WAIVER TO CREDIT
AGREEMENT
WAIVER, dated as of September 30, 2009 (this
“ Waiver ”), to the Credit Agreement dated as of
March 13, 2009 (as modified by that certain Resignation, Waiver,
Consent and Appointment Agreement dated as of March 31, 2009, the
“ Credit Agreement ”) among American Apparel,
Inc., a corporation organized under the laws of the State of
Delaware (the “ Borrower ”), the Facility
Guarantors from time to time party thereto, Wilmington Trust FSB,
in its capacity as Administrative Agent and in its capacity as
Collateral Agent thereunder, and the Lenders from time to time
party thereto.
W I T N E S S E T
H:
WHEREAS, pursuant to the Credit Agreement, the
Lenders have agreed to make, and have made, certain loans and other
extensions of credit to the Borrower;
WHEREAS, the Borrower has requested that certain
provisions of the Credit Agreement be waived as set forth in this
Waiver; and
WHEREAS, the Lenders are willing to agree to
such waiver on the terms and subject to the conditions set forth in
this Waiver;
NOW THEREFORE, in consideration of the premises
and mutual covenants contained in this Waiver, the undersigned
hereby agree as follows:
I.
Defined Terms; Interpretation;
Etc . Capitalized terms used but not
defined in this Waiver shall have the meanings given to them in the
Credit Agreement.
II.
Waiver of Applicability of
Section 6.11 of the Credit Agreement . The Required Lenders hereby agree
that the applicability of the provisions of Section 6.11 for the
period of four consecutive Fiscal Quarters ending September 30,
2009 shall be waived for the period from September 30, 2009 to and
including November 14, 2009.
III.
Conditions Precedent to the
Effectiveness of this Waiver .
(a) This Waiver
shall become effective as of, and with effect from, the date (the
“ Effective Date ”) on which the Borrower and
the Required Lenders shall have duly executed and delivered to the
Administrative Agent this Waiver.
(b) All
corporate and other proceedings required in connection with this
Waiver, and all documents, instruments and other legal matters in
connection with the transactions contemplated by this Waiver, shall
be satisfactory in all respects to the Required Lenders, which
satisfaction shall be evidenced by the execution and delivery by
the Required Lenders of this Waiver.
(c) Each of the
representations and warranties contained in Section IV
(Representations and Warranties) of this Waiver shall be true and
correct.
(d) After
giving effect to this Waiver, no Default or Event of Default shall
have occurred and be continuing as of the date hereof.
(e) No
litigation shall have been commenced against any Loan Party or any
of its Subsidiaries, either on the date hereof or the Effective
Date, seeking to restrain or enjoin (whether
temporarily,
preliminarily
or permanently) the performance of any action by any Loan Party
required or contemplated by this Waiver, the Credit Agreement or
any Loan Document.
IV.
Representations and
Warranties . On and as of the date hereof and as
of the Effective Date, the Borrower hereby represents and warrants
to the Administrative Agent, the Collateral Agent and the Lenders
as follows:
(a) this Waiver
has been duly authorized, executed and delivered by the Borrower
and each Facility Guarantor and constitutes a legal, valid and
binding obligation of the Borrower and each Facility Guarantor,
enforceable against the Borrower and each Facility Guarantor in
accordance with its terms and the Credit Agreement and constitutes
the legal, valid and binding obligation of the Borrower and each
Facility Guarantor, enforceable against the Borrower and each
Facility Guarantor in accordance with its terms;
(b) each of the
representations and warranties contained in Article III
(Representations and Warranties) of the Credit Agreement, the other
Loan Documents or otherwise made in writing in connection therewith
are true and correct in all material respects on and as of the date
hereof and the Effective Date, in each case as if made on and as of
such date except to the extent that such representations and
warranties specifically relate to a specific date, in which case
such representations and warranties shall be true and correct in
all material respects as of such specific date;
(c) after
giving effect to this Waiver, no Default or Event of Default has
occurred and is continuing; and
(d) no
litigation has been commenced against any Loan Party or any of its
Subsidiaries seeking to restrain or enjoin (whether temporarily,
preliminarily or permanently) the performan
