EXHIBIT 10.2
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ASSET PURCHASE AGREEMENT
by and among
GOODY'S FAMILY CLOTHING, INC.,
TSI BRANDS, INC.,
and
TROPICAL SPORTSWEAR INT'L CORPORATION
Dated May 30, 2003
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Table of Contents
Page
ARTICLE I. PURCHASE AND SALE1
Section 1.1. Purchase and Sale of Transferred Assets...........................................1
Section 1.2. Assumption of Liabilities; Excluded Liabilities...................................1
Section 1.3. Purchase Price....................................................................2
Section 1.4. Use of Trademarks and Licenses....................................................2
Section 1.5. Deliveries........................................................................2
Section 1.6. Inventory.........................................................................3
ARTICLE II. REPRESENTATIONS AND WARRANTIES OF THE SELLER AND THE PARENT...........................4
Section 2.1. Organization and Qualifications...................................................4
Section 2.2. Authority; Binding Obligation.....................................................4
Section 2.3. No Conflict; Required Consents....................................................5
Section 2.4. No Subsidiaries...................................................................5
Section 2.5. Litigation........................................................................6
Section 2.6. Trademarks........................................................................6
Section 2.7. Assumed Contracts.................................................................7
Section 2.8. Broker Fees.......................................................................7
Section 2.9. Inventory.........................................................................7
Section 2.10. Limitation of Representations and Warranties......................................7
ARTICLE III. REPRESENTATIONS AND WARRANTIES OF THE BUYER..........................................7
Section 3.1. Organization of the Buyer.........................................................8
Section 3.2. Authority; Binding Obligation.....................................................8
Section 3.3. No Conflict; Required Consents....................................................8
Section 3.4. Broker Fees ......................................................................8
ARTICLE IV. RIGHTS AND OBLIGATIONS SUBSEQUENT TO CLOSING..........................................8
Section 4.1. Survival of Representations and Warranties........................................8
Section 4.2. Confidentiality Obligations of the Seller and the Parent..........................9
Section 4.3. Confidentiality Obligations of the Buyer..........................................9
Section 4.4. Compliance ......................................................................10
Section 4.5. Further Assurances...............................................................10
ARTICLE V. INDEMNIFICATION.......................................................................10
Section 5.1. Indemnification of the Seller and the Parent.....................................10
Section 5.2. Indemnification of the Buyer.....................................................10
Section 5.3. Indemnification Procedure........................................................11
ARTICLE VI. MISCELLANEOUS........................................................................12
Section 6.1. Fees and Expenses................................................................12
Section 6.2. Notices..........................................................................12
Section 6.3. Governing Law; Forum; Process....................................................13
Section 6.4. Entire Agreement.................................................................13
Section 6.5. Assignability; Binding Effect....................................................13
Section 6.6. Execution in Counterparts........................................................13
Section 6.7. Amendments.......................................................................13
Section 6.8. Severability.....................................................................13
Section 6.9. Section Headings.................................................................14
Section 6.10. Gender and Tenure................................................................14
Section 6.11. Third-Party Rights...............................................................14
Section 6.12. Construction.....................................................................14
Section 6.13. Disclosure.......................................................................14
Section 6.14. Definitions......................................................................14
SCHEDULES
Schedule 1.1(a)...-- List of Trademarks
Schedule 1.1(b)...-- List of License Agreements
Schedule 1.4(a)...-- Retail Outlet Inventory
Schedule 1.4(b)...-- Outstanding Orders
Schedule 1.6(b)...-- Fall 2003 Inventory
Schedule 2.3......-- Seller No Conflict; Required Consents
Schedule 2.5......-- Seller Litigation
Schedule 2.6......-- Seller Trademarks
Schedule 3.3......-- Buyer No Conflict; Required Consents
Exhibits
Exhibit A.........-- Assignment of Trademarks
Exhibit B.........-- Purchase Order
ASSET PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT, dated as of May 30, 2003 (this "Agreement"), by and among GOODY'S FAMILY
CLOTHING, INC., a Tennessee corporation (the "Buyer"), TSI BRANDS, INC., a Delaware corporation (the "Seller"),
and TROPICAL SPORTSWEAR INT'L CORPORATION, a Florida corporation (the "Parent") (the Buyer, the Seller and the
Parent are each hereinafter individually referred to as a "Party" and collectively as the "Parties").
ARTICLE I.
PURCHASE AND SALE
Section 1.1. Purchase and Sale of Transferred Assets. Upon the terms and subject to the conditions of this
Agreement, the Seller and the Parent do hereby sell, transfer, convey, assign and deliver free and clear of any
Encumbrance, as defined in Section 6.14 (other than the rights embodied in the license agreements listed on
Schedule 1.1(b)), to the Buyer, and the Buyer does hereby purchase, acquire and accept from the Seller and the
Parent, all of the Seller's and/or the Parent's right, title and interest in and to the following (collectively,
the "Transferred Assets"):
(a) the trademarks which are specified on Schedule 1.1(a) and all registrations and applications for
registrations of any of the foregoing, and all claims against third parties for infringement of these trademarks
(the "Trademarks"); and
(b) all rights and interest of the Seller in the license agreements listed on Schedule 1.1(b) (the "License
Agreements"), and all claims against third parties in respect of these License Agreements.
Section 1.2. Assumption of Liabilities; Excluded Liabilities.
(a) Subject to the terms and conditions of this Agreement, the Buyer hereby agrees to assume, pay and
perform when due all obligations of the Seller (collectively, the "Assumed Liabilities") under the License
Agreements (the "Assumed Contracts") arising or coming due after the date hereof.
(b) It is expressly agreed and understood that the Buyer shall not assume or be bound by any liabilities of
the Seller or the Parent, or their respective businesses of any kind or nature, known, unknown, accrued,
absolute, contingent, recorded or unrecorded or otherwise, whether now existing or hereafter arising (the
"Excluded Liabilities") other than those specifically identified in Section 1.2(a). Without limitation of the
foregoing, the Buyer is not assuming any (i) obligation related to any breach or default (or an event which
might, with notice or lapse of time or both, constitute a default) under any Assumed Contract arising out of or
relating to periods on or prior to the date hereof, (ii) obligation related to any indemnity, defense or hold
harmless provision or agreement for occurrences prior to the date hereof, (iii) claims of infringement by third
parties against the Seller's and/or the Parent's ownership or use of the Trademarks, (iv) liability for any taxes
of the Seller, the Parent or of any other Person (as defined in Section 6.14) under Treasury Regulation Section
1.1502-6 (or any similar provision of state, local or foreign law, rule or regulation), as a transferee or
successor, by contract or otherwise, or (v) liabilities or obligations for any actions, judgments, fines, losses,
claims, damages or amounts in settlement arising from or in connection with or on the basis of events, acts,
omissions, conditions, or any other state of facts, occurring or existing prior to or on the date hereof. All
responsibility with respect to the Excluded Liabilities shall remain with the Seller and the Parent (as
applicable).
Section 1.3. Purchase Price.
(a) Subject to the other provisions of this Agreement, the purchase price for the Transferred Assets is US
$4,000,000 (four million dollars).
(b) The Seller shall pay any and all municipal, county, state and federal sales
and documentary transfer taxes, impositions, liens, leases, assessments and similar charges if any, incurred by
the Buyer or the Seller or the Parent in connection with the transactions contemplated by this Agreement. Each
Party shall in a timely manner sign and swear to any return, certificate, questionnaire or affidavit as to
matters within its knowledge required in connection with the payment of any such tax.
Section 1.4. Use of Trademarks and Licenses.
(a) Until the earlier of (i) December 1, 2003 or (ii) the liquidation of all the Retail Outlets owned and
operated by the Seller and/or the Parent listed on Schedule 1.4(a) (the "Retail Outlets"), the Seller and Parent
shall have a non-exclusive, royalty-free license to use the Trademarks on products in inventory as of the date of
this Agreement in the Retail Outlets in order to begin liquidating the Retail Outlets' inventory and ultimately
wind-down the business connected with the Retail Outlets. The amount of inventory in the Retail Outlets existing
as of the date of this Agreement is set forth on Schedule 1.4(a).
(b) Until the earlier of (i) October 1, 2003 or (ii) the fulfillment of the purchase orders specified on
Schedule 1.4(b) (the "Outstanding Orders"), the Seller and the Parent shall have a non-exclusive, royalty-free
license to use the Trademarks on products to fulfill any Outstanding Orders. As of the date of this Agreement,
neither the Seller nor the Parent (nor any of their respective affiliates) shall take any new orders (or modify
any Outstanding Order to increase the amount of product being supplied to any particular customer) or enter into
any contracts or agreements to sell products bearing any of the Trademarks. Such Outstanding Orders are
described in detail by customer, type of product, and units on Schedule 1.4(b).
(c) Notwithstanding the provisions of Section 1.4(b), until October 1, 2003 the Seller and the Parent shall
have the right to sell any Shelf Storage Inventory (as defined below) not otherwise purchased by the Buyer
pursuant to Section 1.6.
(d) The Seller and the Parent shall not make, acquire, or purchase any products or inventory bearing any of
the Trademarks for purposes of sale except as expressly provided in this Section 1.4 and except for the Fall 2003
Inventory (as defined below).
(e) Each of the Seller and the Parent agrees that their use of the Trademarks after the date hereof as
provided in this Section 1.4 will be in compliance with all applicable laws, rules and regulations and be subject
to the rights granted to the licensees in the License Agreements.
Section 1.5. Deliveries.
(a) The Seller and the Parent are herewith delivering to the Buyer the following:
(i) An Assignment of Trademarks in the form of Exhibit A duly executed by the Seller.
(ii) The files maintained by counsel for the Seller and the Parent related to the Trademarks (the "Legal
Trademark Files"). Such files will be available for review by the Buyer and its representatives prior
to the date hereof and will be numbered and transferred to the Buyer within five (5) business days after
the date hereof.
(iii) A certificate of the corporate secretary of the Seller attaching thereto a true, correct and complete
copy of resolutions of the Board of Directors of the Seller authorizing the execution, delivery and
performance of this Agreement and the Seller Documents (as defined in Section 2.2) and consummation of
the transactions contemplated hereby and thereby.
(iv) A certificate of the corporate secretary of the Parent attaching thereto a true, correct and complete
copy of resolutions of the Board of Directors of the Parent authorizing the execution, delivery and
performance of this Agreement and the Parent Documents (as defined in Section 2.2) and consummation of
the transactions contemplated hereby and thereby.
(v) UCC-3 termination statements and other documentation relating to the release of all security interests
relating to the Transferred Assets as necessary.
(b) The Buyer is herewith delivering to the Seller and the Parent the following:
(i) A certificate of the corporate secretary of the Buyer attaching thereto a true, correct and complete
copy of resolutions of the Board of Directors of the Buyer authorizing the execution, delivery and
performance of this Agreement and the Buyer Documents (as defined in Section 3.2) and consummation of
the transactions contemplated hereby and thereby.
Section 1.6. Inventory.
(a) The Seller hereby grants to the Buyer the non-exclusive right to purchase an undetermined number of
units of the Parent's Spring 2003 inventory (the "Shelf Storage Inventory") not otherwise sold or disposed of by
the Parent prior to the date hereof at a price per unit to be mutually agreed upon by the Seller and the Buyer
and in accordance with the terms and conditions set forth on the Purchase Order attached hereto as Exhibit B.
The Seller shall deliver all Shelf Storage Inventory so purchased by the Buyer not later than 30 days after the
date of this Agreement.
(b) The Buyer hereby agrees to purchase, at Seller's election, up to 153,736 units of the Parent's Fall 2003
inventory (the "Fall 2003 Inventory" and together with the Shelf Storage Inventory, the "Inventory") specified on
Schedule 1.6(b) at a price per unit of US$6.00, or $4.75 for short sleeve shirts, for an aggregate of US$881,646
in accordance with the terms and conditions set forth on the Purchase Order attached hereto as Exhibit B.
However, in no event, shall the Buyer be required to purchase the Fall 2003 Inventory if it is received by the
Buyer after October 1, 2003 (or after June 30, 2003 for the short sleeve shirts) or if it is otherwise sold or
disposed of by the Parent. It is understood that certain of the Fall 2003 Inventory is subject to the
Outstanding Orders and may be sold by the Parent pursuant to such orders.
ARTICLE II.
REPRESENTATIONS AND WARRANTIES OF THE SELLER AND THE PARENT
The Seller and the Parent hereby, jointly and severally, represent and warrant to and for the benefit of
the Buyer:
Section 2.1. Organization and Qualifications.
(a) The Seller is a corporation duly formed, validly existing and in good standing under the laws of the
State of Delaware with all requisite corporate or other power and authority to own, operate or lease its assets
and properties and to carry on its business as currently conducted. The copies of the Certificate of
Incorporation and Bylaws of the Seller, as heretofore made available to the Buyer, are correct and complete in
all respects.
(b) The Parent is a corporation duly formed, validly existing and in good standing under the laws of the
State of Florida with all requisite corporate or other power and authority to own, operate or lease its assets
and properties and to carry on its business as currently conducted. The copies of the Certificate of
Incorporation and Bylaws of the Parent, as heretofore made available to the Buyer, are correct and complete in
all respects.
(c) The Seller is a wholly-owned subsidiary of the Parent through Savane International Corporation, which is
a wholly-owned subsidiary of the Parent.
Section 2.2. Authority; Binding Obligation.
(a) The Seller has the requisite authority and power to enter into, execute and deliver this Agreement and
each agreement, certificate, document and instrument to be executed and delivered by the Seller pursuant to this
Agreement, including, without limitation, the Assignment of Trademarks (the "Seller Documents") and to perform
its obligations hereunder and thereunder. The execution, delivery and performance by the Seller of this
Agreement and each Seller Document have been duly authorized by all necessary corporate or other action of the
Seller. This Agreement and each Seller Document has been, or will be, as applicable, duly executed and delivered
by the Seller and constitutes, or will constitute upon delivery and execution, as applicable, a valid and binding
obligation of the Seller enforceable against it in accordance with its terms.
(b) The Parent has the requisite authority and power to enter into, execute and deliver this Agreement and
each agreement, certificate, document and instrument to be executed and delivered by the Parent pursuant to this
Agreement (the "Parent Documents") and to perform its obligations hereunder and thereunder. The execution,
delivery and performance by the Parent of this Agreement and each Parent Document have been duly authorized by
all necessary corporate or other action of the Parent. This Agreement and each Parent Document has been, or will
be, as applicable, duly executed and delivered by the Parent and constitutes, or will constitute upon delivery
and execution, as applicable, a valid and binding obligation of the Parent enforceable against it in accordance
with its terms.
Section 2.3. No Conflict; Required Consents.
(a) Except as set forth in Schedule 2.3, neither the execution, delivery or performance of this Agreement or
the Seller Documents nor the consummation by the Seller of the transactions contemplated hereby or thereby will
(a) conflict with or result in any breach of any provision of the Certificate of Incorporation or Bylaws of the
Seller, (b) require any filing with or notification to, or permit, authorization, consent or approval of, any
Governmental Entity (as defined in Section 6.14) or other Person, except where the failure to make any such
filing or notification, or obtain any such permit, authorization, consent or approval could not reasonably be
expected to have a Seller Material Adverse Effect (as defined in Section 6.14), or (c) subject to making the
filings with and notifications to, and obtaining the permits, authorizations, consents and approvals of, the
Persons set forth on Schedule 2.3: (i) conflict with or violate any law, rule or regulation applicable to the
Seller or any of the Transferred Assets, (ii) conflict with, result in a violation or breach of, constitute a
default (or an event that with notice or lapse of time or both could become a default) or give rise to or result
in any loss of benefit or right of termination, amendment or acceleration under any note, bond, mortgage, lien,
indenture, lease, license, contract, agreement or other instrument or obligation (written or oral) to which the
Seller is a party or by which any its assets, business or affairs (including the Transferred Assets) may be
bound, or (iii) result in or require the creation or imposition of, or result in the acceleration of, any
indebtedness or Encumbrance of any nature upon, or with respect to, the Seller or any of the Transferred Assets.
(b) Except as set forth in Schedule 2.3, neither the execution, delivery or performance of this Agreement or
the Seller Documents or the Parent Documents nor the consummation by the Parent or the Seller of the transactions
contemplated hereby or thereby will (a) conflict with or result in any breach of any provision of the Certificate
of Incorporation or Bylaws of the Parent, (b) require any filing with or notification to, or permit,
authorization, consent or approval of, any Governmental Entity or other Person, except where the failure to make
any such filing or notification, or obtain any such permit, authorization, consent or approval could not
reasonably be expected to have a Seller Material Adverse Effect, or (c) subject to making the filings with and
notifications to, and obtaining the permits, authorizations, consents and approvals of, the Persons set forth on
Schedule 2.3: (i) conflict with or violate any law, rule or regulation applicable to the Parent or any of the
Transferred Assets, (ii) conflict with, result in a violation or breach of, constitute a default (or an event
that with notice or lapse of time or both could become a default) or give rise to or result in any loss of
benefit or right of termination, amendment or acceleration under any note, bond, mortgage, lien, indenture,
lease, license, contract, agreement or other instrument or obligation (written or oral) to which the Parent is a
party or by which any its assets, business or affairs or any of the Transferred Assets may be bound, or (iii)
result in or require the creation or imposition of, or result in the acceleration of, any indebtedness or
Encumbrance of any nature upon, or with respect to, the Parent or any of the Transferred Assets.
Section 2.4. No Subsidiaries. Neither the Seller nor the Parent owns, of record or beneficially, or
controls, directly or indirectly, any capital stock, securities convertible into capital stock or any other
equity interest in any corporation, association or business entity that owns any of the Transferred Assets or any
interest therein, nor is the Seller or the Parent, directly or indirectly, a participant in any joint venture,
partnership or other non-corporate entity that owns any of the Transferred Assets or any interest therein, except
for the Parent's ownership in Savane International Corporation.
Section 2.5. Litigation. Except as set forth on Schedule 2.5 or as indicated in the Legal Trademark Files,
there is no claim, counterclaim, action, suit, order, proceeding or investigation pending or, to Seller's or the
Parent's knowledge, threatened against, probable of assertion against or affecting the Seller or the Parent with
respect to the Transferred Assets or relating to the transactions contemplated hereby or by the Seller Documents
or the Parent Documents, before any Governmental Entity nor, to the Seller's or the Parent's knowledge after due
inquiry, is there any reasonable basis for any such claim, action, suit, proceeding or governmental,
administrative or regulatory investigation. Except as indicated in the Legal Trademark Files, the Seller is not
directly subject to or materially affected by any order, judgment, decree or ruling of any Governmental Entity
with respect to the Transferred Assets. Except as indicated in the Legal Trademark Files, neither the Seller nor
the Parent (or any subsidiary or affiliate of the Seller or the Parent) has received any written opinion or
memorandum of legal advice from legal counsel to the effect that it is exposed to any liability which may be
materially adverse to the Transferred Assets. Except as indicated in the Legal Trademark Files, neither the
Seller nor the Parent (or any subsidiary or affiliate of the Seller or the Parent) is engaged in any legal action
to recover monies due it or for damages sustained by it with respect to the Transferred Assets.
Section 2.6. Trademarks.
(a) Schedule 1.1(a) lists all jurisdictions, and the locations in such jurisdictions, in which the
Trademarks or any variations thereof are (or have been) registered or owned by the Seller or the Parent (or any
subsidiary or affiliate of the Seller or the Parent), the identity of the registered owner of the Trademarks, and
the status of such registrations.
(b) Except as indicated in the Legal Trademark Files, neither the Seller nor the Parent has received any
written notice that any of the rights of the Seller in the Trademarks have been declared unenforceable or
otherwise invalid by any Governmental Entity. The Seller has taken the actions indicated in the Legal Trademark
Files to maintain and protect its rights in and to each Trademark. Except as indicated in the Legal Trademark
Files, to the knowledge of the Seller and the Parent, there are no rights of any Person that would interfere with
or prevent the transfer to the Buyer of all of the rights of the Seller in and to the Trademarks. Except as
indicated in the Legal Trademark Files, to the knowledge of the Seller and the Parent, there is no existing third
party infringement, misuse, or misappropriation of the Trademarks. Except as indicated in the Legal Trademark
Files, to the knowledge of the Seller and the Parent, the Trademarks do not interfere with, infringe upon,
conflict with or otherwise violate the rights of any Person. Except as indicated in the Legal Trademark Files,
to the knowledge of the Seller and the Parent, all Trademarks are properly registered under applicable law, rule
or regulation.
(c) Except as set forth on Schedule 2.6 or as indicated in the Legal Trademark Files, neither the Seller nor
the Parent has agreed to indemnify any Person for or against any interference, infringement, misappropriation, or
other conflict with respect to any Trademark. Except as set forth on Schedule 2.6, to the knowledge of the
Seller and the Parent, (i) the Seller possesses the sole and exclusive good, valid and transferable title in and
to all of the Trademarks, free and clear of all Encumbrances, and (ii) no royalties or other consideration is
required in connection with the use and enjoyment of the Trademarks by the Buyer (other than pursuant to any
arrangements entered into by the Buyer).
Section 2.7. Assumed Contracts. True, correct and complete copies of all the Assumed Contracts have been
provided to the Buyer. Each of the Assumed Contracts is in full force and effect and, to the Seller's and the
Parent's knowledge, is a valid, binding and enforceable obligation of the other parties thereto, except as such
enforceability may be subject to the effects of any applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or similar laws, rules or regulations affecting creditors' rights generally or subject
to the effects of general equitable principles. To the Seller's and the Parent's knowledge, each party to each
Assumed Contract (other than the Seller) has complied in all material respects with all commitments and
obligations on its part to be performed or observed under each Assumed Contract. Neither the Seller nor the
Parent has received notice of default or cancellation of or intent to cancel any of the Assumed Contracts. There
exists no event of default or occurrence, condition or act on the part of the Seller or on the part of any other
party to the Assumed Contracts which constitutes or would constitute (with notice or lapse of time or both) a
breach thereunder, or cause or permit acceleration of any obligation thereunder. Each Assumed Contract, upon
consummation of the transactions contemplated by this Agreement, the Seller Documents, the Parent Documents and
the Buyer Documents, shall continue to be legal, valid, binding and enforceable on terms identical to those
currently in effect (except for the substitution of the Buyer in place of the Seller), shall continue in full
force and effect without penalty or adverse consequence, and the necessary written consents or amendments to the
Assumed Contracts have been obtained so that the consummation of such transactions will not cause a breach of the
Assumed Contracts or cause any other Person to be able to terminate any of the Assumed Contracts.
Section 2.8. Broker Fees. No broker or finder is entitled to any brokerage fees, commission or finders' fee
in connection with the consummation by the Seller or the Parent of the transactions contemplated by this
Agreement or any Seller Document or Parent Document.
Section 2.9. Inventory. When delivered to the Buyer, the Buyer will have good, valid and marketable title
to the Inventory purchased by the Buyer, free and clear of any Encumbrance.
Section 2.10. Limitation of Representations and Warranties. Notwithstanding any provision in this Agreement,
including those set forth in Sections 2.5 and 2.6, no representations or warranties are being made by the Seller
or by the Parent for activities that occurred or for actions that arose prior to the Seller's acquisition of the
Trademarks on August 9, 2001, unless the Seller or the Parent has present, actual knowledge of such activities or
actions.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF THE BUYER
The Buyer hereby makes the following representations and warranties to and for the benefit of the Seller
and the Parent:
Section 3.1. Organization of the Buyer. The Buyer is duly organized, validly existing and in good standing
under the laws of the State of Tennessee.
Section 3.2. Authority; Binding Obligation. The Buyer has the requisite authority and power to enter into,
execute and deliver this Agreement and each agreement, document and instrument to be executed and delivered by
the Buyer pursuant to this Agreement (the "Buyer Documents") and to perform its obligations hereunder and
thereunder. The execution, delivery and performance by the Buyer of this Agreement and the Buyer Documents have
been duly authorized by all necessary corporate or other action of the Buyer. This Agreement and the Buyer
Documents have been, or will be, as applicable, duly executed and delivered by the Buyer and constitutes, or will
constitute upon execution, as applicable, valid and binding obligations of the Buyer, enforceable against it in
accordance with their terms.
Section 3.3. No Conflict; Required Consents. Except as set forth in Schedule 3.3, neither the execution,
delivery or performance of this Agreement or the Buyer Documents nor the consummation by the Buyer of the
transactions contemplated hereby or thereby will (a) conflict with or result in any breach of any provision of
the Charter or Bylaws of the Buyer, (b) require any filing with or notification to, or permit, authorization,
consent or approval of, any Governmental Entity or other Person, except where the failure to make any such filing
or notification, or obtain any such permit, authorization, consent or approval could not reasonably be expected
to have a Buyer Material Adverse Effect (as defined in Section 6.14), or (c) subject to making the filings with
and notifications to, and obtaining the permits, authorizations, consents and approvals of, the Persons set forth
on Schedule 3.3: (i) conflict with or violate any law, rule or regulation applicable to the Buyer, (ii) conflict
with, result in a violation or breach of, constitute a default (or an event that with notice or lapse of time or
both could become a default) or give rise to or result in any loss of benefit or right of termination, amendment
or acceleration under any note, bond, mortgage, lien, indenture, lease, license, contract, agreement or other
instrument or obligation (written or oral) to which the Buyer is a party or by which any its assets, business or
affairs may be bound, or (iii) result in or require the creation or imposition of, or result in the acceleration
of, any indebtedness or Encumbrance of any nature upon, or with respect to, the Buyer.
Section 3.4. Broker Fees. No broker or finder is entitled to any brokerage fees, commission or finders' fee
in connection with the consummation by the Buyer of the transactions contemplated by this Agreement or any Buyer
Document.
ARTICLE IV.
RIGHTS AND OBLIGATIONS SUBSEQUENT TO CLOSING
Section 4.1. Survival of Representations and Warranties. Each representation and warranty contained herein
or in any Seller Document, Parent Document or Buyer Document shall survive the execution and delivery of this
Agreement and shall thereafter terminate and expire on the third (3rd) anniversary of the date of this
Agreement. If written notice of a claim has been given prior to the expiration of the applicable representation
or warranty, then such claim shall survive the expiration of the relevant representation or warranty until the
final resolution of such claim.
Section 4.2. Confidentiality Obligations of the Seller and the Parent. Except to the extent necessary for
the Seller to fulfill its current obligations with respect to the Outstanding Orders and to the extent necessary
to wind-down the Retail Outlets, each of the Seller and the Parent agrees that the Seller and the Parent, and
their respective subsidiaries and affiliates, and their respective officers, directors, employees, agents and
representatives (collectively, the "Seller Representatives") will hold in strict confidence, and will not
distribute or make available, any confidential or proprietary data or information that is used in connection with
or related to the Transferred Assets or any confidential or proprietary data or information provided by or
otherwise obtained from the Buyer concerning the business and/or operations of the Buyer, except:
(a) information which, as of the date hereof, is published or otherwise generally available to the public;
(b) information which, after the date hereof, becomes available to the public other than through an act or
omission of the Seller, the Parent or any Seller Representative which is in violation of the provisions hereof;
(c) information rightfully acquired from a third party which did not obtain such information under a pledge
of confidentiality;
(d) information which is developed by the Seller or the Parent independently of the relationship established
by this Agreement; or
(e) information which is compelled to be disclosed by legal process, in which case the Seller or the Parent
shall notify the Buyer as soon as practicable after it becomes aware of such requirement, and shall cooperate
with the Buyer in obtaining a protective order.
If the Seller or the Parent must disclose such confidential or proprietary data or information in connection with
its Outstanding Orders or in connection with the wind-down of the Retail Outlets, such disclosure shall be
limited to only the amount of disclosure necessary to reasonably complete such Outstanding Orders or close such
Retail Outlets.
The terms and conditions of the License Agreements (and the existence thereof) shall be considered to be
confidential information of the Buyer and shall not be disclosed by the Seller or the Parent or any Seller
Representative.
Section 4.3. Confidentiality Obligations of the Buyer. The Buyer agrees that the Buyer and its subsidiaries
and affiliates and their respective officers, directors, employees, agents and representatives (collectively, the
"Buyer Representatives") will hold in strict confidence, and will not distribute or make available, any
confidential or proprietary data or information provided by or otherwise obtained from the Seller or the Parent
concerning the business and/or operations of the Seller or the Parent (other than relating to the Transferred
Assets and Assumed Liabilities), except:
(a) information which, as of the date hereof, is published or otherwise generally available to the public;
(b) information which, after the date hereof, becomes available to the public other than through an act or
omission of the Buyer or any Buyer Representative which is in violation of the provisions hereof;
(c) information rightfully acquired from a third party which did not obtain such information under a pledge
of confidentiality;
(d) information which is developed by the Buyer independently of the relationship established by this
Agreement; or
(e) information which is compelled to be disclosed by legal process, in which case the Buyer shall notify
the Seller or the Parent as soon as practicable after it becomes aware of such requirement, and shall cooperate
with the Seller and the Parent in obtaining a protective order.
Section 4.4. Compliance. Each Party shall use its best efforts to take or cause to be taken, all action and
do or cause to be done all things necessary, proper or advisable to consummate the transactions contemplated by
this Agreement, the Seller Documents, the Parent Documents and the Buyer Documents and to otherwise comply and
fulfill such Party's obligations hereunder and thereunder.
Section 4.5. Further Assurances. Each Party shall, from time to time on being reasonably required to do so
by the other Party, now or at any time in the future, do or procure the doing of all such acts and/or execute or
procure the execution of all such documents in a form reasonably satisfactory to the other Party as the other
Party may reasonably consider necessary for giving full effect to this Agreement, the Seller Documents, the
Parent Documents and the Buyer Documents and securing to the other Party the full benefit of the rights, powers
and remedies conferred upon the other Party hereunder and thereunder.
ARTICLE V.
INDEMNIFICATION
Section 5.1. Indemnification of the Seller and the Parent. The Buyer shall, from and after the date hereof,
defend and promptly indemnify and hold harmless the Seller and the Parent, and their respective subsidiaries and
affiliates, and their respective officers, directors, employees, agents and representatives (collectively, the
"Seller Indemnified Parties") from, against, for, and in respect of and pay any and all Losses, suffered or
incurred by any such party by reason of (a) any breach of any representation, warranty, covenant or agreement of
the Buyer contained in this Agreement or any Buyer Document, (b) the Assumed Liabilities, and (c) any breach or
failure of observance or performance of any covenant, agreement or commitment made by the Buyer under this
Agreement or any Buyer Document. "Losses" shall mean all damages, awards, judgments, assessments, fines,
penalties, charges, costs, expenses and other payments however suffered or characterized, all interest thereon,
all costs and expenses of investigating any claim, lawsuit of arbitration and any appeal therefrom, all
reasonable attorneys', accountants', investment bankers', and expert witness' fees incurred in connection
therewith, whether or not such claim, lawsuit or arbitration is ultimately defeated and, subject to Section 5.3,
all amounts paid incident to any compromise or settlement of any such claim, lawsuit or arbitration.
Section 5.2. Indemnification of the Buyer. The Seller and the Parent shall, from and after the date hereof,
defend, indemnify, and hold harmless the Buyer and its subsidiaries and affiliates and their respective officers,
directors, employees, agents and representatives (collectively, the "Buyer Indemnified Parties") from, against,
for and in respect of and pay any and all Losses suffered, sustained, incurred or required to be paid by any such
party by reason of (a) any breach of any representation, warranty, covenant or agreement of the Seller or the
Parent contained in this Agreement or any Seller Document or Parent Document, (b) the Excluded Liabilities, (c)
any breach or failure of observance or performance of any covenant, agreement or commitment made by the Seller or
the Parent under this Agreement or any Seller Document or Parent Document, or (d) the Seller's and the Parent's
use of the Trademarks after the date hereof pursuant to Section 1.4.
Section 5.3. Indemnification Procedure.
(a) An indemnified party shall provide written notice to each indemnifying party of any claim of such
indemnified party for indemnification under this Agreement promptly after the date on which such indemnified
party has actual knowledge of the existence of such claim. Such notice shall specify the nature of such claim in
reasonable detail and the indemnifying parties shall be given reasonable access to any documents or properties
within the control of the indemnified party as may be useful in the investigation of the basis for such claim.
The failure to so notify the indemnifying parties shall not constitute a waiver of such claim.
(b) In the event any indemnified party seeks indemnification hereunder based upon a claim asserted by a
third party (a "Third Party Claim"), the indemnifying parties shall have the right (without prejudice to the
right of any indemnified party to participate at its expense through counsel of its own choosing) to defend or
prosecute the Third Party Claim at their expense and through counsel of their own choosing if they give written
notice of their intention to do so and acknowledge their liability pursuant to the indemnity obligations stated
herein no later than twenty (20) days following notice thereof by an indemnified party; provided, however, that,
if the indemnified party shall have reasonably concluded that separate counsel is required because, upon the
advice of counsel to the indemnified party, a conflict of interest would exist under applicable federal, state,
or local ethical laws governing the conduct of attorneys (other than solely by reason of the fact that the
indemnified party is a party seeking indemnification pursuant to this Agreement), the indemnified party shall
have the right to select separate counsel (but not more than one law firm together with local counsel, if
necessary) to participate in the defense of such action on its behalf, at the sole expense of the indemnifying
parties. If the indemnifying parties do not so choose to defend or prosecute any Third Party Claim for which any
indemnified party would be entitled to indemnification hereunder, then the indemnified party shall be entitled to
recover from the indemnifying parties all of the reasonable attorney's fees and other costs and expenses of
litigation of any nature whatsoever incurred in the defense of such claim. Notwithstanding the assumption of the
defense of any Third Party Claim by an indemnifying party pursuant to this paragraph, no Third Party Claim may be
settled by any indemnifying party without the prior written consent of the indemnified party, which consent shall
not be unreasonably withheld or delayed.
(c) The indemnifying parties and the indemnified party shall cooperate in furnishing evidence and testimony
and in any other manner which the other may reasonably request, and shall in all other respects have an
obligation of good faith dealing, one to the other, so as not to unreasonably expose the other to undue risk of
loss.
ARTICLE VI.
MISCELLANEOUS
Section 6.1. Fees and Expenses. Except as otherwise provided in this Agreement, each Party will bear its
own direct expenses incurred in connection with the negotiation and preparation of this Agreement and the Seller
Documents, Parent Documents and Buyer Documents, as the case may be, and the consummation and performance of the
transactions contemplated hereunder and thereunder. Except as otherwise provided in this Agreement, in the event
that a dispute should arise among the Parties, the prevailing party shall be entitled to reimbursement of its
reasonable attorneys' fees and expenses (including court costs).
Section 6.2. Notices. All notices and other communications hereunder shall be in writing and shall be
deemed to have been given if delivered personally or sent by facsimile transmission, overnight courier, or
certified, registered or express mail, postage prepaid. Any such notice shall be deemed given when so delivered
personally or sent by confirmed facsimile transmission, one (1) day after deposit with an overnight courier, or
if mailed, five (5) days after the date of deposit in the United States mails, as follows:
To the Buyer: Goody's Family Clothing, Inc.
▇▇▇ ▇▇▇▇▇'▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇▇▇ Berlin Shereff ▇▇▇▇▇▇▇▇, LLP
The Chrysler Building
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
To the Seller and the Parent:
Tropical Sportswear Int'l Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Any notice given hereunder may be given on behalf of any Party by its counsel or other authorized
representatives. The address of any Party may be changed on notice to the other Party duly served in accordance
with the foregoing provisions.
Section 6.3. Governing Law; Forum; Process. This Agreement shall be construed in accordance with, and
governed by, the laws of the State of Tennessee as applied to contracts made and to be performed entirely in the
State of Tennessee without regard to principles of conflicts of law. Each of the Parties hereby irrevocably and
unconditionally submits to the exclusive jurisdiction of any court of the State of Tennessee or any federal court
sitting in the State of Tennessee for purposes of any suit, action or other proceeding arising out of this
Agreement (and agrees not to commence any action, suit or proceedings relating hereto except in such courts).
Each of the Parties agrees that service of any process, summons, notice or document by U.S. registered mail at
its address set forth herein shall be effective service of process for any action, suit or proceeding brought
against it in any such court. Each of the Parties hereby irrevocably and unconditionally waives any objection to
the laying of venue of any action, suit or proceeding arising out of this Agreement, which is brought by or
against it, in the courts of the State of Tennessee or any federal court sitting in the State of Tennessee and
hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any
such action, suit or proceeding brought in any such court has been brought in an inconvenient forum.
Section 6.4. Entire Agreement. This Agreement, including the Schedules and Exhibits hereto and the Seller
Documents, Parent Documents and Buyer Documents herewith, are intended to embody the complete, final and
exclusive agreement among the Parties with respect to the purchase of the Transferred Assets and the related
transactions and are intended to supersede all previous negotiations, commitments and writings agreements and
representations, written or oral, with respect thereto and may not be contracted by evidence of any such prior or
contemporaneous agreement, understanding or representations, whether written of oral.
Section 6.5. Assignability; Binding Effect. This Agreement may not be assigned by the Seller or the
Parent. The Buyer may, in its discretion, transfer and assign this Agreement to a subsidiary or affiliate or to
a successor of the Buyer by merger or sale of assets. This Agreement and the rights, covenants, conditions and
obligations of the respective parties hereto and any instrument or agreement executed pursuant hereto shall be
binding upon and enforceable by, and shall inure to the benefit of, the Parties and their respective successors
and permitted assigns.
Section 6.6. Execution in Counterparts. This Agreement may be executed in two (2) or more counterparts,
each of which shall be deemed an original, but all of which shall constitute one (1) and the same document.
Delivery of a facsimile version of one (1) or more signatures to this Agreement shall be deemed adequate delivery
for purposes of this Agreement.
Section 6.7. Amendments. This Agreement may not be amended or modified, nor may compliance with any
condition or covenant set forth herein be waived, except by a writing duly and validly executed by each Party, or
in the case of a waiver, the Party waiving compliance; provided, however, that no such waiver shall operate as a
waiver of, or estoppel with respect to, any subsequent or other failure. Whenever this Agreement requires or
permits a waiver or consent by or on behalf of any Party, such waiver or consent shall be given in writing.
Section 6.8. Severability. In the event that any one or more of the provisions contained in this Agreement,
or the application thereof in any circumstances, is held invalid, illegal or unenforceable in any respect for any
reason, the validity, legality and enforceability of any such provision in every other respect and of the
remaining provisions contained in this Agreement shall not be in any way impaired thereby, it being intended that
all of the rights and privileges of the Parties shall be enforceable to the fullest extent permitted by law.
Section 6.9. Section Headings. The Section headings of this Agreement are for convenience of reference only
and shall not be deemed to alter or affect any provision hereof.
Section 6.10. Gender and Tenure. Where the context or construction requires, all words applied in the plural
shall be deemed to have been used in the singular, and vice versa; the masculine shall include the feminine and
neuter, and vice versa; and the present tense shall include the past and future tense and vice versa.
Section 6.11. Third-Party Rights. Nothing in this Agreement, whether express or implied, is intended to
confer rights or remedies under or by reason of this Agreement on any Persons other than the Parties, each Seller
Indemnified Party and each Buyer Indemnified Party and their respective successors and permitted assigns, nor is
anything in this Agreement intended to relieve or discharge the obligation or liability of any third Persons to
any Party, nor shall any provisions give any third Persons any right of subrogations over or action against any
Party.
Section 6.12. Construction. The language in all parts of this Agreement shall in all cases be construed
simply, accurately to its fair meaning, and not strictly for or against any of the Parties, without limitation,
there shall be no presumption against any Party on the ground that such Party was responsible for drafting this
Agreement or any part thereof, and any rule of law, or any legal decision that would require interpretation of
any claimed ambiguities in this Agreement against the Party that drafted it has no application and is expressly
waived.
Section 6.13. Disclosure.
(a)......The Parties agree not to issue any announcement, press release, public statement or other information
(either written or oral) to the press or any third Person with respect to this Agreement, the Seller Documents,
the Parent Documents or the Buyer Documents, or the transactions contemplated hereby or thereby, without
obtaining the prior written approval of the other Parties (which approval shall not be unreasonably withheld);
provided, however, that nothing contained herein shall prevent any Party, at any time, from furnishing any
required information to any Governmental Entity or from issuing any announcement, press release, public statement
or other information to the press or any third Person with respect to this Agreement, the Seller Documents, the
Parent Documents or the Buyer Documents, or the transactions contemplated hereby or thereby, if required by law,
rule or regulation, including applicable stock exchange regulation (provided that the other Parties shall be
furnished with an advance copy of any such announcement, press release, public statement or other information).
(b)......The Seller, the Parent and the Buyer each undertake to provide all such information known to it or which
on reasonable inquiry ought to be known to it as may reasonably be required by the Buyer, the Parent or the
Seller for the purpose of complying with the requirements of law, rule or regulation (including applicable stock
exchange regulation).
Section 6.14. Definitions.
(a)......As used herein, "Buyer Material Adverse Effect" shall mean a material adverse effect on the validity or
enforceability of (i) this Agreement or the Buyer Documents, or the transactions contemplated hereby and thereby,
or (ii) the rights or remedies of the Seller and the Parent hereunder or thereunder.
(b)......As used herein, "Encumbrance" shall mean any lien, encumbrance, option, pledge, security interest,
charge, restriction or other adverse claim or right whatsoever.
(c)......As used herein, "Governmental Entity" shall mean the government of the United States of America, any
other nation or any political subdivision thereof, whether state or local, and any agency, authority,
instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.
(d)......As used herein, "Person" shall mean any natural person, sole proprietorship, entity, corporation,
company, association joint venture, joint stock company, partnership, trust, organization, individual (including
personal representatives, executors and heirs of a deceased individual), nation, state government (including
agencies, branches, departments, bureaus, boards, divisions and instrumentalities thereof), trustee, receiver or
liquidator.
(e)......As used herein, "Seller Material Adverse Effect" shall mean a material adverse effect on (i) the
Transferred Assets, or (ii) the validity or enforceability of (1) this Agreement or the Seller Documents or the
Parent Documents, or the transactions contemplated hereby and thereby, or (2) the rights or remedies of the Buyer
hereunder or thereunder.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed in their respective names by
their respective officers duly authorized, as of the date first written above.
GOODY'S FAMILY CLOTHING, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Chairman and CEO
TSI BRANDS, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President
TROPICAL SPORTSWEAR INT'L CORPORATION
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: CEO and President