery, in which event Boston Whaler shall pay all costs incurred in returning same to Boston Whaler. Shipments shall be subject to Boston Whaler’s production schedule and availability of materials or transportation equipment. No liability shall be sustained by Boston Whaler by reason of its not filling any order due to circumstances beyond its reasonable control such as, but not limited to, labor disputes, natural disasters, accidents to machinery, acts of God, acts of or threatened acts of war or terrorism, material shortages, regulations, demands for goods exceeding Boston Whaler’s available supply or any other cause beyond Boston Whaler’s control. In the event of any delay in delivery, failure to fill orders or other default or damage caused by any of the foregoing, Boston Whaler may, at its option and without liability, cancel all or any portion of the applicable orders to the extent affected by the event of force majeure and/or extend any date upon which performance is due hereinunder.

7. Risk of Loss : Risk of loss for Products ordered by Dealer shall pass to Dealer at the time the Products or parts are tendered to the designated carrier or the Dealer or Dealer’s representative at the Boston Whaler factory. Boston Whaler has instructions to insure Products on behalf of Dealer from the shipping point to the final delivery point unless otherwise agreed by the parties in writing. Dealer will be the loss payee on any claim. Boston Whaler will assist Dealer in the processing and collection of any claims against the carrier contracted by Boston Whaler. Notwithstanding the above, if Dealer or Dealer’s representative takes possession of Products at the Boston Whaler factory, Dealer assumes responsibility to insure the Products upon tender of the Products to Dealer or Dealer’s representative at the Boston Whaler factory.

8. Payment - Claims : All sales of Products to Dealer shall be paid for in advance by Dealer, unless otherwise agreed between Boston Whaler and Dealer in writing. All claims for shortage or damages or unacceptable Product shall be made pursuant to Boston Whaler’s then current policy on shipment damage and claims procedures applicable to all Boston Whaler domestic dealers. The failure of Dealer to give such notification as set forth in Boston Whaler’s then current shipment damage and claims procedures policy shall constitute a waiver of any such claim. Dealer shall cause to be paid or shall make reimbursement to Boston Whaler in full for any and all taxes, duties, or other charges imposed by federal, state, municipal, or other governmental authority upon Dealer’s purchase under this Agreement.

9. Product Modification : Boston Whaler shall have the right to discontinue the sale of Products or to modify the design, specifications and components of Products at any time provided, however, that Boston Whaler shall notify Dealer, prior to shipment, of any major changes with respect to Products previously ordered by Dealer but not yet delivered, in which event Dealer shall have the right to terminate such order within five (5) business days after such notification by providing written notice to Boston Whaler. The failure to provide such timely written notification shall be deemed acceptance by Dealer of such changes.

10. Warranties and Limitation of Warranties and Liability :

10.1 Warranties : Dealer agrees to:

A. Sell Products only on the basis of Boston Whaler’s published applicable limited warranty and make no other warranty or representations concerning the limited warranty, express or implied, either verbally or in writing.

B. Display at each Dealer Location that Product warranty information required by applicable law and furnish and make known to the first-use purchaser at the time of delivery the appropriate operations and maintenance manual provided by Boston Whaler, instructional information for the use and operation of the Product consistent with the operations and maintenance manual, the Product installation instructions, if any, together with Boston Whaler’s written limited warranty, including all disclaimers and limitations thereto.

C. Subject to the terms of the applicable limited warranty, expressly inform the purchaser in writing that no Boston Whaler warranty applies if the Product is “used” unless Boston Whaler expressly authorizes such warranty in writing or the existing balance of the warranty is transferable and is transferred. No Product warranty shall apply if the design or material of the Product is substantially modified without the express authorization of Boston Whaler in writing.

D. Provide timely warranty service on all Product presented to Dealer by purchasers in accordance with Boston Whaler’s then current warranty service program applicable to all domestic Boston Whaler dealers selling comparable Products. Dealer agrees to make all claims for reimbursement under Boston Whaler’s warranty service program in the manner reasonably prescribed by Boston Whaler. Boston Whaler may revise its warranty service program from time to time, providing Dealer with written notification of all revisions, and those revisions will supersede all previous programs.

E. To verify the accuracy of the warranty claims submitted to Boston Whaler by Dealer and the service provided by Dealer with regard to such warranty claims, provide Boston Whaler with access to its applicable books and records, and provide such additional documentation which Boston Whaler may reasonably request. In the event Boston Whaler finds errors in the aggregate greater than 5% of reviewed claims submitted by Dealer Location and paid by Boston Whaler, Boston Whaler may calculate the percentage rate of error; and using that percentage rate of error, extrapolate the

amount owed to Boston Whaler for up to three (3) prior years of all paid claims made by Boston Whaler to Dealer at that Dealer Location. Within thirty (30) days of such notice of such amount, Dealer shall either pay the extrapolated amount to Boston Whaler or pay the cost of a full audit by Boston Whaler or Boston Whaler’s designee or at Dealer’s option and expense, a third party auditor reasonably acceptable to Boston Whaler and Dealer and pay to Boston Whaler that amount, if any, found to be owing to Boston Whaler as a result of such audit. Boston Whaler agrees to honor all legitimate warranty claims on Products when made by purchaser through Dealer in the manner reasonably prescribed by Boston Whaler. Boston Whaler shall respond to all proper and legitimate warranty claims submitted by Dealer within the time period described in the then current warranty policy applicable to domestic Boston Whaler dealers. Boston Whaler agrees to pay or credit all accepted and undisputed claims within thirty (30) days after receipt of all required documentation.

10.2 Limitation of Warranties and Liability.

EXCEPT AS SPECIFICALLY PROVIDED IN BOSTON WHALER’S PUBLISHED APPLICABLE LIMITED WARRANTY, BOSTON WHALER MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO PRODUCTS, INCLUDING WITHOUT LIMITATION THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR, NOR SHALL THE MEASURE OF DAMAGES INCLUDE, ANY AMOUNTS FOR LOST PROFITS, LOST SALES, OR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES FOR ANY REASON OR UPON ANY CAUSE OF ACTION, WHETHER SOUNDING IN TORT, CONTRACT OR ANY OTHER LEGAL THEORY.

11. Indemnification .

A. In order to obtain preferred boat show space at discounted rates for Dealers, Boston Whaler may contract with and agree to indemnify boat show sponsors and other related parties. Accordingly, Dealer shall defend, indemnify and hold harmless Boston Whaler, and any boat show sponsor which Boston Whaler has agreed to indemnify, from any and all claims, causes of action, and suits, including claims of negligence arising either directly or indirectly out of Dealer’s use of boat show space originally obtained by Boston Whaler.

B. Boston Whaler agrees to indemnify and hold harmless Dealer for losses, cost and expense to the extent such losses, cost or expense result from any third party claim related to (1) Boston Whaler’s negligent acts or omissions involving the original design or manufacture of any Product at the time it left Boston Whaler’s possession or control, or the repair of any Product performed by Boston Whaler, or (2) any breach of this Agreement by Boston Whaler. Boston Whaler, at its expense and through counsel of its own choosing, may defend any litigation that may arise out of any claims covered hereby, and Dealer agrees to cooperate at its own expense and provide Boston Whaler with any available information as may be reasonably necessary to such defense. In the event Boston Whaler elects not to defend any litigation that may arise out of any claims covered hereby, Boston Whaler will be responsible for Dealer’s reasonable attorney fees on a pro-rated basis to the extent such losses are subject to indemnification pursuant to this Agreement.

C. Dealer agrees to indemnify and hold harmless Boston Whaler for losses, cost and expense to the extent such losses, cost or expense result from any third party claim related to (1) Dealer’s negligent acts or omissions involving Dealer’s improper application, use or repair of the Products, (2) statements or representations not specifically authorized by Boston Whaler, including warranties inconsistent with Boston Whaler’s standard limited warranty, and the installation of any after market components or any other modification or alteration to the Product, or (3) any breach of this Agreement by Dealer. Dealer, at its expense and through counsel of its own choosing, may defend any litigation that may arise out of any claims covered hereby, and Boston Whaler agrees to cooperate at its own expense and provide Dealer with any available information as may be reasonably necessary to such defense. In the event Dealer elects not to defend any litigation that may arise out of any claims covered hereby, Dealer will be responsible for Boston Whaler’s reasonable attorney fees on a pro-rated basis to the extent such losses are subject to indemnification pursuant to this Agreement.

D. The provisions in this Section 11 regarding indemnification do not apply to claims by third parties in which there has been a judicial determination that the indemnifying party does not have liability to the third party. The provisions in this Section 11 shall survive the expiration or termination of this Agreement.

12. Repossession or Repurchase of Product by Boston Whaler : Dealer shall be liable to and reimburse Boston Whaler for any and all losses or deficiencies on the sale or disposition of any Product purchased by Dealer pursuant to this Agreement which is repossessed or repurchased by Boston Whaler for any reason whatsoever, except as contemplated in Section 16G. Dealer shall also be liable for any and all discounts, volume rebates, or other sales incentives paid to Dealer on Product repurchased, and all reasonable attorney’s fees, court costs, and expenses incurred in connection with such repossession or repurchase. Dealer agrees to provide Boston Whaler, upon request, guarantees or other adequate security to cover any repurchase or financial obligations that Boston Whaler may assume in connection with Dealer’s flooring or financing.

13. Trademarks and Service Marks : Dealer acknowledges that Boston Whaler or its affiliated companies are the exclusive owners of various trademarks, service marks, trade designations, logos and trade dress (collectively “Identification”) which Boston Whaler uses in connection with Products and its business. Dealer is authorized to use Identification only in the manner prescribed by Boston Whaler, only in connection with the promotion and sale of Products, and only until the expiration or termination of this Agreement. Dealer shall not register or assist any other party to register any domain name that contains or closely resembles any Company Identification without first obtaining the prior written consent of Company. Dealer shall not use Identification in any unauthorized manner or in any manner that adversely reflects upon the reputation of Boston Whaler or in relation to any other matter that is a breach of this Agreement. Dealer shall not use Identification or advertise outside of the Territory to the extent prohibited by the terms of this Agreement, without Boston Whaler’s express written consent and shall comply with Boston Whaler’s Advertising Policy. Authorization shall not be interpreted as a license for use of Identification. Dealer acquires no proprietary rights with respect to Identification, and this authorization shall terminate simultaneously with the termination or expiration of this Agreement. In the event of expiration or termination of this Agreement, Dealer shall immediately

discontinue use of Identification in any way whatsoever and shall thereafter not use, either directly or indirectly, any Identification or any confusingly similar Identification in a manner likely to confuse, mislead, or deceive the public. Dealer may continue to use Identification for a reasonable period of time in the event Boston Whaler does not repurchase Dealer Product inventory as long as such Identification use remains subject to the terms of this Agreement, Boston Whaler’s Advertising Policy or any other written instructions provided by Boston Whaler to Dealer. Dealer agrees that any unauthorized use or continued use of Identification after the period of time allowed by this Section 13 shall constitute irreparable harm entitling Boston Whaler to seek equitable relief, including injunction and specific performance, without the necessity of posting bond or proving actual damages, as a remedy for any such breach. Such remedies shall not be deemed to be the exclusive remedies for such a breach by Dealer but shall be in addition to all other remedies available at law or equity to Boston Whaler.

14. [Intentionally omitted.]

15. No Agency Created : It is understood and agreed that Dealer is not, nor shall it at any time represent itself to be, the agent, employee, representative, partner, or franchisee of Boston Whaler for any purpose. Neither party shall enter into any contract or commitment in the name of or on behalf of the other party. Boston Whaler has no fiduciary duty to Dealer pursuant to this Agreement or the relationship between the parties. Dealer is not required to pay, and shall not pay, to Boston Whaler any fee for the right to purchase the Products or otherwise do business with Boston Whaler.

16. Term of Agreement - Termination :

A. The term of this Agreement shall be as set forth in the Defined Terms (the “ Term”) subject however to the provisions set forth in this Section 16 and in Section 18.

B. Subject to the provisions of Section 16F below, Boston Whaler may terminate this Agreement upon the giving of at least sixty (60) days prior written notice to Dealer if: (1) Dealer does not have an ability to purchase Products via flooring or self-financing; or (2) Dealer fails to meet its financial obligations as they become due to either Boston Whaler or lender(s) financing Products. Boston Whaler shall work in good faith with Dealer to try to resolve any differences between them prior to giving such 60-day notice of termination.

C. This Agreement may be terminated at any time by the mutual consent of the parties.

D. Subject to the provisions of Section 16F below, either party may elect to not extend the Term of this Agreement for another twelve (12) month period following expiration of the current twelve (12) month period of the Term as described in the Defined Terms in the event of the material breach or default of any of the material obligations, Performance Standards (as defined in Section 3.1B and Exhibit B), covenants, representations, warranties, or duties imposed herein or in Boston Whaler’s policies or programs applicable to domestic Boston Whaler dealers by either party. In such event, the non-breaching party will provide written notice to the breaching party and an opportunity to cure or remedy such breach. The parties shall work together in good faith to resolve any issues but

the additional twelve (12) month extension shall not be added until such time that the breach is remedied to the reasonable good faith satisfaction of the parties. At such time as the parties agree that the concerns have been remedied, the additional twelve (12) month extension shall be added to the end of the existing Term.

Notwithstanding the above, so long as Dealer’s failure to meet the Performance Standards is not caused by Boston Whaler failing to have Product available for purchase by Dealer, Boston Whaler shall have the right to terminate this Agreement as to the applicable Dealer Location (i) if Dealer is failing to meet the Performance Standards in a Dealer Location and begins selling, displaying, or advertising products that are competitive with the Products (other than products of another Brunswick Corporation brand or new products which MarineMax sells, displays or advertises for sale as of the date of this Agreement) at that Dealer Location and does not cure its failure to meet the Performance Standards within ninety (90) days after written notice of the same from Boston Whaler and good faith efforts by the parties to agree on an appropriate cure during such time period, (ii) if Dealer is meeting the Performance Standards in a Dealer Location, but then starts failing to meet the Performance Standards after beginning selling, displaying, or advertising products that are competitive with the Products (other than products of another Brunswick Corporation brand or new products which MarineMax sells, displays or advertises for sale as of the date of this Agreement) at that Dealer Location and does not cure its failure to meet the Performance Standards within six (6) months after written notice of the same from Boston Whaler, or (iii) as to the Lindenhurst, NY, Huntington, NY and Copiague, NY Locations, Dealer is failing to meet the Performance Standards in the Location and does not cure its failure to meet the Performance Standards within six (6) months after written notice of the same from Boston Whaler.

E. Notwithstanding subparagraph D above or anything in this Agreement to the contrary, this Agreement may be terminated by a party upon sixty (60) days prior written notice to the other party if any of the following occur with regard to the other party: (1) the other party ceases to exist; (2) the other party becomes insolvent or takes or fails to take any action which constitutes an admission of inability to pay debts as they mature; (3) the other party makes a general assignment for the benefit of creditors to an agent authorized to liquidate any substantial amount of assets; (4) the other party becomes a subject of an “order for relief” within the meaning of the United States Bankruptcy Code; (5) the other party becomes the subject of a receivership, reorganization, liquidation or any similar proceeding; or (6) the other party makes a fraudulent misrepresentation that is material to this Agreement. This Agreement may be terminated upon sixty (60) days prior written notice by Boston Whaler upon the occurrence of: (1a) a prohibited assignment, transfer, delegation or subcontracting without consent as described in Section 18A; (2b) the commission by Dealer of an act of fraud upon Boston Whaler; (3c) the commission by Dealer (or any of its officers) of a felony or other act of fraud which is materially detrimental to Boston Whaler’s reputation or business or which materially impairs the Dealer’s ability to perform the duties under this Agreement; or (4d) Dealer fails to pay any lender financing Products after the sale of Products by Dealer (out of trust).

F. For the purpose of the first paragraph of Section 16D, if a breach or default by Dealer pertains only to one Dealer Location, Boston Whaler shall have the right to deny the additional extension period for that particular Dealer Location only until remedied as described in Section D. For the purpose of Section 16B or E, if Dealer breaches or defaults as described in such provisions, Boston

Whaler may, in its own discretion, elect either to terminate the entire Agreement (as to all Dealer Locations) or terminate only as to particular Dealer Location subject to the Agreement. Notwithstanding the foregoing, in the event of any possible termination pursuant to Section 16B or E, a party seeking to terminate shall first provide written notice to the other party stating the potential grounds therefore and both parties shall work together in good faith for a period of no less than sixty (60) days to resolve any concerns between the parties.

G. [****]

H. In the event of termination of this Agreement prior to its expiration date, provided the termination is not for fraud, bad faith, or insolvency of Dealer, Boston Whaler will nevertheless continue to sell to Dealer warranty parts and accessories for Products on a cash on delivery basis for a period not to exceed twelve (12) months in order that Dealer may continue to provide warranty service on Products which have outstanding warranties subject to Dealer’s compliance with the terms and conditions of Boston Whaler’s warranty and parts program applicable to all domestic Boston Whaler dealers. The performance of any warranty work after termination or expiration of this Agreement shall not be construed as a continuation of this Agreement, the commencement of a new agreement, or a waiver of the termination.

I. Any period of time described in the Agreement shall be modified to include such different period of time that may be required by applicable law.

J. In the event of expiration or the termination of this Agreement by either party, Boston Whaler is relieved from any obligation to make any further Product shipments under this Agreement, and may cancel all of Dealer’s unshipped orders for Products, irrespective of previous acceptance by Boston Whaler, except those which are proved to Boston Whaler’s reasonable satisfaction to have been the subject of a binding customer order to Dealer prior to the receipt of any notice of termination or expiration. The acceptance of orders from Dealer for the continuous sale of Products to Dealer or any other act after expiration or termination of this Agreement shall not be construed as a continuation of this Agreement, the commencement of a new agreement, or a waiver of the termination. Upon the expiration or termination of this Agreement, all obligations owed by Dealer to Boston Whaler shall become immediately due and payable on the effective date of the expiration or termination, whether otherwise then due or not (without presentment, demand, protest or notice of any kind, all of which are waived by Dealer); and Boston Whaler may offset or deduct from any and all sums owed to Dealer any and all sums owed by Dealer to Boston Whaler, or any parent, affiliate or subsidiary of Boston Whaler, returning to Dealer the excess, if any.

17. Governing Law : This Agreement shall be governed, interpreted and construed according to the laws of the State of Tennessee, U.S.A., without regard to applicable conflicts of law.

18. Assignability :

A. This appointment and Agreement is made and entered into with the distinct understanding that it is personal with Dealer, and is not, whether by operation of law, change in control or otherwise, assignable or in any part delegable or transferable unless the express written consent of Boston Whaler is obtained; provided, however, that Dealer may assign the appointment and this Agreement to a subsidiary or affiliate without consent. An assignment by Dealer to any subsidiary or affiliate shall not relieve Dealer from any obligation or responsibility provided for under the terms of this Agreement. Unless first approved by Boston Whaler in writing, any purported assignment, transfer, delegation or subcontracting of Dealer’s rights and obligations under this Agreement by it (other than to a subsidiary or affiliate) may immediately render this Agreement terminated in Boston Whaler’s sole discretion.

B. Boston Whaler may not assign this Agreement without the prior written consent of Dealer, except that no such consent is necessary with respect to assignment of this Agreement to any Boston Whaler owned subsidiary or affiliate. An assignment by Boston Whaler to any owned subsidiary or affiliate shall not relieve Boston Whaler from any obligation or responsibility provided for under the terms of this Agreement. Upon any sale of the business or the assets of Boston Whaler to a nonaffiliated third party, and where Dealer does not agree to the assignment, this Agreement shall be terminated and Boston Whaler shall be released from any further obligations and liabilities to supply Products to Dealer under this Agreement provided however that the provisions of Sections 11 and 16 and all other provisions that are intended to survive termination either expressly or impliedly shall do so in accordance with their terms.

19. Notices, Communications :

A. Any written notice given pursuant to this Agreement shall be either hand delivered (by courier or otherwise), or mailed, postage prepaid, by Registered or Certified Mail, return receipt requested, to the party identified below at the respective address listed below. Notice may also be given by fax, e-mail or other electronic method; however, if notice is provided pursuant to Section 16, a copy must also be mailed in the manner described herein. Such notice shall be deemed to be given upon first receipt. A change of address may be given by such notice.


To Boston Whaler:		To Dealer:

		William H. McGill, Jr.
		President
Boston Whaler		MarineMax, Inc.
Attention: President
100 Whaler Way		2600 McCormick Drive
Edgewater, FL 32141		Suite 200
		Clearwater, Florida 33759


With a copy to:		With a copy to:

Brunswick Corporation Law Department		MarineMax, Inc.
Attention: General Counsel		Attention: General Counsel
1 N. Field Court		Suite 200
Lake Forest, Ill		2600 McCormick Drive
Tel: (847)735-4700		Clearwater, FL 33759
Fax: (847) 735-4433		Tel: (727) 531 1700
		Fax: (727) 450-1162

B. Dealer hereby grants permission and consent to Boston Whaler and to those entities who are authorized by Boston Whaler to send or transmit communications (including but not limited to facsimiles, wireless communications, and e-mails) to Dealer and Dealer’s officers, directors, employees, subsidiaries and affiliates, and their permitted successors and assigns. Such communications are not limited in content and may include advertisements, and Dealer understands that by providing such consent it may incur costs that are related to the receipt of such communications. Dealer further agrees that such communications may be sent to any telephone number or electronic media address supplied by Dealer for each Dealer Location.

20. Entire Agreement - Non-Waiver : This Agreement, including any attached addenda, contains the entire agreement between the parties with respect to the matters set forth herein and may not be amended or modified except by a written instrument signed by Boston Whaler and Dealer that expressly states that the writing constitutes an amendment or modification to this Agreement, provided that, subject to the provisions of this Agreement, Boston Whaler may in its sole discretion and from time to time make changes in accordance with its own reasonable business judgment to the policies and programs applicable to all domestic Boston Whaler dealers upon the giving of notice to Dealer as described herein. This Agreement terminates and replaces all prior agreements made between the parties regarding the subject matter of this Agreement and there are no other agreements regarding the matters herein provided that each party shall remain obligated to the other for any monies owed under such prior agreements between the parties; and except for payments to be made to Dealer in the ordinary course of business or claims of third parties, there are no other monies, claims, or actions which may give rise to or result in any compensation or monies being owed to Dealer by Boston Whaler. Failure on the part of Boston Whaler or Dealer to enforce any term of this Agreement shall not constitute a waiver thereof.

21. Severability – Existing Claims : Whenever possible, each paragraph of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any portion of this Agreement is deemed invalid or unenforceable, the remaining sections shall still be enforceable unless removal of that portion so materially alters the risks and benefits to either party that enforcement would be substantially unfair. In such a case, the parties agree to immediately negotiate a substitute clause to restore each party as closely as possible to the risks and benefits originally assumed. Dealer represents to Boston Whaler that it is not aware of any claims, causes of action, or disputes that it has or may assert against Boston Whaler that arise out of or have accrued prior to the effective date of this Agreement. Dealer further represents to Boston Whaler that it has not breached or otherwise violated any term or condition of any previous agreement with Boston Whaler.

22. Disputes : All disputes, controversies or claims connected with, arising out of, or relating to this Agreement, or any modification, extension or renewal thereof, or to any causes of action that result from such relationship, shall be subject exclusively to the remedy of arbitration described herein, including but not limited to sums due under this Agreement, the interpretation, performance or nonperformance of this Agreement, and claim for damages or rescission, a breach or default of this Agreement, the creation, termination or nonrenewal of this Agreement (such as a dispute regarding the causes, validity or circumstances of the termination, nonextension, or nonrenewal), and trade regulations or antitrust claims, whether such controversies or claims are in law or equity or include claims based upon contract, statute, tort or otherwise. All controversies shall be conducted in accordance with the American Arbitration Association Commercial Arbitration Rules.

The arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. § 1-16, as amended, and judgment upon the award rendered by the arbitrator may be entered by any court having jurisdiction thereof. The place of the arbitration shall be at Chicago, Illinois. Dealer consents to personal jurisdiction of the federal and state courts located in the State of Illinois for the purpose of enforcing this provision or confirming any arbitration award. No party shall be entitled to receive an award of damages in excess of actual damages and in no event shall the parties receive an award of punitive, special or consequential damages, or prejudgment interest.

Except for claims based on sums owing to Boston Whaler for Products purchased by Dealer, or sums owing to Dealer for the reimbursement of funds it paid for Products that were previously returned to Boston Whaler or claims based on Section 11 hereof, all arbitration claims and proceedings must be instituted within one (1) year after the dispute arises, and the failure to institute arbitration proceedings within such period shall constitute an absolute ban to the institution of any proceedings and a waiver and relinquishment of all such claims.

This paragraph shall survive the expiration or termination of the Agreement.

23. [intentionally omitted]

24. Reservation of Rights : Boston Whaler grants to Dealer only those rights expressly stated in this Agreement. Except to the extent otherwise expressly provided in this Agreement, Boston Whaler retains all rights. This Agreement does not concern any other brands or products, except the Boston Whaler Products identified in the Defined Terms. Boston Whaler and/or its affiliates reserve the right for Boston Whaler’s affiliates to own, acquire, manage, sell, display or service other products and other brands in any area (including the Territory) including those that may compete with Products. Boston Whaler reserves the right to receive incentives, rebates or other payments from third-party suppliers, including without limitation related to purchases by or through Dealer from such third party suppliers.

25. Confidentiality . Each party shall maintain as confidential all proprietary business information, trade secrets and all materials containing confidential business information provided to

such party by the other party, including but not limited to customers, vendors, price lists, wholesale prices, programs, rebates, discounts, inventions, concepts, designs, structures, formulas, processes, financial information, employees, strategic plans, acquisition plans or other business affairs of the disclosing party. Dealer acknowledges that Boston Whaler is an affiliate of Brunswick Corporation, and accordingly subsidiaries, affiliates and other divisions of Brunswick Corporation may be given access or have access to confidential business information received in connection with this Agreement, and such disclosure does not constitute a breach of this paragraph. Each party, on behalf of its directors, officers, employees and agents to whom such information and materials are disclosed, agree that it shall keep such information and materials confidential both during and after the Term of this Agreement for a period of three (3) years provided that if any such information or material is a trade secret, then the obligations under this Section shall survive the termination of this Agreement for the longer of five (5) years or the length of time such information remains a trade secret.

These obligations of confidentiality do not apply to any information which (1) was known to the receiving party prior to receipt from the disclosing party; (2) is independently developed by the receiving party, provided that the burden of proof of such independent development shall be on the receiving party; (3) is or becomes publicly known without the fault of the receiving party; (4) is or becomes rightfully available to the receiving party without confidential restriction from a source not bound by a confidentiality obligation to the disclosing party; (5) is required by law, rule or regulation to be disclosed; (6) is required to be disclosed pursuant to court or government action; provided, the disclosing party is given reasonable prior notice of such disclosure; or (6) is disclosed pursuant to written agreement of the parties.

The terms of this paragraph are in addition to, and in no way a limitation of, the terms of any confidentiality or non-disclosure agreement (or any confidentiality provision in any other agreement) between or involving Boston Whaler (or its affiliates) and Dealer.

26. Miscellaneous : In case of any dispute relating to the rights and duties imposed by this Agreement, both parties will openly discuss and make reasonable efforts at amicable resolution. Except as expressly described to the contrary in this Agreement, the rights and remedies of each party are not exclusive. Unless otherwise provided, where either party has a right to make a determination or pursue or not pursue a particular course of action under the terms of this Agreement, such as, for example granting consent or approval, such determinations and decisions shall be made by such party in its sole discretion. As defined herein, a domestic Boston Whaler dealer shall be an authorized Boston Whaler dealer whose territory is located solely within the continental Unites States.

27. Counterparts and Signatures : This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute on and the same Agreement. Any signature delivered by fax or other electronic transmission shall be deemed to be an original signature.

28. Guarantee : As a condition for Boston Whaler’s entering into this Agreement, MarineMax has signed this Agreement as evidence of its irrevocable guarantee of the Dealer’s performance of all of the duties and obligations provided for in this Agreement.

EXHIBIT A

[****]

EXHIBIT B

[****]

EXHIBIT X

[****]

Exhibit 10.20 (g)

SALES AND SERVICE AGREEMENT

This Sales and Service Agreement (“ Agreement ”) is entered into as of September 1, 2014 by Boston Whaler, Inc. (“Boston Whaler” or “Company”) MarineMax, Inc. (“MarineMax”), and MarineMax Northeast, LLC (“Dealer”), in consideration of the mutual covenants contained in this Agreement, and subject to and incorporating herein the Sales and Service Agreement Terms and Conditions attached hereto. Pursuant to this Agreement, Company hereby appoints Dealer through its Dealer Locations identified in Exhibit A as its dealer for the sale of Products in the Territory identified in such Exhibit. Dealer represents and warrants to Company that MarineMax East, Inc. is the direct parent of Dealer and MarineMax, Inc. is the sole and exclusive parent of MarineMax East, Inc.

DEFINED TERMS

In this Agreement, the following words and expressions that are not defined elsewhere in this Agreement shall have the following meaning, except where the context requires otherwise:

Dealer and Dealer’s Principal Address: MarineMax Northeast, LLC, 2600 McCormick Drive, Suite 200, Clearwater, Florida 33759

Dealer Location: Each Dealer facility as listed on Exhibit A attached hereto.

Territory: Identified for each Dealer Location in attached Attachment 1 to Exhibit A

Product(s): Full line of Boston Whaler Boats (Including related parts and accessories)

Performance Standards: See attached Exhibit B.

or within sixty (60) days after the first (1st) year of any such two (2) year renewal term, either party may provide written notice to the other party to terminate this Agreement effective as of August 31 of the then current contract year.


Boston Whaler, Inc.				MarineMax, Inc.


By:				By:
Title:				Title:
Date:				Date:

MarineMax Northeast, LLC


By:
Title:
Date:

MarineMax East, Inc.


By:
Title:
Date: