Exhibit 2.2
AMENDMENT NO. 1
TO ASSET PURCHASE AGREEMENT
THIS AMENDMENT NO. 1 TO ASSET PURCHASE AGREEMENT (this
"Amendment"), dated as of November 26, 1996, amends that certain
Asset Purchase Agreement, dated as of November 5, 1996 (the
"Agreement"), by and among HMX/PBP Company ("Buyer"), Hartmarx
Corporation and Plaid Clothing Group Inc., Plaid International
Inc., Plaid Retail Group Inc., Plaid Investment Co., Inc., Plaid
Finance Corp., Palm Beach Company, Inc., X. Xxxxxxxxxx, Inc.,
Xxxxxxxxxx Enterprises Holding, Inc., Xxxxxxxxxx Enterprises,
Inc., and Ambrook Manufacturing, Inc., (collectively the
"Sellers"). Capitalized terms not otherwise defined herein have
the meanings given such terms in the Agreement.
WHEREAS, the parties to the Agreement wish to amend the
Agreement in the manner set forth below.
NOW, THEREFORE, in consideration of the mutual
covenants and agreements set forth herein, the parties hereto
covenant and agree as follows:
1. Closing. The Closing shall take place on November
26, 1996, or at such other time as the parties shall agree.
2. Section 1.6.2 of the Agreement is hereby amended
and restated to read in its entirety as follows:
"Section 1.6.2 Royalties. Buyer shall pay to
Sellers, on or before the 45th day following the first
anniversary of the Closing Date, cash in an amount
determined by subtracting (i) $500,000 from (ii) 2% of
Buyer's Net Sales Revenues during the first year
following the Closing in respect of those product
categories acquired by Buyer from Sellers, as set forth
on Schedule 1-G (the "Product Categories"). In the
event that Buyer sells or discontinues, prior to the
first anniversary of the Closing Date, any of the
businesses relating to the Product Categories, the
sales of which are included in Sellers' September 1996
sales forecast for 1997, which projections appear
opposite each Product Category on Schedule 1-G (the
"Projections"), then, for purposes of calculating
Buyer's Net Sales Revenues for the first year following
the Closing only and not for any other period, revenues
generated from sales for any such sold Product
Categories shall be deemed equal to the projected
annual sales for such Product Categories as reflected
in the Projections. On or before the 45th day
following each of the second, third and fourth
anniversary of the Closing Date, Buyer shall pay to
Sellers an amount equal to 1% of Buyer's Net Sales
Revenue in excess of $107.5 million in respect of the
Product Categories for the preceding year. "Net Sales
Revenue" shall mean revenues generated from sales, net
of returns, discounts and allowances, each as
determined in accordance with GAAP."
3. Section 3.1.16 of the Agreement is hereby amended
and restated to read in its entirety as follows:
"Section 3.1.16 Financial Statements. Buyer
shall have received from Sellers (i) financial
information sufficient to permit Buyer and Hartmarx, in
their sole and absolute discretion, and without
additional cost to Sellers, to satisfy the obligations
of Buyer (or Hartmarx) with respect to applicable law,
including, without limitation, all securities laws,
rules and regulations with respect to the transactions
(which may require Sellers to assist Buyer and/or
Hartmarx in obtaining, at Buyer's sole expense,
certified financial statements for periods preceding
the Closing) and (ii) such unaudited financial
statements of Sellers for the current year through the
most recent period for which such financial statements
are available, prepared in accordance with GAAP."
From and after the Closing, at Buyer's sole expense, Sellers
shall provide Buyer and/or Hartmarx with such assistance as Buyer
shall reasonably request in providing the financial information
referred to above.
4. Sellers' Names. The final sentence of Section 8.7
of the Agreement is hereby amended to add the clause "To the
greatest extent reasonably practicable" to the beginning of such
sentence.
5. Effective as of the Closing, ownership and control
of all bank accounts of Sellers having non-negative balances
shall be transferred to buyer and Sellers shall cooperate with
Buyer and take such further actions as may be necessary to effect
such transfers.
6. Section 1.4 of the Agreement is hereby amended and
restated to read in its entirety as follows:
"Section 1.4 Assumed Liabilities. On and subject
to the terms and conditions of this Agreement, and
subject to the satisfaction of the conditions precedent
set forth herein, Buyer shall assume only the following
obligations and liabilities (collectively, the "Assumed
Liabilities") of any of Sellers (and the omission of
any obligation or liability from this section shall be
deemed an affirmative agreement by the Parties that
such obligation or liability shall not be assumed by
Buyer):
(a) any trade (including payables for piece
goods and trim) and other accounts payable (including
for utilities and supplies) of Sellers as identified on
Schedule 1-D, to the extent set forth on the Closing
Balance Sheet (other than the footnotes thereto, if
any), but only to the extent such liabilities: (i) are
properly recorded thereon, (ii) have been incurred in
the ordinary course of business consistent with past
custom and practice, and (iii) are of the same type and
nature as those liabilities of Sellers, with respect to
Acquired Assets and Assumed Liabilities, set forth on
the face of the Prior Balance Sheets, none of which
relates to any (A) Taxes (to the extent not expressly
agreed to be paid by Buyer pursuant hereto), (B) any
intercompany note payables or any intercompany
indebtedness for borrowed money, (C) breach of
contract, (D) breach of warranty, (E) tort, (F)
infringement, (G) workers' compensation claims or
liabilities, obligations or reserves relating to any
workers' compensation insurance program or arrangement,
(H) violation of law, (I) any action, suit or
proceeding (including, without limitation, any
obligation or liability arising under any
Environmental, Health and Safety Laws or product
liability laws), or (J) subject to the penultimate
sentence of Section 1.6, health insurance or other
medical benefits;
(b) any accrued employee payroll, vacation
and holiday pay, and the payment obligations set forth
in the penultimate sentence of Section 1.6, and certain
other accrued union and non-union employee benefit
obligations as identified on Schedule 1-E, to the
extent set forth on the Closing Balance Sheet, but
excluding any and all severance obligations;
(c) solely to the extent that the aggregate
of the Assumed Liabilities specified in subsection (a)
and subsection (b) of this Section 1.4 are less than
the Maximum Assumed Payables, other current liabilities
of Sellers identified on Schedule 1-F (which schedule
shall be prepared by Sellers, but subject to Buyer's
approval), but only to the extent such liabilities are
set forth on the Closing Balance Sheet, it being
understood that, notwithstanding the foregoing
limitations, in no event shall the Assumed Liabilities
specified in subsections (a), (b) and (c) of this
Section 1.4 be less than or greater than the Maximum
Assumed Payables;
(d) any liabilities and obligations to the
extent arising solely, and attributable to actions,
conditions or events occurring solely, after the
Closing Date and relating exclusively to (i) the
Assigned Contracts, (ii) the assumed Intellectual
Property Licenses (including the Designated Licenses),
(iii) that certain headquarters lease of Sellers in New
York, New York (the "HQ Lease"), and (iv) outstanding
purchase orders of inventory (other than purchase
orders under which any Seller or the third-party
supplier is in default) made by Sellers to suppliers
(but only to the extent, in the sole and reasonable
discretion of Buyer, that such orders were made on
price and quantity terms, and otherwise consistent
with, Sellers' normal course of business and past
custom and practice); and in each case, only to the
extent such contracts, licenses, leases and purchase
orders are identified and expressly designated on the
Assigned Contracts List and are actually assigned to
Buyer; and
(e) any other specific liabilities and
obligations, if any, expressly assumed by Buyer under
this Agreement and the Approval Order."
7. Waiver of Sale Order Condition. The conditions
set forth in Sections 3.1.13 and 3.3.4 of the Agreement that the
Sale Order be entered on or before November 15, 1996 are hereby
waived by each of the parties hereto.
8. Miscellaneous. The provisions of Sections 10.1,
10.2, 10.3, 10.4, 10.5, 10.6, 10.8, 10.10 and 10.14 of the
Agreement shall also govern this Amendment.
9. Effect of this Amendment. The Agreement, as
amended pursuant to the terms of this Amendment, shall be and
continue in full force and effect after the time of this
Amendment with respect to each of the parties hereto.
In Witness Whereof, each of the parties hereto has
caused this Amendment to be duly executed on the day and year
first above stated.
HMX/PBP Company
By: Xxxx X. Xxxxx
Its: Executive Vice President
Printed Name: Xxxx X. Xxxxx
Hartmarx Corporation, solely for
purposes of Sections 4.2.2-4.2.4,
10.8 and 10.15 hereof
By: Xxxx X. Xxxxx
Its: Executive Vice President/General
Counsel
Printed Name: Xxxx X. Xxxxx
Ambrook Manufacturing, Inc.,
Debtor-In-Possession
By: Xxxxxx X. XxXxxxxx
Its: Senior Vice President/General
Counsel
Printed Name: Xxxxxx X. XxXxxxxx
Palm Beach Company, Inc.,
Debtor-In-Possession
By: Xxxxxx X. XxXxxxxx
Its: Senior Vice President/General
Counsel
Printed Name: Xxxxxx X. XxXxxxxx
Plaid Clothing Group Inc.,
Debtor-In-Possession
By: Xxxxxx X. XxXxxxxx
Its: Senior Vice President/General
Counsel
Printed Name: Xxxxxx X. XxXxxxxx
Plaid International Inc.,
Debtor-In-Possession
By: Xxxxxx X. XxXxxxxx
Its: Senior Vice President/General
Counsel
Printed Name: Xxxxxx X. XxXxxxxx
Plaid Investment Co., Inc.,
Debtor-In-Possession
By: Xxxxxx X. XxXxxxxx
Its: Senior Vice President/General
Counsel
Printed Name: Xxxxxx X. XxXxxxxx
X. Xxxxxxxxxx, Inc.,
Debtor-In-Possession
By: Xxxxxx X. XxXxxxxx
Its: Senior Vice President/General
Counsel
Printed Name: Xxxxxx X. XxXxxxxx
Xxxxxxxxxx Enterprises, Inc.,
Debtor-In-Possession
By: Xxxxxx X. XxXxxxxx
Its: Senior Vice President/General
Counsel
Printed Name: Xxxxxx X. XxXxxxxx
Xxxxxxxxxx Enterprises Holding, Inc.,
Debtor-In-Possession
By: Xxxxxx X. XxXxxxxx
Its: Senior Vice President/General
Counsel
Printed Name: Xxxxxx X. XxXxxxxx
Plaid Retail Group Inc.,
Debtor-In-Possession
By: Xxxxxx X. XxXxxxxx
Its: Senior Vice President/General
Counsel
Printed Name: Xxxxxx X. XxXxxxxx
Plaid Finance Corp.,
Debtor-In-Possession
By: Xxxxxx X. XxXxxxxx
Its: Senior Vice President/General
Counsel
Printed Name: Xxxxxx X. XxXxxxxx
