An agreement for one of Cleveland’s most successful companies to buy one of its oldest is all but, in clothing terms, “sewn up.”
The asset purchase agreement between Jones CapitalCorp LLC and Hardwick Clothes Inc. was filed in U.S. Bankruptcy Court late Wednesday afternoon.
Tommy Hopper, chairman and president of Hardwick Clothes, and Joe Mason, senior vice president and chief financial officer for Jones CapitalCorp LLC, signed the document Tuesday.
The parties have agreed to a selling price of $2 million.
An initial hearing is scheduled for April 10 at 10 a.m. in Chattanooga to hear Hardwick’s motion that it be allowed to make the proposed sale to Jones “free and clear of liens.”
The notice for the hearing states anyone who does not want the motion granted must appear or have their attorney appear on that day.
A final hearing will be set by the court on that date.
Should the agreement be approved by the court and no other parties approach with a higher bid than the $2 million, Jones CapitalCorp would acquire Hardwick’s assets and ongoing operations.
The clothing manufacturer would be owned by Hardwick Clothes LLC moving forward with funds from Jones.
It is a move designed to help retain and revive the company that has been saddled with having to file for bankruptcy after the Pension Benefit Guaranty Corporation wanted immediate payment of liabilities related to Hardwick’s terminated pension plan.
Allan Jones, CEO of Jones CapitalCorp, said the decision to acquire Hardwick assets was an easy one.
“Hardwick Clothes is America’s oldest privately held clothing manufacturer and has been a vital part of Cleveland since 1880,” Jones said.
“The company needed a strong partner who was willing to enter a competitive field and we stepped up to the plate,” he added. “We are going to build on Hardwick’s proud 133-year history and ensure that the future is something to be excited about.”
Hopper, who will remain Hardwick’s chairman of the board, said the move by Jones is a welcome one.
“We needed time to put together a new business strategy and thanks to Jones, we can now move forward as an even stronger company,” Hopper said. “Our more than 225 employees should be excited about our future.”
Those employees were informed of the news by Jones and Hopper at a company meeting Wednesday at the close of the business day.
Part of the new Hardwick will eventually include new talent in the industry that both men have agreed requires “a national search for the talent needed to move Hardwick forward.”
Jones discussed the decision to buy the company in an interview with the Cleveland Daily Banner.
He noted only the Banner has been in operation locally longer than Hardwick and it is important to be able to support those companies that have shown their loyalty to the area.
“There was a big sign in my house that says, ‘Buy locally whenever possible. Allan Jones.’ That’s been my philosophy, to buy locally whenever possible,” Jones said.
“I was trying to help Hardwick with their PGBC,” Jones said. “I was going to help financially, but after looking at the company, we decided to make an offer.”
He said a major reason to bid for the company is the average employee has been there for more than 13 years.
Jones said recent years have taken the majority of the clothing industry offshore, but feels it is coming back.
“I think now is the right time for American made,” Jones said. “We want to take advantage of the history and experience. That’s our plan.”
He reiterated Hopper’s continuing presence, saying the new company “... needs his information and knowledge.”
Jones said he wanted to produce clothes “with better fabric and better buttons.”
“We want to do some things that are pretty innovative that we have some ideas for,” he said.
But, Jones admitted with a laugh the clothing business is totally new to him.
“I don’t have a clue,” he said. “Not yet. But I’ll get it.”
“When I formed Check Into Cash, I went to the check-cashing convention to find software and things I needed, and they told me Check Into Cash wouldn’t work,” Jones recalled. “The next time they laughed at me. I had three locations. I went back the next year and I had 18 locations and their attention. The next year I went back and I spoke to the group and you couldn’t get into the room.”
Jones added, “Most industries are revolutionized by people that don’t understand them. Hardwick has great potential and will regain its competitive posture in the near future.”