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Syndicated Letter of Credit Facility

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Title:

Syndicated Letter of Credit Facility

Entities:

Tarrant Apparel Group

Date:

2002

Size:

Preview shows 58KB of 148KB total

Price:

$49

ID:

#380404

► Loans ► Letter ► Syndicated Letters of Credit Facility
► Consumer ► Apparel & Accessories

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DATED 13th. JUNE, 2002

TARRANT COMPANY LIMITED (1)

and

MARBLE LIMITED (2)

and

TRADE LINK HOLDINGS LIMITED (3)

(as Borrowers)

and

UPS CAPITAL GLOBAL TRADE FINANCE

CORPORATION (4)

(as Agent and Issuer)

and

CERTAIN BANKS AND

FINANCIAL INSTITUTIONS (5)

(as Banks)

SYNDICATED LETTER OF CREDIT FACILITY

BARLOW LYDE & GILBERT

24th Floor

Nine Queen?s Road Central

Hong Kong

CONTENTS

		PAGE
CLAUSE

1	INTERPRETATION	1

2	THE FACILITY	10

3	CONDITIONS PRECEDENT	11

4	UTILISATION OF THE FACILITY	11

5	CANCELLATION	17

6	TAXES	17

7	INCREASED COSTS	18

8	ILLEGALITY	19

9	REPRESENTATIONS AND WARRANTIES	20

10	FINANCIAL CONDITION	23

11	COVENANTS	29

12	DEFAULT	33

13	DEFAULT INTEREST	36

14	INDEMNITIES AND CURRENCY OF ACCOUNT	37

15	PAYMENTS	38

16	SET-OFF	40

17	FEES	40

18	PRO RATA SHARING	40

19	COSTS, EXPENSES AND STAMP DUTIES	41

20	CALCULATIONS AND EVIDENCE OF DEBT	41

21	THE AGENT AND THE BANKS	42

22	ASSIGNMENTS AND TRANSFERS	46

23	AMENDMENTS, WAIVERS AND REMEDIES	48

24	NOTICES	49

25	LAW AND JURISDICTION	50

SCHEDULES

1	BANKS AND COMMITMENTS	52

2	CONDITIONS PRECEDENT	53

3	BORROWER'S CERTIFICATE	54

4	FORM OF TRANSFER CERTIFICATE	55

5	LETTER OF CREDIT FEES	58

THIS AGREEMENT is made the 13 day of June, 2002

BETWEEN:

(1) TARRANT COMPANY LIMITED a company incorporated in Hong Kong under company number 163310 with its registered office at 13th Floor, Lladro Centre, 72-80 Hoi Yuen Road, Kwun Tong, Kowloon, Hong Kong (?Tarrant?);

(2) MARBLE LIMITED a company incorporated in Hong Kong under company number 399753 with its registered office at 13th Floor, Lladro Centre, 72-80 Hoi Yuen Road, Kwun Tong, Kowloon, Hong Kong (?Marble?);

(3) TRADE LINK HOLDINGS LIMITED a company incorporated in Hong Kong under company number 592076 with its registered office at 13th Floor, Lladro Centre, 72-80 Hoi Yuen Road, Kwun Tong, Kowloon, Hong Kong (?Trade Link?);

(4) UPS CAPITAL GLOBAL TRADE FINANCE CORPORATION (?the Agent?) and in its capacity as the Finance Party issuing any Letter of Credit (?the Issuer?); and

(5) THE BANKS AND FINANCIAL INSTITUTIONS named in Schedule 1 (?the Original Banks?).

IT IS AGREED as follows:

1 DEFINITIONS AND INTERPRETATION

1.1 In this Agreement, including the Schedules, the following words and expressions shall (except where the context otherwise requires) have the following meanings:-

?Adjusted Net Worth?		the meaning given to it in Clause 10.5;

?Auditors?		Ernst & Young, or any other firm of accountants of similar standing selected by the Borrowers and satisfactory to the Agent;

?Available Commitment?		the Commitment of each Bank less that Bank?s Participating Proportion of the aggregate of the Issuer?s contingent liabilities under any Letters of Credit issued;

?Available Facility?		at any time, the aggregate of the Available Commitments;

?Bank?		any Original Bank and any Transferee which has become a party to this Agreement in accordance with Clause 22 in each case so long as it continues to be a party to this Agreement;


?Borrowers?		Tarrant, Marble and Trade Link and ?Borrower? means any of them;

?Borrowing Costs?		the meaning given to it in Clause 10.5;

?Borrowings?		the meaning given to it in Clause 10.5;

?Commitment?		in relation to a Bank, the amount set opposite its name in Schedule 1 (and/or, as the case may be, the amount in US dollars specified as the portion transferred in the Transfer Certificate pursuant to which such Bank increased its Commitment or became a party to this Agreement) as the same may at any time be cancelled, reduced or transferred by it in accordance with this Agreement;

?Commitment Period?		the period commencing on the date of this Agreement and ending on the Termination Date;

?Default?		an Event of Default or any condition, act or event which (with the giving of notice, lapse of time, making of any determination, fulfilment of any condition or any combination of any of the foregoing) may become an Event of Default;

?Default Interest Period?		the meaning given to it in Clause 13.2;

?EBITDA?		the meaning given to it in Clause 10.5;

?Environmental Authorisation?		any authorisation, permit, licence, consent, registration or other approval required by or pursuant to any Environmental Law;

?Environmental Laws?		all applicable laws, regulations, codes of practice, circulars, statutory guides, guidance notes and the like (whether in Hong Kong, the United States or in any other jurisdiction in which any Borrower carries on its business or in which its assets may be situated) relating to contamination, human health, safety or the environment including but not limited to those relating to waste, nuisance, health and safety, noise, packaging or the manufacture, processing, use, handling, treatment, storage, labelling, recovery, recycling, transport or disposal of Hazardous Substances;

?Event of Default?		any of those events specified in Clause 12.1;


?FRI?		Fashion Resource (TCL), Inc., a company incorporated under the laws of the state of California in the United States of America with its registered office at 3151 East Washington Boulevard, Los Angeles, Ca 90023, USA;

?Facility?		the facility referred to in Clause 2.1 made or to be made available to the Borrowers on the terms and subject to the conditions of this Agreement;

?Facility Office?		in relation to a Bank at any time, the office set out under its name at the end of this Agreement or, in the case of a Transferee, in the Transfer Certificate to which it is a party as Transferee or, in the case of a Bank which is an assignee or other successor of any other Bank, the office notified to the Agent by the assignee or other successor on or before the date it becomes a Bank or such other office as such Bank may from time to time notify to the Agent;

?Finance Document?		this Agreement, the Security Documents and any other agreement, deed, notice, document or certificate entered into by any Borrower pursuant thereto or otherwise in connection therewith, in each case as amended or modified from time to time;

?Finance Party?		each of the Agent, the Issuer and any Bank;

?Financial Statements?		any financial statements required to be delivered to the Agent pursuant to Clause 10.2.1 and complying with the provisions of Clause 10.3;

?Financial Year?		any period of twelve months ending on 31st December;

?Flotation?		the inclusion of any part of the ordinary share capital of the Parent or the Borrower on any recognised investment exchange;

?Foreign Currency?		any currency which is freely transferable and freely convertible into US dollars as may at any time be specifically agreed by the Agent;

?GAAP?		generally accepted accounting principles and policies in Hong Kong consistently applied;

?GMAC?		GMAC Commercial Credit LLC, a limited liability company incorporated under the laws of New York in the United States of America;

?Group?		at any time, TAG and all TAG?s Subsidiaries (and


		member of the Group shall be construed accordingly);

?Guez Guarantee?		the guarantee entered into on even date herewith by Mr Gerard Guez in favour of the Agent on behalf of the Issuer and the Banks;

?Hazardous Substance?		any radioactive emissions and any natural or artificial substance (whether in solid or liquid form or in the form of a gas or vapour and whether alone or in combination with any other substance) capable of causing harm to the environment, human health or welfare or to any organism, including (without limitation) any type of waste or any form of energy;

?Intercreditor Agreement?		an intercreditor agreement entered into on even date herewith by and between the Issuer, GMAC and TAG, setting out the terms of the relationship between the parties thereto regarding, inter alia, the security granted by TAG to each of GMAC and the Issuer;

?Letter of Credit?		any letter of credit issued, or import loan granted or Documents against Acceptance financed, by the Issuer at the request of the Borrower pursuant to the terms of Clause 4.2 (including without limitation any standby letter of credit issued by the Issuer in favour of The Hongkong and Shanghai Banking Corporation Limited);

?Letter of Credit Fee?		the meaning given to it in Clause 17.1;

?Majority Banks?		Banks whose Outstandings together exceed sixty-six and two-thirds per cent (66.67%) of the Outstandings of all the Banks (or, if there are no Outstandings, Banks whose Commitments together exceed sixty-six and two-thirds per cent (66.67%) of the Total Commitments) provided that, if at any time there is only one Bank party to this Agreement ?Majority Banks? shall mean that Bank singly, and if at any time there are only two Banks party to this Agreement ?Majority Banks? shall mean the Bank with the largest Outstandings (or, if there are no Oustandings, the Bank with the largest Commitment);

?Management Accounting Period?		each period of three calendar months ending on 31st March, 30th June, 30th September and 31st December in any year;

?Management Accounts?		as at the date of this Agreement, the unaudited but consolidated and consolidating management accounts of each of the Parents and the Borrowers in respect of the Management Accounting Period ended 31st

		March 2002 to be prepared in accordance with GAAP and in a format agreed by the Agent and thereafter those accounts or the then latest such accounts for successive Management Accounting Periods required to be delivered to the Agent pursuant to Clause 10.2.2;

?Original Financial Statements?		the financial statements of TAG, the Group and the Borrowers for the Financial Year ending 31st December 2001;

?Outstandings?		in relation to a Bank at any time, the aggregate principal amount of its share of the US dollar equivalent of the aggregate contingent liabilities in respect of any Utilisations outstanding at that time;

?Parent Guarantee?		the guarantee and security agreement entered into on even date herewith by the Parents in favour of the Agent on behalf of the Issuer and the Banks;

?Parents?		TAG and FRI and ?Parent? means either of them;

?Participating Proportion?		in relation to a Bank and any payment or indemnification due from it hereunder at any time:

(i)

the proportion borne by its Outstandings to the aggregate of the Outstandings of all the Banks at that time; or

(ii)

if there are no Outstandings at that time, the proportion borne by its Commitment to the Total Commitments; or

(iii)

if at that time there are no Outstandings and the Total Commitments have been cancelled, the proportion borne by its Commitment to the Total Commitments immediately before they were cancelled,


		in each case determined, and as at such time as may be specified, by the Agent;

?Permitted Encumbrance?		any encumbrance permitted under Clause 11.3.1;

?Permitted Indebtedness?		any indebtedness permitted under Clause 11.3.3;

?Relevant Accounting Information?		the meaning given to it in Clause 10.4;

?Sale?		in relation to any Borrower, any transaction pursuant to which a person (or persons acting in concert) obtains control of the relevant Borrower (other than

those persons having control of the relevant Borrower immediately after the date of this Agreement) or in terms of which all or substantially all of the assets of the relevant Borrower, or of the Borrowers as a whole, are transferred to such person;

?Security Documents?

(i) the Syndicated Composite Guarantee and Debenture (ii) the Parent Guarantee; (iii) the Guez Guarantee, (iv) a charge over shares executed on even date herewith by FRI in favour of the Agent on behalf of the Issuer and the Banks in respect of its shares in Tarrant, and (v) the Intercreditor Agreement, in each case as amended or modified from time to time;

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