EXHIBIT 10.3
INTERCREDITOR AGREEMENT
INTERCREDITOR AGREEMENT ("AGREEMENT"), dated as of December 14, 2004,
among GMAC COMMERCIAL FINANCE LLC ("GMAC CF"), UPS CAPITAL GLOBAL TRADE FINANCE
CORPORATION ("UPS"), X.X. Xxxxxxx & Company, as agent (in such capacity,
"AGENT") for itself and the subordinated secured lenders party to the Debentures
referred to below (such subordinated secured lenders, the "DEBENTURE HOLDERS"),
and TARRANT APPAREL GROUP (d/b/a Fashion Resource), a California corporation
("TARRANT").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, GMAC CF, Tarrant, FASHION RESOURCE (TCL), INC., a California
corporation ("FR"), TAG MEX, INC., a California corporation ("MEX"), UNITED
APPAREL VENTURES, LLC, a California limited liability company ("United"),
PRIVATE BRANDS, INC., a California corporation ("PRIVATE BRANDS"), and NO!
JEANS, INC. ("NO! JEANS"), a California corporation (collectively, the "GMAC CF
OBLIGORS") have agreed to amend and restate the prior GMAC CF Credit Agreement
in its entirety as set forth in that certain Factoring Agreement effective as of
September 29, 2004 (as amended, restated, modified or otherwise supplemented
from time to time, the "GMAC CF FACTORING Agreement"); and
WHEREAS, to secure its obligations pursuant to the GMAC CF Factoring
Agreement, Tarrant and the other GMAC CF Obligors each granted in favor of GMAC
CF, a security interest in certain of its personal property as more fully set
forth hereafter; and
WHEREAS, Tarrant Company Limited ("TCL"), Marble Limited ("ML") and
Trade Link Holdings Limited ("TLHL" and together with TCL and ML, collectively,
"TARRANT SUBSIDIARIES" and each, a "TARRANT SUBSIDIARY"), each a corporation
organized under the laws of Hong Kong, and UPS are each party to that certain
Syndicated Letter of Credit Facility Agreement dated June 13, 2002 (the "UPS
CREDIT FACILITY") pursuant to which UPS has extended a revolving letter of
credit facility to Tarrant Subsidiaries to finance the purchase and processing
of certain inventory from time to time by, or for the benefit of, Tarrant
Subsidiaries; and
WHEREAS, each of Tarrant and FR has executed and delivered that certain
Guaranty and Security Agreement dated as of May 30, 2002, in favor of UPS,
guaranteeing the obligations of Tarrant Subsidiaries to UPS arising under the
UPS Credit Facility (the "GUARANTEED UPS OBLIGATIONS") and, to secure the
Guaranteed UPS Obligations, each of Tarrant and FR (collectively, the "UPS
OBLIGORS") has granted therein in favor of UPS a security interest in certain of
its personal property as more fully set forth hereafter; and
WHEREAS, GMAC CF, UPS, Tarrant, and certain other controlled
subsidiaries of Tarrant are parties to that certain Amended and Restated
Intercreditor Agreement dated as of December 13, 2004 (the "GMAC CF/UPS
INTERCREDITOR AGREEMENT"); and
WHEREAS, in connection with the issuance and sale by Tarrant of 6%
Secured Convertible Debentures due December 14, 2007, in the original aggregate
principal amount of $10,000,000 (the "DEBENTURES"), which Debentures are secured
by a subordinated security interest in the Subordinated Collateral (as defined
below), GMAC CF, UPS, Agent and Tarrant have agreed to enter into this Agreement
as set forth herein;
NOW, THEREFORE, the parties agree as follows:
SECTION 1. DEFINITIONS. As used herein (except as otherwise expressly
provided), the following terms shall have the meanings herein specified. Defined
terms in this Agreement shall include in the singular number the plural and in
the plural number the singular. All terms defined in the Uniform Commercial
Code, unless otherwise defined herein, shall have the meanings set forth
therein.
"BUSINESS DAY" means any day other than a day on which commercial banks
are authorized or required to close in Atlanta, Georgia or New York, New York.
"COLLATERAL" means, collectively, the GMAC CF Collateral and the UPS
Collateral.
"CREDITORS" means GMAC CF, UPS, Agent and the Debenture Holders, and
their respective successors and assigns.
"DEBTOR" shall mean Tarrant, any GMAC CF Obligor or any UPS Obligor.
"GMAC CF COLLATERAL" has the meaning set forth on SCHEDULE 1 hereto.
"GMAC CF DEBT" means all indebtedness, obligations and liabilities of
any GMAC CF Obligor, direct or indirect, absolute or contingent, to GMAC CF or
in connection with any of the GMAC CF Loan Documents until the irrevocable
payment in full of all principal, interest and other amounts thereunder, in each
case including, without limitation, interest accruing from and after the
commencement of a voluntary or involuntary bankruptcy proceeding whether or not
such interest is paid or payable to the applicable Creditor.
"GMAC CF LOAN DOCUMENTS" shall mean collectively, the GMAC CF Factoring
Agreement and all agreements, documents and instruments at any time executed
and/or delivered by Tarrant or any of the subsidiaries of Tarrant a party
thereto or any other person to, with or in favor of GMAC CF in connection
therewith or related thereto, as all of the foregoing now exist or may hereafter
be amended, modified, supplemented, extended, renewed, restated or replaced from
time to time.
"INSOLVENCY PROCEEDING" shall mean, as to any Debtor any of the
following, occurring after the date hereof: (a) any case or proceeding with
respect to such Person under the U.S. Bankruptcy Code, any other federal, state
or provincial bankruptcy, insolvency, reorganization or other law affecting
creditors' rights generally or any other or similar proceedings of any other
jurisdiction or otherwise seeking any stay, reorganization, arrangement,
liquidation, dissolution, composition or readjustment of the obligations and
indebtedness of such Person or (b) any proceeding seeking the appointment of any
receiver, administrative receiver, receiver and manager, examiner, judicial
custodian, trustee, liquidator, official manager, administrator or similar
official for such Person or any material part of its properties or (c) any
proceedings for liquidation, dissolution or other winding up of the business of
such Person or (d) the sale of all or substantially all of the assets or capital
stock of such Person or (e) any assignment for the benefit of creditors or any
marshaling of assets of such Person.
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"LOAN AGREEMENTS" means the GMAC CF Factoring Agreement, the UPS Credit
Facility, and the Debentures.
"LOAN DOCUMENTS" means the GMAC CF Loan Documents, the UPS Loan
Documents, and the Subordinated Loan Documents.
"OBLIGATIONS" means all indebtedness, obligations and liabilities of
any Person, direct or indirect, absolute or contingent, to any of the Creditors
or in connection with any of the Loan Documents until the irrevocable payment in
full of all principal, interest and other amounts thereunder, in each case
including, without limitation, interest accruing from and after the commencement
of a voluntary or involuntary bankruptcy proceeding whether or not such interest
is paid or payable to the applicable Creditor.
"PERSON" or "PERSON" shall mean any individual, sole proprietorship,
partnership, corporation (including, without imitation, any corporation which
elects subchapter S status under the Internal Revenue Code of 1986, as amended),
limited liability company, limited liability partnership, business trust,
unincorporated association, joint stock company, trust, joint venture, or other
entity or any government or any agency or instrumentality or political
subdivision thereof.
"SENIOR CREDITORS" shall mean individually and collectively GMAC CF and
UPS.
"SENIOR DEBT" shall mean individually and collectively the GMAC CF Debt
and the UPS Debt.
"SUBORDINATED COLLATERAL" has the meaning set forth on SCHEDULE 3
hereto.
"SUBORDINATED CREDITORS" shall mean individually and collectively the
Agent and the Debenture Holders.
"SUBORDINATED INDEBTEDNESS" means all indebtedness, obligations and
liabilities of Tarrant, direct or indirect, absolute or contingent, to the
Subordinated Creditors or in connection with any of the Subordinated Loan
Documents until the irrevocable payment in full of all principal, interest and
other amounts thereunder, in each case including, without limitation, interest
accruing from and after the commencement of a voluntary or involuntary
bankruptcy proceeding whether or not such interest is paid or payable to the
Subordinated Creditors.
"SUBORDINATED LOAN DOCUMENTS" shall mean, collectively, the Debentures
and all agreements, documents and instruments at any time executed and/or
delivered by Tarrant to, with or in favor of the Debenture Holders or the Agent,
for the ratable benefit of the Debenture Holders, in connection with or related
to the Debentures, other than the Registration Rights Agreement with respect to
the shares of Common Stock underlying the Debentures, as all of the foregoing
now exist or may hereafter be amended, modified, supplemented, extended,
renewed, restated or replaced from time to time as permitted by this Agreement.
"SUBSIDIARY STOCK" shall mean all of the issued and outstanding shares
of stock of a any Debtor (other than Tarrant), directly or indirectly, owned or
controlled, by Tarrant.
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"UCC" or "UNIFORM COMMERCIAL CODE" shall mean the Uniform Commercial
Code as the same may, from time to time, be enacted and in effect in any
applicable jurisdiction.
"UPS COLLATERAL" has the meaning set forth on SCHEDULE 2 hereto.
"UPS DEBT" means all indebtedness, obligations and liabilities of any
UPS Obligor, direct or indirect, absolute or contingent, to UPS or in connection
with any of the UPS Loan Documents until the irrevocable payment in full of all
principal, interest and other amounts thereunder, in each case including,
without limitation, interest accruing from and after the commencement of a
voluntary or involuntary bankruptcy proceeding whether or not such interest is
paid or payable to the applicable Creditor.
"UPS LOAN DOCUMENTS" shall mean collectively, the UPS Credit Facility
and all agreements, documents and instruments at any time executed and/or
delivered by Tarrant, any of the subsidiaries of Tarrant a party thereto, or
Tarrant Subsidiaries or any other person to, with or in favor of UPS, as all of
the foregoing now exist or may hereafter be amended, modified, supplemented,
extended, renewed, restated or replaced from time to time.
SECTION 2. CONSENT; PRIORITY OF LIENS; ACKNOWLEDGEMENTS OF SECURITY
INTEREST; EXISTING AGREEMENT.
(a) CONSENT. Notwithstanding any negative pledge or other
restriction in the GMAC CF Loan Documents or the UPS Loan Documents, each of
GMAC CF and UPS hereby consents to the transactions contemplated by the
Subordinated Loan Documents including the loans to Tarrant evidenced by the
Debentures and the lien and pledge of the Subordinated Collateral by Tarrant in
favor of Agent, for the ratable benefit of the Debenture Holders.
(b) PRIORITY OF LIENS.
(i) Notwithstanding anything to the contrary including,
without limitation, the date, time, manner or order of perfection or
attachment of the security interests and liens on the Collateral
granted by Tarrant to either of the Senior Creditors or the
Subordinated Creditors, and notwithstanding the usual application of
the priority provisions of the UCC or any other applicable law or
judicial decision of any jurisdiction, or whether any Subordinated
Creditor holds possession of all or any part of the Collateral, or if a
Secured Creditor or a Subordinated Creditor is perfected without filing
or possession in any part of the Collateral, the parties hereto agree
that the Lien in favor of GMAC CF on the GMAC CF Collateral and the
Lien in favor of UPS on the UPS Collateral shall be first, senior and
prior security interests and Liens on the Collateral, prior in interest
and superior to the Lien of the Subordinated Creditors on the
Subordinated Collateral.
(ii) No Subordinated Creditor shall contest the validity,
perfection or enforceability of the Liens on the GMAC CF Collateral and
the UPS Collateral or any other Lien or security interest granted to
any Senior Creditor by Tarrant or any other Debtor, or any payment on
the GMAC CF Debt or the UPS Debt or the allowance of the GMAC CF Debt
or the UPS Debt as a senior secured claim, and Agent, on behalf of
Agent and the Debenture Holders,
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agrees to cooperate in the defense of any action contesting the
validity, perfection or enforceability of such Liens or security
interests or such payment or allowance.
(c) ACKNOWLEDGMENTS. Agent, for the ratable benefit of the
Debenture Holders, shall hold no lien or have any security interest in any of
the GMAC CF Collateral or UPS Collateral or any other assets of Tarrant,
including any Subsidiary Stock, or any other Debtor except for the Subordinated
Collateral.
(d) EXISTING INTERCREDITOR AGREEMENT. Nothing herein is intended
to, and shall not, amend or modify the terms of the Existing Intercreditor
Agreement or the rights and obligations of GMAC CF and UPS, as between such
parties, under the Existing Intercreditor Agreement.
SECTION 3. OTHER AGREEMENTS.
(a) TURNOVER OF PROCEEDS. Agent, on behalf of Agent and the
Debenture Holders, agrees that it will hold any proceeds of any GMAC CF
Collateral that it may receive for the account of GMAC CF and pay, in like money
and funds, any such amounts that it may receive to GMAC CF promptly upon
receipt. Agent, on behalf of Agent and the Debenture Holders, agrees that it
will hold any proceeds of any UPS Collateral for the account of UPS, and pay, in
like money and funds, any such amounts that it may receive to UPS promptly upon
receipt. Notwithstanding any provision of any insurance policy or assignment to
the contrary, if Agent, for the ratable benefit of the Debenture Holders,
receives any insurance proceeds paid or payable as a result of casualty, loss,
theft or other event relating to the GMAC CF Collateral, Agent shall hold such
proceeds in trust for GMAC CF and will promptly deliver the same to GMAC CF in
the form received, accompanied by any necessary assignments or endorsements.
Notwithstanding any provision of any insurance policy or assignment to the
contrary, if Agent, for the ratable benefit of the Debenture Holders, receives
any insurance proceeds paid or payable as a result of casualty, loss, theft or
other event relating to the UPS Collateral, Agent shall hold such proceeds in
trust for UPS and will promptly deliver the same to UPS in the form received,
accompanied by any necessary assignments or endorsements.
(b) LIMITATION ON DUTIES. Agent, on behalf of Agent and the
Debenture Holders, agrees that neither GMAC CF nor UPS shall have any duties to
Agent or any of the Debenture Holders under or in respect of the Subordinated
Loan Documents.
(c) RIGHTS TO DEAL WITH COLLATERAL. Agent, on behalf of Agent and
the Debenture Holders, agrees that (i) UPS shall be entitled to sell, transfer
or otherwise dispose of or deal with the UPS Collateral as provided in the UPS
Credit Facility, and (ii) GMAC CF shall be entitled to sell, transfer or
otherwise dispose of or deal with the GMAC CF Collateral as provided in the GMAC
CF Factoring Agreement. Upon request of GMAC CF or UPS, Agent, on behalf of
Agent and the Debenture Holders, agrees that it will execute and deliver such
further documents (including, without limitation, releases and termination
statements) in conjunction with the sale, transfer or other disposition of any
GMAC CF Collateral or UPS Collateral, as applicable, as shall be necessary or
desirable, in the commercially reasonable opinion of GMAC CF or UPS, in order to
effectuate the disposition of such collateral by such party. Each of Tarrant and
Agent, on behalf of Agent and the Debenture Holders, hereby waives
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any rights it may have to require marshalling of the Collateral. Accordingly,
Agent, on behalf of Agent and the Debenture Holders, hereby agrees that UPS may
liquidate the UPS Collateral in any order in its sole discretion and GMAC CF may
liquidate the GMAC CF Collateral in any order in its sole discretion.
(d) AMENDMENT OF LOAN DOCUMENTS. Each Senior Creditor reserves the
right, in its sole discretion (but with any required consent of Tarrant and any
other party thereto, and without limiting the obligations of Tarrant or any
other party under any Loan Document), to amend, waive or otherwise modify any of
the provisions of the Loan Documents to which it is a party and, in its sole
discretion, to exercise or refrain from exercising any powers or rights which it
may have thereunder.
(e) TRANSFERS. Notwithstanding any provision to the contrary in
any Loan Agreement and without limiting Section 5 hereof, any Creditor may
transfer this Agreement or any other Loan Document or all or a portion of any of
its rights and obligations under this Agreement or any other Loan Document
(whether by way of security or otherwise) to one or more transferees, provided
that each such transferee shall have, from and after the effective date of such
transfer, to the extent of the interest transferred, agreed in writing to be
bound by this Agreement to the same extent as if substituted for its transferor
hereunder and shall thereby succeed to and assume the rights and obligations of
such transferor under this Agreement and the other Loan Documents, and the
transferor thereupon shall, to the same extent, be released from its obligations
under this Agreement.
(f) CERTAIN NOTICES BY AGENT. Agent, on behalf of Agent and the
Debenture Holders, hereby agrees that it shall promptly notify GMAC CF and UPS
of Agent declaring in writing to Tarrant an Event of Default (as defined in the
Debentures) under the Subordinated Loan Documents.
(g) STANDSTILL.
(i) Agent, on behalf of Agent and the Debenture Holders,
agrees that it shall not exercise any rights (including, but not
limited to, setoff rights) nor assert any claims with respect to the
Collateral or the Subsidiary Stock, nor seek to foreclose on its
security interests, nor take any action or institute any proceedings,
directly or indirectly, with respect to the Collateral (including, but
not limited to, commencing or joining with any other creditor or
creditors in commencing any Insolvency Proceeding against any Debtor)
until the receipt by Agent, for the ratable benefit of the Debenture
Holders, of notice from GMAC CF that the GMAC CF Obligors have
indefeasibly satisfied in full the GMAC CF Debt and from UPS that the
UPS Obligors have indefeasibly satisfied in full the UPS Debt.
(ii) Notwithstanding Section 3(g)(i) (except, with respect
to clause (C), any actions described in clause (C) shall be subject to,
and not in contravention of, such Section) or any other provision of
this Agreement to the contrary, this Agreement does not prohibit,
restrict or limit a Debenture Holder's right independently of, and
without the consent of, the Agent, for the ratable benefit of the
Debenture Holders, or any other Lender, to: (A) receive shares of
Tarrant's Common Stock upon conversion or exercise of the Debentures or
any other securities issued in connection therewith, and to seek
specific performance thereof; or (B) receive
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payments to the extent provided for under Section 3(h)(i)(A) below; or
(C) seek to collect the Subordinated Indebtedness or take any other
action, including a declaration of default as to, or acceleration of,
any Subordinated Indebtedness or assertion of any claims or otherwise
initiating any Insolvency Case, or instituting any other legal
proceeding against Tarrant.
(h) SUBORDINATION OF THE SUBORDINATED INDEBTEDNESS.
(i) Tarrant and Agent, on behalf of Agent and the
Debenture Holders, agree in favor of Senior Creditors that until all
Senior Debt is indefeasibly paid and satisfied in full:
(A) Tarrant shall not, directly or indirectly,
make, and Agent, on behalf of Agent and the Debenture Holders,
agrees that it shall not, directly or indirectly, accept or
receive, any payment of principal or interest or any
prepayment or non-mandatory payment or any payment pursuant to
acceleration or claims of breach or to acquire Subordinated
Indebtedness or otherwise in respect of any Subordinated
Indebtedness; except that, so long as no Event of Default, or
event which with the giving of notice, passage of time, or
both, would constitute an Event of Default, shall have
occurred and be continuing under the terms of either of the
GMAC CF Loan Documents or UPS Loan Documents or would be
caused thereby, Agent, for the ratable benefit of the
Debenture Holders, and the Debenture Holders may collect and
receive and Tarrant may pay (1) regularly scheduled
installments on a quarterly basis of interest at a per annum
rate of 6%, as they become due (but not in advance, and
without acceleration), (2) payment of liquidated damages and
fees pursuant to the terms of the Debenture or the transaction
documents entered into in connection therewith, and (3) after
indefeasible payment of the Senior Debt, principal at maturity
of the Debentures in accordance with the terms and conditions
of the Debentures;
(B) Tarrant shall not grant to Agent, for the
ratable benefit of the Debenture Holders, and Agent, on behalf
of Agent and the Debenture Holders, agrees that it shall not
acquire any additional collateral or guarantees for any
Subordinated Indebtedness; and
(C) Tarrant and Agent shall not amend, modify,
alter or change the terms of any of the Subordinated Loan
Documents or any other arrangements related to the
Subordinated Indebtedness, without the prior written consent
of Senior Creditors;
(ii) A legend shall be written by Agent on any instrument
at any time evidencing the Subordinated Indebtedness to the effect that
it is subject to the terms and conditions of this Agreement.
(iii) Should any payment of or distribution on account of
any Subordinated Indebtedness be received or collected by Agent, for
the ratable benefit of the Debenture Holders, to the extent such
payment or distribution was not permitted under Section 3(h)(i)(A)
hereof, such payment shall be held in trust by Agent for the benefit of
Senior Creditors and shall be delivered forthwith to Senior Creditors
for application to Senior Debt, in the form received with any necessary
endorsement or assignment. Such payment shall be split among the Senior
Creditors on a 50/50 basis.
(vi) Tarrant and Agent, on behalf of Agent and the
Debenture Holders, waive notice of acceptance hereof by Senior
Creditors, and waive notice of and consent to the creation
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of any Senior Debt, extensions granted or other action taken by Senior
Creditors in reliance hereon, the acquisition or release of collateral
for or guarantors of the payment of Senior Debt, the releasing of any
other subordinating creditor, if applicable. Tarrant and Agent, on
behalf of Agent and the Debenture Holders, waive demand, presentment,
protest, notice of protest and of default and any and all other notices
(except as expressly provided for herein) to which any of them might
otherwise be entitled.
(i) INSOLVENCY. This Agreement shall be applicable both before and
after the commencement of any Insolvency Proceeding by or against Tarrant and
all converted and succeeding cases in respect thereof. The relative rights, as
provided for in this Agreement, shall continue after the commencement of any
such case on the same basis as prior to the date of the commencement of any such
case, as provided in this Agreement, subject to any court order approving the
financing of or use of cash collateral by Tarrant, as debtor-in-possession.
SECTION 4. NOTICES. All notices, requests, consents, demands and other
communications to or upon the respective parties hereto shall be in writing and
telecopied or delivered to the intended recipient at its "Address for Notices"
specified below its name on the signature pages hereof or at such other address
as shall be designated by such party in a notice to the other parties. All
notices, requests or demands required to be made or given hereunder shall be
deemed to have been duly given or made: if by hand, immediately upon delivery;
if by certified mail, return receipt requested, five (5) days after mailing; if
by overnight delivery service, one day after dispatch; or if by telex,
telecopier (fax) or telegram, immediately upon receipt.
SECTION 5. BENEFIT OF AGREEMENT; OBLIGATIONS SEVERAL. This Agreement
shall be binding upon and inure to the benefit of and be enforceable by the
respective successors and permitted assigns of the parties hereto. By its
consent to the provisions of this Agreement, Tarrant agrees to be bound by the
provisions hereof. The obligations of each of the parties under this Agreement
are several and not joint, it being expressly agreed that no Creditor shall be
liable for the failure of any other Creditor to perform its obligations
hereunder.
SECTION 6. GOVERNING LAW. This Agreement and the rights and obligations
of the parties hereunder shall be construed in accordance with and be governed
by the law of the State of New York. Any legal action or proceeding with respect
to this Agreement may be brought in any state or superior court located in New
York County, New York or any court of the United States of America for the
Southern District of New York and, by execution and delivery of this Agreement,
each party hereto hereby accepts for itself and in respect of its property,
generally and unconditionally, the non-exclusive jurisdiction of the aforesaid
courts.
SECTION 7. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, TRIAL BY JURY
IN ANY ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT.
SECTION 8. COUNTERPARTS. This Agreement may be executed in any number
of counterparts and by the different parties hereto on separate counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall together constitute one and the same instrument. Any signatures
delivered by a party by facsimile transmission or by e-mail
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transmission of an adobe file format document (also known as a PDF file) shall
be deemed an original signature hereto.
SECTION 9. EFFECTIVENESS. This Agreement shall become effective on the
date on which all of the parties hereto shall have signed a copy hereof (whether
the same or different copies) and shall have delivered the same to the Creditors
at their addresses set forth below. This Agreement shall remain effective until
all Obligations are irrevocably paid in full, provided that once the Obligations
owed to any Creditor shall have been irrevocably paid in full, such Creditor
shall have no further rights hereunder.
SECTION 10. HEADINGS DESCRIPTIVE. The headings of the several sections
of this Agreement are inserted for convenience only and shall not in any way
affect the meaning or construction of any provision of this Agreement.
SECTION 11. AMENDMENT OR WAIVER. This Agreement may be amended,
changed, waived, discharged or terminated with the written consent of each of
the parties hereto, provided that no consent of any Creditor shall be required
if all Obligations to that Creditor have been paid in full, are no longer
outstanding and cannot be reborrowed.
SECTION 12. INCONSISTENT PROVISIONS. If any provision of this Agreement
shall be inconsistent with, or contrary to, any provision in any Loan Document,
the provision in this Agreement shall be controlling, and shall supersede such
inconsistent provision to the extent necessary to give full effect to all
provisions contained in this Agreement.
SECTION 13. SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
SECTION 14. REPRESENTATION AND WARRANTY OF AGENT. Agent represents,
warrants, acknowledges and agrees on behalf of itself and any Debenture Holder
on the date hereof that it is authorized to enter into this Agreement on behalf
of itself and each Debenture Holder.
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IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Agreement as of the date first
above written.
GMAC COMMERCIAL FINANCE LLC
By: /S/ XXX XXXXXXXX
----------------------------------------------
Name: XXX XXXXXXXX
--------------------------------------------
Title: SENIOR VICE PRESIDENT
-------------------------------------------
ADDRESS FOR NOTICES:
-------------------
000 Xxxxx Xxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxx Xxxxxxxx
Telecopy No.: (000) 000-0000
WITH A COPY TO:
--------------
Otterbourg, Steindler, Houston & Xxxxx, P.C.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx X. Brand, Esq.
Telecopy No.: (000) 000-0000
[SIGNATURES CONTINUE ON FOLLOWING PAGE]
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UPS CAPITAL GLOBAL TRADE
FINANCE CORPORATION
By: /S/ XXXX X. XXXXXXXX
----------------------------------------------
Name: XXXX X. XXXXXXXX
--------------------------------------------
Title: DIRECTOR OF PORTFOLIO MANAGEMENT
-------------------------------------------
ADDRESS FOR NOTICES:
-------------------
00 Xxxxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxx X. Xxxxxxxx
Telecopy No.: (000) 000-0000
WITH A COPY TO:
--------------
Paul, Hastings, Xxxxxxxx & Xxxxxx LLP
000 Xxxxxxxxx Xxxxxx, X.X., Xxxxx 0000
Xxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxx, Esq.
Telecopy No.: (000) 000-0000
X.X. XXXXXXX & COMPANY
By: /S/ G. XXXXX XXXXXXX
----------------------------------------------
Name: G. XXXXX XXXXXXX
--------------------------------------------
Title: CHAIRMAN/CEO
-------------------------------------------
ADDRESS FOR NOTICES:
-------------------
000 Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: President
WITH A COPY TO:
--------------
Xxxxxxx Xxxxxxxxx LLP
The Graybar Building
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxx Xxxxxxx, Esq.
Telecopy No.: (000) 000 0000
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The undersigned hereby acknowledge and agree to the terms of the
annexed Intercreditor Agreement this 14th day of December, 2004.
TARRANT APPAREL GROUP (d/b/a
Fashion Resource)
By: /S/ XXXXXXX XXXXX
----------------------------------------------
Name: XXXXXXX XXXXX
--------------------------------------------
Title: CHIEF FINANCIAL OFFICER
-------------------------------------------
ADDRESS FOR NOTICES:
-------------------
0000 Xxxx Xxxxxxxxxx Xxxxxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxx
Telecopy No.: (000) 000-0000
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SCHEDULE 1
GMAC CF COLLATERAL
All of each GMAC CF Obligor's present and future Accounts,
Chattel Paper and Instruments, and all Supporting Obligations, General
Intangibles and Documents arising out of or relating to the foregoing; Retained
Goods; credit balances and other property of such GMAC CF Obligor's held or
received by GMAC CF; rights of stoppage in transit, replevin, repossession,
reclamation and other rights and remedies of an unpaid vendor; and all of such
GMAC CF Obligor's Records relating to and all proceeds of the foregoing property
and rights, but excluding the UPS Collateral. As used in this Schedule:
"ACCOUNT" shall have the meaning set forth in the UCC.
"CHATTEL PAPER" shall have the meaning set forth in the UCC.
"CUSTOMER" shall mean and include the account debtor with
respect to any Account and/or the prospective purchaser of goods, services or
both with respect to any contract or contract right, and/or any party who enters
into or proposes to enter into any contract or other arrangement with a GMAC CF
Obligor, pursuant to which such GMAC CF Obligor is to deliver any personal
property or perform any services.
"DOCUMENT" shall have the meaning set forth in the UCC.
"GENERAL INTANGIBLE" shall have the meaning set forth in the
UCC.
"INSTRUMENT" shall have the meaning set forth in the UCC.
"INVENTORY" shall have the meaning set forth in the UCC.
"RECORDS" shall mean all of a GMAC CF Obligor's present and
future books of account of every kind or nature, purchase and sale agreements,
invoices, ledger cards, ledger sheets, bills of lading and other shipping
evidence, statements, files, correspondence, memoranda, documents, credit files,
business papers and other data relating to the GMAC CF Collateral or any
Customer, together with the computer software (whether owned by such GMAC CF
Obligor or in which it has an interest), computer programs, tapes, disks,
diskettes and other data and software storage media and devices, computers, file
cabinets or containers in or on which the foregoing are stored (including,
without limitation, any of such GMAC CF Obligor's rights with respect to the
foregoing maintained with or by any other person).
"RETAINED GOODS" shall mean all merchandise returned or
rejected by Customers or repossessed from Customers relating to or securing any
of the Accounts.
"SUPPORTING OBLIGATION" shall have the meaning set forth in
the UCC.
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SCHEDULE 2
UPS COLLATERAL
1. Any and all Inventory financed pursuant to the UPS Credit Facility,
acquired directly or indirectly by any UPS Obligor from one or more Tarrant
Subsidiaries (the "INVENTORY");
2. That certain deposit account maintained by any UPS Obligor at Union Bank of
California, N.A., Account Number 2100716472 and any proceeds thereof;
3. FR's equity interests, direct or indirect, in TCL; and
4. Proceeds and products, whether tangible or intangible, of any of the
foregoing, including proceeds of insurance covering any or all of the
foregoing, and any and all accounts, books, general intangibles, inventory,
investment property, negotiable collateral, money, deposit accounts, or
other tangible or intangible property resulting from the sale, exchange,
collection, or other disposition of any of the foregoing, or any portion
thereof or interest therein, and the proceeds thereof.
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SCHEDULE 3
SUBORDINATED COLLATERAL
All of Tarrant's present and future Accounts, Chattel Paper and Instruments, and
all Supporting Obligations, General Intangibles and Documents arising out of or
relating to the foregoing; Retained Goods; credit balances and other property of
Tarrant held or received by the Debenture Holders; rights of stoppage in
transit, replevin, repossession, reclamation and other rights and remedies of an
unpaid vendor; and all of Tarrant's Records relating to and all proceeds of the
foregoing property and rights but excluding the UPS Collateral.
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