SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report: August 4, 1997
(Date of earliest event reported)
Commission File Number 0-1500
EVANS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 36-1050870
(State or other jurisdiction of (IRS Employer
Incorporation or organization Identification Number)
36 South State Street, Chicago, Illinois 60603
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code 312-855-2000
<PAGE>
Item 2. Acquisition and Disposition of Assets
On August 4, 1997, the Company finalized its
agreement to acquire the assets of Triomphe Fourrures,
Incorporated which were used in connection with the
operation of the Maximilian Fur Salons at Bloomingdale's,
a division of Federated Department Stores, Inc.
The total purchase price was $5,387,000 which includes
inventory and operating assets as well as the world-wide
fur trademark of Maximilian. A down payment of
$1,572,699 was made on August 7, 1997 with installments of
$524,233 due on November 4, 1997 and February 4, 1998
and quarterly installments of $262,117 due from May 4, 1998
through November 4, 1999 with a final installment of
$931,350 due on December 30, 1999.
The acquisition, which was effective as of August 2,
1997, will be accounted for by the purchase method of
accounting and, accordingly, the assets and results of
operations will be included in the Company's consolidated
financial statements commencing on August 3, 1997.
The total acquisition cost exceeded the fair market
value of the net assets acquired by $500,000 which will be
recorded as goodwill and will be amortized over a
twenty year period on a straight line basis.
Item 5. Other Events
On August 7, 1997, the Company finalized an agreement
with its lender for an amendment to its loan and security
agreement. Included in the amendment, among other things,
are the following:
The credit facility was increased to $35,000,000 from
$27,000,000.
The revolving loan commitment which provides for direct
borrowings was increased to $33,000,000 from $25,000,000.
The financial covenants were adjusted to reflect the
acquisition of the assets of Triomphe Fourrures, Incorporated,
as well as the Company's current financial operating condition.
<PAGE>
Item 7. Financial Statements and Exhibits
(b) Pro Forma Financial Information
The following unaudited pro forma condensed consolidated
financial statements are filed with this report:
Pro Forma Condensed Consolidated Balance Sheet as of May 31, 1997 Page F-1
Pro Forma Condensed Consolidated Statement of Earnings for
the year ended March 1, 1997 Page F-2
Pro Forma Condensed Consolidated Statement of Earnings for
the thirteen weeks ended May 31, 1997 Page F-3
Notes to Pro Forma Condensed Financial Statements Page F-4
The Pro Forma Condensed Consolidated Balance Sheet of
Registrant as of May 31, 997 reflects the financial position
of Registrant after giving effect of the acquisition of
assets discussed in Item 2 and assumes the acquisition took
place on May 31, 1997. The Pro Forma Condensed Consolidated
Statements of Earnings for the fiscal year ended March 1,
1997 and the thirteen weeks ended May 31, 1997 assume the
acquisition occurred on March 2, 1996 and is based on the
operations of Registrant for the year ended March 1, 1997
and the thirteen weeks ended May 31, 1997.
The unaudited pro forma condensed consolidated financial
statements have been prepared by Registrant based upon
assumptions deemed proper by it. The unaudited pro forma
condensed consolidated financial statements presented herein
are shown for illustrative purposes only and are not
necessarily indicative of the future financial position or
future results of operations of the Registrant, or of the
financial position or results of operations of Registrant
that would have actually occurred had the transaction been
in effect as of the date or for the periods presented. In
addition, it should be noted that Registrant's financial
statements will reflect the acquisition only from August 3,
1997.
(c) Exhibit 4.59
Amendment dated August 7, 1997 which amends the loan and
security agreement dated June 16, 1997 between Registrant
and Jackson National Life Insurance Company, a Michigan
Insurance Company with PPM Finance, Inc. as Attorney-in-fact.
Exhibit 10.17
Purchase agreement dated as of August 4, 1997 by and between
Registrant and Triomphe Fourrures, Incorporated, a
subsidiary of Revillon, Incorporated, a New York
Corporation.
<PAGE>
<TABLE>
PRO FORMA FINANCIAL INFORMATION
Evans, Inc. and Subsidiaries
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET AT MAY 31, 1997
(Unaudited)
<CAPTION>
Pro Forma
Historical Adjustment Pro Forma
----------- ---------- -----------
<S> <C> <C> <C>
ASSETS
- ------
Current assets:
Cash and cash equivalents $ 118,000 $ 118,000
Accounts receivable (net) 13,238,000 13,238,000
Merchandise inventories 15,847,000 $3,049,000 18,896,000
Prepaid expenses and
other assets 1,027,000 1,027,000
Assets held for sale 4,750,000 4,750,000
----------- ---------- -----------
Total current assets 34,980,000 3,049,000 38,029,000
----------- ---------- -----------
Property and equipment 11,340,000 145,000 11,485,000
Accumulated depreciation
and amortization (7,584,000) (7,584,000)
----------- ---------- -----------
Net property and equipment 3,756,000 145,000 3,901,000
----------- ---------- -----------
Other assets 3,055,000 2,193,000 5,248,000
----------- ---------- -----------
$41,791,000 $5,387,000 $47,178,000
=========== ========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
Current liabilities:
Notes payable $13,112,000 $1,573,000 $14,685,000
Current portion of
long-term debt 692,000 1,573,000 2,265,000
Accounts payable 4,847,000 4,847,000
Accrued liabilities 6,039,000 6,039,000
----------- ---------- -----------
Total current liabilities 24,690,000 3,146,000 27,836,000
----------- ---------- -----------
Long-term debt 1,141,000 2,241,000 3,382,000
----------- ---------- -----------
Other liabilities 36,000 36,000
----------- ---------- -----------
Total liabilities 25,867,000 5,387,000 31,254,000
----------- ---------- -----------
Shareholders' equity:
Preferred stock, 3,000,000 shares
authorized, none issued
Common stock, 6,333,435
shares issued 1,267,000 1,267,000
Capital in excess of par value 15,535,000 15,535,000
Retained earnings 3,501,000 3,501,000
----------- ---------- -----------
20,303,000 20,303,000
Treasury stock
(1,347,664 shares at cost) (4,379,000) (4,379,000)
----------- ---------- -----------
15,924,000 15,924,000
----------- ---------- -----------
$41,791,000 $5,387,000 $47,178,000
=========== ========== ===========
</TABLE>
F-1
<PAGE>
<TABLE>
PRO FORMA FINANCIAL INFORMATION
Evans, Inc. and Subsidiaries
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR FISCAL YEAR ENDED MARCH 1, 1997
(Unaudited)
<CAPTION>
Pro Forma Pro Forma
Historical Adjustment Results
---------- ---------- ---------
<S> <C> <C> <C>
Net sales $69,789 $16,396 $86,185
Service revenues 12,915 3,023 15,938
---------- ---------- ---------
82,704 19,419 102,123
---------- ---------- ---------
Costs and expenses:
Cost of goods and services sold,
buying and occupancy costs 53,988 10,918 64,906
Selling and general expenses 30,617 8,126 38,743
Provision for doubtful accounts 621 15 636
Interest expense 1,446 1,446
Other income, net 673 673
---------- ---------- ---------
87,345 19,059 106,404
---------- ---------- ---------
Loss before provision (credit)
for income taxes (4,641) 360 (4,281)
Provision (credit) for income taxes 83 83
---------- ---------- ---------
Net loss $(4,724) $ 360 $(4,364)
========== ========== =========
Net loss per common share $ (0.96) $ (0.89)
Weighted average common shares 4,918,301 4,918,301
</TABLE>
F-2
<PAGE>
<TABLE>
PRO FORMA FINANCIAL INFORMATION
Evans, Inc. and Subsidiaries
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THIRTEEN WEEKS ENDED MAY 31, 1997
(Unaudited)
<CAPTION>
Pro Forma Pro Forma
Historical Adjustment Results
---------- ---------- ---------
<S> <C> <C> <C>
Net sales $ 9,050 $6,185 $15,235
Service revenues 4,767 527 5,294
---------- ---------- ---------
13,817 6,712 20,529
---------- ---------- ---------
Costs and expenses:
Cost of goods and services sold,
buying and occupancy costs 8,966 3,901 12,867
Selling and general expenses 5,555 2,746 8,301
Provision for doubtful accounts 123 123
Interest expense 399 399
Other income, net (2) (2)
---------- ---------- ---------
15,041 6,647 21,688
---------- ---------- ---------
Loss before provision (credit)
for income taxes (1,224) 65 (1,159)
Provision (credit) for income taxes - -
---------- ---------- ---------
Net loss $(1,224) $ 65 $(1,159)
========== ========== =========
Net loss per common share $ (0.25) $ (0.23)
Weighted average common shares 4,927,198 4,927,198
</TABLE>
F-3
<PAGE>
Evans, Inc.
Notes to Unaudited Pro Forma Condensed Financial Statements
(Unaudited)
The following assumptions have been made for the purposes of
the pro forma financial statements.
Balance Sheet
- -------------
Reflects the acquisition of assets under the purchase
agreement with Triomphe Fourrures, Incorporated dated August
4, 1997.
Assumes down payment funded out of current credit facility
resulting in an increase to notes payable with remaining
liability allocated between current and long-term debt.
Statement of Operations
- -----------------------
The pro forma adjustments to the accompanying Condensed
Consolidated Pro Forma Statements of Operations for both the
year ended March 1, 1997 and the thirteen weeks ended May 31,
1997 were based on the historical results of operations of
Triomphe Fourrures, Incorporated. Selling and general expenses
have been adjusted to reflect the amortization related to the
Maximilian trademark and goodwill as well as to adjust depreciation
expense to reflect the acquisition value of fixed assets.
F-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf of the
undersigned thereunto duly authorized.
EVANS, INC.
DATE: August 21, 1997 PATRICK J. REGAN
PATRICK J. REGAN
President and
Chief Executive Officer
DATE: August 21, 1997 WILLIAM E. KOZIEL
WILLIAM E. KOZIEL
Vice President and
Chief Financial Officer
<PAGE>
EVANS, INC. AND SUBSIDIARIES
Exhibit Description
--------- -------------
4.59 Amendment dated August 7, 1997 which amends
the loan and security agreement dated June
16, 1997 between Registrant and Jackson
National Life Insurance Company, a Michigan
Insurance Company with PPM Finance, Inc. as
Attorney-in-fact.
10.17 Purchase agreement dated as of August 4,
1997 by and between Registrant and Triomphe
Fourrures, Incorporated, a subsidiary of
Revillon, Incorporated, a New York
Corporation.
FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT
THIS FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT
(this "Amendment") is made and entered into this 7th day of
August, 1997, by and among EVANS, INC., a Delaware corporation
("Evans"), KOSLOW'S, INC., a Texas corporation ("Koslow's"),
EVANS-ROSENDORF OF MARYLAND, INC., a Delaware corporation
("Rosendorf" collectively referred to with Evans and Koslow, the
"Borrowers") and JACKSON NATIONAL LIFE INSURANCE COMPANY, a
Michigan insurance corporation, ("Jackson" or "Lender").
PRELIMINARY STATEMENTS
A. Borrowers and Lender have entered into that certain Loan
and Security Agreement, dated June 16, 1997 (the "Loan
Agreement").
B. The borrowers are in need of additional working capital
beyond the amounts permitted to be borrowed under the Loan
Agreement and have asked the Lender to amend the Loan Agreement
to, among other things, increase the Facility to $35,000,000.
C. The Lender is willing to amend the Loan Agreement
subject to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises herein
contained and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties,
intending to be legally bound, agree as follows:
AGREEMENT
ARTICLE I
Definitions
1.01 Capitalized terms used in this Amendment are defined in
the Loan Agreement, as amended hereby, unless otherwise stated.
ARTICLE II
Amendments to Loan Agreement
2.01 Amendments to Section 1 - Definitions. The following
definitions in Section l of the Loan Agreement are hereby amended
in their entirety as follows:
<PAGE>
(a) "'Facility' means the credit facility extended to
the Borrower and the Borrowing Subsidiaries hereunder in the
principal amount of $35,000,000."
(b) "'Revolving Loan Commitment' shall mean the sum of
$33,000,000."
(c) "'Revolving Note' shall mean the Amended and
Restated Revolving Note in the original principal amount of
$33,000,000, executed by Borrower and each Borrowing
Subsidiary to the order of Lender, dated as of August 7,
1997."
2.02 Amendments to Section 2 - Loan and Terms of Payment.
(a) Section 2. 1(a)(ii) is hereby amended in its entirety as
follows:
"(ii) the lesser of: (x) $20,000,000 during the
months of January through April and $27,000,000 during
the months of May through December; or (y) the sum of
the following:
(A) during the months of January through
April, Sixty (60%) percent of the value of the
Borrower's and each Borrowing Subsidiary's Eligible
Inventory such value not to exceed 83% of the off-
peak mid-range GOB appraisal value of finished
goods based on the most recent appraisal prepared
by an independent appraiser acceptable to Lender;
and
(B) during the months of May through December,
Sixty-eight (68%) percent of the value of the
Borrower's and each Borrowing Subsidiary's Eligible
Inventory such value not to exceed 75% of the peak
GOB appraisal value of finished goods based on the
most recent appraisal prepared by an independent
appraiser acceptable to Lender; minus"
(b) The last full sentence in Section 2.1(a) is hereby
amended and restated as follows:
"So long as no Event of Default has occurred and is
continuing, however, Borrower shall only be required to
pay for two inventory appraisals annually."
2.03 Amendments to Section 2.5 - Fees. Section 2.5(a) is
hereby amended in its entirety as follows:
"(a) An unused line fee of three-tenths of one percent
(0.3%) per annum on the difference between $33,000,000 and
the average unpaid monthly balance
<PAGE>
of the revolving loan Advances and undrawn Letter of Credit
Obligations outstanding under the Facility, payable
monthly."
2.04 Amendment to Section 10.1 - Affirmative Covenants;
Section 10.1(g) is hereby amended in its entirety as follows:
"Keep or cause to be kept in full force and effect each
Department License and promptly notify Lender of any default
under a Department License which could give rise to a
termination of such Department License, and, in such event,
at the request of Lender, remove all collateral located at
the Licensed Departments which are subject to such
Department License to a location satisfactory to Lender."
2.05 Amendments to Section 10.3 Financial Covenants.
Sections 10.3(a) and (b) are hereby amended in their entirety as
follows:
"(a) Borrower and Borrowing Subsidiaries shall
continuously maintain, on a consolidated basis:
(i) For the Fiscal Year ending March 1, 1997,
Consolidated Tangible Net Worth equal to or greater
than Eight Million Five Hundred Thousand Dollars
($8,500,000) and thereafter Consolidated Tangible Net
Worth equal to or greater than Six Million Five Hundred
Thousand Dollars ($6,500,000) increased quarterly by
75% of the Borrower's year to date consolidated Net
Income.
(ii) For each period specified below, Borrower and
Borrowing Subsidiaries will not permit consolidated
EBITDA to be less than the amounts set forth below:
March 1, 1997 through: Amount
---------------------- ------------
May 31, 1997 ($1,100,000)
August 31, 1997 ($2,500,000)
November 30, 1997 ($1,300,000)
February 28, 1998 $3,600,000
Thereafter, Borrower and Borrowing Subsidiaries shall
maintain a minimum ratio of EBITDA to interest expense of
2:00 to 1:00 for each Fiscal Quarter calculated on a rolling
twelve month basis.
(b) Borrower and Borrowing Subsidiaries shall not
permit Net Income excluding any after-tax extraordinary
gains or losses plus depreciation and amortization deducted
in determining Net Income minus Capital Expenditures not
financed to current principal maturities of long term debt
and Capital Leases paid during such period for the periods
set forth below to be less than the ratio set forth opposite
each such period:
<PAGE>
PERIOD RATIO
- ------------------------------------- --------------
Fiscal Quarter ending nearest to (.4) to 1.00
November 30, 1997
Fiscal six month period ending nearest to 4.00 to 1.00
February 28, 1998
Fiscal nine month period ending nearest to 3.00 to 1.00
May 31, 1998
Fiscal twelve month period ending nearest to 1.00 to 1.00
August 31, 1998
Fiscal twelve month period ending nearest to 1.15 to 1.00
November 30, 1998
Thereafter, for each rolling twelve month 1.25 to 1.00
Fiscal Quarter"
ARTICLE III
Amendment Fee
The Borrower hereby agrees to pay to the Lender on the date
hereof an amendment fee in the amount of $5,000.
ARTICLE lV
Amendments to Revo1ving Note
The Borrower and each Borrowing Subsidiary shall deliver to
the Lender on the date hereof an Amended and Restated Revolving
Note in the principal amount of $33,000,000 in the form of
Exhibit A hereto (the "Amended Note").
ARTICLE V
Ratifications, Representations and Warranties
5.01 Ratifications. The terms and provisions set forth in
this Amendment shall modify and supersede all inconsistent terms
and provisions set forth in the Loan Agreement and the Other
Agreements, and, except as expressly modified and superseded by
this Amendment, the terms and Provisions of the Loan Agreement
and the Other Agreements are ratified and
<PAGE>
confirmed and shall continue in full force and effect. Borrower
and each Borrowing Subsidiary and Lender agree that the Loan
Agreement and the Other Agreements, as amended hereby, shall
continue to be legal, valid, binding and enforceable in
accordance with their respective terms.
5.02 Representations and Warranties. Borrower and each
Borrowing Subsidiary hereby represent and warrant to Lender that
(a) the execution, delivery and performance of this Amendment and
any and all Other Agreements executed and/or delivered in
connection herewith including, without limitation, the Amended
Note, have been authorized by all requisite corporate action on
the part of Borrower and each Borrowing Subsidiary and will not
violate the Articles of Incorporation or Bylaws of Borrower or
either Borrowing Subsidiary; (b) the representations and
warranties contained in the Loan Agreement, as amended hereby,
and any Other Agreements are true and correct on and as of the
date hereof and on and as of the date of execution hereof as
though made on and as of each such date; (c) no Event of Default
or event or condition which, with notice or passage of time or
both, would constitute an Event of Default under the Loan
Agreement, as amended hereby, has occurred and is continuing; and
(d) Borrower and each Borrowing Subsidiary are in full compliance
with all covenants and agreements contained in the Loan Agreement
and the Other Agreements, as amended hereby.
ARTICLE VI
Miscellaneous Provisions
6.01 Survival of Representations and Warranties. All
representations and warranties made in the Loan Agreement or any
Other Agreements, including, without limitation, any document
furnished in connection with this Amendment, shall survive the
execution and delivery of this Amendment and the Other
Agreements, and no investigation by Lender shall affect the
representations and warranties or the right of Lender to rely
upon them.
6.02 Reference to Loan Agreement. Each of the Loan
Agreement and the Other Agreements and any and all other
agreements, documents or instruments now or hereafter executed
and delivered pursuant to the terms hereof or pursuant to the
terms of the Loan Agreement, as amended hereby, are hereby
amended so that any reference in the Loan Agreement and such
Other Agreements to the Loan Agreement or any such Other
Agreements shall mean a reference to the Loan Agreement and the
Other Agreements as amended hereby.
6.03 Expenses of Agent. As provided in the Loan Agreement,
Borrowers agree to pay on demand all reasonable costs and
expenses incurred by Lender in connection with the preparation,
negotiation and execution of this Amendment and the Other
Agreements executed pursuant hereto, and any and all amendments,
modifications, and supplements thereto, including, without
limitation, the reasonable costs and fees of Lender's legal
counsel.
6.04 Severability. Any provision of this Amendment held by a
court of competent jurisdiction to be invalid or unenforceable
shall not impair or invalidate the remainder of this Amendment
and the effect thereof shall be confined to the provision so held
to be invalid or unenforceable.
<PAGE>
6.05 Successors and Assigns. This Amendment is binding upon
and shall insure to the benefit of Lender and Borrower and each
Borrowing Subsidiary and their respective successors and assigns,
except that Borrower and Borrowing Subsidiaries may not assign or
transfer any of their rights or obligations hereunder without the
prior written consent of Lender.
6.06 Counterparts. This Amendment may be executed in one or
more counterparts, each of which when so executed shall be deemed
to be an original, but all of which when taken together shall
constitute one and the same instrument.
6.07 Effect of Waiver. No consent or waiver, express or
implied, by Lender to or for any breach of or deviation from any
covenant or condition by Borrower or Borrowing Subsidiaries shall
be deemed a consent to or waiver of any other breach of the same
or any other covenant, condition or duty.
6.08 Heading. The headings, captions, and arrangements used
in this Amendment are for convenience only and shall not affect
the interpretation of this Amendment.
6.09 Applicable Law. THIS AMENDMENT AND ALL OTHER AGREEMENTS
EXECUTED PURSUANT HERETO SHALL BE DEEMED TO HAVE BEEN MADE AND TO
BE PERFORMABLE IN AND SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF ILLINOIS
(WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAW).
6.10 Final Agreement. THE LOAN AGREEMENT AND THE OTHER LOAN
DOCUMENTS, EACH AS AMENDED HEREBY, REPRESENT THE ENTIRE
EXPRESSION OF THE PARTIES WITH RESPECT TO THE SUBJECT MATTER
HEREOF ON THE DATE THIS AMENDMENT IS EXECUTED. THE LOAN AGREEMENT
AND THE OTHER AGREEMENTS, AS AMENDED HEREBY, MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES. NO MODIFICATION, RESCISSION,
WAIVER, RELEASE OR AMENDMENT OF ANY PROVISION OF THIS AMENDMENT
SHALL BE MADE, EXCEPT BY A WRITTEN AGREEMENT SIGNED BY BORROWER,
EACH BORROWING SUBSIDIARY AND LENDER.
(REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK)
<PAGE>
Witness the due execution hereof by the respective duly
authorized officers of the undersigned as of the date first
written above.
EVANS, INC.
By: William E. Koziel
Title: Vice President
KOSLOW'S, INC.
By: William E. Koziel
Title: Vice President
EVANS-ROSENDORF, OF MARYLAND, INC.
By: William E. Koziel
Title: Vice President
JACKSON NATIONAL LIFE INSURANCE
COMPANY, as Lender
By: PPM America, Inc., Attorney-in-Fact
By: Jeffrey J. Podwika
Title: Vice President
PURCHASE AGREEMENT
THIS AGREEMENT, made this 4th of August, 1997, by and
between TRIOMPHE FOURRURES INCORPORATED, a subsidiary of
REVILLON, INCORPORATED ("Revillon"), a New York Corporation
(hereinafter called "Seller") and EVANS, INC., a Delaware
Corporation (hereinafter called "Evans").
WITNESSETH:
WHEREAS, Seller now owns and operates that certain retail
fur business operating certain fur departments in Bloomingdale's
department stores (hereinafter called "said fur business"), and
WHEREAS, Seller is desirous of selling to Evans its entire
fur business including without limitation the fur inventory, the
store and trade fixtures, furniture, machinery, supplies,
computers, equipment, uncompleted customer orders, fur storage
and insurance, dead storage, cleaning and glazing, repairs and
alterations, customers lists for both new sales and storage, the
goodwill and trade names appertaining thereto all comprising said
fur business, and
WHEREAS, Evans is willing to purchase said fur business upon
the terms, covenants and conditions hereinafter stated,
NOW THEREFORE, in consideration of the premises and of the
mutual covenants and agreements of the parties hereof, it is
hereby covenanted and agreed as follows:
1. Seller agrees to sell and Evans agrees to purchase,
subject to the terms, covenants, conditions and agreement
hereinafter provided, all right, title and interest of Seller in
the following described personal property comprising said fur
business of Seller in Bloomingdale's ("Bloomingdale's"):
(a) All fur inventories (excluding, however, inventory
checked out to certain of Seller's officers) whether or not
detailed on Schedule I attached hereto determined pursuant to
physical inventory taken at closing. All storage and service
inventories detailed on Schedule I.
(b) All store and trade fixtures, furniture,
machinery, supplies and computers located in Seller's fur
departments used in operating said fur business and all other
equipment of every kind and character located in Seller's fur
departments used in said fur business, whether or not detailed on
Schedule II hereto attached.
(c) Seller's interest in any leasehold improvements in
the premises which Seller operates under its License Agreement
with Bloomingdale's.
<PAGE>
(d) All licenses which by law are transferable.
(e) Seller's interest in any storage agreements with
Central Storage, RAM, Kazis, District, CalBest and Leather Rich
fur storage company upon the same terms and conditions as
contained in such agreements. Each storage company to provide a
certified list of garments in their possession (see Schedule I)
and to be solely responsible for any omissions from such schedule
or for any garment listed in such schedule which may be lost or
damaged before or after the closing hereunder, provided, however
in the event Seller shall have received a customer's garment, but
did not deliver same to any of the above storage companies, then
and in such event, Seller shall be responsible for any such
garment.
(f) The assets of the entire fur business located in
Seller's fur departments as a going concern as shown on Seller's
balance sheet as of May 31, 1997, together with all customers
lists (current and prospective), telephone numbers, goodwill and
the assignment of Seller's and Revillon's right, title and
interest in the trade names and trademarks used in said fur
business including but not limited to the name "Maximilian" for
furs and fur products throughout the world and as registered in
countries which are listed in the Schedule of Trademarks attached
hereto as Schedule VIII, subject to the claims, restrictions,
exceptions and limitations set forth in the Schedule of
Trademarks. Seller also transfers to Evans apart from the
trademarks or trade names, above listed, whatever right, title,
and interest Seller may have acquired throughout the world, by
use, registration or otherwise, in and to whatever herein
unlisted registered or herein unlisted unregistered trademarks
and/or trade names owned by Seller and used in the conduct of
Seller's business (hereinafter collectively "trademarks") and any
and all goodwill associated therewith or represented thereby.
The assets being sold hereunder shall nevertheless
exclude the following: petty cash in the said fur departments;
accounts receivable; tangible property located at 333 Seventh
Avenue, New York, New York; prepaid expenses; and company-wide
software and systems.
All assets being sold hereunder shall be purchased
"AS IS, WHERE IS," without representations or warranties by
Seller, express or implied, except those representations and
warranties expressly set forth in this Agreement.
2. The purchase price for the foregoing assets shall be as
follows:
(a) For the fur inventory described in and included
under Paragraph 1 (a) hereof a sum equal to the appraised value
thereof according to the inventory thereof.
<PAGE>
(b) For the store and trade fixtures, furniture,
machinery, supplies, and computers used in operating said fur
business and all equipment as described in Paragraph 1 (b) hereof
and the agreements and licenses as described in Paragraphs 1(c),
1(d) and 1(e) hereof, the sum of $145,000.00, which shall be paid
on December 30, 1999.
(c) For all names and trademarks including the
Maximilian name and trademark, the sum of $1,693,484.00 payable
to Revillon.
(d) For the entire retail fur business as a going
concern, together with all customer lists, telephone numbers,
goodwill and trade names of Seller as described in Paragraph 1(f)
hereof, the sum of $500,000.00.
3. (a) Closing hereunder shall take place no later than
August 12, 1997, unless otherwise agreed upon by Seller and
Evans. The closing shall be effective for all purposes as of the
close of business on August 2, 1997, and Evans shall be solely
responsible for all costs, expenses, liabilities and obligations
of the said fur business after the close of business on August 2,
1997, as if the closing had taken place on that date and time.
In the event Closing does not occur by August 12, 1997, and is
not extended by agreement of the parties, this Agreement shall
immediately terminate. In no event shall the Confidentiality
Agreement between the parties terminate.
(b) Upon closing the following procedure shall be
adopted:
(i) Seller shall forthwith deliver possession to
Evans of the fur inventories and of said fur business and keys
thereto, trade fixtures, furniture, machinery, supplies,
computers, equipment, uncompleted customer orders, fur storage,
cleaning and glazing, repairs and alterations and customer lists
described in Paragraph 1 hereof.
(ii) Seller shall deliver to Evans good and
sufficient instruments, in form and substance reasonably
satisfactory to Evans, conveying and assigning to Evans of all of
Seller's right, title and interest in and to the assets of the
said fur business and (with Revillon) name Maximilian listed in
Paragraph 1 free of encumbrances except as set forth in Section 1
and Schedule IX hereto annexed.
(iii) Seller shall deliver to Evans certified
copies of Resolutions in form and substance reasonably acceptable
to Evans' General Counsel, of the Board of Directors and
shareholders of Seller whereby the sale of said fur business and
the execution of all documents required hereby to effect same
shall be duly authorized and approved.
<PAGE>
(iv) Evans shall deliver to Seller a certified
copy of resolutions in form and substance reasonably acceptable
to Seller's counsel, of the board of directors of Evans whereby
the purchase of said fur business and the execution of all
documents required hereby to effect same shall be duly authorized
and approved.
(v) The parties shall take all other actions
contemplated by this Agreement to occur at closing.
4. The purchase price except as set forth in Paragraphs
2(b) and (c) above, shall be paid by Evans to Seller as follows:
(a) On the closing date Evans shall pay to Seller a
sum equal to thirty percent (30%) of the total purchase price.
(b) The remaining balance will be paid as follows:
(i) Three (3) months after closing, Evans will
pay to Seller ten percent (10%) of the total purchase price.
(ii) Six (6) months after closing, Evans will pay
to Seller ten percent (10%) of the total purchase price.
(iii) Every three (3) months thereafter, Evans
will pay to Seller five percent (5%) of the total purchase price
with the entire balance being due and payable on December 30,
1999.
(c) The sum of $145,000 referred to in Paragraph 2(b)
will be paid on December 30, 1999.
(d) the sum of $1,693,484.00 referred to in Paragraph
2(c) will be paid as follows:
(i) On the closing date Evans shall pay to
Revillon the sum of $508,045.20.
(ii) Three (3) months after closing, Evans will
pay to Revillon $169,348.40.
(iii) Six (6) months after closing, Evans will
pay to Revillon $169,348.40.
(iv) Every three (3) months thereafter, Evans will
pay to Revillon $84,674.20, with the entire balance being due and
payable on December 30, 1999.
<PAGE>
(e) The deferred amounts set forth in this Paragraph 4
or any other paragraph under this Agreement will be subject to
acceleration at the option of Seller and Revillon should Evans
default in the timely payment of any amounts due hereunder to
Seller or Revillon.
(f) The payments to be made under Paragraphs 4(b), (c)
and (d) shall be covered by Installment Notes in the form
attached as Exhibit I.
(g) The payments set forth in this Paragraph 4 shall,
at Seller's option be paid by cashier's check or wire transfer.
5. Anything to the contrary notwithstanding, provided
Evans shall have complied with the terms and conditions of this
Paragraph 5, it is expressly understood and agreed that Evans may
retain a reasonable and necessary portion of any balance due
hereunder to be applied as necessary to the payment of any loss,
damage, liability or expense which Evans may sustain or incur by
reason of any claim or lien incurred or created by Seller on or
before six (6) months after the closing date, being asserted by a
creditor, lien holder, or governmental agency against Seller,
Evans or the personal property sold hereunder, whether such claim
or lien shall be asserted under the bulk sales act of any state
in which Seller operates or by virtue of any mortgage, sales
contract or other security instrument or for unpaid sales taxes,
license taxes, ad valorem taxes or taxes due the Federal or State
Governments or for any reason whatsoever, arising out of or in
any manner connected with the sale by Seller and the purchase by
Evans of the inventory and other assets described in this
Agreement. If demand for payment is made upon Evans by any
creditor, lien holder or governmental agency for any such claim
or lien, or if Evans shall have reliable knowledge of any such
outstanding claim or lien, then Evans shall be entitled to
withhold an amount sufficient to pay any such claim or lien
beyond the date or dates of payment provided herein until such
claim or lien has been paid or settled by Seller. Evans shall
promptly send copies to Seller of any demands made upon it by any
such creditor, lien holder or governmental agency and any such
outstanding claim or lien.
6. Seller expressly covenants, agrees, represents and
warrants as follows:
(a) That it shall pay or cause to be paid all
indebtedness of Seller and all taxes against Seller, its
business, and the properties included under this Agreement and
that Seller will and does indemnify and hold Evans harmless from
and against any and all claims, demands, causes of action,
liability, loss, cost and expense (together "claims") (except
claims to the extent they are less than $250.00 each and not
exceeding $10,000 in the aggregate and except claims expressly
set forth in this Agreement) of every kind and nature whatsoever
relating to or resulting from said fur business and from
<PAGE>
transactions or happenings prior to the closing date and from any
indebtedness or tax liabilities of Seller. Anything in this
paragraph to the contrary notwithstanding, Seller shall have the
right to use due diligence in either contesting or defending any
of the aforesaid matters. Evans shall promptly send copies to
Seller of any notices received by Evans concerning the aforesaid
matters.
(b) Except as expressly set forth in this Agreement,
that it now has or will have upon the date of delivery of
possession thereof to Evans, good, marketable and assignable
title of and to all of the property included under this Agreement
except as to any such property covered by leases or other
arrangements set forth in Schedule III. Except as expressly set
forth in this Agreement, that upon delivery to Evans, same will
be free and clear of all liens, charges, encumbrances whatsoever,
and that the entire right, title and interest therein which
Seller agrees herein to sell, transfer and deliver to Evans,
Seller shall forever warrant and defend.
(c) Seller shall deliver to Evans on or before the
closing date as Schedule IV a list signed and sworn to by Seller
containing the names and business addresses of all creditors of
Seller known by Seller to be owed at least $25,000 as of the date
of Schedule IV and the names of all person who are known by
Seller to assert claims in excess of $1,000 against it as of the
date of Schedule IV, even though such claims are disputed.
(d) That except as otherwise expressly provided in
this Agreement, it is understood and agreed that Evans does not
assume and shall in no event be liable for any obligations,
indebtedness, rents incurred by Seller through the closing date,
or other commitments of Seller or Seller's property, such as
sales taxes, occupation taxes, use taxes, excise taxes, income
taxes, unemployment insurance taxes, social security taxes or any
other taxes of a like or different nature. Evans shall promptly
send copies to Seller of notices received by Evans concerning the
aforesaid matters.
(e) That until the closing, Seller shall continue to
operate said fur business in substantially the same manner,
including the advertising thereof, as heretofore conducted and
shall not remove from the premises any of the items listed in
paragraph 1(b) above except, to the extent necessary, supplies;
that Seller will not hereafter encumber any property covered by
this Agreement or permit any liens to attach thereto; that upon
the date of delivery of possession to Buyer the fur inventory
shall not exceed in quantity the amount of merchandise heretofore
generally carried by Seller at the comparable time of the year.
<PAGE>
(f) It will not disclose to anyone except
Bloomingdale's or as otherwise required by law, any of the names
or addresses of past or present customers of Seller and that
Seller will keep all information relative to said customers
confidential, consistent with Seller's usual practices regarding
its own trade secrets and confidential information (See Paragraph
11).
(g) It will not for itself or on behalf of it or in
conjunction with anyone solicit, divert or take any of the
customers or business of Seller (See Paragraph 11). Evans
acknowledges that Revillon, Incorporated, the parent company of
Seller, is a competitor of Evans and may, without Seller being in
breach of this Agreement, compete for the business of customers
of the said fur business, but shall not use any customer list
generated from Maximilian customers at Bloomingdale's.
(h) Except as stated in Schedule V, and the Schedule
of Trademarks, there are no actions, suits or proceedings pending
or, to Seller's knowledge, threatened against or affecting the
assets to be sold or the fur business (including, but not limited
to, product liability, product warranties, patent or trade mark
infringement or unfair competition) at law or in equity before
any federal, state or municipal authorities or government
department, commission, board, bureau, agency or instrumentality,
domestic or foreign, which involves any claim not fully covered
by insurance (excluding policy deductibles), including, but not
limited to, any audits in process, deficiency assessments, liens
filed or threatened to be filed, or any other proceedings or
investigation whatsoever with any taxing authority, or
governmental authorities not as of the closing date finally
concluded.
7. Any customary proratable items in connection with the
said fur business, including but not limited to those items in
this paragraph, shall be prorated between Seller and Evans as of
the date of Closing. On the closing date, Seller shall transfer
to Evans any transferable licenses and permits which Evans may
elect to take over, such election to be made by July 31, 1997,
the unexpired cost thereof to be prorated between Seller and
Evans.
(a) It is understood and agreed that customer
contracts for storage and insurance shall not be prorated;
(b) Uncompleted contracts for cleaning and glazing,
repairs and alterations will not be prorated;
(c) As and when collected by Evans, Evans shall pay to
Seller the remaining installments due on uncompleted contracts
for remodelings; provided, however, if Seller has not paid its
vendors for work performed on remodelings or other services and
<PAGE>
if Seller does not dispute in writing the vendor's claim to such
payment within ten (10) days after notice from Evans to Seller of
such non-payment, then Evans shall pay for such services and
deduct any
amounts so paid from amounts due Seller, either from any
remaining installments due Seller on uncompleted contracts for
remodeling or any payment due under Paragraph 4 herein. Seller
agrees to diligently resolve any such disputed claim or, if not
capable of resolution, to indemnify, defend and hold Evans
harmless from any such claim and any related costs or expenses.
(d) Seller shall pay to Evans the sum of $2.00 per
service garment which was
taken in by Seller in any Bloomingdale's department and handed
out by Evans through December 31, 1997. Evans shall provide
Seller with records showing the number of garments so delivered.
If Seller shall not pay any such amount due and payable to Evans
by the later of February 1, 1998 or ten (10) days after Seller
receives such records from Evans, Evans may deduct such amounts
due hereunder from any payment due Seller.
8. It is understood and agreed that Evans shall, for a
period of three (3) months after the last scheduled payment due
from any such customer, collect, as agent for Seller, any "Short
Deposit Accounts" due to Seller as of the closing date. Evans
agrees to use its best efforts to collect such accounts and shall
render a monthly accounting to Seller of collection during the
preceding month, and shall, at such time, remit the proceeds
thereof to Seller less the license fees thereon and applicable
credit card charges, if any, due to Bloomingdale's. With respect
to any account which is unpaid three (3) months after the last
scheduled payment, customer's payments shall be refunded by Evans
and such amount less license fees shall be due to Evans from
Seller. Any such amounts due to Evans under this paragraph shall
be paid to Evans by Seller within ten (10) days of the date of
notice to Seller accompanied by complete documentation of the
refund by Evans to such customer and Evans' efforts to collect
such account. In the event any such amount is not paid when due,
Evans shall have the right to deduct same from the next payment
due to Seller. Upon payment in full of the purchase price by any
such customer, Seller shall deliver the subject garment to Evans.
9. From and after the date hereof until the closing date
Seller will:
(a) At all reasonable time and intervals, on
reasonable notice, permit Evans' employees and agents to come
upon the premises of Seller and inspect Seller's business,
including without limitation, inventory, books and records and
operation procedures; provided, however, Evans shall not (i)
conduct any such investigation in such a manner as to cause any
<PAGE>
interference with Seller's business or (ii) contact any supplier
or customer of Seller without first obtaining Seller's consent.
(b) Permit Evans to do a complete preliminary
inventory count in Seller's presence.
(c) Maintain all books, accounts and records relating
to said fur business in the usual, regular and ordinary manner on
a basis consistent with prior years.
(d) Endeavor to preserve intact Seller's business
organization and the goodwill of Seller's customers.
(e) Permit Evans to interview any of Seller's
employees at reasonable times, on reasonable notice, without
interference with Seller's normal working operation.
10. The obligation of Evans to consummate the transactions
herein contemplated on the closing date is, at the option of
Evans, subject to the following express conditions precedent:
(a) The representations and warranties of Seller
contained in this Agreement were true in all material respects
when made and shall be true at and as of the closing date in all
material respects as though such representations and warranties
had been made at and as of the closing date and Seller shall have
performed all agreements on its part required to be performed and
shall not be in default in any material respect under any of the
provisions of this Agreement at or prior to the closing date.
(b) At the closing date there shall exist no known
violations of any federal, state or local law or regulations
materially affecting the assets to be sold or said fur business,
and no governmental body shall have pending charges of any such
violation.
(c) Evans shall have been furnished a current
certificate from the Secretary of State of New York that Seller
is a corporation duly incorporated and subsisting under the
Business Corporation Law of New York (except for any past due
biennial reports) and current certificates from the Secretaries
of the States of Pennsylvania, Florida, California, New Jersey,
Virginia and Maryland confirming that it is qualified to do
business in those states.
(d) Evans being furnished by the closing date with a
complete list, as Schedule VI of all employees, at the date of
this Agreement showing their present rate of compensation and any
bonuses to be paid to them by Seller for the fiscal year ending
December 31, 1997. The parties agree that any bonuses which are
paid by Evans to Leslie Freund and Trish Lucas for the fiscal
year ending December 31, 1997, will be as set forth in Schedule
VII and prorated on the basis of 5/12 of the amount being paid by
Evans and 7/12 to be paid by Seller, with credit given to Seller
<PAGE>
for advances paid to Trish Lucas. On or before the closing date,
Seller will advise Evans in writing, as Schedule VII, of any
contracts or other arrangements, whether oral or written, with
any of its employees.
(e) Evans shall have received an opinion as of the
closing date from Kavanagh Maloney & Osnato LLP, Counsel to
Seller, to the effect that:
(i) Seller is a corporation duly incorporated,
and subsisting under the Business Corporation Law of the State of
New York.
(ii) The execution of this Agreement and
performance of all obligations hereunder by Seller has been duly
authorized by all necessary corporate action and are not in
conflict with any provisions of the Articles of Incorporation or
By-Laws of Seller or of any agreement of which Seller is a party
of which such counsel has actual knowledge.
(f) Evans shall have been furnished with all corporate
and other documents which it may have reasonably requested
hereunder, all certified in such manner as Evans may reasonably
request.
11. The parties hereto acknowledge that its parent
Revillon, Incorporated, a New York Corporation, operates free
standing fur and apparel stores in New York, Chicago, Palm Beach
and Beverly Hills and a boutique in Saks Jandel in Chevy Chase,
Maryland, under the name Revillon. Evans acknowledges that
Revillon, Incorporated, the parent company of Seller, is a
competitor of Evans and may, without Seller being in breach of
this Agreement, compete for the business of customers of the said
fur business, but shall not use any customer list generated from
Maximilian customers at Bloomingdale's. The parties hereto agree
that they will not say or do anything to detract from the quality
reputation of the Revillon, Maximilian, Bloomingdale's and Evans
names. Seller will not do anything to divert sales from
Bloomingdale's to the Revillon stores where located. The parties
hereto agree that they will not send any correspondence to
customers regarding the sale covered by this Agreement without
prior written approval by the other party.
Either party hereto shall be entitled alternatively or
cumulatively to damages for breach of this paragraph, to an order
requiring performance of the obligations of this paragraph or to
any other appropriate order to remedy.
12. The obligation of Seller and Revillon to consummate the
transactions herein contemplated on the closing date is, at the
option of Seller, subject to the following express conditions
precedent:
<PAGE>
(a) The representations and warranties of Evans
contained in this Agreement were true in all material respects,
when made and shall be true at and as of the closing date in all
material respects as though such representations and warranties
had been made at and as of the closing date; and Evans shall have
performed all agreements on its part required to be performed and
shall not be in default in any material respect under any of the
provisions of this Agreement at or prior to the closing date.
(b) There has been no material adverse change in the
financial condition of Evans since May 31, 1997. Evans warrants
and represents that Evans' balance sheet and statement of
operations as of and for the Quarter ended May 31, 1997, attached
hereto and made a part hereof as Exhibit C, accurately present
Evans' financial condition and results of operations for the
period indicated aforesaid.
(c) Seller shall have been or will as soon as
reasonably possible after the closing, be furnished a current
certificate from the Secretary of State of Delaware that Evans
is a corporation duly incorporated and subsisting under the laws
of Delaware.
(d) Seller shall have received in opinion as of the
closing date, of Counsel for Evans, to the effect that:
(i) Evans is a corporation duly incorporated
validly existing and in good standing under the laws of the State
of Delaware;
(ii) The execution of this Agreement, and the
performance of all obligations hereunder by Evans have been duly
authorized by all necessary corporate action, and are not in
conflict with any provisions of the Articles of Incorporated or
By-Laws of Evans or of any agreement to which Evans is a party of
which such counsel has actual knowledge;
(iii) This Agreement has been duly executed
and delivered by Evans and constitutes a valid and binding
obligation of Evans enforceable according to its terms.
(e) Seller shall have been furnished with all
corporate and other documents which it may have reasonably
requested hereunder, all certified in such manner as Seller may
reasonably request.
13. Seller warrants and represents that Seller's balance
sheet and statement of operations as of and for the six month
period ended June 30, 1997, to be attached hereto and made a
part hereof as Exhibit B accurately presents Seller's financial
condition and results of operations for the period indicated
aforesaid. (The six month statements for the period ended June
30, 1997, shall be provided on or before September 15, 1997.)
<PAGE>
14. (a) Seller agrees to reimburse Evans (except for
claims of less than $250.00 each and not exceeding $7,500.00 in
the aggregate) for any expenses incurred or amount paid by Evans
for repair or alteration to or on behalf of a customer of Seller
where such payment is the result of a breach of any warranty
given by Seller or by operation of law to such customer incident
to any sales made or services performed by Seller prior to the
closing date. Evans shall be entitled to use its reasonable
business judgment in making such repairs and alterations provided
that if the amount involved for a single garment exceeds $250.00
Evans shall inform Seller.
(b) Anything in this Agreement to the contrary
notwithstanding, and subject to Evans' compliance with this
subparagraph 14(b), Seller agrees to reimburse Evans, less
applicable license fees and sales commissions, in the event
customers return any garments purchased prior to the closing
date. Evans shall notify Gabrielle Asness (or any other person
designated by Seller in writing) at phone number 1-800-992-6199
or fax 954-742-8238 within two business days after a customer
attempts to return such a garment. For ten (10) days thereafter,
Seller shall have the exclusive right to deal with such customer
regarding such return and to apply Seller's standard returns
policy to such customer. If, within such ten (10) day period,
Seller shall not have resolved such return transaction to the
customer's satisfaction, at no cost to Evans, Bloomingdale's
shall make the final determination to resolve such dispute. Any
amount to be refunded by Bloomingdale's to such customer
according to the aforesaid procedure shall in turn be reimbursed
by Seller to Evans within ten (10) days after Evans notifies
Seller that such amount has been reflected as a deduction from
monies otherwise due Evans on Bloomingdale's monthly remittance
schedule. In the event any such amount is not paid when due,
Evans shall have the right to deduct same from the next payment
due Seller. Upon the return and refund of any sale under the
provisions of this sub-paragraph, Evans shall return the garment
to Seller.
15. Evans may deduct any and all reasonable and necessary
costs incurred in accordance with the provisions of paragraphs 6
and 14 above (subject to the limitations therein) from any
amounts remaining due to Seller.
16. Seller shall cause its officers to encourage Seller's
existing employees paid through Federated Department Stores, Inc.
to become employees of Evans. Evans will hire all of Seller's
existing employees paid through Federated Department Stores, Inc.
Subject to the needs of the business and the performance of the
individual employee, Evans further intends to keep substantially
<PAGE>
all of Seller's existing employees paid through Federated
Department Stores, Inc. in its employment.
17. Each party shall be responsible for its costs and
expenses incurred incident to its performance of and compliance
with all of the agreements and conditions contained in this
Agreement.
18. Seller and Evans will at any time before, at or as soon
after the closing date as is reasonably possible, execute and
deliver or cause others to do so, all such documents, instruments
and confirmatory assignments, and do or cause to be done all such
other acts as shall be reasonably necessary to carry out their
respective obligations under this agreement.
19. Time is of the essence of this Agreement. Any party
hereto shall be entitled alternatively or cumulatively to damages
for breach of this Agreement, to an order requiring performance
of the obligations of this Agreement or to any other appropriate
order or remedy.
20. This Agreement is personal to the parties hereto and
may not be assigned in whole or in part by any of them without
the prior written consent of the other, except that Evans may
assign its rights hereunder to a wholly-owned subsidiary;
provided that, no such assignment shall release Evans from its
obligations hereunder, and further provided that such subsidiary
shall be subject to all obligations under this Agreement relating
to such assignment.
21. Except to the extent required by law or by a financial
institution, the parties will use their best efforts to prevent
the financial details of this transaction from becoming publicly
known.
22. All covenants, agreements, representations and
warranties made herein and certificates and instruments delivered
pursuant hereto by Seller or Evans shall be deemed to be material
and to have been relied upon by the parties to whose benefit such
covenants, agreements, representations and warranties are made,
notwithstanding any investigation heretofore or hereafter made by
or on behalf of the other party and shall survive the closing
hereunder.
23. If any provision of this Agreement or the application
thereof, to any person or circumstance shall to any extent be
invalid or unenforceable, the remainder of this Agreement, or the
application of such provision to persons or circumstances other
than those as to which it is invalid or unenforceable, shall not
be affected thereby and each provision of this Agreement shall be
valid and enforceable to the fullest extent permitted by law.
<PAGE>
24. On the closing date, Seller shall deliver to Evans in
form and substance acceptable to Evans' General Counsel a
Certificate signed by Rebeca DeVives as President of Seller, to
the effect that all warranties and representations of Seller
contained in this Agreement are true at and as of the closing
date in all material respects; that Seller has performed all
agreements on its part required to be performed hereunder and
that Seller is not in default under any of the provisions of this
Agreement.
On the closing date, Evans shall deliver to Seller in
form and substance acceptable to Seller's counsel a certificate
signed by William E. Koziel as Vice President of Evans, to the
effect that all warranties and representations of Evans contained
in this Agreement are true at and as of the closing date in all
material respects, that Evans has performed all agreements on its
part required to be performed hereunder and that Evans is not in
default under any of the provisions of this Agreement.
25. Every notice and other communication contemplated by
this Agreement by any party hereto shall be delivered in person
or given by postage prepaid, certified mail, addressed to the
parties for whom intended at the address specified at the end of
this paragraph or at such other address as the intended recipient
previously shall have designated by written notice to the other
party. Unless otherwise provided in this Agreement, notice by
mail shall be effective on the date it is officially recorded as
delivered by return receipt and in the absence of record of
delivery it shall be presumed to be delivered on the fifth day or
next business day thereafter after it was deposited in the mails.
Notice not given in writing shall be effective only if
acknowledged in writing by the party to whom it was given. The
address of the parties hereto are:
SELLER: Triomphe Fourrures Incorporated
c/o Joel Rudell, Esq.
Kavanagh Maloney & Osnato LLP
415 Madison Avenue
New York, NY 10017
and
Claude Potier
Vice Chairman & CEO
Triomphe Fourrures Incorporated
333 Seventh Avenue
New York, NY 10001
<PAGE>
BUYER: Evans, Inc.
South State Street
Chicago, Illinois 60603
Attention: President
and
Samuel B. Garber
General Counsel
36 South State Street
Chicago, IL 60603
26. Failure of any party at any time to require another
party's performance of any obligation under this Agreement shall
not affect the right to require performance of that obligation.
Any waiver of any party hereto of any breach of any provision of
this Agreement shall not be construed as a waiver of any
continuing or succeeding breach of such provisions, a waiver of
modification of the provision itself, or a waiver or modification
of any right under this Agreement.
27. Evans shall place orders with the firm of Alex
Alexandrou Ltd. during the period commencing with the closing
date through January 31, 1998, under Evans normal purchasing
terms of 25% per month, commencing 30 days after delivery, up to
the sum of $1.0 million. The said orders shall include the
existing Karl Lagerfeld collection of approximately $250,000.
28. Evans shall assume, for the period July 1, 1997 through
June 30, 1998, Revillon Incorporated's obligations under its
existing contract with Karl Lagerfeld S.A. for the exclusive
right to manufacture, distribute and sell certain Karl Lagerfeld
branded fur garments for women in the U.S.A.; provided, however,
that Seller shall use its best efforts without being required to
pay any additional sums therefor, to secure for Evans an option,
exercisable on or before October 31, 1997, to fulfill Revillon
Incorporated's obligations under such contract for the period
July 1, 1998 through June 30, 1999.
29. Anything in this Agreement to the contrary
notwithstanding, Evans shall be required to give Seller notice of
any claim that Seller has breached any term or provision of this
Agreement not later than December 30, 1999.
30. The closing shall be held at the offices of Kavanagh
Maloney & Osnato LLP, 415 Madison Avenue, New York, New York,
10017.
31. This Agreement sets forth the entire understanding and
supersedes prior agreements between the parties relating to the
subject matter contained herein and merges all prior discussions
between them and no party shall be bound by any definition,
<PAGE>
condition, representation, warranty, covenant or other provision,
other than as expressly stated in this Agreement or as
contemporaneously or subsequently set forth in writing and
executed by the party to be bound thereby.
32. The validity, construction and enforceability of this
Agreement shall be governed in all respects by the laws of the
State of Ohio.
33. The Agreement includes all Schedules and Exhibits
hereto annexed. Any information included in any Schedule or
Exhibit shall be deemed to be included in all Schedules and
Exhibits for all purposes of this Agreement.
34. Each party represents that it has not employed any
broker or finder in connection with the transactions contemplated
by this Agreement.
35. Annexed hereto as Exhibit D is a letter from Evans'
lender approving the transactions contemplated by this Agreement.
36. Revillon, Incorporated joins herein solely for the
purpose of assigning all of its right, title and interest in the
trade names and trademarks used in said fur business including,
but not limited to, the name "Maximilian" for furs and fur
products throughout the world and as registered in countries
which are listed in the Schedule of Trademarks attached hereto as
Schedule VIII, subject to the claims, restrictions, exceptions
and limitations set forth in the Schedule of Trademarks.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed on the date first above written.
ATTEST: TRIOMPHE FOURRURES INCORPORATED:
JOEL RUDELL, Secretary By: REBECCA DE VIVES, President
ATTEST: REVILLON, INCORPORATED:
JOEL RUDELL, Secretary By: REBECCA DE VIVES, President
ATTEST: EVANS, INC.
SAMUEL B. GARBER, Secretary By: WILLIAM E. KOZIEL, Vice President
