PURCHASE AND SALE AGREEMENT
Exhibit
10.2
EXECUTION
VERSION
AGREEMENT,
dated as of the 2nd day of June 2006, by and among Iconix Brand Group, Inc.,
f/k/a Candies. Inc., a Delaware corporation (the “Company”), D’Loren Realty LLC
d/b/a Content Holdings, a New York limited liability company (“Content”), Xxxxxx
X’Xxxxx, an individual (“D’Loren”), Xxxx Xxxxxxxxx, an individual (“Xxxxxxxxx”)
and Xxxxxxxxx Twist, an individual (“Twist” and along with D’Loren, Xxxxxxxxx
and Content, the “Content Parties”).
W
I T N E S S E T H
:
WHEREAS,
the Company and UCC Funding Corporation, a New York corporation (“UCCF”) entered
into a letter agreement dated October 29, 2004, which by its terms was
simultaneously assigned by UCCF to Content at such time (the “October 2004
Agreement”); and
WHEREAS,
by assignment dated May 24, 2005, Content directed the Company to make payment
of the Fees (as such term is defined in the October 2004 Agreement) as follows:
Content 80%; Xxxxxxxxx 10%; and Twist 10% (the “Assignment” and together with
the October 2004 Agreement, the “Letter Agreement”); and
WHEREAS,
the Company wishes to purchase all of the rights, title and interest of the
Content Parties under the Letter Agreement and to assume all of the Content
Parties’ obligations thereunder; and
WHEREAS,
the Content Parties are willing to sell, transfer and assign such rights and
obligations in consideration of, and conditioned upon, the Company’s making the
payment contemplated by this Purchase and Sale Agreement (this
“Agreement”):
NOW,
THEREFORE, in consideration of the foregoing premises and the respective
representations, warranties, covenants and agreements hereinafter set forth,
the
parties hereto hereby agree as follows:
1.
Purchase and Sale of the Rights.
Upon
the execution and delivery of this Agreement, the Company hereby purchases
from
the Content Parties and the Content Parties hereby sell, transfer and assign
to
the Company, all of their respective rights, title and interest (in any manner
whatsoever) in, and all of their respective obligations under, the Letter
Agreement (the “Obligations”), including but not limited to, all rights of the
Content Parties to future Fees (as such term is defined in the October 2004
Agreement) and all rights of the Content Parties to any payments upon the sale
of Xxxxxxx Xxxxxxx Licensing LLC under the Letter Agreement (collectively the
“Rights”); and the Company hereby assumes all of the Rights and all of the
Obligations of the Content Parties under the Letter Agreement.
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2.
Consideration for Content’s Agreement to Purchase the Rights and assume the
Obligations under the Letter Agreement.
(a)
The
purchase price for the purchase and sale of the Rights and the assumption of
the
Obligations shall be an aggregate amount of one Million Five Hundred Thousand
Dollars ($1,500,000) (the “Purchase Price”), which shall be payable as follows:
Seven Hundred Fifty Thousand Dollars ($750,000) shall be payable upon execution
of this Agreement (the “Cash Portion”) and an additional Seven Hundred Fifty
Thousand Dollars ($750,000), and interest accrued thereon at the rate of six
(6%) percent per annum, shall be payable on October 31, 2006, as evidenced
by
three promissory notes, each in the form of note attached hereto as Exhibit
A
(the
“Notes” and together with this Agreement, the “Transaction Documents”). The Cash
Portion shall be made in immediately available funds and shall be paid as
follows: Content $600,000; Xxxxxxxxx $75,000; and Twist $75,000 pursuant to
the
wire instructions set forth on Schedule
A
attached
hereto.
(b)
Nothing herein shall be construed to require any additional services to be
performed by the Content Parties or any of their respective officers, directors
or affiliates, or to impose any limitations or restrictions on the future
business activities of Consulting or any of its officers, directors, successors,
assigns or affiliates, under the Letter Agreement or otherwise.
3.
Representations and Warranties.
(a)
The
Company hereby represents and warrants that (i) each of the Transaction
Documents has been duly authorized, executed and delivered by the Company and
each are the valid and binding obligation of the Company, enforceable against
the Company in accordance with their respective terms, (ii) the Company has
not
assigned any claim of any kind against any of the Consulting Parties to any
third party and (iii) no consent of any third party is required for the
execution, delivery and performance of the Transaction Documents by the Company.
(b)
Each
of the Content Parties hereby represents and warrants that: (i) this
Agreement has been duly authorized, executed and delivered by each Content
Party
and is the valid and binding obligation of each Content Party, enforceable
against each Content Party in accordance with its terms, (ii) the Rights are
held free and clear of any liens or encumbrances of any nature whatsoever other
than in favor of a Content Party, (iii) no Content Party has assigned any of
the
Rights, Obligations or any claim of any kind with respect to the Rights or
Obligations against the Company to any third party and (iv) no consent of
any third party is required for the execution, delivery and performance of
this
Agreement by the Content Parties.
(c)
The
Company on the one hand, and Content Parties on the other hand, each represent
and warrant to the other that no broker or finder was engaged or dealt with
in
connection with any of the transactions contemplated by this
Agreement.
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4.
Releases.
(a)
Releases
by Content.
Effective as of the date of this Agreement, except to the extent otherwise
set
forth in Section 4(c) below, each of the Content Parties, for himself, herself
and itself and for each of their past and present agents, officers, directors,
employees, attorneys, shareholders, parents, subsidiaries, and each of their
respective legal or business entities, insurers, successors and assigns, (the
“Content Releasing Parties”) hereby jointly and severally, voluntarily release
and forever discharges the Company and each of its affiliates, parents,
subsidiaries, officers, directors, stockholders, employees, agents, attorneys,
accountants and other advisors, and the heirs, executors and administrators,
if
applicable, and the predecessors, successors or assigns of each of the foregoing
(collectively the “Company Released Parties”) from all actions, causes of
action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills,
specialties, covenants, contracts, controversies, agreements, promises,
variances, trespasses, damages, judgments, extents, executions, claims, and
demands of any nature whatsoever (“Claims”), in law or equity, which against any
of the Company Released Parties, any or all of the Content Releasing Parties
ever had, now have or hereafter can, shall or may have, for, upon, or by reason
of any matter, cause or thing whatsoever from the beginning of the world to
the
date hereof arising out of or relating to the Letter Agreement.
(b)
Release
by the Company.
Effective as of the date of this Agreement, except to the extent otherwise
set
forth in Section 5(c) below, the Company for itself and for each of its past
and
present agents, officers, directors, employees, attorneys, shareholders,
parents, subsidiaries, and each of their respective legal or business entities,
insurers, successors and assigns, (the “Company Releasing Parties”) hereby
jointly and severally, voluntarily release and forever discharges the Content
Parties and each of its affiliates, parents, subsidiaries, officers, directors,
stockholders, employees, agents, attorneys, accountants and other advisors,
and
the heirs, executors and administrators, if applicable, and the predecessors,
successors and assigns of Content and each of the foregoing (collectively the
“Content Released Parties”) from all Claims, in law or equity, which against any
of the Content Released Parties, any or all of the Company Releasing Parties
ever had, now have or hereafter can, shall or may have, for, upon, or by reason
of any matter, cause or thing whatsoever from the beginning of the world to
the
date hereof arising out of or relating to the Letter Agreement.
(c)
Exceptions,
Indemnification.
Notwithstanding anything contained in this Section 4 to the contrary, this
Section 4 shall not apply to any Claims arising out of breach of the obligations
contained in this Agreement, the Notes or fraud. Each of the Company and Content
Parties hereby agree to indemnify and hold the other harmless from any and
all
loses, liabilities, expenses and costs (including reasonable attorneys’ fees)
arising out of, resulting from, or relating to (i) any breach of any
representation or warranty made herein by such indemnifying party or
(ii) any breach of any covenant or agreement made by such indemnifying
party herein.
(d)
Waiver
and Bar.
In
providing the release included in this Section 4, each of the parties
acknowledges and intends (on behalf of itself and all other persons on whose
behalf the release is being given) that it shall be effective as a bar to each
and every one of the Claims mentioned in or implied by the foregoing releases.
The parties expressly consent that the releases shall be given full force and
effect according to each and all of their express terms and provisions,
including those relating to unknown and unsuspected Claims (notwithstanding
any
state statute that expressly limits the effectiveness of a general release
of
unknown, unsuspected and unanticipated Claims, if any), as well as those
relating to any other Claims mentioned in or implied by the foregoing releases.
The parties acknowledge and agree that this waiver is an essential and material
term of the releases and that without such waiver the parties would not have
agreed to the terms of this Agreement. The parties further agree that in the
event a claim is brought in violation of the foregoing releases, they shall
serve as a complete defense to such Claims.
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5.
Covenants.
Each
of
the parties hereto hereby further agrees to execute, acknowledge, deliver,
file
and/or record, or cause such other parties to the extent permitted by law to
execute, acknowledge, deliver, file and/or record such other documents as may
be
required by this Agreement and as the Company, on the one hand, and the Content
Parties, on the other, or their respective legal counsel may, reasonably require
in order to document and carry out the transactions contemplated by this
Agreement, including, but not limited to, any filing of termination statements
with respect to any security interest held by the Content Parties on any asset
of the Company or its subsidiaries which were granted under the Letter
Agreement.
6.
Notices.
All
notices, requests, demands and other communications hereunder shall be in
writing and shall be deemed to have been duly given or made as of the date
delivered or mailed if delivered personally or mailed by registered or certified
mail, postage prepaid, return receipt requested, to the parties at their
respective addresses set forth below:
If
to the
Company:
0000
Xxxxxxxx, 0xx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxx Xxxx, CEO
With
a
copy to:
Blank
Rome LLP
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxxx X. Xxxxxxx, Esq.
Fax:
(000) 000-0000
If
to
Content Parties to:
Content
Holdings
0000
Xxxxxx xx xxx Xxxxxxxx, 00xx Xxxxx
Xxx
Xxxx,
XX 00000
Attention:
Xxxxxx X. X'Xxxxx
Fax:
000-000-0000
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with
a
copy to:
Xxxxxxx
Krooks LLP
000
Xxxxx
Xxxxxx, 00xx Xxxxx
Xxx
Xxxx,
XX 00000
Attention:
Xxxxxxxx X. Xxxxxxx, Esq.
Fax:
000-000-0000
7.
Press Release.
None of
the parties hereto will make any voluntary public statements or press releases
without showing the other such proposed release prior to it being publicized,
and obtaining the other’s approval.
8.
Entire Agreement.
This
Agreement, along with the Notes and the Security Agreement, constitutes the
entire agreement of the parties hereto with respect to the subject matter
hereof, and supersedes all prior agreements and understandings of the parties,
oral and written, with respect to the subject matter hereof.
9.
Choice of Law/Governing Law.
This
Agreement shall be construed and enforced in accordance with the internal laws
of the State of New York without reference to its conflicts of laws
provisions.
10.
Further Assurances.
The
Parties hereto agree to, at their own expense, execute and deliver such other
instruments of conveyance, transfer or termination and take such other actions
as any other party may reasonably request, including obtaining the signatures
of
parties not Party to this Agreement, in order to more effective consummate
the
transactions contemplated hereby.
11.
Amendment. This
Agreement may only be modified by a written instrument, which is executed by
each of the parties hereto.
12.
Severability.
This
Agreement shall be deemed severable, and the invalidity or unenforceability
of
this Agreement or any other term or condition hereof shall not affect the
validity or enforceability of this Agreement or of any other term or provision
hereof. Furthermore, in lieu of any such invalid or unenforceable term or
provision, the parties hereto agree that there shall be added as a part of
this
Agreement a provision as similar in terms to such invalid or unenforceable
provision as may be possible and be valid and enforceable.
13.
Headings.
The
headings contained herein are for the sole purpose of convenience of reference,
and shall not in any way limit or affect the meaning or interpretation of any
of
the terms of this Agreement.
14.
Binding Effect; Benefit.
This
Agreement shall inure to the benefit of, and be binding upon, the parties hereto
and their respective heirs, legal representatives, successors and assigns.
15.
Counterparts and Facsimile.
This
Agreement may be executed in one or more counterparts, each of which shall
be
deemed to be an original but all of which together will constitute one and
the
same instrument. For purposes of this Agreement signatures received by facsimile
shall have the same force and effect as original signatures.
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IN
WITNESS WHEREOF, this Agreement has been executed and delivered by the parties
hereto as of the date first above written.
By:
/s/
Xxxx
Xxxx
Xxxx
Xxxx
President
and CEO
CONTENT
HOLDINGS
By:
/s/
Xxxxxx X.
X’Xxxxx
Xxxxxx
X. X’Xxxxx
Manager
/s/
Xxxxxx
X’Xxxxx
Xxxxxx
X’Xxxxx
/s/s
Xxxx
Xxxxxxxxx
Xxxx
Xxxxxxxxx
/s/
Xxxxxxxxx
Twist
Xxxxxxxxx
Twist
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Exhibit
A - Form of Note
NON-NEGOTIABLE
PROMISSORY NOTE
|
$_______________
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June
2, 2006
|
FOR
VALUE RECEIVED, the
undersigned, ICONIX
BRAND GROUP., INC., a
Delaware corporation (the “Maker”)
promises to pay [ ]
(the “Payee”),
the
principal sum of
[ ]
DOLLARS ($_________) (the “Principal”),
together with interest on the Principal as provided below, in lawful money
of
the United States of America, payable pursuant to the terms and conditions
provided for herein.
This
promissory note (this “Note”)
is one
a series of promissory notes being issued by Maker as of even date herewith
in
the aggregate principal amount of Seven Hundred and Fifty Thousand Dollars
($750,000) (the “Notes”)
to
secure Maker’s obligations to make certain payments under the Purchase and Sale
Agreement of even date herewith among the Maker, the Payee and the Payees
of the
other Notes of this series (the “Purchase Agreement”). The payment rights of
each Payee holding Notes shall rank equally and each of such Payees shall
share
in any proceeds thereof pro
rata
according to the unpaid Principal amount due and owing to each of such Payees.
1. Payment
Terms.
Subject
to Section 4 hereof, the Principal and accrued interest thereon are due and
payable on October 31, 2006 (the “Maturity Date”). The payment of
Principal and interest under this Note shall be made to Payee in immediately
available funds, at such address or location as Payee shall designate.
Maker may at any time, without penalty, premium or charge of any kind, prepay
in
whole or in part the indebtedness evidenced by this Note. Any such prepayments
shall be applied first to interest accrued through the date of prepayment
and
then to Principal.
2. Interest.
Interest shall accrue on the unpaid Principal balance at the rate of six
percent
(6%) per annum until this Note is paid in full and shall be paid on the Maturity
Date or earlier in the event of an optional prepayment or mandatory prepayment
as provided herein; provided, however, that from the date of any Default
(as
defined in Section 3, below) to and including the date the obligations of
Maker
under this Note are paid in full, all Principal, accrued but unpaid interest,
and any other amounts that are or subsequently become due under this Note
shall
bear interest at the rate of fourteen percent (14%) per annum or, if such
rate
be at any time above the legal rate of interest for obligations in the nature
of
those under this Note, at the maximum allowable legal rate of
interest.
3. Events
of Default.
Maker shall be in default under this Note upon the occurrence of any of the
following events of default (each a “Default”):
(a)
Maker
fails to pay the Principal and/or interest under this Note, when due; or
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(b)
Maker
becomes insolvent or bankrupt; or if Maker suffers a receiver or trustee
for it
or substantially all of its assets to be appointed and, if appointed without
its
consent, not discharged within sixty (60) days; or if Maker makes an assignment
for the benefit of its creditors; or
(c)
Maker
breaches any of its obligations under the Purchase Agreement; or
(d)
Maker
enters into any agreement for the (i) sale of all or substantially all of
its
assets or (ii) any merger, consolidation or similar transaction in which
Maker
is not the surviving entity or following the consummation of which the
shareholders of Maker do not hold a majority of the equity interests in the
surviving or resulting entity.
4. Remedies
Upon Default.
Upon the occurrence of any Default, the Principal balance hereof together
with
all accrued interest shall become immediately due and payable without notice
or
demand. In addition, upon the occurrence of any Default, Maker shall pay
all of Payee’s reasonable costs of collection, including actual and reasonable
attorneys’ fees and disbursements.
5. Notices.
All notices, requests, demands and other communications required or permitted
under this Note shall be in writing and shall be deemed to have been duly
given,
made and received the same day when personally delivered or sent by telecopy
with receipt confirmation, the next business day when delivered by overnight
courier, or three (3) business days after mailing, if sent in the United
States by registered or certified mail, postage prepaid, return receipt
requested, addressed as set forth below:
If
to Maker:
0000
Xxxxxxxx, 0xx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxx Xxxx, CEO
With
a copy to:
Blank
Rome LLP
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxxx X. Xxxxxxx, Esq.
Fax:
(000) 000-0000
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If
to Payee:
Content
Holdings
1330
Avenue of the Xxxxxxxx, 00xx Xxxxx
Xxx
Xxxx,
XX 00000
Attention:
Xxxxxx X. X'Xxxxx
Fax:
000-000-0000
with
a copy to:
Xxxxxxx
Krooks LLP
000
Xxxxx
Xxxxxx, 00xx Xxxxx
Xxx
Xxxx,
XX 00000
Attention:
Xxxxxxxx X. Xxxxxxx, Esq.
Fax:
000-000-0000
or
at
such other address or addresses as either Payee or Maker may from time to
time
designate by notice to the other party, in writing.
6. Waivers
of Presentment, Etc.
MAKER EXPRESSLY WAIVES PRESENTMENT, PROTEST, DEMAND, NOTICE OF DISHONOR,
NOTICE
OF NON-PAYMENT, NOTICE OF MATURITY, NOTICE OF PROTEST, PRESENTMENT FOR THE
PURPOSE OF ACCELERATING MATURITY, AND DILIGENCE IN COLLECTION.
7. Waivers
and Amendments: Non-Contractual Remedies: Preservation of
Remedies.
This
Note may be amended, superseded, canceled, renewed or extended and the terms
hereof may be waived, only by a written instrument signed by Payee and Maker
or,
in the case of a waiver, by Payee. The failure of Payee to insist, in any
one or
more instances, upon performance of the terms or conditions of this Note
shall
not be construed as a waiver or relinquishment of any right granted hereunder
or
of the future performance of any such term, covenant or condition. No waiver
on
the part of Payee of any right, power or privilege, nor any single or partial
exercise of any such right, power or privilege, shall preclude any further
exercise thereof or the exercise of any other such right, power or privilege.
The rights and remedies herein provided are cumulative and are not exclusive
of
any rights or remedies that Payee may otherwise have at law or in
equity.
8. Governing
Law.
This
Note shall be governed by and construed and enforced in accordance with the
laws
of the State of New York. The parties hereby: (i) in any legal proceeding
brought in connection with this Note hereby, irrevocably submit to the
nonexclusive in personam
jurisdiction of (A) any state or Federal court of competent jurisdiction
sitting
in the State of New York, County of New York or (B) in the event that any
party
is a defendant in any legal proceeding in which it seeks to join the other
as a
third party defendant, then, any state or Federal court in which such proceeding
has properly been brought, and consent to suit therein; and (ii) waive any
objection they or it may now or hereafter have to the venue of such proceeding
in any such court or that such proceeding was brought in an inconvenient
court.
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9. Headings.
The headings in this Note are for reference only and shall not affect the
interpretation of this Note.
10. Severability.
Whenever possible, each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note is held to be prohibited by or invalid under applicable law,
such
provision shall be ineffective only to the extent of such prohibition or
invalidity without invalidating the remainder of such provision or the remaining
provisions of this Note.
11. Mutilated,
Lost Stolen or Destroyed Note.
In case this Note shall be mutilated, lost, stolen or destroyed, Maker shall
issue and deliver, in exchange and substitution for and upon cancellation
of the
mutilated Note, or in lieu of and substitution for this Note lost, stolen
or
destroyed, a new Note of like tenor, but only upon receipt of evidence
satisfactory to Maker of such loss, theft, or destruction of such Note.
12. Miscellaneous.
(a)
This Note shall bind the Maker and its respective successors, and the benefits
hereof shall inure to the benefit of Payee and its successors and assigns.
Neither Maker nor Payee may assign or transfer this Note to any third
party.
(b)
All references herein to “Maker” and “Payee” shall be deemed to apply to the
Maker and Payee, and their respective successors and permitted
assigns.
(c)
This
Note and any other documents delivered in connection herewith and the rights
and
obligations of the parties hereto and thereto shall for all purposes be governed
by and construed and enforced in accordance with the substantive law of the
State of New York without giving effect to its conflicts of law
principles.
(d)
Any
individual signing this Note on behalf of an entity represents and warrants
to
the Payee that such individual has the right and authority to so execute
this
Note, and that this Note will be enforceable against such entity in accordance
with its terms.
[SIGNATURE
PAGE FOLLOWS]
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IN
WITNESS WHEREOF,
this
Note has been executed and delivered on the date first written
above.
