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EXHIBIT 10.20
INDEMNITY AGREEMENT
FOR FACTOR AND SUPPLIER GUARANTEES
THIS INDEMNITY AGREEMENT (this "Agreement") is entered into as
of January 1,
2006, between FTC COMMERCIAL CORP. ("FTC") and TAVERNITI SO
JEANS, LLC (the
"Client").
1. GUARANTEES. From time to time, in order to assist the Client
in the
purchase of goods or for other purposes, the Client may request
that FTC
guarantee payment of certain obligations of the Client. The
decision to do so
shall be a matter of FTC's sole discretion. In the event FTC
issues any such
guarantees (the "Guarantees"), the same shall be subject to the
terms and
conditions of this Agreement. This Agreement supplements the
Factoring Agreement
between FTC and the Client dated November 22, 2004 (as amended
from time to
time, the "Factoring Agreement"), and all of the terms and
provisions of the
Factoring Agreement are incorporated herein by reference.
Capitalized terms used
in this Agreement, which are not defined in this Agreement,
shall have the
meanings set forth in the Factoring Agreement. This Agreement,
the Factoring
Agreement and all other present and future documents instruments
and agreements
between FTC and the Client are referred to herein collectively
as the "Factoring
Documents". The amount, extent, terms and conditions of the
Guarantees and any
documents relating thereto, shall in all respects be determined
solely by FTC
and shall be subject to change, modification and revision by FTC
at any time and
from time to time, in its sole discretion.
2. CHARGES. Notwithstanding any provisions to the contrary in
the Factoring
Agreement and unless FTC and the Client otherwise agree in
writing, the Client
shall pay FTC a fee equal to one percent (1.0 %) of the face
amount of each
Guarantee for each sixty (60) day period (or fraction thereof)
from the date of
issuance of a Guarantee to the stated expiration date of the
Guarantee; provided
however, that in no event shall the fee paid for any Guarantee
be less than one
hundred fifty dollars ($150.00). Said fee shall be paid and
shall be fully
earned upon the issuance of the Guarantee, regardless of any
subsequent payment,
cancellation or termination prior to the stated expiration date
of the
Guarantee. In addition, the Client shall reimburse FTC for all
charges, fees and
expenses charged to FTC in connection with any Guarantee (all of
which
conclusive on the Client). Said fee and all charges, fees and
expenses charged
to FTC in connection with any Guarantee may be charged by FTC to
the Client's
account.
3. INDEMNITY. The Client unconditionally agrees to indemnify,
defend and hold
FTC harmless from any and all loss, claim, liability, cost or
expense, of any
kind or nature, based upon, arising from or in any manner
relating to, any and
all Guarantees or any transaction or occurrence relating to any
or all
Guarantees, and all Guarantee Obligations (as defined below),
including (without
limitation) any of the foregoing arising from any errors or
omissions in
connection with any Guarantee (whether caused by FTC or
otherwise). The Client's
unconditional obligation to FTC hereunder shall not be modified
or diminished
for any reason or in any manner whatsoever.
4. GUARANTEE OBLIGATIONS. All of the Client's present and
future
indebtedness, liabilities, and obligations to FTC of every
nature whatsoever,
however arising, fixed or contingent, due or to become due,
under this Agreement
or otherwise in any manner relating to any Guarantee are
referred to herein as
the "Guarantee Obligations". The Guarantee Obligations include,
without
limitation, the obligation of the Client to reimburse FTC for
all sums which FTC
pays under or in connection with any Guarantee, all charges and
expenses which
may pertain either directly or indirectly to any Guarantee,
FTC's charges as
herein provided, and all attorneys' fees and all other costs and
expenses. FTC
shall have the right, at any time and without notice to the
Client, to charge
any of the Client's factoring or other accounts with FTC with
the amount of any
and all Guarantee Obligations. Without limiting the fact that
the amount of
advances FTC may make to the Client under the Factoring
Documents is a matter of
FTC's sole discretion, FTC may reduce the amount of such
advances which would
otherwise be available under the Factoring Documents by the
amount of all
outstanding Guarantees and Guarantee Obligations.
5. NON-RESPONSIBILITY. If a Guarantee is issued in connection
with the
purchase of goods by the Client ("Goods"), FTC shall not be
responsible to the
Client for: the existence, character, quality, quantity,
condition, packing,
value or delivery of the Goods; any difference or variation in
the character,
quality, quantity, condition, packing, value or delivery of the
Goods from that
expressed in any document or agreement relating thereto; the
validity,
sufficiency or genuineness of any documents relating to any
Goods or of any
endorsements thereon, even if such documents should in fact
prove to be in any
or all respects invalid, insufficient, fraudulent or forged; the
time, place,
manner or order in which shipment of any Goods is made; partial
or incomplete
shipment of any Goods, or failure or omission to ship any or all
of the Goods;
any deviation from instructions relating to any Goods; delay,
default, or fraud
by the shipper, vendor or anyone else in connection with any
Goods or the
shipping thereof; or any breach of contract between the shipper
or vendor and
the Client; any other act or omission of any kind or nature of
any person with
respect to, or in connection with, any Goods.
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6. FTC'S AUTHORITY. The Client
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