Exhibit 10.81
Standard [LOGO] Chartered
Standard Chartered Bank
0 Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Telephone 000-000-0000
December 30, 1999
Tarrant Apparel Group
0000 Xxxx Xxxxxxxxxx Xxxx
Xxx Xxxxxxx, XX 00000
Attn: Xx. Xxxxxxx Xxxx, Treasurer
Ladies and Gentlemen:
Standard Chartered Bank (the "Bank") is pleased to make available an uncommitted
line of credit (the "Facility") to Tarrant Apparel Group (the "Borrower") under
the following terms and conditions. This letter agreement shall supersede and
replace all previous letter agreements between the Bank and the Borrower. No
commitment to lend can be assumed or inferred hereby. The purpose of this letter
agreement is to outline the general parameters of the transactions that the Bank
would consider entering into with the Borrower from time to time.
1. AMOUNT:
An aggregate principal amount at any time outstanding of up to
USD10,000,000 (the "Aggregate Exposure") may be made available
for the advances ("Advances") for periods up to but not
exceeding 90 days for general corporate purposes, and in any
event shall be available at the Bank's sole discretion.
2. AVAILABILITY:
The Bank may terminate the Facility at any time in its sole
discretion and with immediate effect by written notice to the
Borrower. The Bank shall at all times reserve the right to
alter the terms of the facility
3. INTEREST AND FEES:
The Borrower agrees to pay the Bank's rate for advances to be
determined on the date of transaction as specified in the
Promissory Note dated hereof.
4. TAXES:
Payments of all amounts of principal and interest shall be
free and clear of and without deduction for any present or
future taxes, levies, imposts or duties imposed by any
governmental authority in any jurisdiction or political
subdivision or taxing authority therein.
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5. DEFAULT INTEREST:
The Borrower agrees to pay interest on any amount which is not
repaid or paid when due hereunder or under the Promissory Note
(whether at stated maturity, by acceleration or otherwise),
until paid in full at a rate per annum equal to 5% above the
Prime Rate as quoted by the Bank from time to time.
6. EVIDENCE OF INDEBTEDNESS:
The Borrower agrees that the Bank's internal books and
records, the Promissory Note and any other documents required
by the Bank which are executed and delivered by the Borrower
shall be conclusive evidence (absent manifest error) with
respect to all interest rates, repayments and repayment dates
and of the Borrower's indebtedness to the Bank. In addition,
all terms and conditions of the annexed Promissory Note and
any other documents executed in connection herewith are
incorporated by reference into any credit contemplated
hereunder.
7. Y2K: The Borrower represents and warrants that it has made a full
and complete assessment of the anticipated costs, problems and
uncertainties associated with the inability of certain
computer applications and systems to effectively handle data,
including dates, on and after January 1, 2000 as same may
effect the business, operations and financial condition of the
Borrower, its customers, suppliers and vendors. The Borrower
has a realistic and achievable program for testing and, as
needed, reediting its computer applications and systems on a
timely basis. Based on their assessment and program, the
Borrower does not reasonably anticipate any material adverse
effect on its operations, business or financial condition as a
result of issues related to bringing its applications and
systems into operational compliance on or before January 1,
2000.
8. CONDITIONS PRECEDENT:
As a precondition to the Bank's considering to extend the
credit contemplated by this letter agreement (but with the
Bank retaining full discretion as to whether to extend any
credit from time to time), the Borrower shall have executed
and delivered to the Bank, in form and substance satisfactory
to the Bank, the following documents:
(a) Facility Letter: the duplicate copy of this letter
agreement and the following documents duly signed by officers
empowered to sign on the Borrowers behalf;
(b) Corporate Standing: a certificate of the Secretary or
Assistant Secretary of the Borrower certifying the incumbency
and specimen signatures of the officers of the Borrower
executing this letter agreement and each of the related
documents and that attached hereto are (i) a true and complete
copy of the resolutions of the Borrowers board of directors
which authorize the acceptance of the credit and the related
obligations contemplated by this letter agreement (which
resolutions shall not have been rescinded as of the date of
such certification) and (ii) true and complete copies of the
Borrower's articles or certificate of incorporation and all
amendments thereto as in effect as of the date of such
certification;
(c) Promissory Note in the Bank's form duly executed by
officers empowered to sign on the Borrower's behalf; and
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(d) Any and all other documents that the Bank may reasonably
request from time to time.
9. REPRESENTATIONS AND WARRANTIES:
The Borrower represents and warrants to the Bank that the
following statements are true and accurate as of the date
hereof and shall be true and accurate as of the date of the
disbursement of any credit contemplated hereunder, except as
communicated to and approved by the Bank in writing.
(i) The Borrower is a corporation duly organized, validly
existing and in good standing under the laws of the
state of its incorporation and is fully qualified to do
business wherever such qualification is necessary. The
Borrower has full corporate power and authority to
execute this letter and incur the obligations and
indebtedness contemplated hereunder. The execution,
delivery and performance by the Borrower of its
obligations contemplated herein will not contravene any
law, regulation, by-law or contractual obligations
binding upon the Borrower;
(ii) The Borrower's obligation contemplated hereunder
constitutes the Borrower's valid and legally binding
obligation enforceable against the Borrower in
accordance with its terms, except as the enforceability
thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditor's rights generally
and by general principles of equity and has been duly
authorized by the Borrower's board of directors; and
(iii) To the best knowledge of the Borrower, there are no
pending or threatened actions or proceedings before any
court or administrative agency which, if determined
adversely, would materially affect the financial
condition or operations of the Borrower.
10. COVENANTS:
The Borrower hereby agrees that, as long as any Facility
remains outstanding and unpaid, the Borrower shall:
(i) provide the Bank audited annual consolidated financial
statements (including consolidating schedules), prepared
in accordance with GAAP, within 90 days of the end of
the Borrower's fiscal year end;
(ii) submit to the Bank management prepared audited
consolidated quarterly financial statements, prepared in
accordance with GAAP, within 45 days of the end of the
Borrowers' fiscal quarter.
11. RIGHT OF SET-OFF:
In addition to the rights granted to it by applicable law, the
Bank has the right to set-off and apply to any of the
Borrower's obligations hereunder any amount received by it
from the Borrower, including any balance in any deposit
account of the Borrower maintained with the Bank or any of its
branches.
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12. ASSIGNMENTS:
The Bank may at any time assign or sell participation in all
or a portion of its rights and obligations hereunder to one or
more banks or other financial institutions. The Borrower shall
not assign or delegate any of its rights or obligations
hereunder without the prior written consent of the Bank and
any attempted assignment by the Borrower without such consent
shall be null and void.
13. LEGAL FEES AND EXPENSES:
The Borrower agrees to pay to the Bank on its first demand all
costs and expenses incurred by the Bank in connection with the
preparation, execution and/or amendment of this letter
agreement and the enforcement or collection of any obligations
arising in connection with the transactions contemplated
hereby, including, without limitation, reasonable attorneys'
fees, a reasonable estimate of the allocated cost of Bank's
in-house counsel and other legal expenses.
14. WAIVERS:
The failure of the Bank at any time to require performance by
the Borrower of any provisions hereof shall in no way affect
the Bank's rights to require such performance at any time
thereafter, nor shall the waiver by the Bank of the breach of
any provision hereof be taken or held to be a waiver or
modification of any succeeding breach of such provision. No
modification or waiver of any provisions of this letter
agreement shall be effective unless in writing, signed by the
Bank, and only to the extent specifically set forth therein;
nor shall any such waiver or modification be applicable except
in the specific instance for which given.
15. GOVERNING LAW; WAIVER OF TRAIL BY JURY; CONSENT TO JURISDICTION:
The Borrower agrees that any legal action arising out of or in
any connection with this letter agreement or bankers'
acceptances, overdrafts or letters of credit may be brought by
the Bank, in its discretion, in the State or Federal Courts
located in New York City and the Borrower waives the right to
trail by jury in any action or proceeding related hereto or in
connection with the obligations undertaken hereby and in the
security documents related hereto.
THE BORROWER'S OBLIGATIONS WITH RESPECT TO THIS LETTER
AGREEMENT AND THE OBLIGATIONS CONTEMPLATED HEREUNDER SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK.
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If the terms and conditions specified in this letter agreement are acceptable to
you, please indicate your acceptance thereof by signing and returning the
attached copy to us.
Very truly yours,
STANDARD CHARTERED BANK
By: /s/ Xxxxxx X. Xx By: /s/ Xxxxx Xxxxxxxxxx
----------------------------- --------------------------------
Name: Xxxxxx X. Xx Name: Xxxxx Xxxxxxxxxx
Title: Vice President Title: Vice President
Agreed to and accepted by:
TARRANT APPAREL GROUP
By: /s/ Xxxxxx Xxxx By:
----------------------------- --------------------------------
Name: Xxxxxx Xxxx Name:
Title: Chief Executive Officer Title:
Date: 1-13-00 Date:
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