Common use of Inventory Covenants Clause in Contracts

Inventory Covenants. With respect to the Inventory: (a) each Obligor shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ cost therefor and withdrawals therefrom and additions thereto; (b) Obligors shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any time or times as Agent may request after an Event of Default has occurred and is continuing in accordance with clause (e) below, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (c) Obligors shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: (i) for sales of Inventory in the ordinary course of any Obligor’s business, (ii) to move Inventory directly from one location set forth or permitted herein to another such location, (iii) for Inventory shipped from the manufacturer thereof to Obligors which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s request, Borrowers shall deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to the inventory records of Obligors to reconcile the inventory count to Obligors’ inventory records; (f) Obligors assume all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (g) each Obligor shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of Obligor; (h) Obligors shall keep the Inventory in good condition (taken as a whole); and (i) Obligors shall not acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrower shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Administrative and Collateral Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ Borrower’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrower shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practicesdone by way of a cycle count), but at any time or times as Administrative and Collateral Agent may reasonably request after during the existence of an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply Administrative and Collateral Agent with a report in the form and with such specificity as may be reasonably satisfactory to Administrative and Collateral Agent concerning such physical count; (c) Obligors Borrower shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Administrative and Collateral Agent, except: (i) except for sales of Inventory in the ordinary course of any ObligorBorrower’s business, (ii) business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) location and except for Inventory shipped from the manufacturer thereof to Obligors Borrower which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Administrative and Collateral Agent’s request, Borrowers shall Borrower shall, at its expense, no more than once in any twelve (12) month period, but at any time or times as Administrative and Collateral Agent may request on or after an Event of Default, deliver or cause to be delivered to Administrative and Collateral Agent a full written reports or appraisals appraisal as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Administrative and Collateral Agent and by an appraiser reasonably acceptable to Administrative and Collateral Agent, addressed to Administrative and Collateral Agent and Lenders and upon which Administrative and Collateral Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence Borrower shall produce, use, store and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of maintain the Inventory in form, scope with all reasonable care and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent caution and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including the inventory records of Obligors to reconcile the inventory count to Obligors’ inventory records; (f) Obligors assume all responsibility and liability arising from or relating to the production, use, sale or other disposition requirements of the Inventory; (g) each Obligor shall not sell Inventory to any customer on approvalFederal Fair Labor Standards Act of 1938, or any other basis which entitles the customer to return or may obligate Obligors to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of Obligor; (h) Obligors shall keep the Inventory in good condition (taken as a wholeamended and all rules, regulations and orders related thereto); and (i) Obligors shall not acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.;

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrowers shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory Inventory records reasonably satisfactory to AgentAgents, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ Borrowers' cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrowers shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practicesyear, but at any time or times as Agent Agents may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply Agent Agents with a report in the form and with such specificity as may be reasonably satisfactory to Agent Agents concerning such physical count; (c) Obligors shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of AgentAgents, except: (i) except for sales of Inventory in the ordinary course of any Obligor’s business, (ii) Obligors' business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) for Inventory shipped from the manufacturer thereof to Obligors which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon either Agent’s 's request, Borrowers shall deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialistsno more than once in any twelve (12) month period, Inc. but at any time or another inventory counting service reasonably acceptable times as either Agent may request on or after an Event of Default, deliver or cause to Agent, a physical count of be delivered to Agents written reports or appraisals as to the Inventory in form, scope and methodology acceptable to AgentAgents and by an appraiser acceptable to Agents, addressed to Agents or upon which Agents are expressly permitted to rely; (e) Obligors shall produce, use, store and maintain the results of which shall be reported directly by such inventory counting service to Agent Inventory with all reasonable care and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to caution and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with Applicable Law (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938); (f) Obligors assume all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (g) each Obligor Borrowers shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors Borrowers to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of ObligorInventory; (h) Obligors shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (i) Obligors Borrowers shall not not, without prior written notice to Agents, acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrowers shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ such Borrower’s or Guarantor’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrowers and Guarantors shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any time or times as Agent may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (c) Obligors Borrowers and Guarantors shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: (i) except for sales of Inventory in the ordinary course of any Obligor’s business, (ii) its business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) location and except for Inventory shipped from the manufacturer thereof to Obligors such Borrower or Guarantor which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s request, Borrowers shall shall, at their expense, no more than two (2) times in any twelve (12) month period, but at any time or times as Agent may request on or after an Event of Default, deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and Lenders and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence Borrowers and during the continuance of an Event of DefaultGuarantors shall produce, Borrowers shalluse, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of store and maintain the Inventory in form, scope with all reasonable care and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent caution and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors assume none of the Inventory or other Collateral constitutes farm products or the proceeds thereof; (g) each Borrower and Guarantor assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (gh) each Obligor Borrowers and Guarantors shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors any Borrower or Guarantor to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of ObligorInventory; (hi) Obligors Borrowers and Guarantors shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (ij) Obligors Borrowers and Guarantors shall not not, without prior written notice to Agent or the specific identification of such Inventory in a report with respect thereto provided by Borrowers to Agent pursuant to Section 7.1(a) hereof, acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.

Inventory Covenants. With respect to the Inventory: : (a) each Obligor Borrower and Guarantor shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ Inventory and such Borrower's or Guarantor's cost therefor and withdrawals therefrom and additions theretotherefor; (b) Obligors Borrowers and Guarantors shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any time or times as Agent may request at any time on or after an Event of Default exists or has occurred and is continuing in accordance with clause (e) belowcontinuing, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (c) Obligors Borrowers and Guarantors shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: (i) except for sales of Inventory in the ordinary course of any Obligor’s business, (ii) its business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) location and except for Inventory shipped from the manufacturer thereof to Obligors such Borrower or Guarantor which is in transit (including any Inventory that may be at US Customs bonded warehouses pending customs clearance) to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s 's request, Borrowers shall shall, at their expense, no more than two (2) times in any twelve (12) month period, but at any time or times as Agent may request at any time on or after an Event of Default exists or has occurred and is continuing, deliver or cause to be delivered to Agent written reports appraisals (or appraisals updates of appraisals) as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and Lenders and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence Borrowers and during the continuance of an Event of DefaultGuarantors shall produce, Borrowers shalluse, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of store and maintain the Inventory in form, scope with all reasonable care and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent caution and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors assume all responsibility and liability arising from or relating to none of the production, use, sale Inventory or other disposition of Collateral constitutes farm products or the Inventory; (g) each Obligor shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of Obligor; (h) Obligors shall keep the Inventory in good condition (taken as a whole); and (i) Obligors shall not acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.proceeds thereof;

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrowers shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to AgentLender, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ each Borrower's cost therefor and daily or weekly withdrawals therefrom and additions thereto; (b) Obligors Borrowers shall conduct (i) a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practicesyear, but at any time or times as Agent Lender may request on or after an Event of Default has occurred Default, and is continuing in accordance with clause (eii) belowtest counts of inventory at any time or times as Lender may request utilizing a third party service therefore designated by Lender, and promptly following such physical inventory and test counts of inventory shall supply Agent Lender with a report in the form and with such specificity as may be reasonably satisfactory to Agent Lender concerning such physical countcount and test counts; (c) Obligors Borrowers shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of AgentLender, except: (i) except for sales of Inventory in the ordinary course of any Obligora Borrower’s business, (ii) business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) for Inventory shipped from the manufacturer thereof to Obligors which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s Lender's request, Borrowers shall shall, at there expense, no more than four times in any twelve (12) month period, but at any time or times as Lender may request on or after an Event of Default, deliver or cause to be delivered to Agent Lender written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to AgentLender and by an appraiser acceptable to Lender, the results of addressed to Lender or upon which shall be reported directly by such inventory counting service Lender is expressly permitted to Agent and rely; (e) Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to produce, use, store and maintain the confirmation most recently delivered to Inventory with all reasonable care and accepted by Agent caution and in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors Borrowers shall assume all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (g) each Obligor Borrowers shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors a Borrower to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of ObligorInventory; (h) Obligors Borrowers shall keep the Inventory in good condition (taken as a whole); and marketable condition, and (i) Obligors Borrower shall not not, without prior written notice to Lender, acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrower shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality type and quantity of Inventory, Obligors’ Borrower’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrower shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any time or times as Agent may request on or after an Event of Default has occurred and for so long as the same is continuing in accordance with clause (e) belowcontinuing, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may in good faith be reasonably satisfactory to Agent concerning such physical count; (c) Obligors Borrower shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: except (i) for sales of Inventory in the ordinary course of any Obligor’s its business, (ii) to move Inventory directly from one location set forth or permitted herein to another such location, and (iii) for Inventory shipped from the manufacturer thereof to Obligors Borrower which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s request, Borrowers Borrower shall deliver or cause to be delivered to Agent delivered, at its expense (i) a written reports or appraisals appraisal as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and Lenders and upon which Agent and Lenders are expressly permitted to rely; providedrely (each such appraisal being referred to as an “Inventory Appraisal”), thatno more than once in any twelve (12) month period, (iii) Borrowers acknowledge and agree that such an Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers Appraisal at any time following the occurrence and during the continuance of or times as Agent may request on or after an Event of Default; Default and for so long as the same is continuing, and (iiiii) all such an Inventory reports and appraisals shall be at the expense of BorrowersAppraisal, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default Excess Availability shall exist or shall have occurred and be continuingless than the amount equal to $40,000,000; (e) after the occurrence Borrower shall produce, use, store and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of maintain the Inventory in form, scope with all reasonable care and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent caution and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors assume Borrower assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (g) each Obligor Borrower shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors Borrower to repurchase such Inventory (except for the right of customers to return given to retail customers of Obligors defective or non-conforming goods in the ordinary course of the business of Obligors in accordance consistent with the then current return policy practices of ObligorBorrower as of the date hereof); (h) Obligors Borrower shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (i) Obligors Borrower shall not not, without prior written notice to Agent or the specific identification of such Inventory in a report with respect thereto provided by Borrower to Agent pursuant to Section 7.1(a) hereof, acquire or accept any Inventory on consignment or approval. Not later than ninety (90) days after the date hereof, except for Borrower shall deliver to Agent and Lenders an appraisal of all Inventory of Borrower, in form and scope acceptable to Agent, performed by an appraiser acceptable to Agent and upon which Agent is expressly authorized to rely. In addition, no later than fifteen (15) days after the sale date hereof, Borrower shall deliver to Agent and Lenders the appraisal being currently conducted by Xxxxx Xxxxxx LLC of lines other than apparel all Inventory acquired pursuant to the extent such Inventory Permitted Atlantis Plastics Acquisition, in form and scope acceptable to Agent, upon which Agent is reported expressly authorized to Agent in accordance with the terms hereofrely.

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrower shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ Borrower’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrower shall conduct a physical count of the Inventory as required by and in accordance with GAAP and Borrower’s own internal controls at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any other reasonable time or times as Agent may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (c) Obligors Borrower shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: (i) except for sales of Inventory in the ordinary course of any Obligor’s business, (ii) its business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) location and except for Inventory shipped from the manufacturer thereof to Obligors Borrower which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s request, Borrowers shall Borrower shall, at its expense, no more than one (1) time in any twelve (12) month period, but at any time or times as Agent may request on or after an Event of Default, deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and Lenders and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence Borrower shall produce, use, store and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of maintain the Inventory in form, scope with all reasonable care and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent caution and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in material conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors assume none of the Inventory or other Collateral constitutes farm products or the proceeds thereof; (g) Borrower assumes all responsibility and liability arising from or relating to the its production, use, sale or other disposition of the Inventory; (gh) each Obligor Borrower shall not sell Inventory to any customer on approval, approval or any other similar basis which entitles the customer to return or may obligate Obligors Borrower to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of ObligorInventory; (hi) Obligors Borrower shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (ij) Obligors Borrower shall not not, without prior written notice to Agent or the specific identification of such Inventory in a report with respect thereto provided by Borrower to Agent pursuant to Section 7.1(a) hereof, acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrower shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Collateral Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ Borrower’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrower shall conduct a physical count of the Inventory either through periodic cycle counts or wall-to-wall counts so that all Inventory is covered by such counts at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practicesyear, but at any time or times as any Agent may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall (whether pursuant to periodic cycle counts or otherwise) shall, to the extent requested, supply Collateral Agent with a report in the form and with such specificity as may be reasonably satisfactory to Collateral Agent concerning such physical count; (c) Obligors Borrower shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Collateral Agent, except: (i) except for sales of Inventory in the ordinary course of any ObligorBorrower’s business, (ii) business and except to move Inventory directly from one location set forth or permitted herein to another such locationlocation or to return defective, (iii) for returned or slow moving Inventory shipped from the manufacturer thereof to Obligors which is in transit to the locations set forth relevant distribution center or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreementdirectly to the supplier for appropriate credit; (d) Borrower shall make all material payments required to be made under leases of premises at which Inventory is located when due, except as specifically reported to Collateral Agent pursuant to Section 7.1 above; (e) upon Collateral Agent’s request, Borrowers shall deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors Borrower shall, at its expense, no more than once in formany twelve (12) month period, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers but at any time following the occurrence and during the continuance of or times as Collateral Agent may reasonably request on or after an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to the inventory records of Obligors to reconcile the inventory count to Obligors’ inventory records; (f) Obligors assume all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (g) each Obligor shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of Obligor; (h) Obligors shall keep the Inventory in good condition (taken as a whole); and (i) Obligors shall not acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.Event

Inventory Covenants. With respect to the Inventory: (a) each Obligor Debtor shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to US Collateral Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ such Debtor’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors each Debtor shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practicesyear, but at any time or times as US Collateral Agent may request after an while Event of Default has occurred and is continuing in accordance with clause (e) belowcontinuing, and promptly following such physical inventory counts shall supply US Collateral Agent with a report in the form and with such specificity as may be reasonably satisfactory to US Collateral Agent concerning such physical countcounts; (c) Obligors no Debtor shall not remove any Inventory from the locations set forth on the Information Certificate or otherwise permitted hereinherein or in the US Loan Agreement, without the prior written consent of US Collateral Agent, except: (i) except for sales of Inventory in the ordinary course of any Obligorsuch Debtor’s business, (ii) business or as provided in the US Loan Agreement and except to move Inventory (i) directly from one location set forth or permitted herein to another such location, location or (iiiii) to an outside processor for Inventory shipped from the manufacturer thereof to Obligors which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreementprocessing; (d) upon US Collateral Agent’s request, Borrowers shall each Debtor shall, at its expense, no more than once in any twelve (12) month period, but at any time or times as US Collateral Agent may request while Event of Default has occurred and is continuing, deliver or cause to be delivered to US Collateral Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to US Collateral Agent and by an appraiser acceptable to US Collateral Agent, addressed to US Collateral Agent or upon which US Collateral Agent is expressly permitted to rely; (e) each Debtor shall produce, use, store and maintain the results of which shall be reported directly by such inventory counting service to Agent Inventory, with all reasonable care and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to caution and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including, but not limited to, the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors assume each Debtor assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (g) each Obligor no Debtor shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors any Debtor to repurchase such Inventory except for as may be otherwise permitted by the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of ObligorUS Loan Agreement; (h) Obligors each Debtor shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (i) Obligors shall not no Debtor shall, without prior written notice to US Collateral Agent, acquire or accept any Inventory on consignment or approval, approval except for as may be permitted by the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereofUS Loan Agreement.

Inventory Covenants. With respect to the Inventory: : (a) each Obligor Borrower and each Aftermarket Entity shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ such Borrower's or such Aftermarket Entity's cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrowers and Aftermarket Entities shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any time or times as Agent may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (c) Obligors Borrowers and Aftermarket Entities shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: (i) except for sales of Inventory in the ordinary course of any Obligor’s business, (ii) its business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) location and except for Inventory shipped from the manufacturer thereof to Obligors such Borrower or such Aftermarket Entity which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s 's request, Borrowers shall shall, at their expense, no more than one (1) time in any twelve (12) month period, but at any time or times as Agent may request on or after an Event of Default, deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and Lenders and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) rely and Borrowers acknowledge and agree that also shall cause to be furnished to Agent quarterly "desk top" updates to such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuingappraisals; (e) after the occurrence Borrowers and during the continuance of an Event of DefaultAftermarket Entities shall produce, Borrowers shalluse, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of store and maintain the Inventory in form, scope with all reasonable care and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent caution and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors assume none of the Inventory or other Collateral constitutes farm products or the proceeds thereof; (g) each Borrower and each Aftermarket Entity assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (gh) each Obligor Borrowers shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors any Borrower to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors de minimus Inventory that in accordance with the then current Borrowers' customary practices and policies previously disclosed in writing to Agent may from time to time be subject to return policy of Obligorunder stock adjustment programs with customers; (hi) Obligors Borrowers and Aftermarket Entities shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (ij) Obligors Borrowers and Aftermarket Entities shall not not, without prior written notice to Agent or the specific identification of such Inventory in a report with respect thereto provided by Administrative Borrower to Agent pursuant to Section 7.1(a) hereof, acquire or accept any Inventory on consignment or approval. Notwithstanding the provisions set forth in clause (d) in this Section 7.3, except for the sale Borrowers shall not be required to cause to be conducted any inventory appraisals with respect to their Inventory during the 2006 calendar year or thereafter provided that (i) Excess Availability exceeds Fifteen Million Dollars ($15,000,000) at all times during the immediately preceding twelve months and (ii) no Event of lines other than apparel Default or Default has occurred and is then continuing (Borrowers shall cause to be conducted as many inventory appraisals with respect to their Inventory as Agent may request upon the extent such Inventory is reported to Agent in accordance with occurrence and during the terms hereofcontinuation of any Event of Default or Default).

Inventory Covenants. With respect to the Inventory: (a) each Obligor shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ cost therefor and withdrawals therefrom and additions thereto; (b) Obligors shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any time or times as Agent may request after an Event of Default has occurred and is continuing in accordance with clause (e) below, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (c) Obligors shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: (i) for sales of Inventory in the ordinary course of any Obligor’s business, (ii) to move Inventory directly from one location set forth or permitted herein to another such location, (iii) for Inventory shipped from the manufacturer thereof to Obligors which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s request, Borrowers shall deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to the inventory records of Obligors to reconcile the inventory count to Obligors’ inventory records; (f) Obligors assume all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (g) each Obligor shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of Obligor; (h) Obligors shall keep the Inventory in good condition (taken as a whole); and (i) Obligors shall not acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrowers shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records consistent with the current practices of Borrowers as of the date hereof or as modified in any material respect after the date hereof in a manner reasonably satisfactory acceptable to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ Borrowers' cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrowers shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practicesfiscal year, but at any time or times as Agent may request on or after an Event of Default exists or has occurred and so long as the same is continuing in accordance with clause (e) belowcontinuing, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (c) Obligors Borrowers shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: (i) except for sales of Inventory in the ordinary course of any Obligor’s business, (ii) such Borrower's business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) for location or Inventory shipped from the manufacturer thereof to Obligors which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreementsuch location; (d) upon Agent’s 's request, Borrowers shall such Borrower shall, at its expense, no more than once in any six (6) month period, but at any time or times as Agent may request at Agent's expense, or at any time or times as Agent may request at such Borrower's expense on or after an Event of Default exists or has occurred and so long as the same is continuing, deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and or upon which Agent and Lenders are is expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence and during the continuance of an Event of Defaultupon Agent's request, Borrowers each Borrower shall, at their its expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to AgentAgent no more than once in any twelve (12) month period, but at any time or times as Agent may request on or after an Event of Default exists or has occurred and so long as the same is continuing, the results of which shall be reported directly by such inventory counting service to Agent and Borrowers such Borrower shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to the inventory records of Obligors such Borrower to reconcile the inventory count to Obligors’ such Borrower's inventory records; (f) Obligors assume all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (g) each Obligor shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of Obligor; (h) Obligors shall keep the Inventory in good condition (taken as a whole); and (i) Obligors shall not acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.

Inventory Covenants. With respect to the Inventory: Inventory (other than Inventory that is an Excluded Asset): (a) each Obligor Debtor shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Collateral Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of such Inventory, Obligors’ such Debtor’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors each Debtor shall conduct a physical count of the such Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any time or times as Collateral Agent may reasonably request (but not more than once per year) on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply Collateral Agent with a report in the form and with such specificity as may be reasonably satisfactory to Collateral Agent concerning such physical count; (c) Obligors no Debtor shall not remove any such Inventory from the locations set forth or permitted herein, without the prior written consent of Perfection Agent, except: (i) except for sales and movement or transport of such Inventory in the ordinary course of any Obligorsuch Debtor’s business, (ii) business and except to move such Inventory directly from one location set forth or of permitted herein to another such location, (iii) for Inventory shipped from the manufacturer thereof to Obligors which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s requesteach Debtor shall produce, Borrowers shall deliver or cause to be delivered to Agent written reports or appraisals as to use, store and maintain such Inventory, with all reasonable care and caution and in accordance with applicable standards of any insurance and in conformity with applicable laws (including the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess requirements of the Required FrequencyFederal Fair Labor Standards Act of 1938, providedas amended and all rules, that, all such Inventory reports regulations and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuingorders related thereto); (e) after the occurrence and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to the inventory records of Obligors to reconcile the inventory count to Obligors’ inventory records; (f) Obligors assume each Debtor assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the such Inventory; (gf) each Obligor no Debtor shall not sell such Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors such, Debtor to repurchase such Inventory except for the right of return given to retail customers of Obligors (other than in the ordinary course of the business of Obligors consistent with past practices); (g) each Debtor shall keep such Inventory in accordance with the then current return policy of Obligorgood and marketable condition; and (h) Obligors shall keep the Inventory in good condition (taken as a whole); and (i) Obligors shall not no Debtor shall, without prior written notice to Collateral Agent, acquire or accept any such Inventory on consignment or approval, except for the sale of lines approval (other than apparel to in the extent such Inventory is reported to Agent in accordance ordinary course of business consistent with the terms hereofpast practices).

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrower and Guarantor shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ such Borrower's or Guarantor's cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrowers and Guarantors shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any time or times as Agent may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (c) Obligors Borrowers and Guarantors shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: (i) except for sales of Inventory in the ordinary course of any Obligor’s business, (ii) its business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) location and except for Inventory shipped from the manufacturer thereof to Obligors such Borrower or Guarantor which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s 's request, Borrowers shall shall, at their expense, no more than one (1) time in any twelve (12) month period, but at any time or times as Agent may request on or after an Event of Default, deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and Lenders and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence Borrowers and during the continuance of an Event of DefaultGuarantors shall produce, Borrowers shalluse, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of store and maintain the Inventory in formwith all reasonable care and caution, scope ordinary wear and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent tear and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to casualty and accepted by Agent condemnation excepted and in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors assume none of the Inventory or other Collateral constitutes farm products or the proceeds thereof; (g) each Borrower and Guarantor assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (gh) each Obligor Borrowers and Guarantors shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors any Borrower or Guarantor to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of ObligorInventory; (hi) Obligors Borrowers and Guarantors shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (ij) Obligors Borrowers and Guarantors shall not not, without prior written notice to Agent or the specific identification of such Inventory in a report with respect thereto provided by Administrative Borrower to Agent pursuant to Section 7.1(a) hereof, acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrower shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality type and quantity of Inventory, Obligors’ Borrower’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrower shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any time or times as Agent may request on or after an Event of Default has occurred and for so long as the same is continuing in accordance with clause (e) belowcontinuing, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may in good faith be reasonably satisfactory to Agent concerning such physical count; (c) Obligors Borrower shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: except (i) for sales of Inventory in the ordinary course of any Obligor’s its business, (ii) to move Inventory directly from one location set forth or permitted herein to another such location, and (iii) for Inventory shipped from the manufacturer thereof to Obligors Borrower which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s request, Borrowers Borrower shall deliver or cause to be delivered to Agent delivered, at its expense (i) a written reports or appraisals appraisal as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and Lenders and upon which Agent and Lenders are expressly permitted to rely; providedrely (each such appraisal being referred to as an “Inventory Appraisal”), thatno more than once in any twelve (12) month period, (iii) Borrowers acknowledge and agree that such an Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers Appraisal at any time following the occurrence and during the continuance of or times as Agent may request on or after an Event of Default; Default and for so long as the same is continuing, and (iiiii) all such an Inventory reports and appraisals shall be at the expense of BorrowersAppraisal, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default Excess Availability shall exist or shall have occurred and be continuingless than the amount equal to $40,000,000; (e) after the occurrence Borrower shall produce, use, store and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of maintain the Inventory in form, scope with all reasonable care and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent caution and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors assume Borrower assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (g) each Obligor Borrower shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors Borrower to repurchase such Inventory (except for the right of customers to return given to retail customers of Obligors defective or non-conforming goods in the ordinary course of the business of Obligors in accordance consistent with the then current return policy practices of ObligorBorrower as of the date hereof); (h) Obligors Borrower shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (i) Obligors Borrower shall not not, without prior written notice to Agent or the specific identification of such Inventory in a report with respect thereto provided by Borrower to Agent pursuant to Section 7.1(a) hereof, acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.

Inventory Covenants. With respect to the Inventory: Inventory (other than Inventory that is an Excluded Asset): (a) each Obligor Debtor shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Collateral Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of such Inventory, Obligors’ such Debtor’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors each Debtor shall conduct a physical count of the such Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any time or times as Collateral Agent may reasonably request (but not more than once per year) on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply Collateral Agent with a report in the form and with such specificity as may be reasonably satisfactory to Collateral Agent concerning such physical count; (c) Obligors no Debtor shall not remove any such Inventory from the locations set forth or permitted herein, without the prior written consent of Perfection Agent, except: (i) except for sales and movement or transport of such Inventory in the ordinary course of any Obligorsuch Debtor’s business, (ii) business and except to move such Inventory directly from one location set forth or permitted herein to another such location, (iii) for Inventory shipped from the manufacturer thereof to Obligors which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s requesteach Debtor shall produce, Borrowers shall deliver or cause to be delivered to Agent written reports or appraisals as to use, store and maintain such Inventory, with all reasonable care and caution and in accordance with applicable standards of any insurance and in conformity with applicable laws (including the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess requirements of the Required FrequencyFederal Fair Labor Standards Act of 1938, providedas amended and all rules, that, all such Inventory reports regulations and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuingorders related thereto); (e) after the occurrence and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to the inventory records of Obligors to reconcile the inventory count to Obligors’ inventory records; (f) Obligors assume each Debtor assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the such Inventory; (gf) each Obligor no Debtor shall not sell such Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors such Debtor to repurchase such Inventory except for the right of return given to retail customers of Obligors Inventory(other than in the ordinary course of the business of Obligors consistent with past practices); (g) each Debtor shall keep such Inventory in accordance with the then current return policy of Obligorgood and marketable condition; and (h) Obligors shall keep the Inventory in good condition (taken as a whole); and (i) Obligors shall not no Debtor shall, without prior written notice to Collateral Agent, acquire or accept any such Inventory on consignment or approval, except for the sale of lines approval (other than apparel to in the extent such Inventory is reported to Agent in accordance ordinary course of business consistent with the terms hereofpast practices).

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrower shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Collateral Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ Borrower’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrower shall conduct a physical count of the Inventory either through periodic cycle counts or wall-to-wall counts so that all Inventory is covered by such counts at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practicesyear, but at any time or times as any Agent may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall (whether pursuant to periodic cycle counts or otherwise) shall, to the extent requested, supply Collateral Agent with a report in the form and with such specificity as may be reasonably satisfactory to Collateral Agent concerning such physical count; (c) Obligors Borrower shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Collateral Agent, except: (i) except for sales of Inventory in the ordinary course of any ObligorBorrower’s business, (ii) business and except to move Inventory directly from one location set forth or permitted herein to another such locationlocation or to return defective, (iii) for returned or slow moving Inventory shipped from the manufacturer thereof to Obligors which is in transit to the locations set forth relevant distribution center or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreementdirectly to the supplier for appropriate credit; (d) Borrower shall make all material payments required to be made under leases of premises at which Inventory is located when due, except as specifically reported to Collateral Agent pursuant to Section 7.1 above; (e) upon Collateral Agent’s request, Borrowers shall Borrower shall, at its expense, no more than once in any twelve (12) month period, but at any time or times as Collateral Agent may reasonably request on or after an Event of Default, deliver or cause to be delivered to Collateral Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Collateral Agent and by an appraiser reasonably acceptable to Collateral Agent, addressed to Collateral Agent and upon which Collateral Agent and Lenders are is expressly permitted to rely; provided(f) upon Collateral Agent’s request, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence and during the continuance of an Event of Default, Borrowers Borrower shall, at their its expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to the inventory records of Obligors to reconcile the inventory count to Obligors’ inventory records; (f) Obligors assume all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (g) each Obligor shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of Obligor; (h) Obligors shall keep the Inventory in good condition (taken as a whole); and (i) Obligors shall not acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.inventory

Inventory Covenants. With respect to the Inventory: (a) each Obligor the Borrowers shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ the applicable Borrower’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors the Borrowers shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practicesyear, but at any time or times as Agent may request on or after an Event of Default that has occurred and is continuing in accordance with clause (e) belowcontinuing, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (c) Obligors the Borrowers shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: (i) except for sales of Inventory in the ordinary course Ordinary Course of any Obligor’s business, (ii) Business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) for Inventory shipped from the manufacturer thereof to Obligors which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s requestrequest the Borrowers shall, Borrowers shall at its expense, but no more than once in any six (6) month period, but at any time or times as Agent may request on or after an Event of Default that has occurred and is continuing, deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to AgentRequired Lenders and by an appraiser acceptable to Required Lenders, the results of which shall be reported directly by such inventory counting service addressed to Agent and or upon which Agent is expressly permitted to rely; (e) the Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to produce, use, store and maintain the confirmation most recently delivered to Inventory, with all reasonable care and accepted by Agent caution and in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors the Borrowers assume all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (g) each Obligor the Borrowers shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors the Borrowers to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of ObligorInventory; (h) Obligors the Borrowers shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (i) Obligors the Borrowers shall not not, without prior written notice to Agent, acquire or accept any Inventory on consignment or approval, except for approval and (j) none of the sale of lines Inventory or other than apparel to Collateral constitutes farm products or the extent such Inventory is reported to Agent in accordance with the terms hereof.proceeds thereof

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrower and Guarantor shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of such Borrower’s or Guarantor’s Inventory, Obligors’ such Borrower’s or Guarantor’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors each Borrower and Guarantor shall conduct a physical count of the its Inventory either through periodic cycle counts or wall to wall counts, so that all Inventory is subject to such counts at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practicesyear, but at any time or times as Agent may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory (whether through periodic cycle counts or wall to wall counts) shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (c) Obligors no Borrower or Guarantor shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: (i) except for sales of Inventory in the ordinary course of any Obligorsuch Borrower’s business, (ii) or Guarantor’s business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) location and except for Inventory shipped from the manufacturer thereof to Obligors such Borrower or Guarantor which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s request, Borrowers shall and Guarantors shall, at their expense, deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and upon which Agent and Lenders are expressly permitted to relyrely as follows: (i) so long as Compliance Excess Availability is greater twenty (20%) percent of the Maximum Credit, no more than one (1) such written appraisal in any twelve (12) month period, (ii) if Compliance Excess Availability is at any time less than or equal to twenty (20%) percent of the Maximum Credit, no more than two (2) such written appraisals in any twelve (12) month period, and (iii) if a Default or an Event of Default exists or has occurred and is continuing, such number of written appraisals as Agent may request; provided, that, at any time or times as Agent may request, at Agent’s expense, Agent may arrange to have appraisals conducted as to the Inventory; (e) upon Agent’s request, Borrowers and Guarantors shall, at their expense, deliver or cause to be delivered to Agent field examinations as to the Inventory in form, scope and methodology acceptable to Agent and by a field examiner acceptable to Agent, addressed to Agent and upon which Agent and Lenders are expressly permitted to rely as follows: (i) Borrowers acknowledge and agree that so long as Compliance Excess Availability is greater twenty (20%) percent of the Maximum Credit, no more than one (1) such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers field examination in any twelve (12) month period, (ii) if Compliance Excess Availability is at any time following less than or equal to twenty (20%) percent of the occurrence Maximum Credit, no more than two (2) such field examinations in any twelve (12) month period, and during the continuance of (iii) if a Default or an Event of DefaultDefault exists or has occurred and is continuing, such number of field examinations as Agent may request; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall times as Agent may request, at Agent’s expense, Agent may arrange to have occurred and be continuingfield examinations conducted as to the Inventory; (ef) after the occurrence and during the continuance of an Event of Defaultupon Agent’s request, Borrowers and Guarantors shall, at their expense, conduct through RGIS Washington Inventory Specialists, Inc. Service or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent and Borrowers and Guarantors shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to the inventory records of Obligors Borrowers and Guarantors to reconcile the inventory count to ObligorsBorrowers’ and Guarantors’ inventory records, as follows: (i) so long as Compliance Excess Availability is greater twenty (20%) percent of the Maximum Credit, no more than one (1) such physical count in any twelve (12) month period, and at a time to coincide with Borrowers’ and or Guarantors’ physical count of the Inventory, (ii) if Compliance Excess Availability is at any time less than or equal to twenty (20%) percent of the Maximum Credit, no more than two (2) such physical counts in any twelve (12) month period, and at a time to coincide with Borrowers’ and or Guarantors’ physical count of the Inventory, and (iii) if a Default or an Event of Default exists or has occurred and is continuing, such number of physical counts as Agent may request; provided, that, at any time or times as Agent may request, at Agent’s expense, Agent may arrange to have written reports or appraisals conducted as to the Inventory; (fg) Obligors assume each Borrower and Guarantor shall produce, use, store and maintain the Inventory, with all reasonable care and caution and in accordance with applicable standards of any insurance and in conformity with applicable laws (including the requirements of the Federal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (h) none of the Inventory or other Collateral constitutes farm products or the proceeds thereof; (i) each Borrower and Guarantor assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (gj) each Obligor no Borrower or Guarantor shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors such Borrower or Guarantor to repurchase such Inventory except for the right of return given to retail customers of Obligors any Borrower or Guarantor in the ordinary course of the business of Obligors such Borrower or Guarantor in accordance with the then current return policy of Obligorsuch Borrower; (hk) Obligors each Borrower and Guarantor shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (il) Obligors shall not no Borrower or Guarantor shall, without prior written notice to Agent or the specific identification of such Inventory in a report with respect thereto provided by such Borrower or Guarantor to Agent pursuant to Section 7.1(a) hereof, acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrower shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ such Borrower’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrowers shall conduct a physical count of the Inventory as required by and in accordance with GAAP and Borrowers’ own internal controls at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any other reasonable time or times as Agent may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (c) Obligors Borrowers shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: (i) except for sales of Inventory in the ordinary course of any Obligor’s business, (ii) its business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) location and except for Inventory shipped from the manufacturer thereof to Obligors a Borrower which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s request, Borrowers shall shall, at their expense, no more than one (1) time in any twelve (12) month period, but at any time or times as Agent may request on or after an Event of Default, deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and Lenders and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence Borrowers shall produce, use, store and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of maintain the Inventory in form, scope with all reasonable care and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent caution and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in material conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors assume none of the Inventory or other Collateral constitutes farm products or the proceeds thereof; (g) each Borrower assumes all responsibility and liability arising from or relating to the its production, use, sale or other disposition of the Inventory; (gh) each Obligor Borrowers shall not sell Inventory to any customer on approval, approval or any other similar basis which entitles the customer to return or may obligate Obligors Borrowers to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of ObligorInventory; (hi) Obligors Borrowers shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (ij) Obligors Borrowers shall not not, without prior written notice to Agent or the specific identification of such Inventory in a report with respect thereto provided by Borrowers to Agent pursuant to Section 7.1(a) hereof, acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.

Inventory Covenants. With respect to the Inventory: : (a) each Obligor Borrowers shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to AgentLender, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ Borrowers' cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrowers shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practicesyear, but at any time or times as Agent Lender may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply Agent Lender with a report in the form and with such specificity as may be reasonably satisfactory to Agent Lender concerning such physical count; (c) Obligors Borrowers shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of AgentLender, except: (i) except for sales of Inventory in the ordinary course of any Obligor’s business, (ii) a Borrower's business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) for Inventory shipped from the manufacturer thereof to Obligors which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s request, Borrowers shall deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency annually, and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence and during the continuance of an Event of Defaultother times upon Lender's request, Borrowers shall, at their expense, conduct through RGIS Inventory Specialistsbut at any time or times as Lender may request on or after an Event of Default, Inc. deliver or another inventory counting service reasonably acceptable cause to Agent, a physical count of be delivered to Lender written reports or appraisals as to the Inventory in form, scope and methodology acceptable to Agent, the results of Lender (which shall be reported directly by such inventory counting service to Agent and Borrowers shall promptly deliver confirmation in include a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to the inventory records of Obligors to reconcile the inventory count to Obligors’ inventory records; (f) Obligors assume all responsibility and liability arising from or relating to the production, use, sale or other disposition determination of the Orderly Liquidation Value of such Inventory; (g) each Obligor shall not sell Inventory and by an appraiser acceptable to any customer on approvalLender, addressed to Lender or any other basis upon which entitles the customer Lender is expressly permitted to return or may obligate Obligors to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of Obligor; (h) Obligors shall keep the Inventory in good condition (taken as a whole); and (i) Obligors shall not acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.rely;

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrower shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping in all material respects correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ the cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors by no later than February 15, 2000, the books and records of each Borrower shall be reconciled and adjusted to reflect the results of the 1999 year-end physical inventory and all reports with respect to Inventory provided by any Borrower to Agent and Lenders shall be based on the amount of the Inventory after giving effect to such reconciliation and adjustment; (c) each Borrower shall conduct a physical count of the Inventory of such Borrower at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practicesyear, but at any time or times as Agent may request on or after an Event of Default has occurred and for so long as the same is continuing in accordance with clause (e) belowcontinuing, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (cd) Obligors each Borrower shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: except (i) for sales of Inventory in the ordinary course of any Obligor’s such Borrower's business, (ii) to move Inventory directly from one location of such Borrower set forth or permitted herein to another such location of such Borrower or any other Borrower (so long as a financing statement between Agent as secured party and such other Borrower, as debtor, covering such Inventory has previously been recorded in the appropriate governmental offices of the jurisdiction of such location), provided, that, in no event shall the Inventory and Equipment located in Mexico have an aggregate value in excess of $8,000,000 at any time and (iii) for Inventory shipped from the manufacturer thereof to Obligors any Borrower or to any Borrower's customer which is in transit from such manufacturer to the locations set forth or permitted herein, and (iv) in connection with any other transactions herein or dispositions permitted by this Agreementto such customer; (de) upon Agent’s 's request, Borrowers shall shall, at their expense, no more than twice in any twelve (12) month period, but at any time or times as Agent may request on or after an Event of Default and for so long as the same is continuing, deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and Lenders, and upon which Agent and Lenders are expressly permitted to rely; provided(f) each Borrower shall produce, thatuse, (i) Borrowers acknowledge store and agree that such Inventory reports maintain the Inventory, with all reasonable care and appraisals shall be requested by Agent caution and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including, but not limited to, the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (fg) Obligors assume each Borrower assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory, except for liabilities incurred by a Lender due to acts or omissions of such Lender which constitute gross negligence or wilful misconduct as determined pursuant to a final non-appealable order of a court of competent jurisdiction; (gh) each Obligor Borrower shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors such Borrower to repurchase such Inventory (except for the right of return given to retail of customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of Obligorfor Inventory which is defective or non-conforming); (hi) Obligors each Borrower shall keep the Inventory in good and marketable condition (taken as a wholeother than obsolete Inventory); and (ij) Obligors each Borrower shall not not, without prior written notice to Agent, acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.

Inventory Covenants. With respect to the ------------------- Inventory: : (a) each Obligor Loan Party shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to the Administrative Agent and the Documentation Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ such Loan Party's cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Loan Parties shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any time the Administrative Agent or times as the Documentation Agent may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply the Administrative Agent and the Documentation Agent with a report in the form and with such specificity as may be reasonably satisfactory to the Administrative Agent or the Documentation Agent concerning such physical count; (c) Obligors Loan Parties shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of the Administrative Agent and the Collateral Agent, except: (i) except for sales of Inventory in the ordinary course of any Obligor’s business, (ii) its business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) location and except for Inventory shipped from the manufacturer thereof to Obligors such Loan Party which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon the Administrative Agent’s 's or the Documentation Agent's request, the Borrowers shall shall, at their expense, but at any time or times as the Administrative Agent or the Documentation Agent may request on or after an Event of Default, deliver or cause to be delivered to the Administrative Agent and the Documentation Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to the Administrative Agent and the Documentation Agent and by an appraiser acceptable to the Administrative Agent and the Documentation Agent, addressed to Agents and Lenders and upon which Agents and Lenders are expressly permitted to rely; (e) the results of which Loan Parties shall be reported directly by such inventory counting service to Agent produce, use, store and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to maintain the confirmation most recently delivered to Inventory with all reasonable care and accepted by Agent caution and in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors assume none of the Inventory or other Collateral constitutes farm products or the proceeds thereof; (g) each Loan Party assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (gh) each Obligor the Loan Parties shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors any Loan Party to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of ObligorInventory; (hi) Obligors the Loan Parties shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (ij) Obligors the Loan Parties shall not not, without prior written notice to the Administrative Agent and the Documentation Agent or the specific identification of such Inventory in a report with respect thereto provided by the Administrative Borrower to the Administrative Agent and the Documentation Agent pursuant to Section 8.03(a) hereof, acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.

Inventory Covenants. With respect to the Inventory: : (a) each Obligor Borrower and Guarantor shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ such Borrower's or Guarantor's cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrowers and Guarantors shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any time or times as Agent may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (c) Obligors Borrowers and Guarantors shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: (i) except for sales of Inventory in the ordinary course of any Obligor’s business, (ii) its business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) location and except for Inventory shipped from the manufacturer thereof to Obligors such Borrower or Guarantor which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s 's request, Borrowers shall shall, at their expense, no more than two (2) times in any twelve (12) month period, but at any time or times as Agent may request on or after an Event of Default, deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and Lenders and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence Borrowers and during the continuance of an Event of DefaultGuarantors shall produce, Borrowers shalluse, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of store and maintain the Inventory in form, scope with all reasonable care and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent caution and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors assume none of the Inventory or other Collateral constitutes farm products or the proceeds thereof; (g) each Borrower and Guarantor assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (gh) each Obligor Borrowers and Guarantors shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors any Borrower or Guarantor to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of Obligor; [*] (hi) Obligors Borrowers and Guarantors shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (ij) Obligors Borrowers and Guarantors shall not not, without prior written notice to Agent or the specific identification of such Inventory in a report with respect thereto provided by Administrative Borrower to Agent pursuant to Section 7.1(a) hereof, acquire or accept any Inventory on consignment or approval. In addition to, except and not in limitation of, the foregoing, with respect to Imported Inventory, Borrowers shall cause all bills of lading and other documents of title evidencing, covering or otherwise relating to Imported Inventory in transit to the premises of Borrowers or the premises of a Customs Broker or a Port Processor in the United States to name FNA as consignee, and Borrowers shall promptly deliver to Agent, upon Agent's request, a copy of each xxxx of lading or other document of title issued to FNA covering Imported Inventory purchased by FNA and delivered to a Freight Forwarder for shipment to FNA during the immediately preceding week; provided, however, that following Agent's written request delivered to Borrowers, Borrowers shall cause the issuer of each such xxxx of lading or other document of title to promptly deliver directly to Agent the original of each such xxxx of lading or other document of title, which shall be released by Agent only upon Agent's receipt of evidence, satisfactory to Agent, that the Imported Inventory covered thereby has been delivered into the possession of a Port Processor or Customs Broker from whom Agent has received a duly executed Collateral Access Agreement. In addition, at such time as Agent may direct, Borrower shall cause Agent or such financial institution or other person as Agent may specify to be named as consignee in all such bills of lading and other documents of title. Borrower shall cause all bills of lading or other documents of title evidencing FNA's Imported Inventory to be issued in the form of negotiable documents, as such term is defined in the Uniform Commercial Code. * Confidential information has been omitted pursuant to a request to the Securities and Exchange Commission for confidential treatment. The information has been separately filed with the Commission. Without limiting the generality of Section 7.3(h), Borrowers shall provide to Agent copies of all proposed agreements with any customers pursuant to which Borrowers would sell Inventory to such customers on a sale and return basis; provided that, Borrowers' compliance with the foregoing shall in no manner be deemed or constitute Agent's or Required Lenders' consent to Borrowers' sale of lines other than apparel inventory to the extent such Inventory is reported to Agent in accordance with the terms hereofany customers on a sale and return basis.

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrower and Guarantor shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ such Borrower's or Guarantor's cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrowers and Guarantor shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any time or times as Agent may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (c) Obligors Borrowers and Guarantor shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: (i) except for sales of Inventory in the ordinary course of any Obligor’s business, (ii) its business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) location and except for Inventory shipped from the manufacturer thereof to Obligors such Borrower or Guarantor which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s 's request, Borrowers shall shall, at their expense, no more than four (4) times in any twelve (12) month period, but at any time or times as Agent may request on or after an Event of Default, deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and Lenders and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence Borrowers and during the continuance of an Event of DefaultGuarantor shall produce, Borrowers shalluse, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of store and maintain the Inventory in form, scope with all reasonable care and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent caution and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors assume none of the Inventory or other Collateral constitutes farm products or the proceeds thereof; (g) each Borrower and Guarantor assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (gh) each Obligor Borrowers and Guarantor shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors any Borrower or Guarantor to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of ObligorInventory; (hi) Obligors Borrowers and Guarantor shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (ij) Obligors Borrowers and Guarantor shall not not, without prior written notice to Agent or the specific identification of such Inventory in a report with respect thereto provided by Administrative Borrower to Agent pursuant to Section 7.1(a) hereof, acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.

Inventory Covenants. With respect to the Inventory: (a) each Obligor US Borrower shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to AgentLender, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ such US Borrower’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors each US Borrower shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practicesyear, but at any time or times as Agent Lender may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply Agent Lender with a report in the form and with such specificity as may be reasonably satisfactory to Agent Lender concerning such physical count; (c) Obligors each US Borrower shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of AgentLender, except: (i) except for sales of Inventory in the ordinary course of any Obligorsuch US Borrower’s business, (ii) business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) for Inventory shipped from the manufacturer thereof to Obligors which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon AgentLender’s request, Borrowers shall each US Borrower shall, at its expense, but no more than once in any three (3) month period, but at any time or times as Lender may request on or after an Event of Default, deliver or cause to be delivered to Agent Lender written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to AgentLender and by an appraiser acceptable to Lender, addressed to Lender or upon which Lender is expressly permitted to rely; (e) each US Borrower shall produce, use, store and maintain the results of which shall be reported directly by such inventory counting service to Agent Inventory, with all reasonable care and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to caution and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors assume each US Borrower assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (g) each Obligor US Borrower shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors such US Borrower to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of ObligorInventory; (h) Obligors each US Borrower shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (i) Obligors each US Borrower shall not not, without prior written notice to Lender, acquire or accept any Inventory on consignment or approval, except for approval and (j) none of the sale of lines Inventory or other than apparel to Collateral constitutes farm products or the extent such Inventory is reported to Agent in accordance with the terms hereofproceeds thereof.

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrower shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to AgentLender, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ Borrower’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrower shall conduct a physical count cycle counts of its Inventory according to current practices (or, if requested by Lender upon the Inventory at least once each year (at which representatives occurrence and during the continuation of Agent may be present) and at such time or times as is consistent with current practices, but at any time or times as Agent may request after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, a physical Inventory count), and promptly following such physical inventory count shall supply Agent Lender with a report in the form and with such specificity as may be reasonably satisfactory to Agent Lender concerning such physical count; (c) Obligors Borrower shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of AgentLender, except: (i) except for sales of Inventory in the ordinary course of any ObligorBorrower’s business, (ii) business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) for Inventory shipped from the manufacturer thereof to Obligors which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon AgentLender’s request, Borrowers shall Borrower shall, at its expense, no more than once in any twelve (12) month period, but at any time or times as Lender may request on or after an Event of Default, deliver or cause to be delivered to Agent Lender written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent set forth by Lender and by an appraiser reasonably acceptable recommended by Lender (Lender shall use its commercially reasonable effort to Agentsupply Borrower with a choice of at least two appraisers from Lender’s approved list of appraisers), addressed to Agent and Lender or upon which Agent and Lenders are Lender is expressly permitted to rely; provided(e) Borrower shall produce, use, store and maintain the Inventory with all reasonable care and caution and in accordance with applicable standards of any insurance and in conformity with applicable laws (including the requirements of the Federal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (a) It is the intention of the parties hereto that the obligations of Borrower under the Financing Statements and guarantees thereof be secured by a perfected first priority security interest in the Collateral. Accordingly, with respect to assets acquired after the Closing Date that are intended to be subject to the Lien created by this Agreement but which are not so subject, Borrower shall, from time to time (and, in any event, within 30 days after the reasonable request by Lender to do so), (A) execute and deliver to Lender such amendments to Lender or such other documents as Lender shall reasonably deem necessary or advisable to grant to Lender, for the benefit of Lenders, a Lien on such assets, (B) take all actions necessary or advisable to cause such Lien to be duly perfected in accordance with all applicable requirements of law, including, without limitation, the filing of financing statements in such jurisdictions as may be reasonably requested by Lender, and (C) if requested by Lender, deliver to Lender legal opinions relating to the matters described in clauses (A) and (B) immediately preceding, which opinions shall be in form and substance, and from counsel, reasonably satisfactory to Lender. (b) With respect to any Person that, subsequent to the Closing Date, becomes a domestic Recourse Subsidiary of Parent, promptly upon the request of Lender: (i) Borrowers acknowledge cause such new Subsidiary to become a party to the Subsidiary Guarantee, pursuant to documentation which is in form and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; substance reasonably satisfactory to Lender and (ii) all such Inventory reports and appraisals if requested by Lender, deliver to Lender legal opinions relating to the matters described in clause (i) immediately preceding, which opinions shall be at the expense of Borrowersin form and substance, except for Inventory reports and appraisals in excess of the Required Frequencyfrom counsel, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers reasonably satisfactory to Lender. (a) at any time that an Event of Default shall exist exists or shall have has occurred and be continuing; (e) after the occurrence and during the continuance of an Event of Default, Borrowers shall, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of the Inventory in form, scope and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to the inventory records of Obligors to reconcile the inventory count to Obligors’ inventory records; (f) Obligors assume all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (g) each Obligor shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of Obligor; (h) Obligors shall keep the Inventory in good condition (taken as a whole); and is continuing (i) Obligors shall not acquire demand payment on Accounts or accept any other proceeds of Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.Collateral,

Inventory Covenants. With respect to the Inventory: (a) each Obligor Borrower and Guarantor shall and Parent shall cause each Additional L/C Debtor to at all times maintain inventory records reasonably satisfactory to Agent, keeping correct and accurate records itemizing and describing the kind, type, quality and quantity of Inventory, Obligors’ such Borrower’s or Guarantor’s cost therefor and daily withdrawals therefrom and additions thereto; (b) Obligors Borrowers and Guarantors shall conduct a physical count of the Inventory at least once each year (at which representatives of Agent may be present) and at such time or times as is consistent with current practices, but at any time or times as Agent may request on or after an Event of Default has occurred and is continuing in accordance with clause (e) belowDefault, and promptly following such physical inventory shall supply Agent with a report in the form and with such specificity as may be reasonably satisfactory to Agent concerning such physical count; (c) Obligors Borrowers and Guarantors shall not remove any Inventory from the locations set forth or permitted herein, without the prior written consent of Agent, except: (i) except for sales of Inventory in the ordinary course of any Obligor’s business, (ii) its business and except to move Inventory directly from one location set forth or permitted herein to another such location, (iii) location and except for Inventory shipped from the manufacturer thereof to Obligors such Borrower or Guarantor which is in transit to the locations set forth or permitted herein, and (iv) in connection with any other transactions or dispositions permitted by this Agreement; (d) upon Agent’s request, Borrowers shall shall, at its expense, no more than two (2) times in any twelve (12) month period, but at any time or times as Agent may request on or after an Event of Default, deliver or cause to be delivered to Agent written reports or appraisals as to the Inventory of Obligors in form, scope and methodology reasonably acceptable to Agent and by an appraiser reasonably acceptable to Agent, addressed to Agent and Lenders and upon which Agent and Lenders are expressly permitted to rely; provided, that, (i) Borrowers acknowledge and agree that such Inventory reports and appraisals shall be requested by Agent and shall be delivered by Borrowers with at least the Required Frequency and may be requested by Agent and shall be delivered by Borrowers at any time following the occurrence and during the continuance of an Event of Default; and (ii) all such Inventory reports and appraisals shall be at the expense of Borrowers, except for Inventory reports and appraisals in excess of the Required Frequency, provided, that, all such Inventory reports and appraisals shall be at the expense of Borrowers at any time that an Event of Default shall exist or shall have occurred and be continuing; (e) after the occurrence Borrowers and during the continuance of an Event of DefaultGuarantors shall produce, Borrowers shalluse, at their expense, conduct through RGIS Inventory Specialists, Inc. or another inventory counting service reasonably acceptable to Agent, a physical count of store and maintain the Inventory in form, scope with all reasonable care and methodology acceptable to Agent, the results of which shall be reported directly by such inventory counting service to Agent caution and Borrowers shall promptly deliver confirmation in a form reasonably satisfactory to Agent (or in a form substantially similar to the confirmation most recently delivered to and accepted by Agent in accordance with this Section) that appropriate adjustments have been made to applicable standards of any insurance and in conformity with applicable laws (including the inventory records requirements of Obligors to reconcile the inventory count to Obligors’ inventory recordsFederal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto); (f) Obligors assume none of the Inventory or other Collateral constitutes farm products or the proceeds thereof; (g) except upon prior notice to and written approval by Agent, each Borrower and Guarantor assumes all responsibility and liability arising from or relating to the production, use, sale or other disposition of the Inventory; (gh) each Obligor Borrowers and Guarantors shall not sell Inventory to any customer on approval, or any other basis which entitles the customer to return or may obligate Obligors any Borrower or Guarantor to repurchase such Inventory except for the right of return given to retail customers of Obligors in the ordinary course of the business of Obligors in accordance with the then current return policy of ObligorInventory; (hi) Obligors Borrowers and Guarantors shall keep the Inventory in good condition (taken as a whole)and marketable condition; and (ij) Obligors Borrowers and Guarantors shall not not, without prior written notice to Agent or the specific identification of such Inventory in a report with respect thereto provided by Administrative Borrower to Agent pursuant to Section 7.1(a) hereof, acquire or accept any Inventory on consignment or approval, except for the sale of lines other than apparel to the extent such Inventory is reported to Agent in accordance with the terms hereof.