EXHIBIT 2.3 ASSET PURCHASE AGREEMENT

Asset Purchase Agreement

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Title: EXHIBIT 2.3 ASSET PURCHASE AGREEMENT
Governing Law: Georgia Date: 2/9/2005
Industry: Apparel/Accessories Law Firm: Wyche, Burgess, Freeman & Parham, P.A.; Kilpatrick Stockton LLP Sector: Consumer Cyclical

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EXHIBIT 2.3

ASSET PURCHASE AGREEMENT

between

DELTA APPAREL, INC.

and

PARKDALE AMERICA, LLC

Dated as of November 18, 2004

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Table of Contents

(continued)

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ARTICLE 1. - SALE AND PURCHASE OF ASSETS.................................. 1

1.1 Sale and Purchase of Assets.................................... 1

1.2 Excluded Assets................................................ 2

1.3 Closing........................................................ 2

1.4 Purchase Price................................................. 3

1.5 Excluded Liabilities........................................... 3

1.6 Closing Date Deliveries........................................ 4

1.7 Further Assurances............................................. 4

1.8 Allocation of Purchase Price................................... 5

ARTICLE 2. - REPRESENTATIONS AND WARRANTIES............................... 5

2.1 Representations and Warranties as to Seller.................... 5

2.1.1 Corporate Status...................................... 5

2.1.2 Conflicts, Consents................................... 5

2.1.3 Real Property......................................... 6

2.1.4 Personal Property..................................... 6

2.1.5 Litigation............................................ 7

2.1.6 No Judgments or Orders................................ 7

2.1.7 Compliance with Laws, Permits......................... 7

2.1.8 Tax Matters........................................... 7

2.1.9 Labor Matters......................................... 8

2.1.10 Environmental......................................... 8

2.1.11 Brokers, Finders...................................... 10

2.1.12 No Other Representations.............................. 10

2.2 Representations and Warranties of Purchaser.................... 10

2.2.1 Corporate Status...................................... 10

2.2.2 Authorization......................................... 10

2.2.3 Conflicts, Consents................................... 11

2.2.4 Litigation............................................ 11

2.2.5 Brokers, Finders...................................... 11

ARTICLE 3. - CERTAIN COVENANTS............................................ 11

3.1 Access and Information......................................... 11

3.2 Conduct of Business of the Seller.............................. 12

3.3 Efforts to Consummate Transaction.............................. 12

3.4 Consents and Approvals; Releases............................... 12

3.5 Exclusive Dealing.............................................. 12

3.6 Employee Matters............................................... 12

3.7 Tax Matters.................................................... 14

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3.8 Prorations..................................................... 15

3.9 Non-Solicitation............................................... 15

ARTICLE 4. - CONDITIONS PRECEDENT......................................... 16

4.1 Conditions to Obligations of Purchaser......................... 16

4.1.1 Representations, Performance, etc........................ 16

4.1.2 Certain Approvals........................................ 16

4.1.3 No Litigation or Injunction.............................. 16

4.1.4 No Material Adverse Change............................... 16

4.1.5 Transfer Documents....................................... 16

4.1.6 Opinion of Counsel....................................... 17

4.1.7 Supply Agreement......................................... 17

4.1.8 Title Insurance.......................................... 17

4.1.9 Environmental Assessment................................. 17

4.2 Conditions to Obligations of Seller............................ 17

4.2.1 Representations, Performance, etc........................ 17

4.2.2 Certain Approvals........................................ 17

4.2.3 No Litigation or Injunction.............................. 18

4.2.4 Transfer Documents....................................... 18

4.2.5 Opinion of Counsel....................................... 18

4.2.6 Supply Agreement......................................... 18

ARTICLE 5. - TERMINATION.................................................. 18

5.1 Grounds for Termination........................................ 18

5.1.1 Termination by Seller.................................... 18

5.1.2 Termination by Purchaser................................. 18

5.1.3 Termination by Either Party.............................. 18

5.2 Effect of Termination.......................................... 19

ARTICLE 6. - INDEMNIFICATION.............................................. 19

6.1 Indemnification by Seller...................................... 19

6.2 Survival Period of Seller's Indemnification Obligations........ 20

6.3 Indemnification By Purchaser................................... 21

6.4 Survival Period of Purchaser's Indemnification Obligations..... 21

6.5 Notice of Claims............................................... 22

6.6 Third Party Claims............................................. 22

6.7 Exclusivity.................................................... 23

ARTICLE 7. - MISCELLANEOUS................................................ 23

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7.1 Survival......................................................... 23

7.2 Expenses......................................................... 23

7.3 Assignment; Successors; Parties in Interest...................... 23

7.4 Amendment and Modification....................................... 23

7.5 Bulk Sales Law................................................... 24

7.6 Notices.......................................................... 24

7.7 Captions......................................................... 25

7.8 Entire Agreement................................................. 25

7.9 Counterparts..................................................... 25

7.10 Severability..................................................... 25

7.11 Arbitration...................................................... 25

7.12 Confidential Nature of Information............................... 26

7.13 Public Announcement.............................................. 26

7.14 Schedules and Exhibits........................................... 26

7.15 Definitions...................................................... 26

7.16 Governing Law.................................................... 30

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ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT (the "Agreement") is entered into as o f

November 18, 2004 by and between PARKDALE AMERICA, LLC, a North Carolina limited

liability company ("Purchaser"), and DELTA APPAREL, INC., a Georgia corporation

("Seller").

W I T N E S S E T H

WHEREAS, Seller is engaged in, among other things, the operation of a

yarn-spinning facility located at 32 Rabbit Trail, Edgefield, South Carolina

(the "Edgefield Facility"); and

WHEREAS, Seller desires to sell, assign, and transfer to Purchaser, and

Purchaser desires to purchase and acquire from Seller, substantially all of the

assets and properties used in the operation of the Edgefield Facility (the

"Business"), upon the terms and subject to the conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual promises made herein and of

the mutual benefits to be derived herefrom, the parties hereto agree as follows

(certain capitalized terms used in this Agreement are defined in SECTION 7.15

hereof):

ARTICLE 1.- SALE AND PURCHASE OF ASSETS

1.1 Sale and Purchase of Assets. Subject to all of the terms and

conditions of this Agreement and in reliance upon the representations and

warranties contained herein, at the Closing provided for in SECTION 1.3, Seller

shall sell, transfer, assign, convey, and deliver to Purchaser, free and clear

of all Liens (other than Permitted Liens), and Purchaser shall purchase from

Seller, all right, title, and interest of Seller in and to all of the assets and

properties of every nature, kind, and description, tangible and intangible,

whether real, personal, or mixed, whether contingent or otherwise, whether now

existing or hereinafter acquired, whether or not reflected on Seller's books,

used or held for use in the operation of the Business, excluding in all cases

only the Excluded Assets, as the same may exist as of the Closing Date

(collectively, the "Assets"), including, without limitation, all right, title,

and interest of Seller in, to, and under:

(a) The Edgefield Facility, together with the real property described on

SCHEDULE 1.1(a) and the buildings, fixtures and improvements located thereon

(the "Real Property");

(b) All machinery and equipment, tools, business machines, computers,

terminals, computer equipment, telephones, telephone systems, furniture, office

equipment, furnishings, vehicles, trucks, forklifts, rolling stock, trailers,

and storage units located at the Edgefield Facility and any and all assignable

warranties of third parties with respect thereto, including, without limitation,

all personal property listed on SCHEDULE 2.1.4;

Facility (the "Inventory");

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(d) To the extent transfer is permitted by Applicable Law, all licenses,

permits, and orders issued by any Governmental Authority with respect to the

operation of the Business, including, without limitation, those listed on

SCHEDULE 2.1.7(b);

(e) All credits, prepaid rentals, and other prepaid expenses, deferred

charges, advance payments, security deposits, and prepaid items relating to the

Assets (excluding, however, prepaid insurance relating to the Business);

(f) Proceeds from any insurance or indemnity claims pending but

unresolved as of the Closing Date with respect to any of the Assets;

(g) All choses in action, claims, and demands of any nature against

third parties, whether by way of counterclaim or otherwise, with respect to the

ownership, use, function, or value of any of the Assets, regardless of when such

choses in action, claims, and demands arise;

(h) All books, records, files, invoices, data bases, computer programs,

manuals and other materials (in any form or medium) relating to the operation of

the Edgefield Facility, including, without limitation, personnel records of

Hired Employees (except to the extent transfer or disclosure thereof is

restricted by Applicable Law); and

(i) All goodwill attributable to the operation of the Business.

1.2 Excluded Assets. Notwithstanding the foregoing or any other

provision of this Agreement to the contrary, Seller will retain and not

transfer, and Purchaser will not purchase or acquire, the following

(collectively, the "Excluded Assets"):

(a) All contracts, arrangements, leases and other agreements relating to

the Business, including, without limitation, any right to receive payment

pursuant to such contracts, arrangements, leases and other agreements;

(b) All leased machinery, equipment and other items of personal property

listed on SCHEDULE 1.2(b);

Business prior to the Closing Date;

(d) All prepaid insurance relating to the Business; and

(e) All cash and cash equivalents attributable to the operation of the

Business prior to the Closing Date.

1.3 Closing. Subject to the satisfaction or waiver of all respective

conditions to each party's obligations to close, the purchase and sale of the

Assets and the consummation of the transactions contemplated hereby (the

"Closing") shall be consummated at the offices of Kilpatrick Stockton LLP in

Charlotte, North Carolina on December 31, 2004, or at such other place, time, or

date as the parties hereto may agree in writing (the "Closing Date"), effective

as of 11:59 p.m. on the Closing Date.

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1.4 Purchase Price.

(a) The purchase price to be paid by Purchaser to Seller for the sale,

transfer, and conveyance of the Assets shall be the sum of (a) $10,000,000 plus

(b) the Stated Value of the Inventory (the "Purchase Price") payable by

Purchaser to Seller in cash on the Closing Date.

(b) On or immediately prior to the Closing Date, Purchaser and Seller

(and/or their respective representatives) shall conduct a physical audit of all

of the Inventory and Seller shall deliver to Purchaser a certificate executed by

an executive officer of Seller and setting forth, in reasonable detail, the

quantity and Stated Value of the Inventory.

1.5 Excluded Liabilities. Notwithstanding any provision of this

Agreement to the contrary, Purchaser shall not assume any liabilities,

obligations, or commitments of Seller relating to or arising out of the

operation of the Business or the ownership of the Assets other than the Assumed

Liabilities, and all such liabilities, obligations, and commitments shall be

retained by Seller (the "Excluded Liabilities"). Without limiting the generality

of the foregoing, all of the following shall be Excluded Liabilities for

purposes of this Agreement:

(i) All trade accounts payable, accrued payroll, and accrued employee

benefits relating to the Business;

(ii) All Taxes (whether pursuant to existing laws and regulations or laws

and regulations subsequently enacted by any Governmental Authority)

which arise from (A) the operation of the Business prior to the

Closing Date; (B) the ownership of the Assets prior to the Closing

Date; or (C) the consummation of the transactions contemplated

herein;

(iii) All costs, expenses, liabilities, or obligations incurred by Seller

incident to the negotiation and preparation of this Agreement and

its performance and compliance with the agreements and conditions

contained herein;

(iv) All liabilities and obligations of Seller arising from or in

connection with recalls mandated by any Governmental Authority with

respect to, or product liability claims relating to, products

manufactured or sold by Seller prior to the Closing Date;

(v) All liabilities or obligations of Seller relating to any

Environmental Damages arising out of (i) the ownership or operation

of the Assets or the Business prior to the Closing or (ii) any

Release at, to, on or from the Real Property prior to the Closing

Date, whether or not disclosed in any schedule to this Agreement or

otherwise known to Purchaser;

(vi) All liabilities of Seller for the unpaid Taxes of any Person under

Reg. 1.1502-6 of the Code (or any other similar provision of state,

local, or foreign law) as a transferee or successor, by contract, or

otherwise;

(vii) All liabilities or obligations of Seller for borrowed money or

evidenced by bonds, debentures, notes, drafts, or similar

instruments;

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(viii) All liabilities or obligations of Seller under any of the Plans or

relating to payroll, vacation, sick leave, workers' compensation,

unemployment benefits, pension benefits, employee stock option or

profit-sharing plans, health care plans, or any other employee plans

or benefits of any kind for employees of Seller;

(ix) All liabilities or obligations of Seller relating to any claims by

employees of Seller, whether pending as of Closing or arising after

Closing, due to acts, alleged acts, or omissions of Seller under any

federal labor or employment laws or state laws relating to or

arising out of the employment relationship with Seller or the

termination thereof, including, without limitation, any claims under

the National Labor Relations Act, Fair Labor Standards Act, Family

and Medical Leave Act, Title VII of the Civil Rights Act of 1964,

Americans with Disabilities Act, Age Discrimination in Employment

Act, and the Civil Rights Act of 1866 and 1970;

(x) All liabilities or obligations under any employment, severance,

retention, or termination agreement between Seller and any of its

employees;

(xi) All liabilities or obligations of Seller with respect to any

actions, suits, proceedings, or possible claims, whether such

actions, suits, proceedings, or possible claims are currently

pending, threatened, contingent, or otherwise, to the extent such

claims arise out of the conduct of the Business on or prior to the

Closing Date, including any such matters disclosed on SCHEDULE 2.1.5

and without regard to whether any such actions, suits, proceedings,

or possible claims are described on SCHEDULE 2.1.5; and

(xii) All liabilities or obligations relating to the Excluded Assets.

1.6 Closing Date Deliveries.

(a) On the Closing Date, Seller shall deliver or cause to be delivered

to Purchaser all of the documents, instruments, and opinions required to be

delivered by Seller pursuant to SECTION 4.1.

(b) On the Closing Date, Purchaser shall deliver or cause to be

delivered to Seller (i) the Purchase Price; and (ii) all of the documents,

instruments, and opinions required to be delivered by Purchaser pursuant to

SECTION 4.2.

1.7 Further Assurances. On the Closing Date, Seller shall (i) deliver to

Purchaser such other bills of sale, deeds, endorsements, assignments, and other

good and sufficient instruments of conveyance and transfer, in form reasonably

satisfactory to Purchaser and its counsel, as Purchaser may reasonably request

or as may be otherwise reasonably necessary to vest in Purchaser all the right,

title, and interest of Seller in, to, or under all of the Assets, and (ii) take

all steps as may be reasonably necessary to put Purchaser in actual possession

and control of all the Assets. From time to time following Closing, the parties

shall execute and deliver, or cause to be executed and delivered, to each other

such other instruments and documents as may be reasonably requested or as may be

otherwise reasonably necessary to consummate the transactions contemplated

hereunder. Notwithstanding anything in this SECTION 1.7 to the contrary, this

Agreement shall not constitute an agreement to assign any license, certificate,

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approval, authorization, agreement, contract, lease, or other commitment

included in the Assets if an attempted assignment thereof without the consent of

a third party thereto or Governmental Authority would constitute a breach

thereof or a violation of Applicable Law. If any such consent shall not be

obtained or if any attempted assignment would be ineffective, Seller shall

cooperate to the extent permitted by law with Purchaser, at Seller's sole cost

and expense, in any other reasonable arrangement designed to provide to

Purchaser the benefits of any such license, certificate, approval,

authorization, agreement, contract, lease, or other commitment.

1.8 Allocation of Purchase Price. The Purchase Price shall be allocated

among the Assets in the manner set forth on SCHEDULE 1.8. Seller and Purchaser

agree that such allocation is a fair and reasonable allocation of the Purchase

Price, and Seller and Purchaser shall file all applicable tax returns and

reports (including IRS Form 8594 issued pursuant to Section 1060 of the Code) in

accordance with and based upon such allocation and shall not take any position

in any tax return or report, or any tax proceeding or audit, that is

inconsistent with such allocation.

ARTICLE 2. - REPRESENTATIONS AND WARRANTIES

2.1 Representations and Warranties as to Seller. Seller represents and

warrants to Purchaser as follows:

2.1.1 Corporate Status.

(a) Corporate Existence. Seller is a corporation duly organized, validly

existing, and in good standing under the laws of the State of Georgia and has

all requisite corporate power and authority to own, lease, and operate its

properties and to carry on its business as presently conducted. Seller is duly

qualified and in good standing as a foreign corporation duly authorized to do

business in South Carolina.

(b) Authorization. Seller has full power and authority to execute and

deliver this Agreement, to consummate the transactions contemplated hereby, and

to perform its obligations hereunder. The execution and delivery of this

Agreement and the consummation of the transactions contemplated hereby have been

duly authorized by all requisite corporate action on the part of Seller. This

Agreement has been duly executed and delivered by Seller and constitutes the

legal, valid, and binding obligation of Seller, enforceable against it in

accordance with its terms. The other agreements and instruments to be executed

by Seller in connection with this Agreement, when executed and delivered by

Seller, will constitute the legal, valid, and binding obligations of Seller,

enforceable against Seller in accordance with their respective terms.

2.1.2 Conflicts, Consents.

(a) Conflicts. Except as set forth on SCHEDULE 2.1.2, the execution and

delivery of this Agreement and the consummation of the transactions contemplated

hereby in the manner contemplated hereby will not (x) result in the creation of

any Lien upon any of the Assets; or (y) conflict with or result in any violation

of or default under (or any event that, with notice or lapse of time or both,

would constitute a default under), require any consent, notice, or other action

under, or result in the acceleration or required prepayment of any indebtedness

pursuant to the terms of, any provision of (i) the Articles of Incorporation or

the Bylaws of Seller, (ii) any

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mortgage, indenture, loan agreement, note, bond, deed of trust, or other

agreement, commitment, or obligation for the borrowing of money or the obtaining

of credit, material lease, or other material agreement, contract, license,

franchise, permit, or instrument to which Seller is a party or by which Seller

or its properties may be bound, or (iii) any material judgment, order, decree,

law, statute, rule, or regulation applicable to Seller or any of the Assets.

(b) Consents. Except as set forth on SCHEDULE 2.1.2 and except as could

not reasonably be expected to have a Material Adverse Effect, no consent,

approval, authorization, permit, order, filing, registration, or qualification

of or with any court, Governmental Authority, or third Person is required to be

obtained by Seller (whether under Applicable Law, pursuant to agreements to

which Seller is a party, or otherwise) in connection with the execution and

delivery of this Agreement or the consummation by Seller of the transactions

contemplated hereby in the manner contemplated hereby.

2.1.3 Real Property.

(a) The Seller has good and marketable title in fee simple to the Real

Property free and clear of any Liens other than (i) Permitted Liens and (ii)

Liens set forth on SCHEDULE 2.1.3, which Liens shall be released in full at or

prior to Closing. The Seller has furnished Purchaser with true and complete

copies of all deeds, other instruments of title and policies of insurance

describing the Seller's ownership of the Real Property. The Real Property,

including the buildings and operations of the Seller conducted thereon, is in

compliance with all Applicable Laws relating to zoning and does not encroach on

any property of others.

(b) The Seller is not in violation of, or default under, any Applicable

Law pertaining to the Real Property, which violation or default could reasonably

be expected to have a Material Adverse Effect, and no notice of violation of any

Applicable Law, or of any covenant, condition, restriction or easement affecting

any Real Property or with respect to the use or occupancy thereof, has been

given by any Person.

utilities and other services necessary for the operation of such structures, and

the business conducted by the Seller therein, including gas, electricity, water,

telephone, sanitary sewer and storm sewer.

(d) No condemnation proceeding is pending or, to the knowledge of the

Seller, threatened which would impair the occupancy, use or value of the Real

Property.

(e) There are no (a) leases, subleases, licenses, concessions or other

agreements, written or oral, granting to any other Person the right to acquire,

use or occupy any portion of, the Real Property, (b) outstanding options or

rights of first refusal to purchase all or any portion of Real Property or

interest therein, or (c) Persons (other than the Seller) in possession of the

Real Property.

2.1.4 Personal Property. SCHEDULE 2.1.4 sets forth all machinery,

equipment, furniture, and other material items of tangible personal property

with an initial book value in excess of $1,000 located at the Edgefield Facility

(other than any Excluded Assets). Except as set forth on SCHEDULE 2.1.4, Seller

has good title to, and owns free and clear of any Liens (other than Permitted

Liens), all of the Assets, including, without limitation, all personal property

reflected

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on SCHEDULE 2.1.4. The Assets comprise all assets required for the continued

conduct of the Business as presently conducted by Seller.

2.1.5 Litigation. Except as set forth on SCHEDULE 2.1.5, there is no

action, suit, proceeding, or arbitration pending or, to the knowledge of Seller,

threatened against or affecting the Business or the Assets or which would

prevent, hinder, or delay the consummation of the transactions contemplated

hereby. To the knowledge of Seller, there is no investigation pending or

threatened by any Governmental Authority with respect to the Business.

2.1.6 No Judgments or Orders. With respect to the Business, Seller is not

a party to (or to the knowledge of Seller, subject to) any judgment, order, or

decree entered in any action or proceeding brought by any Governmental Authority

or any other party either enjoining Seller in respect of any business practice

or the conduct of business in any area or the acquisition of any property or

which otherwise has or reasonably could be expected to have a Material Adverse

Effect.

2.1.7 Compliance with Laws, Permits.

(a) Compliance with Laws. Seller is not in violation, nor has Seller

received any written notice to the effect that Seller is not in compliance with,

any Applicable Law with respect to the Business, the violation of which could

reasonably be expected to have a Material Adverse Effect.

(b) Permits. All material permits, governmental licenses, orders,

registrations, and other approvals of all federal, state, local, and foreign

governmental and regulatory bodies with respect to the conduct of the Business

have been obtained by Seller, are set forth on SCHEDULE 2.1.7(b), and are in

full force and effect, and Seller has not received written notice of any

threatened violation, suspension or cancellation of same.

2.1.8 Tax Matters. With respect to the Business, Seller has correctly

prepared and timely filed all federal, foreign, state, and local tax returns and

other tax reports required to be filed by Seller and has timely paid, or, with

respect to current taxes not yet due and payable, set up an adequate reserve on

the books of Seller for the payment of, all federal, foreign, state, and local

income taxes and all other taxes (including, without limitation, all franchise,

gross receipts, license, property, sales, use, excise, intangible, severance,

stamp, occupation, environmental, social security, withholding, employment,

unemployment and payroll taxes, and interest or penalties thereon, and all such

other taxes along with all federal, foreign, state, and local income taxes being

defined collectively as "Taxes") that have become due and payable by it, whether

or not such Taxes are shown on any tax return, and has set up an adequate

reserve on the books of Seller for the payment of all Taxes payable by Seller in

respect of the period subsequent to the last of such periods. All such returns

are true, complete and correct in all material respects. Seller is not

delinquent in the payment of any Taxes with respect to the Business or the

Assets, has not waived any statute of limitations with respect to any such

Taxes, and has not, since June 30, 2000, requested or agreed to any extension of

time within which to file any tax return or report or with respect to a tax

assessment or deficiency relating to the Business. No deficiencies for Taxes

with respect to the Business have been assessed or asserted against Seller since

June 30, 2000, and, except as set forth on SCHEDULE 2.1.8, Seller knows of no

unresolved questions or

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claims concerning the tax liability of Seller with respect to the Business.

Except as set forth on SCHEDULE 2.1.8, there is no pending or, to the knowledge

of Seller, threatened examination or audit by the Internal Revenue Service or

any state taxing authorities of any tax returns relating to the Business. Seller

has withheld and paid all Taxes with respect to the Business required to have

been withheld and paid in connection with amounts paid or owing to any Seller

Personnel, creditor, or other third party. Except as set forth on SCHEDULE

2.1.8, since June 30, 2000, (i) the Business has not been audited by any taxing

authority, (ii) Seller is not and has not previously been a party to a tax

allocation or sharing agreement and has not otherwise assumed any liability for

Taxes of any third party, including as a transferee or successor, and (iii)

Seller has not ever been (nor does it have any liability for unpaid taxes,

whether under Section 1.1502-6 of the Treasury regulations or otherwise, because

it was) a member of an affiliated group within the meaning of Section 1504(a) of

the Code or any unitary, affiliated, or similar group for state, local, or

foreign tax purposes. No Liens exist, or will exist immediately following

Closing, on the Assets that relate to or are attributable to any Taxes.

2.1.9 Labor Matters. Seller is not a party to any collective bargaining

agreement with any labor union or similar organization relating to the Business,

nor is Seller aware of any such organization that represents or claims to

represent any employees of the Business or is currently seeking to represent or

organize the employees of the Business. There has not occurred any material

strike, slowdown, picketing, work stoppage, concerted refusal to work overtime,

or other material labor difficulty relating to the Business. There are no labor

disputes currently subject to any pending grievance procedure, arbitration, or

litigation and there is no representation petition pending or, to the knowledge

of Seller, threatened with respect to any employee of the Business. Seller has

complied with all Applicable Law pertaining to the employment of employees of

the Business, including, without limitation, all such laws relating to labor

relations, equal employment, fair employment practices, entitlements, prohibited

discrimination, and other similar employment practices and acts, except for any

failure to comply that, individually or together with all such other failures,

has not had or resulted in and could not reasonably be expected to have or

result in a Material Adverse Effect.

2.1.10 Environmental.

(a) Seller is in compliance in all material respects, and Seller at all

times has complied in all material respects, with all Environmental, Health, or

Safety Requirements of Law applicable to the Business and the Real Property,

including, without limitation, the use, maintenance, and operation of the Real

Property and all activities and conduct of business related thereto and the

treatment, remediation, removal, transport, storage, and disposal of any

Contaminant.

(b) Seller has obtained, to the extent required by Environmental,

Health, or Safety Requirements of Law, all environmental, health, and safety

permits, consents, licenses, and other authorizations (collectively, "EHS

Permits") necessary for the operation of the Business and the ownership of the

Real Property, all such EHS Permits are in good standing, and Seller is

currently in compliance with all terms and conditions of such EHS Permits. There

are no proceedings pending, or to the Seller's knowledge, threatened, to cancel,

revoke or modify the validity of any such EHS Permit.

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notice, order, judgment, decree, settlement, or, to Seller's knowledge, any

investigation, alleging in connection with the Business or the Real Property:

(i) any violation of any Environmental, Health, or Safety Requirements of Law,

(ii) any Remedial Action, or (iii) any claims, liabilities, or costs arising

from the Release or threatened Release of any Contaminant.

(d) No Environmental Lien is attached to the Real Property.

(e) Seller has not received any written notice, claim, or other written

communication concerning (i) any alleged violation of any Environmental, Health,

or Safety Requirements of Law at the Real Property, whether or not corrected to

the satisfaction of the appropriate authority, (ii) alleged liability of Seller

for Environmental Damages arising out of or related to the Business or the Real

Property, or (iii) any alleged liability of Seller arising out of or related to

the Business or the Real Property for the Release or threatened Release of a

Contaminant at any location. There does not exist any writ, injunction, decree,

order, penalty, or judgment outstanding or any lawsuit, enforcement action,

proceeding, citation, directive, or summons relating to the condition, use,

maintenance, or operation of the Real Property or the actual or suspected

presence of any Contaminant(s) on the Real Property or the Release of any

Contaminant(s) from the Real Property.

(f) There has been no Release of any Contaminants and, to the knowledge

of Seller, there is no threatened Release of any Contaminants at, to, on, or

from the Real Property which was or is not in compliance with all Environmental,

Health, and Safety Requirements of Law.

(g) The Real Property is not listed or proposed for listing on the

National Priorities List ("NPL") pursuant to the Comprehensive Environmental

Response, Compensation, and Liability Act, as amended ("CERCLA") or listed on

the Comprehensive Environmental Response Compensation and Liability Information

System List ("CERCLIS") or any similar state list of sites and to Seller's

knowledge, there is no condition at the Real Property that, if known to a

Governmental Authority, would qualify the Real Property for inclusion on any

such list.

(h) Seller has not "disposed" (as such term is defined in the Federal

Resource Conservation and Recovery Act ("RCRA")) of any "hazardous waste" (as

such term is defined in RCRA) at the Real Property in a manner which is not in

compliance with the applicable Environmental, Health, and Safety Requirements of

Law.

(i) Seller has not transported or arranged for the transport of any

Contaminant to any site in connection with the Business which is not in

compliance with the applicable Environmental, Health, and Safety Requirements of

Law.

(j) Seller has complied with Environmental Health and Safety

Requirements of Law in transporting or arranging for the transport of any

Contaminant in connection with the Business to any facility or site for the

purpose of treatment or disposal.

(k) There is not constructed, placed, deposited, stored, disposed, or

located on the Real Property any asbestos in any form except in compliance with

applicable Environmental, Health, or Safety Requirements of Law.

<PAGE>

(l) Except for a water sprinkler system located at the Real Property, no

underground improvements, including, but not limited to, treatment or storage

tanks, sumps, water, gas, separators, or oil wells, or associated piping, but

excluding utility-owned underground improvements, are or have ever been located

on the Real Property.

(m) There is not constructed, placed, deposited, released, stored,

disposed, leaching, or located on the Real Property any polychlorinated

biphenyls ("PCBs") or transformers, capacitors, ballasts, or other equipment

that contain dielectric fluid containing PCBs.

(n) Seller has not received any written notice, claim, or other

communication alleging liability on the part of Seller for the violation of any

Environmental, Health, or Safety Requirements of Law, for Environmental Damages,

or for the Release or threatened Release of any Contaminant in connection with

the Business.

2.1.11 Brokers, Finders. Seller has not retained any broker or finder in

connection with the transactions contemplated hereby so as to give rise to any

valid claim against Purchaser for any brokerage or finder's commission, fee, or

similar compensation.

2.1.12 No Other Representations. Except for the express representations

and warranties of Seller contained in this SECTION 2.1, Purchaser acknowledges

that Seller has not made, and Purchaser has not relied upon, any other

representation or warranty, express or implied, with respect to the Business,

the Assets or the transactions contemplated herein. SELLER HEREBY EXPRESSLY

DISCLAIMS ANY AND ALL IMPLIED WARRANTIES, INCLUDING ANY IMPLIED WARRANTIES OF

MERCHANTABILITY, FITNESS FOR A PARTICULAR USE OR WARRANTIES ARISING FROM CUSTOM

AND PRACTICE. EXCEPT AS EXPRESSLY PROVIDED IN THIS SECTION 2.1, SELLER SELLS,

AND PURCHASER ACCEPTS, THE ASSETS ON AN "AS IS, WHERE IS" BASIS.

2.2 Representations and Warranties of Purchaser. Purchaser represents

and warrants to Seller as of the date hereof as follows:

2.2.1 Corporate Status. Purchaser is a limited liability company duly

organized, validly existing, and in good standing under the laws of the State of

North Carolina and has all requisite limited liability company power and

authority to own, lease, and operate its properties and to carry on its business

as presently conducted and as will be conducted following the consummation of

the transactions contemplated by this Agreement. On the Closing Date, Seller

will be duly qualified and in good standing as a limited liability company

authorized to do business in South Carolina.

2.2.2 Authorization. Purchaser has full corporate power and authority to

execute and deliver this Agreement, to consummate the transactions contemplated

hereby, and to perform its obligations hereunder. The execution and delivery of

this Agreement and the consummation of the transactions contemplated hereby have

been duly authorized by all requisite corporate action on the part of Purchaser.

This Agreement has been duly executed and delivered by Purchaser and constitutes

the legal, valid, and binding obligation of Purchaser enforceable against it in

accordance with its terms. The other agreements and instruments to be executed

by Purchaser in

<PAGE>

connection with this Agreement, when executed and delivered by Purchaser, will

constitute the legal, valid, and binding obligations of Purchaser, enforceable

against Purchaser in accordance with their respective terms.

2.2.3 Conflicts, Consents.

(a) Conflicts. Except as set forth on SCHEDULE 2.2.3, the execution and

delivery of this Agreement by Purchaser and the consummation by Purchaser of the

transactions contemplated hereby in the manner contemplated hereby do not and

will not conflict with or result in any violation of, or default under (or any

event that, with notice or lapse of time or both, would constitute a default

under), require any consent, notice, or other action under, or result in the

acceleration or required prepayment of any indebtedness pursuant to the terms

of, any provision of (i) the Articles of Incorporation or Bylaws of Purchaser,

(ii) any mortgage, indenture, loan agreement, note, bond, deed of trust, or

other agreement, commitment, or obligation for the borrowing of money or the

obtaining of credit, material lease, or other material agreement, contract,

license, franchise, permit, or instrument to which Purchaser is a party or by

which it may be bound, or (iii) any material judgment, order, decree, law,

statute, rule, or regulation applicable to Purchaser.

(b) Consents. Except as set forth on SCHEDULE 2.2.3 and except as could

not reasonably be expected to have a Material Adverse Effect, no consent,

approval, authorization, permit, order, filing, registration, or qualification

of or with any court, Governmental Authority, or third Person is required to be

obtained by Purchaser in connection with the execution and delivery by Purchaser

of this Agreement or the consummation by Purchaser of the transactions

contemplated hereby in the manner contemplated hereby.

2.2.4 Litigation. There is no action, suit, proceeding, claim,

arbitration, grievance, or investigation pending or, to the knowledge of

Purchaser, threatened against Purchaser which would prevent or hinder or delay

the consummation of the transactions contemplated hereby, nor is Purchaser aware

of any

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