Asset Transaction Form 8 K

Item 1.01 Entry into a Material Definitive Agreement.

As previously disclosed, on June 30, 2024, Delta Apparel, Inc. (the "Company") and its domestic direct and indirect subsidiaries, including Salt Life, LLC ("Salt Life") and M.J. Soffe, LLC ("Soffe"), filed voluntary petitions (the "Chapter 11 Cases") under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware (the "Bankruptcy Court").

Salt Life Asset Purchase Agreement

In connection with the Chapter 11 Cases, on August 27, 2024, the Company held an auction pursuant to the Bankruptcy Court approved bidding procedures order to sell its assets to qualified bidders pursuant to Section 363 of the Bankruptcy Code (the "Auction"). At the conclusion of the Auction, Iconix International, Inc., a Delaware corporation, and Hilco Merchant Resources, LLC, a Delaware limited liability company (together, the "Salt Life Buyers"), were selected as the successful bidder. Pursuant to Bankruptcy Court approval obtained on September 16, 2024, on September 19, 2024, the Company and Salt Life (together, the "Salt Life Sellers") entered into an asset purchase agreement (the "Salt Life Purchase Agreement") with the Salt Life Buyers, pursuant to which, subject to the terms and conditions set forth in the Salt Life Purchase Agreement, the Salt Life Buyers agreed to acquire certain assets related to the Salt Life Sellers' business of marketing, sourcing, licensing, and selling of Salt Life® branded products (collectively, the "Salt Life Assets") and assume certain specified liabilities of the Salt Life Sellers (collectively, the "Salt Life Liabilities" and such acquisition of the Salt Life Assets and assumption of the Salt Life Liabilities together, the "Salt Life Transaction"), for a total purchase price of approximately $35.94 million in cash (the "Salt Life Purchase Price"). The Salt Life Purchase Price is subject to adjustment after closing of the Salt Life Transaction based on final net accounts receivable and certain inventory calculations. The closing of the Salt Life Transaction occurred on September 19, 2024.

Soffe Asset Purchase Agreement

In connection with the Chapter 11 Cases and the Auction, on September 18, 2024, the Company and Soffe (together, the "Soffe Sellers") entered into an asset purchase agreement (the "Soffe Purchase Agreement") with Renfro LLC, a Delaware limited liability company (the "Soffe Buyer"), pursuant to which, subject to the terms and conditions set forth in the Soffe Purchase Agreement, the Soffe Buyer agreed to acquire certain assets related to the Soffe Sellers' business of sourcing, producing, manufacturing, marketing, licensing, and selling of Soffe branded products (collectively, the "Soffe Assets") and assume certain specified liabilities of the Soffe Sellers (collectively, the "Soffe Liabilities" and such acquisition of the Soffe Assets and assumption of the Soffe Liabilities together, the "Soffe Transaction"), for a total purchase price of approximately $15.3 million in cash (the "Soffe Purchase Price"), plus the payment of certain expenses. The closing of the Soffe Transaction occurred on September 20, 2024.

The foregoing summaries of the Salt Life Purchase Agreement and the Soffe Purchase Agreement are not complete and are qualified in their entirety by reference to the full text of such agreements, copies of which are attached hereto as Exhibit 2.1 and Exhibit 2.2, respectively, and are incorporated herein by reference.

The representations, warranties and covenants set forth in each of the Salt Life Purchase Agreement and the Soffe Purchase Agreement have been made only for purposes of the Salt Life Purchase Agreement and the Soffe Purchase Agreement and solely for the benefit of the respective parties thereto, and may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk between the respective parties to the Salt Life Purchase Agreement and the Soffe Purchase Agreement instead of establishing these matters as facts. In addition, information regarding the subject matter of the representations and warranties made in each of the Salt Life Purchase Agreement and the Soffe Purchase Agreement may change after the date of each such agreement and do not purport to be accurate as of the date of this Report. Accordingly, investors should not rely upon the representations and warranties in the Salt Life Purchase Agreement and the Soffe Purchase Agreement as statements of factual information.