EXHIBIT 10.19.1
CONSENT AND AMENDMENT NO. 1 TO AGREEMENTS
This CONSENT AND AMENDMENT NO. 1 TO AGREEMENTS (this "Amendment") is
entered into as of February 22, 2007 by and among TARRANT APPAREL GROUP, a
corporation organized under the laws of the State of California ("Holding"),
FASHION RESOURCE (TCL), INC., a corporation organized under the laws of the
State of California ("Fashion"), TAG MEX, INC., a corporation organized under
the laws of the State of California ("Tag Inc."), UNITED APPAREL VENTURES, LLC,
a limited liability company formed under the laws of the State of California
("United"), PRIVATE BRANDS, INC., a corporation organized under the laws of the
State of California ("Private"), NO! JEANS, INC., a corporation organized under
the laws of the State of California ("No! Jeans"; and together with Holding,
Fashion, Tag Inc., United and Private, each individually a "Borrower" and
collectively, the "Borrowers"), the financial institutions which are now or
which hereafter become a party to the Loan Agreement (as hereinafter defined)
(each a "Lender" and collectively, the "Lenders"), GMAC COMMERCIAL FINANCE LLC,
a limited liability company organized under the laws of the State of Delaware
("GMAC CF"), as agent for the Lenders (GMAC CF, in such capacity, "Agent"), and
GMAC CF, as Factor.
WHEREAS, (a) the Borrowers, Lenders, and Agent have entered into
certain financing arrangements pursuant to certain financing agreements,
including, without limitation, that certain Loan and Security Agreement dated as
of June 16, 2006 (as the same may now exist, or may hereafter be amended,
restated, renewed, extended, supplemented, substituted, or otherwise modified,
the "Loan Agreement") and (b) the Borrowers and Factor have entered into certain
financing arrangements pursuant to that certain Amended and Restated Factoring
Agreement dated as of June 16, 2006 (as the same may now exist, or may hereafter
be amended, restated, renewed, extended, supplemented, substituted, or otherwise
modified, the "Factoring Agreement"; together with the Loan Agreement and all of
the notes, guarantees, mortgages, instruments, agreements and other documents
executed and/or delivered in connection with the Factoring Agreement and the
Loan Agreement, as the same may now exist, or may hereafter be amended,
restated, renewed, extended, supplemented, substituted, or otherwise modified,
the "Loan Agreements"); and
WHEREAS, the Borrowers have advised Agent and Factor that Holdings
intends to dissolve certain of its subsidiaries which have no assets,
Indebtedness or material liabilities, namely: United, No! Jeans, PBCR, Inc., a
California corporation ("PBCR"), Tag Mex, LLC, a California corporation ("Tag
LLC"), UAV (Delaware), LLC, a Delaware limited liability company ("UAV
Delaware"), and Xxxx Xxx International, LLC, a Delaware limited liability
company ("Xxxx Xxx"; and together with United, No! Jeans, PBCR, Tag LLC and UAV
Delaware, each individually an "Inactive Subsidiary" and collectively, the
"Inactive Subsidiaries"); and
WHEREAS, the Borrowers have requested that Agent, the Lenders and
Factor consent to Holdings dissolving the Inactive Subsidiaries and that Agent,
the Lenders and Factor, as applicable, amend and modify certain provisions of
the Loan Agreements in connection therewith; and
WHEREAS, Agent, the Lenders and Factor have agreed to accommodate the
Borrowers' requests, subject to the terms and conditions of this Amendment;
NOW, THEREFORE, upon the mutual agreements and covenants set forth
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. DEFINITIONS. Capitalized terms not otherwise defined herein shall have
the meanings ascribed to such terms in the Loan Agreement.
2. CONSENT TO DISSOLUTION OF THE INACTIVE SUBSIDIARIES. Subject to the
terms and conditions of this Amendment, Agent, the Lenders and Factor
hereby consent to the dissolution of the Inactive Subsidiaries.
3. AMENDMENTS TO LOAN AGREEMENT. As of the effective date of this
Amendment, the Loan Agreement is hereby amended as follows:
(a) The definition of "Borrower" as set forth in Section 1.2 of
the Loan Agreement is hereby amended and restated in its
entirety as follows:
""Borrower" or "Borrowers" shall have the meaning set
forth in the preamble to this Agreement and shall extend to
all permitted successors and assigns of such Persons;
provided, however, that from and after the Amendment No. 1
Effective Date, each of United and No! Jeans shall not be a
"Borrower" and the term "Borrowers" shall include neither of
them."
(b) The following definition is hereby inserted in Section 1.2 of
the Loan Agreement in the appropriate alphabetical position:
""Amendment No. 1 Effective Date" shall mean February 22,
2007."
4. AMENDMENTS TO FACTORING AGREEMENT. As of the effective date of this
Amendment, the Factoring Agreement is hereby amended as follows:
(a) The definition of "Client" as set forth in Rider I to the
Factoring Agreement is hereby amended and restated in its
entirety as follows:
""Client" shall mean, individually and collectively,
jointly and severally, Tarrant Apparel Group, Fashion Resource
(TCL), Inc., Tag Mex, Inc. and Private Brands, Inc., together
with their respective successors and assigns."
5. REPRESENTATIONS, WARRANTIES AND COVENANTS. The Borrowers represent,
warrant and covenant with and to Agent, the Lenders and Factor as
follows, which representations, warranties and covenants are continuing
and shall survive the execution and delivery hereof, the truth and
accuracy of, or compliance with each, together with the
representations, warranties and covenants in the other Loan Agreements,
being a condition of the effectiveness of this Amendment and a
continuing condition of the making or providing of any Revolving
Advances or Letters of Credit by the Lenders to the Borrowers:
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(a) All of the representations and warranties set forth in the
Loan Agreement, as amended hereby, and the other Loan
Agreements, are true and correct in all material respects
after giving effect to the provisions hereof, except to the
extent any such representation or warranty is made as of a
specified date, in which case such representation or warranty
shall have been true and correct as of such date.
(b) None of the Inactive Subsidiaries has any assets, Indebtedness
or material liabilities.
6. CONDITIONS PRECEDENT. The effectiveness of this Amendment and the
agreement of Agent, the Lenders and Factor to the modifications and
amendments set forth in this Amendment are subject to the fulfillment
of the following conditions precedent:
(a) No Event of Default or Default shall have occurred and be
continuing on the date of this Amendment, or would exist after
giving effect to the transactions contemplated under this
Amendment;
(b) Agent shall have received counterparts of this Amendment duly
executed and delivered by the Borrowers, Agent, the Lenders
and Factor; and
(c) Agent shall have received a copy of a fully-executed consent
of the agent and lenders under the Guggenheim Loan Agreement,
consenting to the dissolution of the Inactive Subsidiaries.
7. EFFECT OF THIS AMENDMENT. Except as specifically set forth herein, no
other changes or modifications to the Loan Agreements are intended or
implied, and, in all other respects, the Loan Agreements shall continue
to remain in full force and effect in accordance with their terms as of
the date hereof. This Amendment, and the instruments and agreements
delivered pursuant hereto and thereto constitute the entire agreement
of the parties with respect to the subject matter hereof and thereof,
and supersede all prior oral or written communications, memoranda,
proposals, negotiations, discussions, term sheets and commitments with
respect to the subject matter hereof and thereof. Except as
specifically set forth herein, nothing contained herein shall evidence
a waiver or amendment by Agent, the Lenders or Factor of any other
provision of the Loan Agreements. Without limiting the foregoing,
nothing herein contained shall, or shall be deemed to, waive any Event
of Default of which Agent, any Lender or Factor does not or do not have
actual knowledge as of the date hereof, or any event or circumstance
which with notice or passage of time, or both, would constitute an
Event of Default. Agent, the Lenders and Factor may waive any of such
Events of Default, but only in a specific writing signed by Agent, the
Lenders and Factor.
8. FURTHER ASSURANCES. The Borrowers shall execute and deliver such
additional documents and take such additional action as may be
reasonably requested by Agent to effectuate the provisions and purposes
of this Amendment.
9. BINDING EFFECT. This Amendment shall be binding upon and inure to the
benefit of each of the parties hereto and their respective successors
and assigns.
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10. GOVERNING LAW. The rights and obligations hereunder of each of the
parties hereto shall be governed by and interpreted and determined in
accordance with the internal laws of the State of New York (without
giving effect to principles of conflict of laws).
11. COUNTERPARTS. This Amendment may be signed in counterparts, each of
which shall be an original and all of which taken together constitute
one agreement. In making proof of this Amendment, it shall not be
necessary to produce or account for more than one counterpart signed by
the party to be charged. Any signatures delivered by a party by
facsimile transmission or by electronic mail transmission shall be
deemed an original signature hereto.
[Remainder of Page Intentionally Left Blank]
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Each of the parties has signed this Amendment as of the day and year
first above written.
TARRANT APPAREL GROUP
By: /S/ XXXXXXX XXXXX
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Title: Chief Financial Officer
FASHION RESOURCE (TCL), INC.
By: /S/ XXXXXXX XXXXX
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Title: Chief Financial Officer
TAG MEX, INC.
By: /S/ XXXXXXX XXXXX
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Title: Chief Financial Officer
PRIVATE BRANDS, INC.
By: /S/ XXXXXXX XXXXX
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Title: Chief Financial Officer
NO! JEANS, INC.
By: /S/ XXXXXXX XXXXX
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Title: Chief Financial Officer
UNITED APPAREL VENTURES, LLC
By: /S/ XXXXXXX XXXXX
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Title: Chief Financial Officer
GMAC COMMERCIAL FINANCE LLC,
as Agent, a Lender and Factor
By: /S/ ILLEGIBLE
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Title: Senior Vice President
UPS CAPITAL CORPORATION,
as a Lender
By: /S/ XXXX X. XXXXXXXX
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Title: Director of Portfolio Management
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