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EXHIBIT 10.53
SECURITY AGREEMENT
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This Security Agreement is made and entered into as of this 1ST day of
NOVEMBER, 1996 by and between STANDARD CHARTERED BANK (the "Bank") and TARRANT
APPAREL GROUP dba FASHION RESOURCE, a California corporation (the "Debtor").
1. Grant of Security Interest. For value received, the Debtor
hereby grants to the Bank a first priority (unless expressly noted otherwise
herein) security interest in and to all of the following property, whether now
owned or existing or hereafter arising, created or acquired (hereinafter
collectively referred to as the "Collateral").
A. Inventory. All inventory now owned or hereafter
acquired by the Debtor from Tarrant Co. Ltd. ("Tarrant"), or its affiliates,
including but not limited to, all raw materials, work in progress, finished
goods, merchandise, parts and supplies of every kind and description, including
inventory temporarily out of the Debtor's custody or possession, together with
all returns on accounts, now acquired or to be acquired by Debtor (the
"Inventory").
B. Books and Records. All now existing or hereafter
made, compiled or acquired books and records, including electronic data,
relating to the foregoing Inventory and information storage device and media
containing such books and records ("Books and Records").
The Bank's security interest in the Collateral shall be a continuing
lien and shall include all proceeds and products of the Collateral including,
but not limited to, the proceeds of any insurance, indemnity, warranty or
guaranty payable to the Debtor from time to time thereon.
2. Security.
(i) The security interest and assignment of rights
contained herein is granted to secure the payment and performance of:
(a) any and all indebtedness, obligations and
liabilities of Debtor to Bank evidenced by or arising
under the facility letter dated February 22, 1996, by
and between Tarrant and Bank (the "Facility Letter")
now or hereafter existing, all renewals, extensions
and modifications thereto, together with all fees
incurred thereon ("Indebtedness") including
Indebtedness which arose pursuant to said Facility
Letter on or after May 8, 1996.
(b) all costs and expenses reasonably incurred by
Bank to obtain, preserve, perfect and enforce the
security interest granted hereby and all other liens
and security interests securing payment of the
Indebtedness, to collect the Indebtedness and to
maintain, preserve and collect the Collateral,
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including, but not limited to, taxes, assessments,
insurance premiums, repairs, reasonable attorneys'
fees and legal expenses, rent, storage charges,
advertising costs, brokerage fees and expenses of
sale;
(c) each and every covenant and condition
contained in this Security Agreement.
(ii) Prior to or concurrently with the execution and
delivery of this Security Agreement, the Company shall file such
financing statements and other documents in such offices as the Bank
may reasonably request to perfect the security interests granted by
this Security Agreement.
3. Debtor's Representations and Warranties. The Debtor hereby
makes the following representations and warranties to the Bank, which
representations and warranties are continuing.
A. Status. If the Debtor is other than an individual
who is not conducting business as a sole proprietorship, the Debtor is a
corporation duly organized and validly existing under the laws of the State of
California and is properly licensed, qualified to do business and in good
standing in, and, where necessary to maintain the Debtor's rights and
privileges, has complied with the fictitious name statute of every jurisdiction
in which the Debtor is doing business.
B. Authority. The execution, delivery and performance
by the Debtor of this Security Agreement and any document, instrument or
agreement required hereunder have been duly authorized and do not and will not:
(i) violate any provision of any law, rule, regulation, writ, judgment or
injunction presently in effect affecting the Debtor; (ii) result in a breach of
or constitute a default under any material agreement to which the Debtor is a
party or by which it or its assets may be bound or affected; (iii) require any
consent or approval of its stockholders or violate any provision of its
articles of incorporation or by-laws, if the Debtor is a corporation; or (iv)
violate any provision of its partnership agreement, if the Debtor is a
partnership.
C. Legal Effect. This Security Agreement constitutes,
and any document, instrument or agreement required hereunder when executed and
delivered will constitute legal, valid and binding obligations of the Debtor
enforceable against the Debtor in accordance with their respective terms.
D. Title to Collateral; Permitted Liens. The Debtor has
good and marketable title to the Collateral and the same is not now and shall
not become subject to any security interest, encumbrance, lien or claim of any
third person other than: (i) liens and security interests to secure the
Indebtedness or other indebtedness owed to the Bank; (ii) liens for taxers,
assessments or similar charges either not yet due or being duly contested in
good faith; (iii) liens of mechanics, materialmen, warehousemen or other like
liens arising in the ordinary course of business and securing obligations which
are not delinquent; (iv) liens and security interests which, as of the date
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hereof, have been disclosed to and approved by the Bank in writing which, as of
the date of this Security Agreement consists solely of those certain UCC-1
Financing Statements recorded by NationsBanc Commercial Corporation as
Instrument Nos. 93-201729 and 94-148385; (v) liens and security interest which,
as of the date hereof, have been disclosed to and approved by the Bank in
writing which, as of the date of this Security Agreement consist of those
certain UCC-2 Financing Statements recorded by Hongkong and Shanghai Banking
Corporation Limited ("HKSB") as Instrument Nos. 95-16360313, 95-16360317 and
95-163603051; and (vi) purchase money liens or purchase money security
interests upon or in any property acquired or held by the Debtor in the
ordinary course of business (collectively "Permitted Liens").
E. Financial Statements. All financial statements,
information and other data now or hereafter submitted to the Bank in connection
with the transaction with respect to which this Security Agreement is entered
into are true, accurate and correct and have been applied. Since the most
recent submission of any such financial statement, information or other data to
the Bank, the Debtor represents and warrants that no material adverse change in
the financial condition or operations as disclosed therein or thereby has
occurred which has not been fully disclosed to the Bank in writing.
F. Litigation. Except as have been disclosed to the
Bank in writing, there are no actions, suits or proceedings pending or, to the
knowledge of the Debtor, threatened against or affecting the Debtor or Tarrant
or their respective properties before any court or administrative agency which,
if determined adversely to the Debtor or Tarrant as the case may be, would have
a material adverse effect on the Debtor's financial condition or operations or
on the Collateral.
G. Taxes. The Debtor and Tarrant have filed all tax
returns required to be filed and paid all taxes shown thereon to be due,
including interest and penalties, other than taxes which are currently payable
without penalty or interest or those which are being duly contested in good
faith.
H. Priority of Security Interest. Debtor hereby grants
Bank a security interest in the Collateral, subject only to the UCC-1 Financing
Statements filed by NationsBanc Commercial Corporation as instrument nos.
93-201729 and 94-148385; the UCC-1 Financing Statements filed by HKSB as
instrument nos. 95-16360313, 95-16360317 and 95-16360305; and to Permitted
Liens for purchase money under subparagraph D(vi) above.
I. Ownership of Debtor. 31% of Debtor's outstanding
shares are publicly traded; 69% of its shares are owned by ▇▇. ▇▇▇▇▇▇ ▇▇▇▇
(66.7% of the 69%) and ▇▇. ▇▇▇▇ ▇▇▇ (33.3% of the 69%).
J. Ownership of Tarrant. Tarrant is a wholly-owned
subsidiary of Debtor.
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K. Benefits to Debtor; Solvency. The Guarantee by
Debtor of Tarrant's indebtedness to Bank and this Security Agreement are given
by Debtor in consideration, inter alia, of the Bank's conditional agreement to
provide credit facilities to Tarrant. Debtor and Tarrant are interdependent
corporations that, inter alia, Tarrant is a principal supplier of new materials
to Debtor. The extension of credit by Bank to Tarrant substantially benefits
Debtor both directly and indirectly. Debtor is not insolvent and has
sufficient working capital for the conduct of its business, nor would Debtor be
insolvent nor its working capital be impaired if Debtor were required to
satisfy all indebtedness of Tarrant to Bank.
4. Debtor's Covenants. The Debtor covenants and agrees
that, unless the Bank otherwise consents in writing, the Debtor shall at all
times:
A. Maintenance of Insurance. Keep and maintain the
Collateral insured for not less than its full replacement value against all
risks of loss and damage and maintain such other insurance as is usually
carried by companies engaged in similar businesses and owning similar
properties in the same general areas in which the Debtor operates and maintain
such other insurance and coverage as may be required by the Bank. All such
insurance shall be in form and amount and with companies satisfactory to the
Bank. With respect to insurance covering the Collateral, such insurance shall
name the Bank as loss payee pursuant to a loss payable endorsement satisfactory
to Bank or as an additional insured, as its interest may appear, and shall not
be altered or canceled except upon 10 days' prior written notice to the Bank.
Upon the Bank's request, the Debtor shall furnish the Bank with the original
policy or binder of all such insurance.
B. Maintenance of Collateral. Except for Permitted
Liens, keep and maintain the Collateral free and clear of all levies, liens,
encumbrances and other security interests (including, but not limited to, any
lien of attachment, judgment or execution) and defend the Collateral against
any such levy, lien, encumbrance or security interest; comply with all laws,
statutes and regulations pertaining to the Collateral, its use and operation;
execute , file and record such statements, notices and agreements, take such
actions and obtain such certificates and other documents necessary to perfect,
evidence and continue the Bank's security interest in the Collateral and the
priority thereof; maintain accurate and complete records of the Collateral; and
properly care for, house, store and maintain the Collateral in good
condition, free of misuse, abuse and deterioration, other than normal wear
and tear.
C. Intentionally omitted.
D. Location of Inventory. The Inventory is now and
shall at all times hereafter be of good and merchantable quality and free from
defects; is not now and shall not at any time hereafter be stored with a
bailee, warehouseman or similar party without the Bank's prior written consent;
shall at all times be in the Debtor's physical possession except customary
samples; shall not be held by others on consignment, sale on approval, or sale
or return; and shall be kept at the following location(s): ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and such other locations as
may be designated by Debtor and approved by Bank in writing.
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E. Inspection Rights. At any reasonable time and from
time to time, permit the Bank or any representative thereof to examine and make
copies of the Books and Records and visit the properties of the Debtor and
discuss the business and operations of the Debtor with any employee or
representative thereof. If the Debtor now or at any time hereafter maintains
any Books and Records (including, but not limited to, computer generated
records and computer programs for the generation of such records) in the
possession of a third party, the Debtor hereby agrees to notify such third
party to permit the Bank free access to such Books and Records at all
reasonable times and to provide the Bank with copies of any Books and Records
it may request, all at the Debtor's expense, the amount of which shall be
payable immediately upon demand.
F. Reporting Requirements. Furnish, or cause to be
furnished, to the Bank within ninety (90) days after the end of each fiscal
year of the Debtor, consolidated statements of income, balance sheet, capital
accounts and cash flows of the Debtor and its consolidated subsidiaries for
such fiscal year, setting forth in comparative form the figures as at the end
of and for the previous fiscal year and certified without qualification by
independent certified public accountants of recognized standing reasonably
satisfactory to the Bank, whose opinion shall be in scope and substance
satisfactory to the Bank. Promptly upon the Bank's request, deliver or cause
to be delivered to the Bank such other information pertaining to the Debtor,
the Collateral or such other matters as the Bank may reasonably request.
G. Transfer of Collateral. Not sell, contract for sale,
convey, transfer, assign, lease or sublet any of the Collateral except in the
ordinary course of business as presently conducted by the Debtor and then, only
for full, fair and reasonable consideration.
H. Payment of Obligations. Pay, and cause Tarrant to
pay, all their respective liabilities and obligations, when due.
I. Compensation of Employees. Compensate its employees
for services rendered at an hourly rate at least qual to the minimum hourly
rate prescribed by any applicable federal or state law or regulation.
J. Notices. Give the Bank prompt written notice of:
(i) any change in its place of business; (ii) any proposed or actual change in
its name, identity or business nature; (iii) any Event of Default; (iv)
litigation, arbitration or administrative proceedings to which the Debtor is a
party and in which the claim or liability exceeds 10% of Tangible Net Worth
(which means the gross book value of Debtor's assets (exclusive of goodwill,
patents, trademarks, trade names, organization expense, treasury stock,
deferred research and development costs, deferred marketing expenses and other
like intangibles), less liabilities of Debtor) or which affects the Collateral
in any way; and (v) any other matter which has resulted in, or might result in,
a material adverse change on the Collateral or the financial condition or
business operations of the Debtor.
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K. Delivery of Documents. Promptly deliver, upon Bank's
request, any further information or documentation required to establish due
authorization of this Agreement and/or to further perfect or otherwise carry
out the intentions of Bank and Debtor.
L. Indemnity. The Debtor will indemnify and hold
harmless the Bank and its respective employees, representatives, officers and
directors from and against any and all claims, liabilities, losses, damages,
actions, and demands by any party (other than with respect to any claims,
actions or demands made by other such indemnified parties or any liabilities,
losses or damages caused thereby) against the Bank, resulting from any breach
or alleged breach by the Debtor of any representation or warranty made
hereunder, or otherwise arising out of the commitment of the making or
administration of the Indebtedness unless the Bank is determined to have acted
or failed to act with gross negligence or willful misconduct.
5. Events of Default. Any one or more of the following described
events shall constitute an event of default ("Event of Default") hereunder:
A. The occurrences of a default by Debtor with respect
to the Indebtedness.
B. The failure by Debtor in any material respect to
perform or observe any term, covenant or agreement contained in this Security
Agreement, or any other agreement memorializing, securing or supporting the
Indebtedness.
C. The occurrence of a default by Tarrant Co. Ltd. under
its obligations to the Bank under the Facility Letter.
D. Any representation or warranty made under this
Security Agreement shall prove incorrect or misleading in any material respect
when made.
E. There shall be entered a decree or order by a court
having jurisdiction in the premises constituting an order for relief in respect
of the Debtor under Title 11 of the United States Code, as now constituted or
hereafter amended, or any other applicable federal or state bankruptcy law or
other similar law, or appointing a receiver, liquidator, assignee, trustee,
custodian, sequestrator or similar official of the Debtor or of any substantial
part of its property, or ordering the winding-up or liquidation of the affairs
of the Debtor or an involuntary petition or case is filed or commenced against
the Debtor, and a temporary stay entered and any such decree or order shall
continue unstayed and in effect for a period of forty-five (45) consecutive
days or similar events shall occur with respect to Tarrant under Hong Kong law.
F. The Debtor shall file a petition, answer or consent
seeking relief under Title 11 of the United States Code, as now constituted or
hereafter amended, or any other applicable federal or state bankruptcy law or
other similar law, or the Debtor shall consent to the institution of proceedings
thereunder or to the filing of any such petition or to the appointment or taking
of possession of a receiver, liquidator, assignee, trustee, custodian,
sequestrator or other similar official of the Debtor or of any substantial part
of its property, or the Debtor shall fail generally to pay its debts as they
become due, or admit in writing its inability to pay its debts as they become
due, or the Debtor shall authorize any such action, or Tarrant shall take
similar actions under Hong Kong law.
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6. Bank's Rights and Remedies on Default. Upon the occurrence of
any Event of Default, the Bank may, at its sole and absolute election, without
demand and only upon such notice as may be required by law:
A. Acceleration. Declare the Indebtedness and any or
all other indebtedness owing to the Bank by the Debtor or any obligor on the
Indebtedness (however such indebtedness may be evidenced or secured)
immediately due and payable, whether or not otherwise due and payable.
B. Cease Extending Credit. Cease extending credit to or
for the account of the Tarrant, Debtor or any other guarantor of Tarrant's
indebtedness to Bank under any agreement now existing or hereafter entered into
with the Bank.
C. Termination. Terminate any agreement as to any
future obligation of the Bank without affecting the Debtor's obligations to the
Bank or the Bank's rights and remedies under this Security Agreement or under
any other document, instrument or agreement.
D. Segregate Collections. Require the Debtor to
segregate all collections and proceeds of the Collateral so that they are
capable of identification and to deliver such collections and proceeds to the
Bank, in kind, without commingling, at such times and in such manner as
required by the Bank.
E. Records of Collateral. Require the Debtor to deliver
periodically to the Bank all Books and Records and any other information
showing the status, condition and location of the Collateral and such contracts
or other matters which affect the Collateral. In connection herewith, the Bank
may conduct such audits or other examination of such records, including, but
not limited to, verification of balances owing by any account debtor of the
Debtor, as the Bank, in its sole and absolute discretion, deems necessary.
F. Notification of Account Debtors. Notify any or all
of the Debtor's account debtors, buyers or transferees of the Collateral, or
other persons of the Bank's interest in the Collateral and the proceeds thereof
and instruct such person(s) to thereafter make any payment due the Debtor
directly to the Bank.
The Debtor hereby irrevocably constitutes and appoints the Bank
as its attorney-in-fact to (i) endorse the Debtor's name on any notes,
acceptances, checks, drafts, money orders or other evidence of payment that may
come into the Bank's possession; (ii) sign the Debtor's name on any invoice or
▇▇▇▇ of lading relating to any of the Collateral; (iii) notify post office
authorities to change the address for delivery of mail addressed to the Debtor
to such address as the Bank may designate and take possession of and open mail
addressed to the Debtor and remove therefrom proceeds of and payments on the
Collateral; and (iv) demand, receive and enforce payment and give receipts,
releases and satisfactions for and ▇▇▇ for all money payable to the Debtor. All
of the preceding may be done either in the name of the Bank or in the name of
the Debtor with the same force and effect as the Debtor could have done had this
Security Agreement not been entered into.
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G. Compromise. Grant extensions, compromise claims and
settle any accounts for less than the amount owing thereunder, all without
notice to the Debtor or any obligor on or any guarantor of the Indebtedness.
H. Protection of Security Interest in Collateral. Make
such payments and do such acts as the Bank, in its sole judgment, considers
necessary and reasonable to protect its security interest in the Collateral.
The Debtor hereby irrevocably authorizes the Bank to pay, purchase, contest or
compromise any encumbrance, lien or claim which the Bank, in its sole judgment,
deems to be prior or superior to its security interest. Further, the Debtor
hereby agrees to pay to the Bank, upon demand therefor, all expenses and
expenditures (including attorneys' fees) incurred in connection with the
foregoing.
I. Foreclosure. Enforce any security interest or lien
given or provided for under this Security Agreement or under any other document
relating to the Collateral, in such manner and such order, as to all or any
part of the Collateral, as the Bank, in its sole judgment, deems to be
necessary or appropriate and the Debtor hereby waives any and all rights,
obligations or defenses now or hereafter established by law relating to the
foregoing. In the enforcement of its security interest in the Collateral, the
Bank is authorized to enter upon the premises where any Collateral is located
and take possession of the Collateral or any part thereof, together with the
Debtor's records pertaining thereto, or the Bank may require the Debtor to
assemble the Collateral and records pertaining thereto and make such Collateral
and records available to the Bank at a place designated by the Bank. The Bank
may sell the Collateral or any portions thereof, together with all additions,
accessions and accessories thereto, giving only such notices and following only
such procedures as are required by law, at either a public or private sale, or
both, with or without having the Collateral present at the time of sale, which
sale shall be on such terms and conditions and conducted in such manner as the
Bank determines in its sole judgment to be commercially reasonable. Any
deficiency which exists after the disposition or liquidation of the Collateral
shall be a continuing liability of any obligor on or any guarantor of the
Indebtedness and shall be immediately paid to the Bank.
J. Non-Exclusivity of Remedies. Exercise one or more of
the Bank's rights set forth herein or seek such other rights or pursue such
other remedies as may be provided by law, in equity or in any other agreement
now existing or hereafter entered into between the Bank and the Debtor or any
obligor on or guarantor of the Indebtedness, or otherwise.
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K. Application of Proceeds. All amounts in deposit
accounts held and received by the Bank as proceeds from the disposition or
liquidation of the Collateral shall be applied as follows: first, to the costs
and expenses of collection, including court costs and reasonable attorneys'
fees, whether or not suit is commenced by the Bank; next, to those costs and
expenses incurred by the Bank in protecting, preserving, enforcing, collecting,
selling or disposing of the Collateral; next, to the payment of accrued and
unpaid interest or fees on all of the Indebtedness; next, to the payment of the
outstanding principal balance of the Indebtedness; and last, to the payment of
any other indebtedness owed by the Debtor to the Bank. Such application may be
made in the case of cash or monies including funds in Bank's possession prior
to an Event of Default or after, without the necessity of a sale of Collateral,
and such application shall not constitute retention of Collateral in
satisfaction of the Indebtedness. Any excess Collateral or excess proceeds
existing after the collection or disposition or liquidation of the Collateral
will be returned or paid by the Bank to the Debtor.
L. Cumulative Rights. The rights, powers and remedies
of Bank under this Security Agreement shall be in addition to all rights,
powers and remedies given to Bank by virtue of any statute or rule of law, the
loan documents between Bank and Tarrant or any other agreement, all of which
rights, powers and remedies shall be cumulative and may be exercised
successively or concurrently without impairing Bank's interest in the
Collateral.
7. Miscellaneous.
A. Amounts Payable Under This Security Agreement. If
the Debtor fails to pay on demand the amount of any obligation referred to in
this Security Agreement, the Bank may pay such amount at its option and without
any obligation to do so and without waiving any default occasioned by the
Debtor's failure to pay such amount. All amounts so paid by the Bank, together
with reasonable attorneys' fees and all other costs, charges and expenses
relating to the Indebtedness, shall be a part of the Indebtedness and shall
bear interest at the highest rate chargeable on any Indebtedness until paid in
full.
B. Other Terms. Terms not otherwise defined in this
Security Agreement shall have the meanings attributed to such terms in the
California Uniform Commercial Code.
C. Reliance. Each warranty, representation, covenant
and agreement contained in this Security Agreement shall be conclusively
presumed to have been relied upon by the Bank regardless of any investigation
made or information possessed by the Bank and shall be cumulative and in
addition to any other warranties, representations, covenants or agreements
which the Debtor shall now or hereafter give, or cause to be given, to the
Bank.
D. Attorneys' Fees. In the event of any action in
relation to this Security Agreement, the Collateral or any document, instrument
or agreement secured hereby or related hereto, the prevailing party, in
addition to all other sums to which it may be entitled, shall be entitled to
reasonable attorneys' fees.
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E. Notices. All notices, payments, requests,
information and demands which either party hereto may desire, or be required to
give or make to the other party, shall be given or delivered to such party in
writing by telecopier to the telecopier numbers as specified below, addressed
to the address set forth below such party's signature to this Security
Agreement or to such other address as may be specified from time to time in
writing by either party to the other.
F. Waiver. Neither the failure nor delay by the Bank in
exercising any right hereunder or under any document, instrument or agreement
mentioned herein shall operate as a waiver thereof, nor shall any single or
partial exercise of any right hereunder or under any other document, instrument
or agreement mentioned herein preclude other or further exercise thereof or the
exercise of any other right nor shall any waiver of any right or default
hereunder or under any other document, instrument or agreement mentioned herein
constitute a waiver of any other right or default or constitute a waiver of any
other default of the same or any other term or provision.
G. Assignment. This Security Agreement shall be binding
upon and inure to the benefit of the Debtor and the Bank and their respective
successors and assigns, except that the Debtor shall not have the right to
assign its rights hereunder or any interest herein without the Bank's prior
written consent. The Bank may sell or assign all or any portion of its rights
and benefits hereunder and, in connection therewith, may deliver to such
prospective buyer or assignee financial statements and other relevant
information pertaining to the Debtor or any obligor on the Indebtedness.
H. Severability. If any provision hereof is invalid and
unenforceable in any jurisdiction, then, to the fullest extent permitted by
law, (i) the other provisions hereof shall remain in fully force and effect in
such jurisdiction and shall be liberally construed in favor of the Bank in
order to carry out the intentions of the parties hereto as nearly as may be
possible, (ii) such provision shall be ineffective, but only to the extent of
such invalidity and unenforceability, and (iii) the invalidity or
unenforceability of any provision hereof in any jurisdiction shall not affect
the validity or enforceability of such provision in any other jurisdiction.
I. Jurisdiction. This Security Agreement and the rights
of the parties hereunder to and concerning the Collateral, and any documents,
instruments or agreements mentioned or referred to herein, shall be governed by
and construed according to the laws of the State of California.
J. WAIVER OF JURY TRIAL. THE DEBTOR AND THE BANK HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT TO A TRIAL BY JURY IN
ANY ACTION OR PROCEEDING IN ANY WAY ARISING OUT OF OR RELATED TO THIS AGREEMENT
AND AGREE THAT ANY SUCH ACTION OR PROCEEDINGS SHALL BE TRIED BEFORE A COURT AND
NOT BEFORE A JURY. THE DEBTOR REPRESENTS AND WARRANTS THAT NO REPRESENTATIVE
OR AGENT OF THE BANK WAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE BANK
WILL NOT, IN THE EVENT OF ANY LITIGATION, SEEK TO ENFORCE THIS WAIVER OF
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JURY TRIAL. THE DEBTOR ACKNOWLEDGES THAT THE BANK HAS BEEN INDUCED TO ENTER
INTO THIS AGREEMENT IN RELIANCE UPON, AMONG OTHER THINGS, THE PROVISIONS OF
THIS PARAGRAPH.
K. Counterparts. This Security Agreement may be
executed in any number of counterparts, all of which taken together shall
constitute one and the same instrument and either of the parties hereto may
execute this Security Agreement by signing any such counterpart.
L. Legal Representation. Walker, Wright, Tyler & ▇▇▇▇
acted as scrivener for this agreement but did not represent the Secured Party
nor the Debtor in negotiating this agreement and is not responsible to either
of said parties for the form or content of the agreement.
DEBTOR:
TARRANT APPAREL GROUP dba
FASHION RESOURCE, a California
corporation
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Its: Vice President-Finance & C.F.O.
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Address: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
BANK:
STANDARD CHARTERED BANK
By: /s/ ▇▇▇▇▇▇ ▇▇▇
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▇▇▇▇▇▇ ▇▇▇
Its: Senior Manager, CBG/T&G2
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Address: Room ▇▇▇-▇, ▇▇▇▇▇ ▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇
Attention: Corporate Banking Group
Telecopier: 011-852-2371-2953
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