WAIVER AND AMENDMENT NO. 5 TO AGREEMENTS
EXHIBIT 10.15.5
WAIVER AND AMENDMENT NO. 5 TO AGREEMENTS
This WAIVER AND AMENDMENT NO. 5 TO AGREEMENTS (this “Amendment”) is entered into as of August 11, 2008 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.”), PRIVATE BRANDS, INC., a corporation organized under the laws of the State of California (“Private”; and together with Holding, Fashion and Tag Inc., 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 “Financing Agreements”); and
WHEREAS, as a result of certain violations of the Loan Agreement by the Borrowers, Events of Default have occurred under the Financing Agreements and, at the request of the Borrowers, Agent, the Lenders and Factor have agreed to waive such Events of Default subject to the conditions set forth in this Amendment; and
WHEREAS, the Borrowers have requested that Agent, the Lenders and Factor amend and modify certain provisions of the Financing Agreements to which they are a party and 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. Waivers.
(a) | The Borrowers hereby acknowledge, confirm and agree that the Borrowers have violated paragraph 4(b) of the Waiver and Amendment No. 4 to Agreements, dated as of May 12, 2008, entered into by and among the Borrowers, Agent, the Lenders and Factor (“Amendment No. 4”) as a result of the failure by BCBG (as defined in Amendment No. 4) to repay the BCBG Loan (as defined in Amendment No. 4) in a timely manner as set forth in Amendment No. 4. As a result of such failure, an Event of Default has occurred and is continuing under the Loan Agreement (the “Loan Agreement Event of Default”). The Borrowers have requested the Required Lenders to waive the Loan Agreement Event of Default, and the Required Lenders have agreed to, and hereby do, waive the Loan Agreement Event of Default, subject to the terms and conditions set forth herein. |
(b) | The Borrowers hereby acknowledge, confirm and agree that as a result of the occurrence of the Loan Agreement Event of Default, an Event of Default (as defined in the Factoring Agreement) has occurred and is continuing under the Factoring Agreement (the “Factoring Agreement Event of Default”). The Borrowers have requested Factor to waive the Factoring Agreement Event of Default, and Factor has agreed to, and hereby does, waive the Factoring Agreement Event of Default, subject to the terms and conditions set forth herein. |
(c) | Notwithstanding anything to the contrary set forth herein, Agent, the Lenders and Factor hereby reserve all rights and remedies granted to Agent, the Lenders and Factor under the Loan Agreement, the Factoring Agreement, the other Financing Documents, applicable law and otherwise, and nothing contained herein shall be construed to limit, impair or otherwise affect the right of Agent, the Lenders and Factor to declare an Event of Default with respect to any future non-compliance with any covenant, term or provision of the Loan Agreement, the Factoring Agreement or any other document now or hereafter executed and delivered in connection therewith. Without limiting the foregoing, nothing herein contained shall, or shall be deemed to, waive any Event of Default under any of the Financing Agreements other than the Loan Agreement Event of Default and the Factoring Agreement Event of Default. |
3. Amendment to Loan Agreement. Effective as of June 30, 2008, the Loan Agreement is hereby amended by deleting the reference to the amount “$7,900,000” set forth opposite the date “June 2008" contained in Section 6.8(b) (“Minimum EBITDA”) of the Loan Agreement and substituting the following therefor: “$6,000,000".
4. 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: All of the representations and warranties set forth in the Loan Agreement, as amended hereby, the Factoring Agreement 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.
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5. Conditions Precedent. The effectiveness of this Amendment and the agreement of Agent, the Lenders and Factor to the waivers, 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; and |
(b) | Agent shall have received counterparts of this Amendment duly executed and delivered by the Borrowers, Agent, the Lenders and Factor. |
6. Effect of this Amendment. Except as specifically set forth herein, no other changes or modifications to the Financing Agreements are intended or implied, and, in all other respects, the Financing 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 Financing 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.
7. 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.
8. 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.
9. 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).
10. 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.
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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 Xxxx Name: Xxxxxxx Xxxx Title: Chief Financial Officer FASHION RESOURCE (TCL), INC. By: /s/ Xxxxxxx Xxxx Name: Xxxxxxx Xxxx Title: Chief Financial Officer TAG MEX, INC. By: /s/ Xxxxxxx Xxxx Name: Xxxxxxx Xxxx Title: Chief Financial Officer PRIVATE BRANDS, INC. By: /s/ Xxxxxxx Xxxx Name: Xxxxxxx Xxxx Title: Chief Financial Officer GMAC COMMERCIAL FINANCE LLC, as Agent, a Lender and Factor By: /s/ Xxxxx Xxxxxxxx Name: Xxxxx Xxxxxxxx Title: Vice President UPS CAPITAL CORPORATION, as a Lender By: /s/ Xxxx X. Xxxxxxxx Name: Xxxx X. Xxxxxxxx Title: Director of Portfolio Management |
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