EX-10 11 ex10-20.txt EX-10.20 EXHIBIT 10.20 FTC COMMERCIAL CORP. As of January 1, 2006 Antik Denim, LLC 5804 E. Slauson Avenue Commerce, CA 90040 Ladies and Gentlemen: This Amendment No. 3 to Factoring Agreement (this "Amendment") is entered into as of January 1, 2006 by and between FTC COMMERCIAL CORP. ("FTC", "we" or "us") and ANTIK DENIM, LLC ("Client" or "you"), with reference to the following: A. FTC and Client are parties to a Factoring Agreement dated effective as of October 18, 2004 (as amended, the "Factoring Agreement"), the provisions of which are incorporated into this Amendment. B. FTC and Client desire to amend the Factoring Agreement as set forth herein. NOW, THEREFORE, the parties agree as follows: 1. Initially capitalized terms used herein which are not otherwise defined shall have the meanings assigned to them in the Factoring Agreement. 2. The first four sentences of the first subsection of Section 23 of the Factoring Agreement entitled "FACTORING SERVICE CHARGE" are hereby amended to read as follows: You shall pay us a commission in an amount equal to (a) four tenths of one percent (0.40%) of the net amount of each client's risk account and (b) three quarters of one percent (0.75%) of the net amount of each account which is approved by us; provided, however, that: (i) if the aggregate net amount of Combined Assigned Approved Accounts (the aggregate net amount of (A) approved accounts assigned to us by you under this Agreement PLUS (B) approved accounts assigned to us by Blue Holdings, Inc. under the Factoring Agreement between Blue Holdings, Inc. and us dated July 25, 2005, as amended, PLUS (C) approved accounts assigned to us by Taverniti So Jeans, LLC under the Factoring Agreement between Taverniti So Jeans, LLC and us dated November 22, 2004, as amended) during a calendar year (the twelve month period from January 1, 2006 through December 31, 2006 or any twelve month period thereafter) exceeds $10,000,000 but is less than or equal to $20,000,000, the commission on each approved account assigned by you to us under this Agreement during such calendar year in excess of said $10,000,000 up to said $20,000,000 shall be seven tenths of one percent (0.70%) of the net amount of such approved account, and (ii) if the aggregate net amount of Combined Assigned Approved Accounts during such calendar year exceeds $20,000,000 but is less than or equal to $30,000,000, the commission on each approved account assigned by you to us under this Agreement during such calendar year in excess of said $20,000,000 up to said $30,000,000 shall be sixty-five hundredths of one percent (0.65%) of the net amount of each such approved account, and (iii) if the aggregate net amount of Combined Assigned Approved Accounts during such calendar year exceeds $30,000,000, the commission on each approved account assigned by you to us under this Agreement during such calendar year in excess of said $30,000,000 shall be six tenths of one percent (0.60%) of the net amount of each such approved account. Factoring commissions payable to us hereunder are based on your usual and regular selling terms which do not exceed ninety (90) days. If the selling terms on an account receivable exceed such ninety (90) days selling terms, you shall pay us an additional factoring commission equal to one quarter of one percent (0.25%) of the net amount of such account receivable for each thirty (30) days or part thereof the selling terms thereof exceed such ninety (90) days selling terms; provided, however, that no such increase in terms or dating shall be granted without our prior written approval. Notwithstanding any provisions herein to the contrary, in no event shall the factoring commission paid by you be less than $3.00 per invoice. 3. Except as amended hereby, the Factoring Agreement shall remain in full force and effect and unmodified. Client hereby reaffirms each and every one of Client's representations, warranties and covenants under the Factoring Agreement. 4. Any reference in the Factoring Agreement to "this Agreement", "herein", "hereunder" or words of similar meaning shall mean the Factoring Agreement as amended by this Amendment. 5. Client hereby represents and warrants to FTC that this Amendment has been duly authorized by all necessary action on the part of Client and constitutes a valid and legally binding obligation of Client, enforceable against Client in accordance with its terms. 6. This Amendment shall be governed by the laws of the State of California without regard to the conflicts of law principles thereof. 7. The Factoring Agreement, as amended by this Amendment, constitutes the entire agreement between Client and FTC as to the subject matter hereof and may not be altered or amended except by written agreement signed by Client and FTC. No provision hereof may be waived by FTC except upon written waiver executed by FTC. 8. This Amendment may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Sincerely, AGREED: FTC COMMERCIAL CORP. ANTIK DENIM, LLC /s/ Kenneth L. Wengrod /s/ Patrick Chow By:____________________________ By:____________________________ Name: Kenneth L. Wengrod Name: Patrick Chow Title: President Title: CFO