AMENDMENT NO. 1 TO
ASSET PURCHASE AGREEMENT [U.S.]
This AMENDMENT NO. 1 TO ASSET PURCHASE AGREEMENT [U.S.] (this
"Amendment") is made as of this 25th day of March, 2002 by and among WEYCO
GROUP, INC., a Wisconsin corporation, FLORSHEIM GROUP INC., a Delaware
corporation, and those subsidiaries of Florsheim Group Inc. that are identified
as a Seller on the signature pages hereto.
RECITALS
WHEREAS, Sellers and Buyer have entered into that certain Asset
Purchase Agreement, dated as of March 3, 2002, relating to the purchase and sale
of certain assets of Florsheim and its subsidiaries in the United States (the
"U.S. Purchase Agreement"); and
WHEREAS, Sellers and Buyer wish to amend the U.S. Purchase Agreement
on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the Recitals and of the mutual
covenants, conditions and agreements set forth in this Amendment and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is hereby agreed that:
SECTION 1. Definitions. Any capitalized terms in this Amendment that are
not defined herein shall be given the meanings ascribed to such terms in the
U.S. Purchase Agreement.
SECTION 2. Sale of International Assets; Canadian Option.
(a) Subsection (a) of Section 3.16 of the U.S. Purchase Agreement
hereby is amended by deleting the phrase "to be entered into no later than the
commencement of the hearing before the Bankruptcy Court on the Procedures Order
(each such term as defined below)" at the conclusion of the first sentence of
such subsection and replacing such phrase with the following: "to be entered
into no later than April 3, 2002."
(b) Subsection (c) of Section 3.16 of the U.S. Purchase Agreement
hereby is amended by deleting the phrase "to be entered into no later than the
commencement of the hearing before the Bankruptcy Court on the Procedures Order
(each such term as defined below)" at the conclusion of the first sentence of
such subsection and replacing such phrase with the following: "to be entered
into no later than April 3, 2002; provided, however, that the International
Asset Purchase Agreement, if any, with respect to the Canadian Assets and
Liabilities (as defined below) shall be entered into no later than April 12,
2002."
(c) Section 3.16 of the U.S. Purchase Agreement hereby is amended by
adding new subsections (d) and (e) at the conclusion thereof as follows:
1
"(d) Notwithstanding anything to the contrary in this Agreement,
including, without limitation, Section 3.16(c) hereof, Florsheim shall have the
option (the "Canadian Option") to exclude from the European Assets and
Liabilities the assets and liabilities of Florsheim Canada, Inc., (the "Canadian
Assets and Liabilities"). If Florsheim exercises the Canadian Option, (i) the
purchase price for the European Assets and Liabilities under the International
Asset Purchase Agreement shall be reduced from $1,500,000 to $1,100,000 and (ii)
the Purchase Price under this Agreement shall be increased by $200,000.
Florsheim shall exercise the Canadian Option by delivering written notice to
Buyer on or before April 12, 2002.
(e) If Florsheim exercises the Canadian Option as provided above and
instead desires to sell all or substantially all of the Canadian Assets and
Liabilities to one or more third parties, such third parties must be a
Qualifying Buyer and must otherwise be reasonably acceptable to Buyer. Buyer
hereby agrees to enter into a license agreement for use of the Trademarks with
any Qualifying Buyer of the Canadian Assets and Liabilities in form and
substance reasonably satisfactory to Buyer and such Qualifying Buyer. If
Florsheim elects to liquidate the Canadian Assets and Liabilities, Buyer hereby
agrees to enter into one or more license agreements with Florsheim, Florsheim
Canada, Inc. or one or more third party buyers of the Canadian Assets and
Liabilities each in form and substance reasonably satisfactory to Buyer and such
other parties for the limited purpose of liquidating such assets and
liabilities. After the Closing, to the extent that the Canadian Assets and
Liabilities have not been sold or liquidated in accordance with this Section
3.16, the parties agree to (i) maintain the existing technical license
agreement between Florsheim and Florsheim Canada, Inc. on the same terms and
conditions as of the date hereof and (ii) enter into a mutually agreeable
arrangement to continue to provide SAP and related services to the stores in
Canada operated by Florsheim Canada, Inc."
SECTION 3. Xxxxxx Warehouse. Notwithstanding anything to the contrary
in this Agreement, including, without limitation, Section 3.21 hereof, the
purchase orders of Sellers with respect to any shoes located in the public
warehouse in Xxxxxx, Missouri at the Closing shall be included in the Purchased
Assets and Buyer agrees to assume all liabilities and obligations of Sellers
with respect to such purchase orders.
SECTION 4. Sales Commissions. Buyer agrees to pay any commissions due
on any order by a wholesale customer of Sellers that is booked prior to the
Closing and shipped after the Closing. Buyer shall pay such commissions to the
salespersons who booked such orders regardless of their employment status with
Buyer. For the purpose of determining whether commissions are due, it is
expressly understood that blanket orders with respect to particular styles
received from wholesale customers are not considered orders eligible for
commissions until there are confirmed shippable orders for specific locations
against such blanket orders.
SECTION 5. No Other Amendments. Except as expressly modified hereby,
the U.S. Purchase Agreement remains in full force and effect in accordance with
its terms.
SECTION 6. Counterparts. This Amendment may be executed in several
counterparts, each of which shall be deemed an original and all of which, taken
together, shall constitute one and the same instrument.
[the remainder of this page has been intentionally left blank].
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IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed as of the day and year first above written.
BUYER: WEYCO GROUP, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx, Xx.
------------------------------------
Name: Xxxxxx X. Xxxxxxxxx, Xx.
Title: Chief Executive Officer
SELLERS: FLORSHEIM GROUP INC.
By: /s/ Xxxxx X. Xxxxxxxxx Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx Xx.
Title: Chief Executive Officer
THE FLORSHEIM SHOE STORE
COMPANY -- NORTHEAST
By: /s/ Xxxxx X. Xxxxxxxxx Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx Xx.
Title: Chief Executive Officer
THE FLORSHEIM SHOE STORE
COMPANY -- WEST
By: /s/ Xxxxx X. Xxxxxxxxx Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx Xx.
Title: Chief Executive Officer
X.X. X'XXXXX SHOE CO.
By: /s/ Xxxxx X. Xxxxxxxxx Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx Xx.
Title: Chief Executive Officer
FLORSHEIM OCCUPATIONAL
FOOTWEAR, INC.
By: Xxxxx X. Xxxxxxxxx Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx Xx.
Title: Chief Executive Officer
AMENDMENT NO. 2 TO
ASSET PURCHASE AGREEMENT (U.S.)
This AMENDMENT NO. 2 TO ASSET PURCHASE AGREEMENT [U.S.] (this
"Amendment") is made as of the 3rd day of April, 2002 by and among WEYCO GROUP,
INC., a Wisconsin corporation, FLORSHEIM GROUP INC., a Delaware corporation, and
those subsidiaries of Florsheim Group Inc. that are identified as a Seller on
the signature pages hereto.
RECITALS
WHEREAS, Sellers and Buyer have entered into that certain Asset
Purchase Agreement, dated as of March 3, 2002 and amended as of March 25, 2002,
relating to the purchase and sale of certain assets of Florsheim and its
subsidiaries in the United States (the "U.S. Purchase Agreement"); and
WHEREAS, Sellers and Buyer wish to further amend the U.S. Purchase
Agreement on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the Recitals and of the mutual
covenants, conditions and agreements set forth in this Amendment and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is hereby agreed that:
SECTION 1. Definitions. Any capitalized terms in this Amendment that
are not defined herein shall be given the meanings ascribed to such terms in the
U.S. Purchase Agreement.
SECTION 2. Sale of International Assets.
(a) Subsection (a) of Section 3.16 of the U.S. Purchase Agreement
hereby is amended by deleting the phrase "to be entered into no later than April
3, 2002" at the conclusion of the first sentence of such subsection and
replacing such phrase with the following: "the final form of which shall be
agreed upon no later than April 19, 2002."
(b) Subsection (c) of Section 3.16 of the U.S. Purchase Agreement is
amended by deleting the phrase "to be entered into no later than April 3, 2002;
provided, however, that the International Asset Purchase Agreement, if any, with
respect to the Canadian Assets and Liabilities (as defined below) shall be
entered into no later than April 12, 2002" at the conclusion of the first
sentence of such subsection and replacing such phrase with the following: "the
final forms of which shall be agreed upon no later than April 19, 2002."
(c) Subsection (d) of Section 3.16 of the U.S. Purchase Agreement
hereby is amended by deleting the last sentence of such subsection and replacing
such sentence with the following: "Florsheim shall exercise the Canadian Option
by delivering written notice to Buyer on or before April 19, 2002."
1
SECTION 3. No Other Amendments. Except as expressly modified hereby, the
U.S. Purchase Agreement remains in full force and effect in accordance with its
terms.
SECTION 4. Counterparts. This Amendment may be executed in several
counterparts, each of which shall be deemed an original and all of which, taken
together, shall constitute one and the same instrument.
[the remainder of this page has been intentionally left blank]
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IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed as of the day and year first above written.
BUYER: WEYCO GROUP, INC.
By: /s/ Xxxx Xxxxxxxxx
------------------------------------
Name: Xxxx Xxxxxxxxx
Title: Chief Operating Officer
SELLERS: FLORSHEIM GROUP INC.
By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx, Xx.
Title: Chief Executive Officer
THE FLORSHEIM SHOE STORE
COMPANY -- NORTHEAST
By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx, Xx.
Title: Chief Executive Officer
THE FLORSHEIM SHOE STORE
COMPANY -- WEST
By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx, Xx.
Title: Chief Executive Officer
X.X. X'XXXXX SHOE CO.
By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx, Xx.
Title: Chief Executive Officer
FLORSHEIM OCCUPATIONAL
FOOTWEAR, INC.
By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx, Xx.
Title: Chief Executive Officer
AMENDMENT NO. 3 TO
ASSET PURCHASE AGREEMENT (U.S.)
This AMENDMENT NO. 3 TO ASSET PURCHASE AGREEMENT (U.S.) (this "Amendment")
is made as of the 19th day of April, 2002 by and among WEYCO GROUP, INC., a
Wisconsin corporation, FLORSHEIM GROUP INC., a Delaware corporation, and those
subsidiaries of Florsheim Group Inc. that are identified as a Seller on the
signature pages hereto.
RECITALS
WHEREAS, Sellers and Buyer have entered into that certain Asset Purchase
Agreement, dated as of March 3, 2002 and amended as of March 25, 2002 and April
3, 2002, relating to the purchase and sale of certain assets of Florsheim and
its subsidiaries in the United States (the "U.S. Purchase Agreement"); and
WHEREAS, Sellers and Buyer wish to further amend the U.S. Purchase
Agreement on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the Recitals and of the mutual
covenants, conditions and agreements set forth in this Amendment and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is hereby agreed that:
SECTION 1. Definitions. Any capitalized terms in this Amendment that are
not defined herein shall be given the meanings ascribed to such terms in the
U.S. Purchase Agreement.
SECTION 2. Employee Matters. Subsection (a) of Section 3.13 of the U.S.
Purchase Agreement hereby is amended by deleting the first sentence thereof and
replacing such sentence with the following: "Within fifty five (55) days after
the filing of the Bankruptcy Case, the Buyer shall provide the Sellers with a
list of all employees of the Sellers to whom the Buyer or any of its Affiliates
intends to offer employment, and the Buyer or any of its Affiliates shall
promptly thereafter make offers of employment to such employees."
SECTION 3. Sale of International Assets.
(a) Subsection (a) of Section 3.16 of the U.S. Purchase Agreement
hereby is amended by deleting the phrase "the final form of which shall be
agreed upon no later than April 19, 2002" at the conclusion of the first
sentence of such subsection and replacing such phrase with the following: "the
final form of which shall be agreed upon no later than April 26, 2002."
(b) Subsection (c) of Section 3.16 of the U.S. Purchase Agreement
hereby is amended by deleting the phrase "the final forms of which shall be
agreed upon no later than April 19, 2002" at the conclusion of the first
sentence of such subsection and replacing such phrase with the following: "the
final forms of which shall be agreed upon no later than April 26, 2002."
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(c) Subsection (d) of Section 3.16 of the U.S. Purchase Agreement
hereby is amended by deleting the second and third sentences of such subsection
and replacing them with the following: "If Florsheim exercises the Canadian
Option, (i) the purchase price of the European Assets and Liabilities under the
International Asset Purchase Agreement shall be reduced from $1,500,000 to
$1,100,000 and (ii) the Purchase Price under this Agreement shall be increased
by $300,000. Florsheim shall exercise the Canadian Option by delivering written
notice to Buyer on or before April 26, 2002."
SECTION 4. No Other Amendments. Except as expressly modified hereby, the
U.S. Purchase Agreement remains in full force and effect in accordance with its
terms.
SECTION 5. Counterparts. This Amendment may be executed in several
counterparts, each of which shall be deemed an original and all of which, taken
together, shall constitute one and the same instrument.
[the remainder of this page has been internationally left blank]
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IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed as of the day and year first above written.
BUYER: WEYCO GROUP, INC.
By: /s/ Xxxx Xxxxxxxxx
------------------------------------
Name: Xxxx Xxxxxxxxx
Title: Chief Operating Officer
SELLERS: FLORSHEIM GROUP INC.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Financial Officer
THE FLORSHEIM SHOE STORE
COMPANY -- NORTHEAST
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Financial Officer
THE FLORSHEIM SHOE STORE
COMPANY -- WEST
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Financial Officer
X.X. X'XXXXX SHOE CO.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Financial Officer
FLORSHEIM OCCUPATIONAL
FOOTWEAR, INC.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Financial Officer
3
AMENDMENT NO. 4 TO
ASSET PURCHASE AGREEMENT [U.S.]
This AMENDMENT NO. 4 TO ASSET PURCHASE AGREEMENT [U.S.] (this
"Amendment") is made as of the 26th day of April, 2002 by and among WEYCO GROUP,
INC., a Wisconsin corporation, FLORSHEIM GROUP INC., a Delaware corporation, and
those subsidiaries of Florsheim Group Inc. that are identified as a Seller on
the signature pages hereto.
RECITALS
WHEREAS, Sellers and Buyer have entered into that certain Asset
Purchase Agreement, dated as of March 3, 2002 and amended as of March 25, 2002,
April 3, 2002 and April 19, 2002, relating to the purchase and sale of certain
assets of Florsheim and its subsidiaries in the United States (the "U.S.
Purchase Agreement"); and
WHEREAS, Sellers and Buyer wish to further amend the U.S. Purchase
Agreement on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the Recitals and of the mutual
covenants, conditions and agreements set forth in this Amendment and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is hereby agreed that:
SECTION 1. Definitions. Any capitalized terms in this Amendment that are
not defined herein shall be given the meanings ascribed to such terms in the
U.S. Purchase Agreement.
SECTION 2. Sale of International Assets.
(a) Sellers and Buyer agree that (i) the purchase price under the
International Purchase Agreement with respect to the Italian assets of Florsheim
Europe S.r.l. shall be U.S.$1,000,000, (ii) the purchase price under the
International Purchase Agreement with respect to the German assets of Florsheim
Europe S.r.l. shall be U.S.$50,000 and (iii) the purchase price under the
International Purchase Agreement with respect to the assets of Florsheim France
SARL shall be U.S.$50,000, in each case as more particularly described and
subject to the adjustments in the foregoing International Purchase Agreements.
(b) Subsection (a) of Section 3.16 of the U.S. Purchase Agreement
hereby is amended by deleting the phrase "the final form of which shall be
agreed upon no later than April 26, 2002" at the conclusion of the first
sentence of such subsection and replacing such phrase with the following: "the
final form of which shall be agreed upon no later than April 29, 2002."
(c) Subsection (c) of Section 3.16 of the U.S. Purchase Agreement
hereby is amended by deleting the phrase "the final forms of which shall be
agreed upon no later than April 26, 2002" at the conclusion of the first
sentence of such subsection and replacing such
1
phrase with the following: "the final forms of which shall be agreed upon no
later than April 29, 2002."
(d) Subsection (d) of Section 3.16 of the U.S. Purchase Agreement
hereby is amended by deleting the last sentence thereof and substituting the
following in lieu thereof: "Florsheim shall exercise the Canadian Option by
delivering written notice to Buyer on or before April 29, 2002."
SECTION 3. Conditions.
(a) Section 7.10 of the U.S. Purchase Agreement hereby is amended by
deleting such section in its entirety and inserting the following in lieu
thereof:
"7.10. Other Closings. All conditions to the consummation of (a) the
International Purchase Agreement with respect to the Italian assets of Florsheim
Europe S.r.l. and (b) if Florsheim and Florsheim Pacific exercise their option
to sell the Pacific Rim Assets and Liabilities as provided herein, the Pacific
Rim Asset Purchase Agreement, shall have been satisfied or waived."
(b) Section 8.10 of the U.S. Purchase Agreement hereby is amended by
deleting such section in its entirety and inserting the following in lieu
thereof:
"8.10. Other Closings. All conditions to the consummation of (a) the
International Purchase Agreement with respect to the Italian assets of Florsheim
Europe S.r.l. and (b) if Florsheim and Florsheim Pacific exercise their option
to sell the Pacific Rim Assets and Liabilities as provided herein, the Pacific
Rim Asset Purchase Agreement, shall have been satisfied or waived."
SECTION 4. No Other Amendments. Except as expressly modified hereby,
the U.S. Purchase Agreement remains in full force and effect in accordance with
its terms.
SECTION 5. Counterparts. This Amendment may be executed in several
counterparts, each of which shall be deemed an original and all of which, taken
together, shall constitute one and the same instrument.
[the remainder of this page has been intentionally left blank]
2
IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed as of the day and year first above written.
BUYER: WEYCO GROUP, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx, Xx.
------------------------------------
Name: Xxxxxx Xxxxxxxxx, Xx.
Title: CEO
SELLERS: FLORSHEIM GROUP INC.
By: /s/ Xxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxx X. Xxxxx
Title: EVP and CFO
THE FLORSHEIM SHOE STORE
COMPANY -- NORTHEAST
By: /s/ Xxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxx X. Xxxxx
Title: EVP and CFO
THE FLORSHEIM SHOE STORE
COMPANY -- WEST
By: /s/ Xxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxx X. Xxxxx
Title: EVP and CFO
X.X. X'XXXXX SHOE CO.
By: /s/ Xxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxx X. Xxxxx
Title: EVP and CFO
FLORSHEIM OCCUPATIONAL
FOOTWEAR, INC.
By: /s/ Xxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxx X. Xxxxx
Title: EVP and CFO
3
AMENDMENT NO. 5 TO
ASSET PURCHASE AGREEMENT [U.S.]
This AMENDMENT NO. 5 TO ASSET PURCHASE AGREEMENT [U.S.] (this
"Amendment") is made as of the 29th day of April, 2002 by and among WEYCO GROUP,
INC., a Wisconsin corporation, FLORSHEIM GROUP INC., a Delaware corporation, and
those subsidiaries of Florsheim Group Inc. that are identified as a Seller on
the signature pages hereto.
RECITALS
WHEREAS, Sellers and Buyer have entered into that certain Asset
Purchase Agreement, dated as of March 3, 2002 and amended as of March 25, 2002,
April 3, 2002, April 19, 2002 and April 26, 2002, relating to the purchase and
sale of certain assets of Florsheim and its subsidiaries in the United States
(the "U.S. Purchase Agreement"); and
WHEREAS, Sellers and Buyer wish to further amend the U.S. Purchase
Agreement on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the Recitals and of the mutual
covenants, conditions and agreements set forth in this Amendment and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is hereby agreed that:
SECTION 1. Definitions. Any capitalized terms in this Amendment that are
not defined herein shall be given the meanings ascribed to such terms in the
U.S. Purchase Agreement.
SECTION 2. U.S. Purchase Agreement Definitions.
(a) Section 1.13 of the U.S. Purchase Agreement hereby is amended by
deleting such section in its entirety and substituting the following in lieu
thereof: "1.13 [Reserved]."
(b) Section 1.48 of the U.S. Purchase Agreement hereby is amended by
renumbering the existing clause (o) as clause (p) and inserting a new clause (o)
as follows: "the Sellers' SAP operating system and all associated software
(including any of the Sellers' modifications thereof) and related licenses,
maintenance and consulting agreements, hardware and hardware leases."
(c) Section 1.50 of the U.S. Purchase Agreement hereby is amended by
deleting such section in its entirety and substituting the following in lieu
thereof:
"1.50 SAP and Other Computer Assets. "SAP and Other Computer
Assets" shall mean the computer software and related licenses of the Sellers
described on EXHIBIT 8; provided, that the Buyer shall assume any Cure Costs
with respect to any
1
licenses described on such Exhibit without any adjustment to the Purchase
Price therefor."
SECTION 3. Payment at Closing; Post-Closing Adjustment.
(a) Section 1.41 of the U.S. Purchase Agreement hereby is amended by
(i) deleting the word "and" after the semicolon at the conclusion of clause (f)
and before the word "minus" and (ii) deleting clause (g) and inserting the
following in lieu thereof: "(h) the adjustment described in Section 2.2(b)
relating to the Estimated Inventory Value; and plus or minus (i) the adjustment
described in Section 2.3(d) related to the Final Inventory Value."
(b) Section 2.2 of the U.S. Purchase Agreement hereby is amended by
deleting such section in its entirety and substituting the following in lieu
thereof and making corresponding changes to any cross references in the U.S.
Purchase Agreement to such section or any subsections thereof:
2.2 Payment at Closing.
(a) Prior to Closing, Florsheim shall deliver to Buyer
Florsheim's best estimate of the Inventory Value as of the Closing Date
("Estimated Inventory Value"), along with a certificate of Florsheim's
Chief Executive Officer or Chief Financial Officer certifying that the
Estimated Inventory Value was based on the books and records of Sellers,
presents fairly each Seller's best estimate of the Inventory Value as of
the Closing Date and was prepared in accordance with the provisions of this
Agreement.
(b) In the event that the Estimated Inventory Value is in excess
of $27,925,979.63, the Purchase Price shall be increased by the amount of
such excess. In the event that the Estimated Inventory Value is less than
$27,925,979.63, the Purchase Price shall be reduced by the amount of such
deficiency in excess of $1,600,000.
(c) At the Closing, the Buyer shall deliver the Purchase Price,
as adjusted pursuant to Section 2.2(b), less U.S.$500,000 (the "Inventory
Escrow Amount") and less an additional U.S.$500,000 to the Sellers by a
single wire transfer of immediately available funds. Such wire transfer
shall be delivered to the Sellers in care of Florsheim, which all Sellers
hereby designate as their agent to receive, hold and disburse whatever
portion of the Purchase Price that each Seller is entitled to receive for
the sale of the Purchased Assets owned by such Seller.
(d) At the Closing, the Buyer shall deliver the Inventory Escrow
Amount to an escrow agent mutually acceptable to the parties (the
"Inventory Escrow Agent") to be held by the Inventory Escrow Agent on the
terms and subject to the conditions set forth in an escrow agreement among
Buyer, Florsheim and the Inventory Escrow Agent to be executed on the
Closing Date in a form reasonably acceptable to Buyer and Florsheim (the
"Inventory Escrow Agreement").
2
(e) At the Closing, the Buyer shall deliver U.S.$500,000 to
the Escrow Agent to be held by the Escrow Agent on the terms and subject to
the conditions set forth in the Escrow Agreement.
(c) The U.S. Purchase Agreement hereby is amended by inserting a new
Section 2.3 at the conclusion of Article II thereof as follows:
2.3 Final Inventory Value; Post-Closing Adjustment.
(a) On the first Business Day after the Closing Date, Buyer
and Florsheim, or an inventory service reasonably acceptable to Buyer and
Florsheim, shall commence a one hundred percent physical count of the
Inventory to determine the Inventory Value. For any Purchased Store, a
credit shall be made for any inventory sold after the Closing Date and
prior to the time the physical count is conducted at such store. In the
event that the physical count is conducted by an inventory service, Buyer
and Florsheim shall each have one or more representatives observe such
physical count. The cost of any inventory service shall be shared equally
by Buyer and Florsheim. Prior to the physical count, the parties shall
agree on the methodology by which such count shall be conducted.
(b) Not more than seven (7) Business Days after the Closing
Date, Buyer shall deliver to Florsheim a reconciliation report for each
Purchased Store that describes in reasonable detail the sales of inventory
from each such store after the Closing Date and prior to the time the
physical count was conducted at such store, together with a certificate of
Buyer's Chief Executive Officer or Chief Financial Officer certifying that
such report was based on the books and records of Buyer and was prepared in
accordance with the provisions of this Agreement. Not more than ten (10)
Business Days after the Closing Date, Florsheim shall deliver to the Buyer
for its approval, which approval shall not be unreasonably withheld,
Florsheim's determination of the Inventory Value as of the Closing Date
(upon such approval by Buyer and with any corrections or adjustments
approved by Buyer and Florsheim, the "Final Inventory Value"), along with a
certificate of Florsheim's Chief Executive Officer or Chief Financial
Officer certifying that Florsheim's determination of the Inventory Value as
of the Closing Date was based on the results of the physical count
described in subsection (a) above and the books and records of Sellers,
presents fairly each Seller's determination of the Inventory Value as of
the Closing Date and was prepared in accordance with the provisions of this
Agreement. Provided that the physical count is conducted in accordance with
the agreed upon methodology described in subsection (a) above, Buyer shall
not have the right to object to Florsheim's determination of the Inventory
Value as of the Closing Date based solely upon the methodology used in the
physical count. Following the determination of the Final Inventory Value,
Buyer and Florsheim shall execute and deliver to each other a certificate
(the "Final Inventory Certificate") that sets forth the Final Inventory
Value, together with reasonable documentation therefor. The same "standard
cost" methodology and the same amount of standard cost for each item shall
be used in computing the Estimated Inventory Value, the Final Inventory
Value and the dollar amount set forth in Section 2.2(b).
3
(c) After the Closing, Sellers shall not make any wholesale shipments
from the Sellers' warehouse in Jefferson City, Missouri, except as Buyer and
Florsheim may otherwise agree. Throughout the period in which the physical count
is being taken and the Final Inventory Value is being determined, each Seller
shall provide Buyer and its representatives with access to and the right to copy
any records of Sellers relating to the Inventory Value and Buyer shall provide
Sellers and their representative with access to the Purchased Stores.
(d) Promptly following the delivery of the Final Inventory
Certificate, Buyer and Florsheim shall adjust the Purchase Price, upwards or
downwards, dollar for dollar, to account for changes in the Inventory Value as
reflected in the Estimated Inventory Value and the Final Inventory Value and
shall jointly instruct the Inventory Escrow Agent to pay the Inventory Escrow
Amount (or a portion thereof) to Buyer and/or Florsheim accordingly. In the
event that the amount of the foregoing purchase price adjustment is in excess of
the Inventory Escrow Amount, Florsheim or Buyer, as applicable, shall pay or
cause to be paid such excess amount promptly, and, in any event, within three
(3) Business Days, following the delivery of the Final Inventory Certificate.
SECTION 4. Sale of International Assets.
(a) Subsection (a) of Section 3.16 of the U.S. Purchase Agreement
hereby is amended by (i) deleting the phrase "the final form of which shall be
agreed upon no later than April 29, 2002" at the conclusion of the first
sentence of such subsection and replacing such phrase with the following: "the
final form of which shall be agreed upon no later than May 14, 2002", (ii)
deleting "$1,000,000" and substituting "U.S.$1,500,000" in lieu thereof; and
(iii) deleting the last sentence of such subsection and substituting the
following in lieu thereof: "The Pacific Rim Option shall be exercised by
Florsheim and Florsheim Pacific delivering written notice to the Buyer on or
before June 3, 2002; provided, however, that Florsheim and Florsheim Pacific
shall be deemed to have exercised the Pacific Rim Option in the event that
either (x) Florsheim Pacific and a Qualifying Buyer have not entered into a
definitive agreement regarding the purchase and sale of the Pacific Rim Assets
and Liabilities on or before June 3, 2002 or have not consummated such purchase
and sale by June 30, 2002 or (y) the existing license agreement between
Florsheim and Florsheim Pacific, as maintained after the Closing pursuant to
Section 3.16(b), is terminated by Buyer, provided that, in the event of a
termination pursuant to the foregoing clause (y), the purchase price of
U.S.$1,500,000 for the Pacific Rim Assets and Liabilities shall be decreased by
the amount of any royalties payable under such license agreement with respect to
the period after the Closing that have not been paid when due.
(b) Subsection (b) of Section 3.16 of the U.S. Purchase Agreement
hereby is amended by inserting the following at the conclusion thereof: "If the
Closing occurs and the consummation of the sale of the Pacific Rim Assets and
Liabilities by Florsheim Pacific to either Buyer or a Qualifying Buyer has not
occurred on or before the Closing, the parties agree to maintain the existing
license agreement between Florsheim and Florsheim Pacific on the same terms and
conditions as of the date hereof. In such event, the parties agree to cause the
existing license agreement between Florsheim and Florsheim Pacific to be amended
at the Closing to provide that (i) royalties shall be paid on a monthly basis
and, for any month, shall be due by the
4
provide that (i) royalties shall be paid on a monthly basis and, for any month,
shall be due by the 15th day of the following month and (ii) the licensor may
not terminate the agreement unless the licensee breaches the agreement by
failing to pay royalties when due and such breach continues for a period of
five days after the delivery of notice thereof by the licensor, provided, that
such agreement shall automatically terminate upon the consummation of the sale
of the Pacific Rim Assets and Liabilities by FLorsheim Pacific to either Buyer
or a Qualifying Buyer. Sellers and Buyer agree that Xxxxxxx Holdings
("Xxxxxxx") would be the only potential Qualifying Buyer with respect to the
Pacific Rim Assets and Liabilities. Whether in fact Xxxxxxx is a Qualifying
Buyer shall be determined in accordance with this Section 3.16(b)."
(c) Subsection (c) of Section 3.16 of the U.S. Purchase Agreement
hereby is amended by deleting the phrase "the final forms of which shall be
agreed upon no later than April 29, 2002" at the conclusion of the first
sentence of such subsection and replacing such phrase with the following: "the
final forms of which shall be agreed upon no later than May 14, 2002."
SECTION 5. Canadian Option. Florsheim hereby exercises the Canadian
Option, pursuant to Section 3.16(d) of the U.S. Purchase Agreement, to exclude
from the European Assets and Liabilities the Canadian Assets and Liabilities.
Notwithstanding anything to the contrary set forth in the U.S. Purchase
Agreement, Sellers and Buyers agree that (i) the purchase price for the
European Assets and Liabilities under the International Purchase Agreement
shall be reduced from U.S.$1,500,000 to U.S.$1,100,000 and (ii) the Purchase
Price under the U.S. Purchase Agreement shall be increased by U.S.$400,000.
SECTION 6. Conditions.
(a) Section 7.10 of the U.S. Purchase Agreement hereby is amended by
deleting such section in its entirety and inserting the following in lieu
thereof:
"7.10. Other Closings. The International Purchase Agreements with
respect to the Italian assets of Florsheim Europe S.r.l., the German assets of
Florsheim Europe S.r.l. and the assets of Florsheim France SARL shall each have
been executed and delivered by the parties thereto or, in the event any
applicable requirement of non-U.S. law must be satisfied prior to the execution
and delivery of any such agreement prior to the Closing, the parties thereto
shall have executed an acknowledgment in writing that such agreement is in
final form and awaiting execution pending the satisfaction of any such
requirement."
(b) Section 8.10 of the U.S. Purchase Agreement hereby is amended by
deleting such section in its entirety and inserting the following in lieu
thereof:
"8.10. Other Closings. The International Purchase Agreements with
respect to the Italian assets of Florsheim Europe S.r.l., the German assets of
Florsheim Europe S.r.l. and the assets of Florsheim France SARL shall each have
been executed and delivered by the parties thereto or, in the event any
applicable requirement of non-U.S. law must be satisfied prior to the execution
and delivery of any such agreement prior to the Closing, the parties thereto
shall have executed an acknowledgment in writing that
5
such agreement is in final form and awaiting execution pending the
satisfaction of any such requirement."
SECTION 7. No Other Amendments. Except as expressly modified hereby, the
U.S. Purchase Agreement remains in full force and effect in accordance with its
terms.
SECTION 8. Counterparts. This Amendment may be executed in several
counterparts, each of which shall be deemed an original and all of which, taken
together, shall constitute one and the same instrument.
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6
IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed as of the day and year first above written.
BUYER: WEYCO GROUP, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx, Xx.
------------------------------------
Name: Xxxxxx Xxxxxxxxx, Xx.
Title: Chief Executive Officer
SELLERS: FLORSHEIM GROUP INC.
By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx, Xx.
Title: Chief Executive Officer
THE FLORSHEIM SHOE STORE
COMPANY -- NORTHEAST
By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx, Xx.
Title: Chief Executive Officer
THE FLORSHEIM SHOE STORE
COMPANY -- WEST
By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx, Xx.
Title: Chief Executive Officer
X.X. X'XXXXX SHOE CO.
By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx, Xx.
Title: Chief Executive Officer
FLORSHEIM OCCUPATIONAL
FOOTWEAR, INC.
By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
------------------------------------
Name: Xxxxx X. Xxxxxxxxx, Xx.
Title: Chief Executive Officer
7
AMENDMENT NO. 6 TO
ASSET PURCHASE AGREEMENT [U.S.]
This AMENDMENT NO. 6 TO ASSET PURCHASE AGREEMENT [U.S.] (this
"Amendment") is made as of the 10th day of May, 2002 by and among WEYCO GROUP,
INC., a Wisconsin corporation, FLORSHEIM GROUP INC., a Delaware corporation,
and those subsidiaries of Florsheim Group Inc. that are identified as a Seller
on the signature pages hereto.
RECITALS
WHEREAS, Sellers and Buyer have entered into that certain Asset
Purchase Agreement, dated as of March 3, 2002 and amended as of March 25, 2002,
April 3, 2002, April 19, 2002, April 26, 2002 and April 29, 2002, relating to
the purchase and sale of certain assets of Florsheim and its subsidiaries in
the United States (the "U.S. Purchase Agreement"); and
WHEREAS, Sellers and Buyer wish to further amend the U.S. Purchase
Agreement on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the Recitals and of the mutual
covenants, conditions and agreements set forth in this Amendment and for other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, it is hereby agreed that:
SECTION 1. Definitions. Any capitalized terms in this Amendment that are
not defined herein shall be given the meanings ascribed to such terms in the
U.S. Purchase Agreement.
SECTION 2. Definition of Escrow Agreement. Section 1.18 of the U.S.
Purchase Agreement hereby is amended by deleting such section in its entirety
and substituting the following in lieu thereof:
1.18 Escrow Agreement. "Escrow Agreement" shall mean the
escrow agreement among the Buyer, Florsheim and the Escrow Agent, to be
executed on the Closing Date in a form reasonably acceptable to Buyer and
Florsheim, relating to (i) the payment of any premium for the extension of
the Sellers' current directors and officers insurance policy, (ii) the
post-closing adjustment to the Purchase Price pursuant to Section 2.3
hereof and (iii) the payment of the respective purchase prices under (A)
the International Purchase Agreement with respect to the Italian assets of
Florsheim, Europe S.r.l., (B) the International Purchase Agreement with
respect to the German assets of Florsheim Europe S.r.l. and (C) the
International Purchase Agreement with respect to the assets of Florsheim
France SARL.
SECTION 3. The Closing. Notwithstanding the payment of the Purchase Price
on May 21, 2002, the parties agree that the Closing Date shall be May 20, 2002
and that all adjustments
1
to the Purchase Price shall be deemed made as of May 20, 2002 as if the Closing
actually occurred as of such date.
SECTION 4. Payment at Closing. Subsection (d) of Section 2.2 of the U.S.
Purchase Agreement hereby is amended by deleting such subsection in its entirety
and substituting the following in lieu thereof:
(d) At the Closing, the Buyer shall deliver the Inventory
Escrow Amount to the Escrow Agent to be held by the Escrow Agent on the
terms and subject to the conditions set forth in the Escrow Agreement.
SECTION 5. Escrow for Sale of International Assets. The U.S. Purchase
Agreement hereby is amended by inserting a new Section 2.4 at the conclusion of
Article II thereof as follows:
2.4 Escrow for Sale of International Assets. At the Closing, the
Buyer shall deliver U.S.$1,100,000 (the "International Escrow Agreement")
to the Escrow Agent to be held by the Escrow Agent on the terms and subject
to the conditions set forth in the Escrow Agreement. Upon the joint
instruction of Florsheim and the Buyer to the Escrow Agent, the Escrow
Agent shall (i) pay to Florsheim Europe S.r.l. from the International
Escrow Amount the amount of the purchase price under the International
Purchase Agreement with respect to the Italian assets of Florsheim Europe
S.r.l., (ii) pay to Florsheim Europe S.r.l. from the International Escrow
Amount the amount of the purchase price under the International Purchase
Agreement with respect to the German assets of Florsheim Europe S.r.l.,
(iii) pay to Florsheim France SARL from the International Escrow Amount the
purchase price under the International Purchase Agreement with respect to
the assets of Florsheim France SARL and (iv) pay to Florsheim an amount
equal to the excess, if any, of the International Escrow Amount over the
amounts paid to Florsheim Europe S.r.l. and Florsheim France SARL pursuant
to the foregoing clauses (i), (ii) and (iii).
SECTION 6. Purchase Price for International Assets. Notwithstanding
anything to the contrary set forth in Section 2(a) of Amendment No. 4 to the
U.S. Purchase Agreement, the respective purchase prices under (i) the
International Purchase Agreement with respect to the Italian assets of Florsheim
Europe S.r.l., (ii) the International Purchase Agreement with respect to the
German assets of Florsheim Europe S.r.l. and (iii) the International Purchase
Agreement with respect to the assets of Florsheim France SARL shall be as stated
in such agreements but, in any event, shall not in the aggregate exceed
U.S.$1,100,000.
SECTION 7. Value of the Accounts; Final Inventory Value. If, prior to the
delivery of the Final Inventory Certificate, it is determined that, as of the
Closing Date, (a) the Sellers billed a customer within seven days preceding the
Closing Date but the Sellers had not yet shipped all inventory to such customer
for which such customer was billed, or (b) the Sellers shipped inventory to a
customer within seven days preceding the Closing Date but the Sellers had not
yet billed the customer for all of such inventory, the parties agree to make
such adjustments to the Final Inventory Value as are necessary to compensate for
any inaccuracies in the determination
2
of the value of the Accounts as of the Closing Date and the Estimated Inventory
Value caused by the foregoing.
SECTION 8. Post-Closing Purchase Price Adjustment. Subsection (d) of
Section 2.3 of the U.S. Purchase Agreement hereby is amended by deleting such
subsection in its entirety and substituting the following in lieu thereof:
(d) Promptly and, in any event, within three (3) Business Days
following the delivery of the Final Inventory Certificate, Buyer and
Florsheim shall adjust the Purchase Price and cause the release of the
Inventory Escrow Amount as follows:
(i) If the Final Inventory Value is greater than or equal to the
Estimated Inventory Value, Florsheim and Buyer shall jointly instruct the
Escrow Agent to pay to Florsheim the Inventory Escrow Amount and Buyer
shall pay to Florsheim, by wire transfer of immediately available funds,
the amount by which the Final Inventory Value exceeds the Estimated
Inventory Value.
(ii) If the Final Inventory Value is less than the Estimated
Inventory Value, Florsheim and Buyer shall jointly instruct the Escrow
Agent to (A) pay to Buyer from the Inventory Escrow Amount the amount by
which the Estimated Inventory Value exceeds the Final Inventory Value and
(B) pay to Florsheim an amount equal to the excess, if any, of the
Inventory Escrow Amount over the amount paid to Buyer pursuant to the
foregoing clause (A). In the event that the Inventory Escrow Amount is not
sufficient to pay the amount by which the Estimated Inventory Value exceeds
the Final Inventory Value, then Florsheim shall pay or cause to be paid to
Buyer, by wire transfer of immediately available funds, the amount of such
shortfall.
SECTION 9. Certain Accounts. Notwithstanding anything to the contrary in
the U.S. Purchase Agreement, (a) Buyer and Sellers agree that the intercompany
receivable of Florsheim from Florsheim Europe S.r.l. shall constitute a
Purchased Asset and the intercompany payable of Florsheim to Florsheim Europe
S.r.l. shall constitute an Assumed Liability and (b) any Accounts that exist as
of the Closing that relate to the License Agreement, dated January 1, 1999,
between Florsheim and Warson Group, Inc. (the "Warson Accounts") shall
constitute Retained Assets. If after the Closing, Buyer receives any Warson
Accounts that relate to the period prior to Closing, it shall promptly remit
such Accounts to Florsheim.
SECTION 10. Florsheim 401(k) Plan Assumption. Section 3.17 of the U.S.
Purchase Agreement hereby is amended by deleting the phrase "Not later than
fifteen (15) days prior to the Closing Date" at the beginning of such section
and substituting the phrase "Not later than thirty (30) calendar days after the
Closing Date" in lieu thereof.
SECTION 11. No Other Amendments. Except as expressly modified hereby, the
U.S. Purchase Agreement remains in full force and effect in accordance with its
terms.
3
SECTION 12. Counterparts. This Amendment may be executed in several
counterparts, each of which shall be deemed an original and all of which, taken
together, shall constitute one and the same instrument.
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4
IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed as of the day and year first above written.
BUYER: WEYCO GROUP, INC.
By: /s/ XXXX WITTKOOSKE
----------------------------
Name: Xxxx Wittkooske
Title: Senior Vice President
SELLERS: FLORSHEIM GROUP INC.
By: /s/ XXXXX X. XXXXXXXXX
----------------------------
Name: Xxxxx X. Xxxxxxxxx, Xx.
Title: Chief Executive Officer
THE FLORSHEIM SHOE STORE
COMPANY -- NORTHEAST
By: /s/ XXXXX X. XXXXXXXXX
----------------------------
Name:
Title:
THE FLORSHEIM SHOE STORE
COMPANY -- WEST
By: /s/ XXXXX X. XXXXXXXXX
----------------------------
Name:
Title:
X.X. X'XXXXX SHOE CO.
By: /s/ XXXXX X. XXXXXXXXX
----------------------------
Name:
Title:
FLORSHEIM OCCUPATIONAL
FOOTWEAR, INC.
By: /s/ XXXXX X. XXXXXXXXX
----------------------------
Name:
Title:
5
