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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the quarterly period ended June 29, 2002
or
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the transition period from to
Commission File Number 0-23161
Tropical Sportswear Int'l Corporation
(Exact name of registrant as specified in its charter)
Florida 59-3424305
(State or other jurisdiction of I.R.S. Employer
incorporation or organization) Identification No.
4902 W. Waters Avenue Tampa, FL 33634-1302
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (813) 249-4900
(Former name, former address and former fiscal year, if changed since last report.)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or
15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period the
registrant was required to file such reports), and (2) has been subject to such filing requirements for the past
90 days. [X] Yes [ ] No
As of August 8, 2002 there 11,040,084 shares of the registrant's Common Stock outstanding.
TROPICAL SPORTSWEAR INT'L CORPORATION
FORM 10-Q
TABLE OF CONTENTS
PART I Financial Information Page No.
--------
Item 1 Financial Statements 3
Item 2 Management's Discussion and Analysis of Financial Condition and
Results of Operations 14
Item 3 Quantitative and Qualitative Disclosures about Market Risk 21
PART II Other Information
Item 1 Legal Proceedings 21
Item 2 Changes in Securities 21
Item 3 Defaults upon Senior Securities 21
Item 4 Submission of Matters to a Vote of Security Holders 21
Item 5 Other Information 21
Item 6 Exhibits and Reports on Form 8-K 21
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
TROPICAL SPORTSWEAR INT'L CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(In thousands, except per share amounts)
Thirteen Thirteen Thirty-nine Thirty-nine
Weeks Ended Weeks Ended Weeks Ended Weeks Ended
June 29, June 30, June 29, June 30,
2002 2001 2002 2001
------------------ ------------------ ----------------- ------------------
Net sales $ 116,262 $ 107,328 $ 346,883 $ 329,403
Cost of goods sold 84,855 78,791 249,926 236,248
------------------ ------------------ ----------------- ------------------
Gross profit 31,407 28,537 96,957 93,155
Selling, general and
administrative
expenses 24,291 21,655 72,716 62,991
Other charges 12,316 596 12,316 2,774
------------------ ------------------ ----------------- ------------------
Operating income (loss) (5,200) 6,286 11,925 27,390
Other (income) expense:
Interest expense, net 3,520 3,653 10,681 11,557
Other, net (142) 281 (797) 863
------------------ ------------------ ----------------- ------------------
3,378 3,934 9,884 12,420
Income (loss) before income taxes (8,578) 2,352 2,041 14,970
Provision (benefit) for income taxes (2,947) 932 1,045 5,901
------------------ ------------------ ----------------- ------------------
Net income (loss) (5,631) 1,420 996 9,069
Foreign currency translations and
Other 905 437 1,142 (1,061)
------------------ ------------------ ----------------- ------------------
Comprehensive income (loss) $ (4,726) $ 1,857 $ 2,138 $ 8,008
================== ================== ================= ==================
Net income (loss) per common share:
Basic ($0.69) $0.19 $0.13 $1.19
================== ================== ================= ==================
Diluted ($0.69) $0.18 $0.12 $1.17
================== ================== ================= ==================
See accompanying notes.
TROPICAL SPORTSWEAR INT'L CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
June 29, September 29,
2002 2001
----------------- ------------------
ASSETS (unaudited) (audited)
Current Assets:
Cash and cash equivalents $ 40,480 $ 1,714
Accounts receivable, net 87,312 86,908
Inventories 83,246 73,083
Deferred income taxes 13,584 15,040
Prepaid expenses and other current assets 7,000 18,675
----------------- ------------------
Total current assets 231,622 195,420
Property and equipment, net 44,793 47,441
Intangible assets, including trademarks and goodwill, net 46,663 49,455
Other assets 16,773 16,914
----------------- ------------------
Total assets $ 339,851 $ 309,230
================= ==================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses $ 65,131 $ 61,973
Current portion of long-term debt and capital leases 1,252 2,542
----------------- ------------------
Total current liabilities 66,383 64,515
Long-term debt and capital leases 109,242 148,772
Deferred income taxes 6,187 6,402
Other non-current liabilities 3,176 3,274
----------------- ------------------
Total liabilities 184,988 222,963
Shareholders' Equity:
Preferred stock - -
Common stock 109 77
Additional paid in capital 85,277 18,851
Accumulated other comprehensive loss (2,033) (3,175)
Retained earnings 71,510 70,514
----------------- ------------------
Total shareholders' equity 154,863 86,267
----------------- ------------------
Total liabilities and shareholders' equity $ 339,851 $ 309,230
================= ==================
See accompanying notes.
TROPICAL SPORTSWEAR INT'L CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In thousands)
Thirty-nine Thirty-nine
Weeks Ended Weeks Ended
June 29, June 30,
2002 2001
------------------- -------------------
OPERATING ACTIVITIES
Net Income $ 996 $ 9,069
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 5,597 7,642
Deferred income taxes and other 778 (194)
Changes in operating assets and liabilities:
Accounts receivable (404) 13,173
Inventories (10,163) (2,933)
Prepaid expenses and other current assets 11,834 617
Accounts payable and accrued expenses 8,790 (8,745)
------------------ -------------------
Net cash provided by operating activities 17,428 18,629
------------------ -------------------
INVESTING ACTIVITIES
Capital expenditures (5,545) (5,210)
Other, net 86 276
------------------ -------------------
Net cash used in investing activities (5,459) (4,934)
------------------ -------------------
Financing activities
Net change in long-term debt and capital leases (40,833) (13,355)
Proceeds from sale of common stock 63,870 -
Proceeds from exercise of stock options 2,588 612
------------------ -------------------
Net cash provided by (used in) financing activities 25,625 (12,743)
------------------ -------------------
Change in currency translation and other 1,172 (723)
Net increase in cash and cash equivalents 38,766 229
Cash at beginning of period 1,714 1,767
------------------ -------------------
Cash at end of period $40,480 $1,996
================== ===================
See accompanying notes.
TROPICAL SPORTSWEAR INT'L CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
June 29, 2002 and September 29, 2001
(In thousands, except share and per share amounts)
1. BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements of Tropical Sportswear Int'l Corporation
(the "Company") include the accounts of Tropical Sportswear Int'l Corporation and its subsidiaries. These
financial statements have been prepared in accordance with the instructions for Form 10-Q and, therefore, do not
include all information and footnotes required by generally accepted accounting principles. The unaudited
condensed consolidated financial statements should be read in conjunction with the audited financial statements
and related notes included in the Company's Annual Report on Form 10-K for the year ended September 29, 2001. In
the opinion of management, the unaudited condensed consolidated financial statements contain all necessary
adjustments (which include only normal, recurring adjustments) for a fair presentation of the interim periods
presented. Operating results for the thirty-nine weeks ended June 29, 2002 are not necessarily indicative of
results that may be expected for the entire fiscal year ending September 28, 2002.
2. INVENTORIES
Inventories consist of the following:
June 29, September 29,
2002 2001
------------- --------------
Raw materials $6,748 $6,898
Work in process 16,492 14,327
Finished goods 64,960 58,858
Reserve for excess and slow moving inventory (4,954) (7,000)
------------- --------------
$83,246 $73,083
============= ==============
3. DEBT AND CAPITAL LEASES
Long-term debt and capital leases consist of the following:
June 29, September 29,
2002 2001
------------- --------------
Revolving credit line $ - $32,131
Real estate loan 7,000 13,968
Senior Subordinated Notes 100,000 100,000
Other 3,494 5,215
------------- --------------
110,494 151,314
Less current maturities 1,252 2,542
------------- --------------
$109,242 $148,772
============= ==============
4. EARNINGS PER SHARE
Basic and diluted net income per share are computed as follows:
Thirteen Thirteen Thirty-nine Thirty-nine
Weeks ended Weeks ended Weeks ended Weeks ended
June 29, June 30, June 29, June 30,
2002 2001 2002 2001
-------------- --------------- -------------- --------------
Numerator for basic net income (loss)
per share:
Net income (loss) $(5,631) $1,420 $ 996 $9,069
Denominator for basic net income (loss)
per share:
Weighted average shares of common
stock outstanding 8,204 7,661 7,877 7,646
Effect of dilutive stock options using
the treasury stock method - 133 224 94
-------------- --------------- -------------- --------------
Denominator for diluted net income
(loss) per share 8,204 7,794 8,101 7,740
============== =============== ============== ==============
Net income (loss) per common share:
Basic ($0.69) $0.19 $0.13 $1.19
============== =============== ============== ==============
Diluted ($0.69) $0.18 $0.12 $1.17
============== =============== ============== ==============
5. SAVANE CONSOLIDATION
On April 17, 2002, the Company announced a plan to consolidate the administrative, cutting and related functions
of its Savane division in El Paso, Texas into the Company's Tampa, Florida facility. The Company intends to
complete all aspects of this consolidation by March 2003. As part of the consolidation, the Company will vacate
its El Paso administration building and cutting facility. The Company is currently constructing additional
administrative offices in Tampa and the current Tampa cutting facility has sufficient capacity to accommodate the
consolidated cutting operation. The Company will continue to operate its distribution center in the El Paso
area. The consolidation is expected to result in a net reduction of approximately 140 associates, or
approximately 12% of the Company's domestic workforce. Positions eliminated through this consolidation include
administrative and cutting personnel.
The Company also announced the reorganization of its South Pacific division, including discontinuing production
in factories in Fiji that are partially owned by the Company. Product for the Company's South Pacific division
will be sourced globally through lower cost full-package imports.
As a result of these initiatives (internally referred to as "Project Synergy"), the Company recorded a pre-tax
charge totaling approximately $12.3 million in its third fiscal quarter of 2002 for severance, relocation, lease
termination, asset write-downs and other related costs. The Company expects to record an additional pre-tax
charge for Project Synergy of approximately $3.7 million within its next two fiscal quarters. As of June 29,
2002, the Company has accrued approximately $5.0 million related to exit costs which primarily consist of
severance, lease terminations and related expenses. As of June 29, 2002, no payments have been made related to
these accruals. The Company's effective tax rate was impacted by certain tax expenses included in Project
Synergy. Excluding the impact of these charges, the Company's effective tax rate would have been 37.5% for the
thirty-nine weeks ended June 29, 2002.
6. STOCK OFFERING
In June 2002, the Company completed a public offering of 3.0 million shares of common stock. The Company
received net proceeds of approximately $63.9 million, of which approximately $32.0 million was used to repay all
outstanding borrowings under the Facility, to pay down a portion of the Company's real estate loan, and to repay
certain capital lease obligations. The remaining $31.9 million will be used for the payment of the cash portion
of the Project Synergy charges, the construction of a new administration facility in Tampa, Florida and for
working capital and general corporate purposes, including acquisitions.
7. RECENT ACQUISITIONS AND RELATED EXIT RESERVES
On August 9, 2001, the Company completed the acquisition of 100% of the outstanding stock of Duck Head Apparel
Company, Inc. ("Duck Head"). The total purchase price, including cash paid for common stock acquired, cash paid
for the fair value of outstanding stock options, and cash paid for fees and expenses, amounted to $17.9 million.
Cash acquired totaled $5.5 million.
The acquisition was accounted for using the purchase method of accounting and the results of operations for Duck
Head have been included in the consolidated statements of income since the acquisition date. The preliminary
fair value of identifiable tangible and intangible net assets acquired was $28.2 million. This resulted in an
initial excess of the fair value of the net assets acquired over the purchase price of approximately $10.3
million. The Company then reduced the fair value assigned to Duck Head's long-lived assets, including trademarks
and property and equipment from $9.5 million to zero. The remaining $800,000 was recorded as an extraordinary
gain in the consolidated statement of income for the fiscal year ended September 29, 2001.
Subsequent to the acquisition, the Company began performing a thorough analysis of Duck Head's operations and
developed a plan to exit certain activities and terminate certain personnel. The major activities accomplished
to date include, among other things, the elimination of redundant personnel, the closure and subsequent sale of
Duck Head's administrative offices and distribution center in Georgia, the closure of certain retail outlet
stores, and the closure of Duck Head's garment assembly plant in Costa Rica. Personnel termination costs of
approximately $3.8 million related to the termination of approximately 415 of the 500 Duck Head employees, were
accrued in connection with the acquisition. As of June 29, 2002, all accrued termination costs had been paid.
As of June 29, 2002, the Company had remaining accruals of approximately $1.1 million related to estimated lease
termination costs for certain of Duck Head's retail outlet stores and other exit related activities. Additional
exit activity related to Duck Head's retail outlet stores is currently being performed. The Company expects to
complete these exit activities by the end of calendar 2002. Subsequent changes in the estimated fair value of
assets acquired or additional exit activities will be reflected as additional extraordinary gain or loss if
material, until the analysis is completed.
The Company has remaining accrued liabilities related to the acquisition of Savane of approximately $2.7 million
related to exit costs which primarily consist of estimated lease termination costs. The Company expects to
utilize these reserves in conjunction with the Project Synergy consolidation.
8. NEW ACCOUNTING PRONOUNCEMENTS
On September 30, 2001, the Company adopted Statement of Financial Accounting Standard No. 142, "Goodwill and
Other Intangible Assets" ("Statement No. 142"). Statement No. 142 includes requirements to test goodwill and
indefinite lived intangible assets for impairment rather than amortize them. Goodwill and other indefinite lived
intangible assets are tested for impairment, and any impairment charge resulting from the initial application of
Statement No. 142 would be classified as a cumulative change in accounting principle. The provisions of
Statement No. 142 require the completion of a transitional impairment test within six months of adoption, with
any impairment identified treated as a cumulative effect of a change in accounting principle. In accordance with
the provision of Statement No. 142, the Company performed its transitional impairment test during its second
fiscal quarter. The results of this test indicate that the Company's goodwill and other indefinite lived
intangible assets are not impaired, as the fair value of these assets exceed their carrying value.
In accordance with Statement No. 142, the Company discontinued the amortization of goodwill and other indefinite
lived intangible assets effective September 30, 2001. A reconciliation of previously reported net income and
earnings per share for the thirteen weeks and the thirty-nine weeks ended June 29, 2002 and June 30, 2001, to the
amounts adjusted for the exclusion of amortization net of the related income tax effect follows:
Thirteen Thirteen
Weeks ended Weeks ended
June 29, June 30,
2002 2001
--------------- ---------------
Reported net income (loss) $(5,631) $1,420
Add: Amortization, net of tax - 300
--------------- ---------------
Adjusted net income (loss) $(5,631) $1,720
=============== ===============
Basic earnings (loss) per share:
Reported net income (loss) $(0.69) $0.19
Amortization, net of tax - 0.04
--------------- ---------------
Adjusted net income (loss) per $(0.69) $0.23
share-basic
=============== ===============
Diluted earnings (loss) per share:
Reported net income (loss) $(0.69) $0.18
Amortization, net of tax - 0.04
-------------- ----------------
Adjusted net income (loss) per
share-diluted $(0.69) $0.22
============== ================
Thirty-nine Thirty-nine
Weeks ended Weeks ended
June 29, June 30,
2002 2001
--------------- ---------------
Reported net income $ 996 $9,069
Add: Amortization, net of tax - 902
--------------- ---------------
Adjusted net income $ 996 $9,971
=============== ===============
Basic earnings per share:
Reported net income $0.13 $1.19
Amortization, net of tax - 0.12
--------------- ---------------
Adjusted net income per share-basic $0.13 $1.31
=============== ===============
Diluted earnings per share:
Reported net income $0.12 $1.17
Amortization, net of tax - 0.12
--------------- ---------------
Adjusted net income per share-diluted $0.12 $1.29
=============== ===============
In October 2001, the Financial Accounting Standards Board issued Statement of Financial Accounting Standard No.
144, "Accounting for the Impairment or Disposal of Long-Lived Assets" ("Statement No. 144"). Statement No. 144
supersedes Statement of Financial Accounting Standard No. 121, "Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to be Disposed Of", and provides a single accounting model for long-lived assets
to be disposed of. The Company does not expect the adoption of Statement No. 144 to have a material impact on
its consolidated financial statements.
In April 2002, the FASB issued SFAS No.145, "Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB
Statement No. 13, and Technical Corrections" ("Statement 145") which is effective for fiscal years beginning
after May 15, 2002. This Statement rescinds FASB Statement No. 4, "Reporting Gains and Losses from
Extinguishment of Debt," as well as an amendment of that Statement, FASB Statement No. 64, "Extinguishments of
Debt Made to Satisfy Sinking-Fund Requirements" as debt extinguishments are no longer classified as extraordinary
items unless they meet the requirements in Accounting Principles Board Opinion No. 30 of being unusual and
infrequently occurring. Finally, this Statement amends other existing authoritative pronouncements to make
various technical corrections. The Company is currently evaluating the potential impact, if any, the adoption of
Statement 145 will have on its financial position and results of operations.
In June 2002, the FASB issued SFAS No. 146 "Accounting for Costs Associated with Exit or Disposal Activities"
("Statement 146") which is effective for exit or disposal activities that are initiated after December 31, 2002.
This statement nullifies EITF 94-3, "Liability Recognition for Certain Employee Termination Benefits and Other
Costs to Exit an Activity (including Certain Costs Incurred in a Restructuring)." Statement 146 requires that a
liability for a cost associated with an exit or disposal activity be recognized when the liability is incurred
and eliminates the definition and requirements of recognition of exit costs in EITF 94-3. The Company is
currently evaluating the potential impact, if any, the adoption of Statement 146 will have on its financial
position and results of operations.
9. SUPPLEMENTAL COMBINING CONDENSED FINANCIAL STATEMENTS
The Company's Senior Subordinated Notes, due 2008 (the "Notes") are jointly and severally guaranteed fully and
unconditionally by the Company's domestic subsidiaries which are 100% owned by Tropical Sportswear Int'l
Corporation (the "Parent"). The Company's wholly-owned foreign subsidiaries are not guarantors with respect to
the Notes and do not have any credit arrangements senior to the Notes except for their local overdraft facility
and capital lease obligations.
The following are the supplemental combining condensed statement of operations for the thirteen weeks and
thirty-nine weeks ended June 29, 2002, and the thirteen weeks and thirty-nine weeks ended June 30, 2001, the
supplemental combining condensed balance sheet as of June 29, 2002 and September 29, 2001, and the supplemental
combining condensed statement of cash flows for the thirty-nine weeks ended June 29, 2002, and the thirty-nine
weeks ended June 30, 2001. The only intercompany eliminations are the normal intercompany sales, borrowings and
investments in wholly-owned subsidiaries. Separate complete financial statements of the guarantor subsidiaries
are not presented because management believes that they are not material to investors.
Thirteen Weeks Ended June 29, 2002
-----------------------------------------------------------------------------
Statement of Operations Parent Guarantor Non-Guarantor
Only Subsidiaries Subsidiaries Eliminations Consolidated
--------- ------------- ------------ -------------- -------------
Net sales $ 50,435 $53,929 $12,225 $ (327) $ 116,262
Gross profit 12,865 14,388 4,154 - 31,407
Operating income (loss) 3,774 (8,346) (628) - (5,200)
Interest, income taxes and other, net 1,785 (560) (70) (724) 431
Net income (loss) 1,989 (7,786) (558) 724 (5,631)
Thirteen Weeks Ended June 30, 2001
-----------------------------------------------------------------------------
Statement of Operations Parent Guarantor Non-Guarantor
Only Subsidiaries Subsidiaries Eliminations Consolidated
--------- ------------- ------------ -------------- -------------
Net sales $ 50,556 $ 48,114 $ 9,083 $ (425) $107,328
Gross profit 12,413 12,786 3,338 - 28,537
Operating income 4,359 1,734 193 - 6,286
Interest, income taxes and other, net 2,284 2,396 (17) 203 4,866
Net income (loss) 2,075 (662) 210 (203) 1,420
Thirty-nine Weeks Ended June 29, 2002
-----------------------------------------------------------------------------
Statement of Operations Parent Guarantor Non-Guarantor
Only Subsidiaries Subsidiaries Eliminations Consolidated
--------- ------------- ------------ -------------- -------------
Net sales $152,158 $157,957 $37,467 $ (699) $346,883
Gross profit 38,692 45,638 12,627 - 96,957
Operating income 16,133 (5,060) 852 - 11,925
Interest, income taxes and other, net 7,331 3,087 319 192 10,929
Net income (loss) 8,802 (8,147) 533 (192) 996
Thirty-nine Weeks Ended June 30, 2001
----------------------------------------------------------------------------
Statement of Operations Parent Guarantor Non-Guarantor
Only Subsidiaries Subsidiaries Eliminations Consolidated
--------- ------------- ------------ -------------- -------------
Net sales $144,771 $155,708 $31,489 $ (2,565) $329,403
Gross profit 35,315 46,988 10,852 - 93,155
Operating income 12,633 13,360 1,397 - 27,390
Interest, income taxes and other, net 6,656 10,185 379 1,101 18,321
Net income 5,977 3,175 1,018 (1,101) 9,069
As of June 29, 2002
------------------------------------------------------------------------------
Balance Sheet Parent Guarantor Non-Guarantor
Only Subsidiaries Subsidiaries Eliminations Consolidated
----------- ------------- ------------- ------------- --------------
ASSETS
Cash and cash equivalents $37,103 $ 283 $ 3,094 $ - $ 40,480
Accounts receivable, net 35,894 39,316 12,102 - 87,312
Inventories 35,243 38,918 9,085 - 83,246
Other current assets 7,640 12,402 542 20,584
----------- ------------- ------------- ------------- --------------
Total current assets 115,880 90,919 24,823 - 231,622
Property and equipment, net 32,962 6,415 5,416 - 44,793
Investment in subsidiaries and other assets 149,603 61,299 (1,925) (145,541) 63,436
----------- ------------- ------------- ------------- -------------
Total assets $298,445 $158,633 $28,314 $(145,541) $339,851
=========== ============= ============= ============= ==============
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable and accrued liabilities 28,187 $30,350 $ 6,594 $ - $ 65,131
Current portion of long-term debt and
capital leases 270 950 32 - 1,252
----------- ------------- ------------- ------------- --------------
Total current liabilities 28,457 31,300 6,626 - 66,383
Long-term debt and noncurrent portion of
capital leases 107,714 1,434 94 - 109,242
Other noncurrent liabilities 470 8,923 (30) - 9,363
Shareholders' equity 161,804 116,976 21,624 (145,541) 154,863
----------- ------------- ------------- ------------- --------------
Total liabilities and shareholders'
equity $298,445 $158,633 $28,314 $(145,541) $339,851
=========== ============= ============= ============= ==============
As of September 29, 2001
------------------------------------------------------------------------------
Balance Sheet Parent Guarantor Non-Guarantor
Only Subsidiaries Subsidiaries Eliminations Consolidated
----------- ------------- ------------- ------------- --------------
ASSETS
Cash $ 190 $ 249 $ 1,275 $ - $ 1,714
Accounts receivable, net 33,955 45,958 6,995 - 86,908
Inventories 27,358 36,896 8,829 - 73,083
Other current assets 18,047 13,995 1,673 - 33,715
----------- ------------- ------------- ------------- --------------
Total current assets 79,550 97,098 18,772 - 195,420
Property and equipment, net 30,695 11,115 5,631 - 47,441
Investment in subsidiaries and other assets 152,586 55,686 1,908 (143,811) 66,369
----------- ------------- ------------- ------------- --------------
Total assets $262,831 $163,899 $26,311 $(143,811) $309,230
=========== ============= ============= ============= ==============
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable and accrued liabilities $27,832 $28,578 $5,563 $ - $ 61,973
Current portion of long-term debt and
capital leases 1,051 1,223 268 - 2,542
----------- ------------- ------------- ------------- --------------
Total current liabilities 28,883 29,801 5,831 - 64,515
Long-term debt and noncurrent portion of
capital leases 145,964 2,702 106 - 148,772
Other noncurrent liabilities 722 8,986 (32) - 9,676
Shareholders' equity 87,262 122,410 20,406 (143,811) 86,267
----------- ------------- ------------- ------------- --------------
Total liabilities and shareholders'
equity $262,831 $163,899 $26,311 $(143,811) $309,230
=========== ============= ============= ============= ==============
Thirty-nine Weeks Ended June 29, 2002
--------------------------------------------------------------------------------
Statement of Cash Flows Parent Guarantor Non-Guarantor
Only Subsidiaries Subsidiaries Eliminations Consolidated
----------- -------------- ------------- -------------- --------------
Net cash provided by operating activities $ 14,221 $ 2,026 $ 1,181 $ - $ 17,428
Net cash used in investing activities (4,287) (957) (215) - (5,459)
Net cash provided by (used in) financing
activities 27,373 (2,601) 853 - 25,625
Other (394) 1,566 - - 1,172
Net increase in cash 36,913 34 1,819 - 38,766
Cash and cash equivalents, beginning of
period 190 249 1,275 - 1,714
Cash and cash equivalents, end of period 37,103 283 3,094 - 40,480
Thirty-nine Weeks Ended June 30, 2001
--------------------------------------------------------------------------------
Statement of Cash Flows Parent Guarantor Non-Guarantor
Only Subsidiaries Subsidiaries Eliminations Consolidated
----------- -------------- ------------- -------------- --------------
Net cash provided by operating activities $ 15,324 $ 2,341 $ 964 $ - $ 18,629
Net cash used in investing activities (4,486) (198) (250) - (4,934)
Net cash used in financing activities (10,887) (1,143) (713) - (12,743)
Other - (723) - (723)
Net increase (decrease) in cash (49) 277 1 - 229
Cash, beginning of period 171 22 1,574 - 1,767
Cash, end of period 122 299 1,575 - 1,996
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
Our results of operations for fiscal 2001 and fiscal 2002 were adversely impacted by negative economic trends
including increasing unemployment, declines in the U.S. equity markets and decreased consumer confidence. These
trends have continued in fiscal 2002. During these periods, apparel retailers sought to increase consumer demand
and reduce inventories with aggressive price discounting, particularly in the department store channel. In
addition, certain producers made brands available to mass merchants and discounters that normally were distributed
through department and specialty stores. Although the Company's margins did decline during this period, the
Company maintained its strategy to not sacrifice the product quality, customer service, brand quality and
profitable results.
Additionally, sales from the Savane(R) brand have declined significantly since the beginning of fiscal 2002 due to
declines in the department store channel where the Savane(R) product is generally sold. The Company is expanding
its distribution of the Savane(R) brand through major new core replenishment programs with J.C. Penney, Kohl's
and Mervyn's. These programs which began shipping in the third quarter of fiscal 2002 are expected to reverse
the pattern of Savane's recent trends and bring sales back to fiscal 2001 levels.
The following discussion and analysis of the Company's results of operations is based upon our consolidated
financial statements, which have been prepared in accordance with accounting principles generally accepted in the
United States. The preparation of financial statements in conformity with generally accepted accounting
principles requires that we make estimates and assumptions that affect the reported amounts of assets,
liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. These estimates
and assumptions are based on historical and other facts believed to be reasonable under the circumstances, the
results of which form the basis for making judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ materially from these estimates under
different assumptions or conditions. We have chosen accounting policies that we believe are appropriate to
accurately and fairly report the Company's operating results and financial position, and we apply those
accounting policies in a consistent manner. We have identified the policies below as critical to our business
operations and the understanding of our results of operations.
Critical Accounting Policies
Contingencies - The Company accrues for contingent obligations, including estimated legal costs, when the
obligations are probable and the amount is reasonably estimable. As facts concerning contingencies become known,
we reassess our position and make appropriate adjustments to the financial statements. Estimates that are
particularly sensitive to future changes include tax, legal and other regulatory matters such as imports and
exports, which are subject to change as events evolve and as additional information becomes available during the
administrative and litigation process.
Inventories - Inventories are stated at the lower of cost or market. Cost is determined using the first-in,
first-out method. We evaluate our inventory by style, color and size to determine excess or slow moving product
based on projected sales. We record provisions for markdowns and losses on excess and slow-moving inventory to
the extent the cost of inventory exceeds estimated net realizable value. If actual market conditions or
competitive pressures change, the level of inventory reserves would change.
Reserve for Allowances and Doubtful Accounts - Accounts receivable consists of amounts due from our customers
from our normal business activities. We maintain a reserve for allowances and doubtful accounts which is based
on historical collection and deduction write-off experience, and an estimate of potential sales returns. We do
not provide a reserve for credit losses as substantially all of our receivables have been assigned under
factoring agreements, without recourse, except for credit losses on the first 0.10% of amounts factored.
Long-Lived Assets - We estimate the depreciable lives of our property, plant and equipment and review them for
impairment when events or circumstances indicate that their carrying amounts may be impaired. Most of our
property, plant and equipment is used in our cutting and distribution processes. We periodically evaluate the
carrying value of assets which are held for sale to determine if, based on market conditions, the values of these
assets should be adjusted. Although we believe we have appropriately recorded our assets held for sale at their
estimated realizable value, net of estimated disposal costs, the actual sale of these assets could result in
gains or losses which could differ from our estimated amounts. To assess the recoverability of goodwill and
other intangible assets, we make assumptions regarding estimated future cash flows and other factors to determine
whether the carrying values are recoverable from operations. If these assumptions or estimates change, we may be
required to record impairment charges to reduce the value of these assets.
As discussed in the Notes to the Financial Statements, we adopted Financial Accounting Standard No. 142,
"Goodwill and Other Intangible Assets" ("Statement No. 142") on September 29, 2001. Statement No. 142 includes
requirements to test goodwill and indefinite lived intangible assets for impairment rather than amortize them.
Goodwill and other indefinite lived intangible assets are tested for impairment, and any impairment charge
resulting from the initial application of Statement No. 142 would be classified as a cumulative change in
accounting principle. The provisions of Statement No. 142 require the completion of a transitional impairment
test within six months of adoption, with any impairment identified treated as a cumulative effect of a change in
accounting principle. In accordance with the provision of Statement No. 142, the Company performed this
transitional impairment test during the second fiscal quarter. The results of this test indicate that goodwill
and other indefinite lived intangible assets are not impaired, as the fair value of these assets exceed their
carrying value.
Valuation Allowances for Deferred Tax Assets - Valuation allowances are recorded to reduce deferred tax assets
if, based on the weight of the evidence, it is more likely than not that some or all of the deferred tax assets
will not be realized. The evidence considered in making that determination includes, offsetting deferred tax
liabilities, future taxable income, as well as prudent tax planning strategies. We have recorded deferred income
tax assets related to state net operating loss carryforwards, foreign net operating loss carryforwards, foreign
tax credit carryforwards and certain other accruals. We have recorded valuation allowances to reduce the deferred
tax assets relating to these operating loss carryforwards and accruals based on an evaluation of the benefits
expected to be realized. If we determine that we would be able to realize more of our net deferred tax assets,
than we currently expect, we would reduce the valuation allowance, which would have the effect of increasing
income in the period that we make the determination. Conversely, if we determine that we will not be able to
realize all or part of our net deferred tax assets in the future, we will increase the valuation allowance, which
would have the effect of reducing income in the period that we make the determination.
Savane Consolidation
On April 17, 2002, the Company announced a plan to consolidate the administrative, cutting and related functions
of its Savane division in El Paso, Texas into the Company's Tampa, Florida facility. The Company intends to
complete all aspects of this consolidation by March 2003. As part of the consolidation, the Company will vacate
its El Paso administration building and cutting facility. The Company is currently constructing additional
administrative offices in Tampa and the current Tampa cutting facility has sufficient capacity to accommodate the
consolidated cutting operation. The Company will continue to operate its distribution center in the El Paso
area. The consolidation is expected to result in a net reduction of approximately 140 associates, or
approximately 12% of the Company's domestic workforce. Positions eliminated through this consolidation include
administrative and cutting functions.
The Company also announced the reorganization of its South Pacific division, including discontinuing production
in factories in Fiji that are partially owned by the Company. Product for the Company's South Pacific division
will be sourced globally through lower cost full-package imports.
As a result of these initiatives (internally referred to as "Project Synergy"), the Company recorded a pre-tax
charge totaling approximately $12.3 million in its third fiscal quarter of 2002 for severance, relocation, lease
termination, asset write-downs and other related costs. The Company expects to record an additional pre-tax
charge for Project Synergy of approximately $3.7 million within its next two fiscal quarters. As of June 29,
2002, the Company has accrued approximately $5.0 million related to exit costs which primarily consist of
severance, lease terminations and related expenses. As of June 29, 2002, no payments have been made related to
these accruals.
Once completed, the impact of these initiatives is expected to generate annual pre-tax cost savings of
approximately $4.5 million beginning in fiscal 2003. The Company believes that Project Synergy will improve its
ability to service its customers through one centralized location.
Results of Operations
The following table sets forth, for the periods indicated, selected items in the Company's consolidated
statements of income expressed as a percentage of net sales:
Thirteen Thirteen Thirty-nine Thirty-nine
Weeks ended Weeks ended Weeks ended Weeks ended
June 29, June 30, June 29, June 30,
2002 2001 2002 2001
-------------- --------------- ---------------- --------------
Net sales 100.0% 100.0% 100.0% 100.0%
Cost of goods sold 73.0 73.4 72.0 71.7
-------------- --------------- ---------------- --------------
Gross profit 27.0 26.6 28.0 28.3
Selling, general and administrative 20.9 20.2 21.0 19.1
expenses
Other charges 10.6 0.5 3.6 0.9
-------------- --------------- ---------------- --------------
Operating income (loss) (4.5) 5.9 3.4 8.3
Interest expense, net 2.9 3.4 3.0 3.5
Other, net (0.1) 0.3 (0.2) 0.3
-------------- --------------- ---------------- --------------
Income (loss) before income taxes (7.3) 2.2 0.6 4.5
Provision (benefit) for income taxes (2.5) 0.9 0.3 1.8
-------------- --------------- ---------------- --------------
Net income (loss) (4.8)% 1.3% 0.3% 2.7%
============== =============== ================ ==============
Thirteen weeks ended June 29, 2002 compared to the thirteen weeks ended June 30, 2001
Net Sales. Net sales increased to $116.3 million for the third quarter of fiscal 2002 from $107.3
million in the comparable prior year quarter. This increase was primarily due to a 17% increase in units sold,
which was offset by lower average selling prices. The decrease in average selling prices was due to the Company
experiencing pricing pressure due to the weak retail conditions. Additionally, the average selling price was
impacted by a change in mix of product sales as the higher average selling priced Savane(R)products experienced
declines in unit volume as the department store channel that Savane was positioned in suffered declines in
sales. The Company is expanding its distribution of the Savane(R)brand through major new core replenishment
programs with retailers. The new expanded distribution is expected to more than offset Savane's recent adverse
trends in the declining moderate department store retail sector where Savane has traditionally been positioned.
Gross Profit. Gross profit increased to $31.4 million, or 27.0% of net sales, for the third quarter of
fiscal 2002, from $28.5 million, or 26.6% of net sales, for the comparable prior year quarter. The increase in
the gross margin was primarily due to a reduction in raw materials and assembly costs and other production
efficiencies.
Selling, General and Administrative Expenses. Selling, general and administrative expenses increased to
$24.3 million, or 20.9% of net sales, for the third quarter of fiscal 2002, from $21.7 million, or 20.2% of net
sales, for the comparable prior year quarter. The increase in operating expenses as a percentage of net sales was
primarily due to the higher relative operating expenses associated with the Duck Head and Victorinox branded
business, as the Company continues to make investments and provide additional marketing and financial support for
these growth brands.
Other Charges. Other charges for the third quarter of fiscal 2002 of $12.3 million relate to Project
Synergy and include reserves for severance, lease terminations, asset write-downs, and other related costs. Other
charges for the comparable prior year quarter of $596,000 relate to severance.
Interest Expense. Interest expense decreased to $3.5 million for the third quarter of fiscal 2002, from
$3.7 million for the comparable prior year quarter. The decrease was primarily due to lower average interest
rates.
Other, net. During the third quarter of fiscal 2002, the Company recorded other income of $142,000 as
compared with other expense of $281,000 for the third quarter of fiscal 2001. The change consisted primarily of
lower amortization expense and higher royalty income, offset in part by higher factor fees. In accordance with
Statement No. 142, the Company discontinued the amortization of its intangible assets effective September 30,
2001.
Income Taxes. The Company's effective income tax rate for the third quarter of fiscal 2002 was 34.4%
compared to 39.6% in the comparable prior year quarter. Excluding the impact of certain tax expenses included in
Project Synergy, the Company's effective tax rate would have been 37.5%. The decrease in the effective rate is
primarily the result of tax planning strategies implemented by the Company and the reduction of non-deductible
goodwill amortization. These rates are based on the Company's expected effective annual tax rate.
Net Income. As a result of the above factors, particularly the charges related to Project Synergy, the
Company incurred a net loss of $5.6 million for the third quarter of fiscal 2002 as compared with net income of
$1.4 million in the comparable prior year quarter.
Thirty-nine weeks ended June 29, 2002 compared to the thirty- nine weeks ended June 30, 2001
Net Sales. Net sales increased to $346.9 million for the thirty-nine weeks ended June 29, 2002 from
$329.4 million in the comparable prior year period. This increase was primarily due to a 19% increase in units
sold, a small portion of which related to sales of Duck Head(R)branded product, which was acquired in August
2001. This increase was offset by a decrease in average selling prices. The decrease in average selling prices
was due to the Company experiencing pricing pressure due to the weak retail conditions. Additionally, the
average selling price was impacted by a change in mix of product sales as the higher average selling priced
Savane(R)products experienced declines in unit volume as the department store channel that Savane was positioned in
suffered declines in sales. The Company is expanding its distribution of the Savane(R)brand through major new
core replenishment programs with retailers. The new expanded distribution is expected to more than offset
Savane's recent adverse trends in the declining moderate department store retail sector where Savane has
traditionally been positioned.
Gross Profit. Gross profit increased to $97.0 million, or 28.0% of net sales, for the thirty-nine weeks
ended June 29, 2002, from $93.2 million, or 28.3% of net sales, for the comparable prior year period. The
increase in the gross margin was primarily due to a reduction in raw materials and assembly costs and other
production efficiencies, offset in part by lower average selling prices.
Selling, General and Administrative Expenses. Selling, general and administrative expenses increased to
$72.7 million, or 21.0% of net sales, for the thirty-nine weeks ended June 29, 2002, from $63.0 million, or 19.1%
of net sales, for the comparable prior year period. The increase in operating expenses as a percentage of net
sales was primarily due to the higher relative operating expenses associated with the Duck Head and Victorinox
branded components of the business, as the Company continues to make investments and provide additional marketing
and financial support for these growth brands.
Other Charges. Other charges for the thirty-nine weeks ended June 29, 2002 of $12.3 million relate to
Project Synergy and include reserves for severance, lease terminations, asset write-downs, and other related
costs. Other charges for the comparable prior year period of $2.8 million relate to severance, in-process
research and development acquired in connection with the Victorinox(R)license, costs related to closure of a sewing
plant in Chihuahua, Mexico, and costs related to the unsuccessful pursuit of an acquisition.
Interest Expense. Interest expense decreased to $10.7 million for the thirty-nine weeks ended June 29,
2002, from $11.6 million for the comparable prior year period. The decrease was primarily due to lower average
interest rates. During this period, the Company's average borrowings remained relatively flat.
Other, net. During the thirty-nine weeks ended June 29, 2002, the Company recorded other income of
$797,000 as compared with other expense of $863,000 for the thirty-nine weeks ended June 30, 2001. The change
consisted primarily of lower amortization expense and higher royalty income, offset in part by higher factor
fees. In accordance with Statement No. 142, the Company discontinued the amortization of its intangible assets
effective September 30, 2001.
Income Taxes. The Company's effective income tax rate for thirty-nine weeks ended June 29, 2002 was
51.2% compared to 39.4% in the comparable prior year period. Excluding the impact of certain tax expenses
included in Project Synergy, the Company's effective tax rate would have been 37.5%. The decrease in the
effective rate is primarily the result of tax planning strategies implemented by the Company and the reduction of
non-deductible goodwill amortization. These rates are based on the Company's expected effective annual tax rate.
Net Income. As a result of the above factors, particularly the charges related to Project Synergy, net
income decreased to $1.0 million for the thirty-nine weeks ended June 2002 from $9.1 for the thirty-nine weeks
ended June 29, 2001.
Liquidity and Capital Resources
The Company's revolving credit line (the "Facility") provides for borrowings of up to $110 million, subject to
certain borrowing base limitations. Borrowings under the Facility bear variable rates of interest and are secured
by substantially all of the Company's domestic assets. The Facility matures in June 2003. As of June 29, 2002,
the Company had no outstanding borrowings under the Facility.
In June 2002, the Company completed a public offering of 3.0 million shares of common stock. The Company
received net proceeds of approximately $63.9 million, of which approximately $32.0 million was used to repay all
outstanding borrowings under the Facility, to pay down a portion of the Company's real estate loan, and to repay
certain capital lease obligations. The remaining $31.9 million will be used for the payment of the cash portion
of the Project Synergy charges, the construction of a new administration facility in Tampa, Florida and for
working capital and general corporate purposes, including acquisitions.
Capital expenditures totaled $5.5 million for the thirty-nine weeks ended June 29, 2002 and are expected to
approximate $11.0 million for the entire fiscal year. The expenditures expected for the remainder of the fiscal
year primarily relate to the construction of an administration building in Tampa, Florida, which is expected to be
completed during the quarter ended March 2003, and the upgrade or replacement of various other equipment and
computer systems including hardware and software.
During the thirty-nine weeks ended June 29, 2002, the Company generated $17.4 million of cash from its
operations. This was primarily the result of net income of $1.0 million (which included non-cash expenses of $6.4
million), a decrease in prepaid expenses and other current assets of $11.8 million (which included net cash
proceeds of approximately $6.7 million from the sale of the former Duck Head headquarters and distribution
center), an increase in accounts payable and accrued expenses of $8.8 million, and an increase in accounts
receivable of $0.4 million, offset in part by an increase in inventories of $10.2 million.
In connection with Project Synergy, the Company expects to utilize a total of approximately $13.0 million in cash
from its third fiscal quarter of 2002 through its first fiscal quarter of 2003, related to payments for employee
separations, employee relocation, moving costs and costs to terminate certain operating leases.
During the thirty-nine weeks ended June 29, 2002, the Company generated $25.6 million of cash from financing
activities, principally related to net proceeds of $63.9 million from the public offering of 3.0 million shares of
common stock in June 2002. Net proceeds from the offering were utilized to repay certain borrowings noted above.
The Company believes that its existing working capital, borrowings available under the Facility and internally
generated funds provide sufficient resources to support current business activities. To the extent that the
Company seeks to accelerate its growth plans, the Company may need to raise additional capital either through the
issuance of equity or debt securities or additional credit facilities.
Seasonally
Historically, the Company's business has been seasonal, with slightly higher sales and income in the second and
third fiscal quarters. In addition, certain of the Company's products, such as shorts and corduroy pants, tend to
be seasonal in nature. In the event such products represent a greater percentage of the Company's sales in the
future, the seasonally of the Company's sales may be increased.
Factors Affecting the Company's Business and Prospects
This report contains forward-looking statements subject to the safe harbor created by the Private Securities
Litigation Reform Act of 1995. Management cautions that these statements represent projections and estimates of
future performance and involve certain risks and uncertainties. The Company's actual results could differ
materially from those anticipated in these forward-looking statements as a result of certain factors including,
without limitation: difficulties in achieving continued operating efficiencies; our inability to achieve
projected revenue and earnings growth in fiscal 2002; disruptions in the business associated with the
consolidation of the cutting and administrative functions of the Savane division from El Paso, Texas to Tampa,
Florida; disruptions in the business associated with discontinuing production in the partially owned plants in
Fiji; failure to achieve the planned cost savings associated with the consolidation and reorganization; failure
of the Company's customers to accept the Company's post-consolidation integrated production and selling of
products; restrictions and limitations placed on us by our debt instruments; general economic conditions,
including but not necessarily limited to, recession or other cyclical effects impacting our customers in the
United States or abroad, changes in interest rates or currency exchange rates; potential changes in demand in the
retail market; reduction in the level of the consumer spending; the availability and price of raw materials and
global manufacturing costs and restrictions; increases in costs; the continued acceptance of the Company's
existing and new products by its major customers; the financial strength of the Company's major customers; delays
or other difficulties in implementing the Company's business plans for Duck Head; delays associated with the
timing of shipment and acceptance of the Victorinox(R)apparel line; the ability of the Company to continue to use
certain licensed trademarks and tradenames, including Victorinox(R), John Henry(R), Bill Blass(R), and Van
Heusen(R); business disruptions and costs arising from acts of terrorism or other military activities around the
globe; and other risk factors listed from time to time in the Company's SEC reports, filings and announcements,
including its Annual Report on Form 10-K. In addition, the estimated financial results for any period do not
necessarily indicate the results that may be expected for any future period, and the Company undertakes no
obligation to update them.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
The Company's market risk is primarily limited to fluctuations in interest rates as it pertains to the Company's
borrowings under the Facility and the Real Estate Loan. There have been no material changes to the Item 7A
disclosure made in the Company's Annual Report on Form 10-K for the fiscal year ended September 29, 2001.
PART II OTHER INFORMATION
Item 1. Legal Proceedings
Not Applicable
Item 2. Changes in Securities
Not Applicable
Item 3. Defaults upon Senior Securities
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
Not Applicable
Item 5. Other Information
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
(a) The Exhibits to this report on Form 10-Q are listed on the Exhibit Index, which immediately
follows the signature page hereto.
(b) Reports on Form 8-K
None
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 by the undersigned thereunto duly authorized.
TROPICAL SPORTSWEAR INT'L CORPORATION
-------------------------------------
(Registrant)
/s/ N. Larry McPherson
N. Larry McPherson
Executive Vice President,
Chief Financial Officer,
and Treasurer
(in the dual capacity of duly authorized
officer and principal accounting officer)
August 12, 2002
Index to Exhibits
Exhibit
Number Description
- ------ -----------
*3.1 Amended and Restated Articles of Incorporation of Tropical Sportswear Int'l Corporation (filed
as Exhibit 3.1 to Tropical Sportswear Int'l Corporations Form 10-Q filed May 14, 2002).
3.2 Amended and Restated By-Laws of Tropical Sportswear Int'l Corporation (filed herewith).
*4.1 Specimen Certificate for the Common Stock of Tropical Sportswear Int'l Corporation (filed as
Exhibit 4.1 to Amendment No. 1 to Tropical Sportswear Int'l Corporation's Registration
Statement on Form S-1 filed October 2, 1997).
*4.2 Shareholders' Agreement dated as of September 29, 1997 among Tropical Sportswear Int'l
Corporation, William W. Compton, the Compton Family Limited Partnership, Michael Kagan, the
Kagan Family Limited Partnership, Shakale Internacional, S.A. and Accel, S.A. de C.V. (filed as
Exhibit 4.2 to Amendment No. 1 to Tropical Sportswear Int'l Corporation's Registration
Statement on Form S-1 filed October 2, 1997).
*4.3 Indenture dated as of June 24, 1998 among Tropical Sportswear Int'l Corporation, the Subsidiary
Guarantors named therein, and SunTrust Bank, Atlanta, as trustee (filed as Exhibit 4.4 to
Tropical Sportswear Int'l Corporation's Registration Statement on Form S-4 filed August 20,
1998).
*4.4 Shareholder Protection Rights Agreement, dated as of November 13, 1998, between Tropical
Sportswear Int'l Corporation and Firstar Bank Milwaukee, N.A. (which includes as Exhibit B
thereto the Form of Right Certificate) (filed as Exhibit 99.1 of Tropical Sportswear Int'l
Corporation's current report on Form 8-K dated November 13, 1998).
*4.5 Supplemental Indenture No. 1 dated as of August 23, 2000 among Tropical Sportswear Int'l
Corporation, each of the New Subsidiary Guarantors named therein, and SunTrust Bank, Atlanta,
as trustee (filed as Exhibit 4.5 to Tropical Sportswear Int'l Corporation's Annual Report on
Form 10-K filed December 19, 2000).
10.1 Eleventh Amendment to Loan and Security Agreement with Fleet Capital Corporation dated May
22, 2002 (filed herewith).
10.2 Note Amendment Agreement to Renewal and Replacement Promissory Note with Bank of America, N.A.
dated June 26, 2002 (filed herewith)
10.3 Amendment to Loan Agreement with Bank of America, N.A. dated March 31, 2002 (filed herewith).
* Incorporated by reference.