{"id":41289,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/security-agreement-anntaylor-global-sourcing-inc-and-the.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"security-agreement-anntaylor-global-sourcing-inc-and-the","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/finance\/security-agreement-anntaylor-global-sourcing-inc-and-the.html","title":{"rendered":"Security Agreement &#8211; AnnTaylor Global Sourcing Inc. and The Hongkong and Shanghai Banking Corp. Ltd."},"content":{"rendered":"<pre>                              AMENDED AND RESTATED SECURITY AGREEMENT\n\n        \n         AMENDED  AND  RESTATED  SECURITY AGREEMENT  dated  as  of\nSeptember  20,  1996  between  ANNTAYLOR  GLOBAL  SOURCING,  INC.\n(formerly  known as CAT US, Inc.), a Delaware corporation  having\nan  office  at  142 West 57th Street, New York,  NY   10019  (the\n'Company')  and  THE  HONGKONG AND SHANGHAI  BANKING  CORPORATION\n -------\nLIMITED,  a  foreign banking corporation acting through  its  New\nYork Branch (the 'Bank').\n                  ----\n                     \n                     \n                     W I T N E S S E T H :\n        \n         WHEREAS,  the Company has provided a collateral  security\ninterest  to  the  Bank under a General Security Agreement  dated\nAugust 4, 1995 (the 'Original Agreement');\n                     ------------------\n        \n        \n         WHEREAS,  the  Company has requested  that  the  Original\nAgreement be restated in its entirety to reflect the amendment of\ncertain provisions thereof; and\n        \n        \n         WHEREAS,  the  Company and the Bank  are  parties  to  an\nAmended  and Restated Credit Agreement dated as of September  20,\n1996  (as  modified and supplemented and in effect from  time  to\ntime,  the  'Credit Agreement'), providing, subject to the  terms\n             ----------------\nand  conditions  thereof, for extensions of  credit  (by  issuing\nletters of credit and making loans) to be made by the Bank to the\nCompany  in  an aggregate face or principal amount not  exceeding\n$40,000,000.\n        \n        \n         NOW,  THEREFORE,  to induce the Bank to  enter  into  the\nCredit  Agreement, and for other good and valuable consideration,\nthe receipt and sufficiency of which are hereby acknowledged, the\nCompany  has agreed to continue to pledge and to grant a security\ninterest  in the Collateral (as hereinafter defined) as  security\nfor   the   Secured   Obligations   (as   hereinafter   defined).\nAccordingly, the parties hereto agree that the Original Agreement\nis hereby amended and restated in its entirety as follows:\n         Section 1.     Definitions.  Terms defined in the Credit  Agreement\n                        -----------\nare used herein as defined therein.  In addition, as used herein:\n         'Accounts'  shall  have the meaning  ascribed  thereto  in\n          --------\nSection 3(d) hereof.\n\n         'Collateral'  shall have the meaning ascribed  thereto  in\n          ----------\nSection 3 hereof.\n       \n         'Documents'  shall  have the meaning ascribed  thereto  in\n          ---------\nSection 3(i) hereof.\n       \n         'Equipment'  shall  have the meaning ascribed  thereto  in\n          ---------\nSection 3(g) hereof.\n\n===========================================================================\n       \n         'Instruments' shall have the meaning ascribed  thereto  in\n          -----------\nSection 3(e) hereof.\n       \n         'Inventory'  shall  have the meaning ascribed  thereto  in\n          ---------\nSection 3(f) hereof.\n        \n         'Issuers'   shall  mean,  collectively,  the   respective\n          -------\ncorporations  identified in Annex 1 hereto  under  the  caption\n  \n'Issuers'.\n -------\n         'Pledged Stock' shall have the meaning ascribed thereto in\n          -------------\nSection 3(a) hereof.\n       \n         'Secured  Obligations' shall mean, collectively,  (a)  the\n          --------------------\nprincipal  of  and interest on the Loans made by the  Bank  to,\nand  the  Note held by the Bank of, the Company, and all  other\namounts  from  time to time owing to the Bank  by  the  Company\n  \nunder the Credit Agreement or the Note, (b) all obligations  of\nthe  Company to the Bank hereunder, and (c) all obligations  of\nthe  Company  under any other Credit Document to  which  it  is\nparty.\n        \n         'Stock Collateral' shall mean, collectively, the\n          ----------------\nCollateral  described in clauses (a) through (c) of  Section  3\n  \nhereof  and  the proceeds of and to any such property  and,  to\nthe  extent related to any such property or such proceeds,  all\n  \nbooks,  correspondence,  credit files,  records,  invoices  and\n  \nother papers.\n        \n         'Uniform Commercial Code'  shall  mean   the   Uniform\n          -----------------------\nCommercial  Code  as in effect in the State of  New  York  from\ntime to time.\n              \n         Section 2.     Representations and Warranties.    The   Company\n                        ------------------------------\nrepresents and warrants to the Bank that:\n         (a)  the  Company  is  the sole beneficial  owner  of  the\n  \nCollateral  and  no  Lien  exists  or  will  exist   upon   any\n  \nCollateral  at  any  time  (and,  with  respect  to  the  Stock\nCollateral,  no right or option to acquire the same  exists  in\nfavor  of  any other Person), except for Liens permitted  under\nSection 8.06 of the Credit Agreement and except for the  pledge\nand  security interest in favor of the Bank created or provided\nfor  herein  which pledge and security interest  constitutes  a\nfirst  priority perfected pledge and security interest  in  and\nto all of the Collateral;\n         (b)  the  Pledged  Stock  evidenced  by  the  certificates\nidentified  in  Annex 1 hereto is, and all other Pledged  Stock\n  \nwill  be,  duly  authorized, validly  issued,  fully  paid  and\nnonassessable  and none of such Pledged Stock  is  or  will  be\nsubject  to  any  contractual restriction, or  any  restriction\nunder the charter or by-laws of the respective Issuers of  such\nPledged  Stock, upon the transfer of such Pledged Stock (except\nfor  any  such  restriction contained herein or in  the  Credit\nAgreement);\n\n===========================================================================\n         (c)  the  Pledged  Stock  evidenced  by  the  certificates\nidentified   in  Annex  1  hereto  constitutes  the   indicated\npercentage  of  the  total  issued and  outstanding  shares  of\ncapital  stock  of any class of the Issuers beneficially  owned\nby  the  Company on the date hereof (whether or not  registered\nin  the  name  of  the  Company) and  said  Annex  1  correctly\nidentifies,  as at the date hereof, the respective  Issuers  of\nsuch  Pledged Stock, the respective class and par value of  the\nshares  comprising such Pledged Stock and the respective number\nof  shares  (and  registered owner thereof) evidenced  by  each\nsuch certificate; and\n         (d)  any goods now or hereafter produced by the Company or\nany  of  its Subsidiaries included in the Collateral have  been\nand  will  be  produced in compliance with the requirements  of\nthe Fair Labor Standards Act, as amended.\n         Section 3.     Collateral.  As collateral security for  the  prompt\n                        ----------\npayment  in  full  when  due  (whether  at  stated  maturity,  by\nacceleration  or  otherwise)  of  the  Secured  Obligations,  the\nCompany  hereby  continues to pledge and  grant  to  the  Bank  a\nsecurity  interest  in  all  of the Company's  right,  title  and\ninterest  in  the following property, whether now  owned  by  the\nCompany  or  hereafter  acquired  and  whether  now  existing  or\nhereafter coming into existence, and wherever located (all  being\ncollectively referred to herein as 'Collateral'):\n                                    ----------\n         (a)  the  respective shares of common\/preferred  stock  of\nthe  Issuers evidenced by the certificates identified in  Annex\n  \n1  hereto  and  all other shares of capital stock  of  whatever\nclass  of  the Issuers, now or hereafter owned by the  Company,\ntogether  with  in  each case the certificates  evidencing  the\nsame (collectively, the 'Pledged Stock');\n                         -------------\n         (b)  all   shares,   securities,   moneys   or   property\nrepresenting  a  dividend  on any  of  the  Pledged  Stock,  or\nrepresenting  a distribution or return of capital  upon  or  in\nrespect  of  the Pledged Stock, or resulting from  a  split-up,\nrevision, reclassification or other like change of the  Pledged\nStock  or  otherwise  received in exchange  therefor,  and  any\nsubscription warrants, rights or options issued to the  holders\nof, or otherwise in respect of, the Pledged Stock;\n         (c)  without  affecting the  obligations  of  the  Company\nunder  any provision prohibiting such action hereunder or under\nthe  Credit  Agreement, in the event of  any  consolidation  or\nmerger  in  which any Issuer is not the surviving  corporation,\nall  shares of each class of the capital stock of the successor\ncorporation  (unless such successor corporation is the  Company\nitself)  formed  by  or  resulting from such  consolidation  or\nmerger;\n         (d)  all accounts and general intangibles (each as defined\n  \nin  the  Uniform  Commercial Code) of the Company  constituting\nany  right to the payment of money, including (but not  limited\nto)  all moneys due and to become due to the Company in respect\nof  any  loans or advances for the purchase price of  Inventory\nor  Equipment  or  other goods sold or leased or  for  services\n\n========================================================================\n\nrendered,  all  moneys due and to become  due  to  the  Company\nunder  any  guarantee (including a letter  of  credit)  of  the\npurchase  price of Inventory or Equipment sold by  the  Company\nand  all  tax  refunds (such accounts, general intangibles  and\nmoneys  due  and to become due being herein called collectively\n'Accounts');\n --------\n         (e)  all  instruments, chattel paper or letters of  credit\n(each  as  defined  in  the  Uniform Commercial  Code)  of  the\nCompany  evidencing, representing, arising from or existing  in\nrespect  of, relating to, securing or otherwise supporting  the\npayment  of,  any of the Accounts, including (but  not  limited\nto)  promissory  notes,  drafts, bills of  exchange  and  trade\nacceptances (herein collectively called 'Instruments');\n                                         -----------\n            \n         (f)  all  inventory (as defined in the Uniform  Commercial\nCode)  of  the  Company, all goods obtained by the  Company  in\nexchange  for  such  inventory,  and  any  products   made   or\nprocessed  from  such inventory including  all  substances,  if\nany, commingled   therewith   or   added   thereto   (herein\ncollectively called 'Inventory');\n                     ---------\n            \n         (g)  all  equipment (as defined in the Uniform  Commercial\nCode) of the Company (herein collectively called 'Equipment');\n                                                  ---------\n         (h)  each  contract  and other agreement  of  the  Company\n  \nrelating  to  the  sale or other disposition  of  Inventory  or\nEquipment;\n            \n         (i)  all  documents  of title (as defined in  the  Uniform\nCommercial  Code)  or other receipts of the  Company  covering,\nevidencing  or  representing  Inventory  or  Equipment  (herein\ncollectively called 'Documents');\n                     ---------\n            \n         (j)  all  rights,  claims  and  benefits  of  the  Company\nagainst  any  Person  arising  out  of,  relating  to   or   in\nconnection  with  Inventory  or  Equipment  purchased  by   the\nCompany,  including,  without  limitation,  any  such   rights,\nclaims  or  benefits against any Person storing or transporting\nsuch Inventory or Equipment; and\n            \n         (k)  all  other  tangible or intangible  property  of  the\n  \nCompany,  including, without limitation, all proceeds, products\nand  accessions  of and to any of the property of  the  Company\ndescribed  in clauses (a) through (j) above in this  Section  3\n(including,  without  limitation,  any  proceeds  of  insurance\nthereon),  and, to the extent related to any property described\nin  said clauses or such proceeds, products and accessions, all\nbooks,  correspondence,  credit files,  records,  invoices  and\nother  papers,  including without limitation all tapes,  cards,\ncomputer  runs and other papers and documents in the possession\nor  under the control of the Company or any computer bureau  or\nservice company from time to time acting for the Company.\n\n===========================================================================\n         Section 4.     Further Assurances; Remedies.  In furtherance of the\n                        ----------------------------\ngrant  of the pledge and security interest pursuant to Section  3\nhereof, the Company hereby agrees with the Bank as follows:\n         4.01      Delivery and Other Perfection.  The Company shall:\n                   -----------------------------\n         (a)  if  any  of  the above-described shares,  securities,\nmonies or property required to be pledged by the Company  under\nclauses  (a), (b) and (c) of Section 3 hereof are  received  by\nthe  Company, forthwith either (x) transfer and deliver to  the\nBank  such  shares  or securities so received  by  the  Company\n(together  with  the  certificates  for  any  such  shares  and\nsecurities  duly  endorsed in blank or accompanied  by  undated\nstock  powers  duly executed in blank) all of which  thereafter\nshall  be  held  by  the Bank, pursuant to the  terms  of  this\nAgreement,  as  part of the Collateral or (y) take  such  other\naction as the Bank shall deem necessary or appropriate to  duly\nrecord  the  Lien created hereunder in such shares, securities,\nmonies  or  property referred to in said clauses (a),  (b)  and\n  \n(c);\n             \n         (b)  deliver  and  pledge  to  the  Bank  any   and   all\nInstruments,  endorsed and\/or accompanied by  such  instruments\nof  assignment and transfer in such form and substance  as  the\nBank  may  request; provided, that so long as no Default  shall\nhave  occurred  and be continuing, the Company may  retain  for\ncollection  in the ordinary course any Instruments received  by\nit  in  the  ordinary course of business and  the  Bank  shall,\npromptly   upon  request  of  the  Company,  make   appropriate\narrangements  for making any other Instrument  pledged  by  the\nCompany  available  to  it  for  purposes   of   presentation,\ncollection or renewal (any such arrangement to be effected,  to\nthe  extent  deemed  appropriate by  the  Bank,  against  trust\nreceipt or like document);\n             \n         (c)  give,  execute,  deliver,  file  and\/or  record  any\nfinancing  statement, notice, instrument,  document,  agreement\nor  other  papers  that may be necessary or desirable  (in  the\njudgment  of the Bank) to create, preserve, perfect or validate\nany  security interest granted pursuant hereto or to enable the\nBank  to exercise and enforce its rights hereunder with respect\nto  such  security  interest,  including,  without  limitation,\ncausing  any  or all of the Stock Collateral to be  transferred\nof  record  into the name of the Bank or its nominee  (and  the\nBank  agrees  that if any Stock Collateral is transferred  into\nits  name  or the name of its nominee, the Bank will thereafter\npromptly  give  to  the  Company  copies  of  any  notices  and\ncommunications  received  by  it  with  respect  to  the  Stock\nCollateral),  provided  that  notices  to  account  debtors  in\nrespect of any Accounts or Instruments shall be subject to  the\nprovisions of clause (g) below;\n            \n         (d)  upon  the  acquisition after the date hereof  by  the\n  \nCompany  of any Equipment covered by a certificate of title  or\nownership,  cause  the Bank to be listed as the  lienholder  on\n  \n=======================================================================  \n  \n  \nsuch   certificate  of  title  and  within  120  days  of   the\nacquisition thereof deliver evidence of the same to the Bank;\n         (e)  keep full and accurate books and records relating  to\nthe  Collateral,  and stamp or otherwise mark  such  books  and\nrecords  in  such manner as the Bank may reasonably require  in\norder  to  reflect  the  security  interests  granted  by  this\nAgreement;\n            \n         (f)  permit  representatives of the Bank, upon  reasonable\nnotice,  at  any time during normal business hours  to  inspect\nand  make  abstracts from its books and records  pertaining  to\nthe  Collateral, and permit representatives of the Bank  to  be\npresent  at  the Company's place of business to receive  copies\nof   all   communications  and  remittances  relating  to   the\nCollateral,   and   forward   copies   of   any   notices    or\ncommunications  by the Company with respect to the  Collateral,\nall in such manner as the Bank may require; and\n         (g)  upon the occurrence and during the continuance of any\nDefault,  upon  request of the Bank, promptly notify  (and  the\nCompany  hereby authorizes the Bank so to notify) each  account\ndebtor  in  respect  of any Accounts or Instruments  that  such\nCollateral  has been assigned to the Bank hereunder,  and  that\nany   payments  due  or  to  become  due  in  respect  of  such\nCollateral are to be made directly to the Bank.\n\n         4.02      Other Financing Statements and Liens.  Without  the\n                   ------------------------------------\nprior written consent of the Bank, the Company shall not file  or\nsuffer to be on file, or authorize or permit to be filed or to be\non  file,  in any jurisdiction, any financing statement  or  like\ninstrument  with respect to the Collateral in which the  Bank  is\nnot named as the sole secured party.\n             \n         4.03      Preservation  of  Rights.  The  Bank  shall  not  be\n                   ------------------------\nrequired  to take steps necessary to preserve any rights  against\nprior parties to any of the Collateral.\n            \n         4.04      Special Provisions Relating to Stock Collateral.\n                   -----------------------------------------------\n            \n         (a)  The  Company  will  cause  the  Stock  Collateral  to\nconstitute  at all times the percentage indicated  on  Annex  1\nhereto  of the total number of shares of each class of  capital\nstock of each Issuer then outstanding.\n            \n         (b)  So  long  as no Event of Default shall have  occurred\nand  be  continuing,  the  Company  shall  have  the  right  to\nexercise  all voting, consensual and other powers of  ownership\npertaining  to  the  Stock  Collateral  for  all  purposes  not\ninconsistent  with  the  terms of this  Agreement,  the  Credit\nAgreement,  the  Notes  or  any other instrument  or  agreement\nreferred  to  herein  or  therein, provided  that  the  Company\nagrees  that  it  will  not vote the Stock  Collateral  in  any\nmanner  that is inconsistent with the terms of this  Agreement,\n\n===========================================================================\n\nthe  Credit  Agreement, the Notes or any such other  instrument\nor  agreement;  and the Bank shall execute and deliver  to  the\nCompany  or  cause to be executed and delivered to the  Company\nall  such  proxies,  powers  of attorney,  dividend  and  other\norders,  and  all  such instruments, without recourse,  as  the\nCompany may reasonably request for the purpose of enabling  the\nCompany  to exercise the rights and powers which it is entitled\nto exercise pursuant to this Section 4.04(b).\n\n         (c)  Unless and until an Event of Default has occurred and\nis  continuing,  the Company shall be entitled to  receive  and\nretain  any dividends on the Stock Collateral paid in cash  out\nof earned surplus.\n            \n         (d)  If any Event of Default shall have occurred, then  so\nlong  as  such Event of Default shall continue, and whether  or\nnot  the  Bank  or  any Bank exercises any available  right  to\ndeclare  any  Secured Obligation due and payable  or  seeks  or\npursues  any  other  relief or remedy  available  to  it  under\napplicable  law or under this Agreement, the Credit  Agreement,\nthe  Notes  or  any other agreement relating  to  such  Secured\nObligation, all dividends and other distributions on the  Stock\nCollateral  shall be paid directly to the Bank and retained  by\nit  as  part of the Stock Collateral, subject to the  terms  of\nthis  Agreement, and, if the Bank shall so request in  writing,\nthe   Company  agrees  to  execute  and  deliver  to  the  Bank\nappropriate additional dividend, distribution and other  orders\nand  documents  to  that end, provided that if  such  Event  of\nDefault   is   cured,   any  such  dividend   or   distribution\ntheretofore  paid  to  the  Bank shall,  upon  request  of  the\nCompany  (except  to  the  extent theretofore  applied  to  the\nSecured Obligations) be returned by the Bank to the Company.\n         4.05      Events  of  Default, etc.  During the period  during\n                   -------------------------\nwhich an Event of Default shall have occurred and be continuing:\n                      \n                   (i)  the  Company shall, at the request  of  the\n         Bank,  assemble the Collateral owned by it at  such  place\n         or  places, reasonably convenient to both the Bank and the\n         Company, designated in its request;\n                      \n                   (ii)      the Bank may make any reasonable compromise\n         or  settlement deemed desirable with respect to any of the\n         Collateral  and  may extend the time of  payment,  arrange\n         for  payment  in  installments, or  otherwise  modify  the\n         terms of, any of the Collateral;\n                   (iii)     the  Bank shall have all of the rights  and\n         remedies  with  respect  to the Collateral  of  a  secured\n         party  under the Uniform Commercial Code (whether  or  not\n         said  Code  is  in  effect in the jurisdiction  where  the\n         rights  and  remedies  are asserted) and  such  additional\n         rights  and remedies to which a secured party is  entitled\n\n==========================================================================\n         under  the  laws in effect in any jurisdiction  where  any\n         rights  and remedies hereunder may be asserted, including,\n         without  limitation,  the right,  to  the  maximum  extent\n         permitted  by law, to exercise all voting, consensual  and\n         other powers of ownership pertaining to the Collateral  as\n         if  the Bank were the sole and absolute owner thereof (and\n         the  Company  agrees to take all such  action  as  may  be\n         appropriate to give effect to such right);\n                      \n                   (iv)      the Bank in its discretion may, in its name\n       \n         or  in  the name of the Company or otherwise, demand,  sue\n       \n         for,  collect or receive any money or property at any time\n       \n         payable  or  receivable on account of or in  exchange  for\n       \n         any  of  the  Collateral, but shall be under no obligation\n       \n         to do so; and\n\n                   (v)       the  Bank may, upon 10 Business Days' prior\n         written notice to the Company of the time and place,  with\n         respect to the Collateral or any part thereof which  shall\n         then  be  or  shall thereafter come into  the  possession,\n         custody  or  control of the Bank, or any  of  its  agents,\n         sell, lease, assign or otherwise dispose of all or any  of\n         such  Collateral,  at such place or  places  as  the  Bank\n         deems  best,  and  for  cash or on credit  or  for  future\n         delivery  (without thereby assuming any credit  risk),  at\n         public  or private sale, without demand of performance  or\n         notice of intention to effect any such disposition  or  of\n         time  or  place thereof (except such notice as is required\n         above  or by applicable statute and cannot be waived)  and\n         the  Bank  or  anyone  else may be the purchaser,  lessee,\n         assignee  or recipient of any or all of the Collateral  so\n         disposed  of  at  any  public  sale  (or,  to  the  extent\n         permitted  by  law, at any private sale),  and  thereafter\n         hold the same absolutely, free from any claim or right  of\n         whatsoever  kind,  including  any  right  or   equity   of\n         redemption  (statutory or otherwise), of the Company,  any\n         such  demand,  notice  or right and  equity  being  hereby\n         expressly  waived  and released.  The  Bank  may,  without\n         notice or publication, adjourn any public or private  sale\n         or  cause  the same to be adjourned from time to  time  by\n         announcement  at the time and place fixed  for  the  sale,\n         and  such  sale may be made at any time or place to  which\n         the same may be so adjourned.\n\nThe  proceeds of each collection, sale or other disposition under\nthis  Section  4.05 shall be applied in accordance  with  Section\n4.09 hereof.\n\n         The  Company  recognizes  that,  by  reason  of  certain\nprohibitions contained in the Securities Act of 1933, as amended,\nand  applicable state securities laws, the Bank may be compelled,\nwith respect to any sale of all or any part of the Collateral, to\nlimit purchasers to those who will agree, among other things,  to\nacquire the Collateral for their own account, for investment  and\nnot  with  a  view  to the distribution or resale  thereof.   The\nCompany acknowledges that any such private sales may be at prices\nand  on  terms  less favorable to the Bank than those  obtainable\nthrough   a   public   sale  without  such   restrictions,   and,\nnotwithstanding such circumstances, agrees that any such  private\nsale  shall  be  deemed  to  have been  made  in  a  commercially\nreasonable  manner and that the Bank shall have no obligation  to\nengage in public sales and no obligation to delay the sale of any\nCollateral  for  the  period  of time  necessary  to  permit  the\nrespective Issuer thereof to register it for public sale.\n\n             \n         4.06      Deficiency.  If the proceeds of sale, collection  or\n                   ----------\nother  realization of or upon the Collateral pursuant to  Section\n4.05  hereof are insufficient to cover the costs and expenses  of\nsuch   realization  and  the  payment  in  full  of  the  Secured\nObligations, the Company shall remain liable for any deficiency.\n             \n         4.07      Removals, etc.   Without at  least  30  days  prior\n                   -------------\nwritten  notice to the Bank, the Company shall not  (i)  maintain\nany of its books or records with respect to the Collateral at any\noffice  or  maintain its chief executive office or its  principal\nplace  of  business  at  any place, or permit  any  Inventory  or\nEquipment  to  be  located anywhere other  than  at  the  address\nindicated  beneath  the signature of the Company  to  the  Credit\nAgreement or at one of the locations identified in Annex 2 hereto\nor  in  transit from one of such locations to another  (or,  with\nrespect to Inventory, in transit from one of such locations to  a\ncustomer  of the Company) or (ii) change its corporate  name,  or\nthe name under which it does business, from the name shown on the\nsignature page hereto.\n\n            \n         4.08      Private Sale.  The Bank shall incur no liability as a\n                   ------------\nresult of the sale of the Collateral, or any part thereof, at any\nprivate  sale  pursuant  to Section 4.05 hereof  conducted  in  a\ncommercially  reasonable manner.  The Company hereby  waives  any\nclaims  against the Bank arising by reason of the fact  that  the\nprice  at  which  the Collateral may have been  sold  at  such  a\nprivate  sale  was  less  than the price which  might  have  been\nobtained  at a public sale or was less than the aggregate  amount\nof  the  Secured Obligations, even if the Bank accepts the  first\noffer received and does not offer the Collateral to more than one\nofferee.\n             \n         4.09      Application of Proceeds.  Except as otherwise herein\n                   -----------------------\nexpressly provided, the proceeds of any collection, sale or other\nrealization of all or any part of the Collateral pursuant hereto,\nand  any  other  cash  at the time held by the  Bank  under  this\nSection 4, shall be applied by the Bank:\n       \n       \n         First,  to the payment of the costs and expenses  of  such\n         -----\ncollection,  sale  or  other realization, including  reasonable\nout-of-pocket costs and expenses of the Bank and the  fees  and\nexpenses  of  its  agents and counsel, and  all  expenses,  and\nadvances made or incurred by the Bank in connection therewith;\n\n         Next,  to  the payment in full of the Secured Obligations; and\n         ----\n\n==========================================================================\n\n         Finally,  to the payment to the Company, or its successors\n         -------\nor  assigns,  or  as  a  court  of competent  jurisdiction  may\ndirect, of any surplus then remaining.\n\nAs  used  in this Section 5, 'proceeds' of Collateral shall  mean\n                              --------\ncash,  securities and other property realized in respect of,  and\ndistributions  in  kind  of, Collateral,  including  any  thereof\nreceived  under any reorganization, liquidation or adjustment  of\ndebt  of  the Company or any issuer of or obligor on any  of  the\nCollateral.\n             \n         4.10      Attorney-in-Fact.  Without limiting  any  rights  or\n                   ----------------\npowers  granted by this Agreement to the Bank while no  Event  of\nDefault  has occurred and is continuing, upon the occurrence  and\nduring the continuance of any Event of Default the Bank is hereby\nappointed the attorney-in-fact of the Company for the purpose  of\ncarrying  out  the provisions of this Section 4  and  taking  any\naction  and  executing any instruments which the  Bank  may  deem\nnecessary  or advisable to accomplish the purposes hereof,  which\nappointment  as attorney-in-fact is irrevocable and coupled  with\nan  interest.  Without limiting the generality of the  foregoing,\nso  long  as the Bank shall be entitled under this Section  4  to\nmake  collections in respect of the Collateral,  the  Bank  shall\nhave  the  right  and power to receive, endorse and  collect  all\nchecks made payable to the order of the Company representing  any\ndividend,  payment,  or  other distribution  in  respect  of  the\nCollateral or any part thereof and to give full discharge for the\nsame.\n             \n         4.11      Perfection.   Prior  to  or  concurrently  with  the\n                   ----------\nexecution  and delivery of this Agreement, the Company shall  (i)\nfile  such  financing  statements and  other  documents  in  such\noffices as the Bank may request to perfect the security interests\ngranted by Section 3 of this Agreement, and (ii) deliver  to  the\nBank  all  certificates identified in Annex 1 hereto, accompanied\nby undated stock powers duly executed in blank.\n\n            \n         4.12      Termination.  When all Secured Obligations shall have\n                   -----------\nbeen paid in full and the Facilities of the Bank under the Credit\nAgreement  shall have expired or been terminated, this  Agreement\nshall  terminate,  and  the  Bank shall  forthwith  cause  to  be\nassigned, transferred and delivered, against receipt but  without\nany   recourse,   warranty  or  representation  whatsoever,   any\nremaining Collateral and money received in respect thereof, to or\non  the  order of the Company.  The Bank shall also  execute  and\ndeliver  to  the  Company  upon  such  termination  such  Uniform\nCommercial   Code   termination   statements   and   such   other\ndocumentation as shall be reasonably requested by the Company  to\neffect   the  termination  and  release  of  the  Liens  on   the\nCollateral.\n             \n         4.13      Expenses.  The Company agrees to pay to the Bank all\n                   --------\nout-of-pocket expenses (including reasonable expenses  for  legal\nservices  of  every kind) of, or incident to, the enforcement  of\nany  of  the provisions of this Section 4, or performance by  the\nBank  of  any  obligations  of the  Company  in  respect  of  the\nCollateral which the Company has failed or refused to perform, or\nany  actual  or  attempted  sale, or any  exchange,  enforcement,\n\n============================================================================\n\ncollection,  compromise or settlement in respect of  any  of  the\nCollateral,  and for the care of the Collateral and defending  or\nasserting  rights and claims of the Bank in respect  thereof,  by\nlitigation or otherwise, including expenses of insurance, and all\nsuch  expenses shall be Secured Obligations to the  Bank  secured\nunder Section 3 hereof.\n\n             \n         4.14      Further  Assurances.  The Company agrees that,  from\n                   -------------------\ntime  to  time upon the written request of the Bank, the  Company\nwill execute and deliver such further documents and do such other\nacts and things as the Bank may reasonably request in order fully\nto effect the purposes of this Agreement.\n\n         4.15      Collateral   Audit.   The  Company   shall   permit\n                   ------------------\nrepresentatives of the Bank to undertake an annual audit  of  the\nCollateral, and the Company agrees to pay all reasonable expenses\nof the Bank incurred in connection therewith.\n            \n         Section 5.     Miscellaneous.\n                        -------------\n            \n         5.01      No Waiver.  No failure on the part of the Bank or any\n                   ---------\nof  its agents to exercise, and no course of dealing with respect\nto,  and  no  delay  in exercising, any right,  power  or  remedy\nhereunder shall operate as a waiver thereof; nor shall any single\nor  partial  exercise by the Bank or any of  its  agents  of  any\nright,  power or remedy hereunder preclude any other  or  further\nexercise  thereof or the exercise of any other  right,  power  or\nremedy.  The remedies herein are cumulative and are not exclusive\nof any remedies provided by law.\n            \n         5.02      Governing Law.   This Agreement shall be governed by,\n                   -------------\nand  construed in accordance with, the law of the  State  of  New\nYork.\n            \n         5.03      Notices.  All notices, requests, consents and demands\n                   -------\nhereunder   shall   be   in  writing  and  telexed,   telecopied,\ntelegraphed, cabled or delivered to the intended recipient at its\naddress  or telex number specified pursuant to Section  10.02  of\nthe  Credit Agreement and shall be deemed to have been  given  at\nthe times specified in said Section 10.02.\n             \n         5.04      Waivers,  etc.  The terms of this Agreement  may  be\n                   --------------\nwaived, altered or amended only by an instrument in writing  duly\nexecuted  by  the  Company and the Bank.  Any such  amendment  or\nwaiver shall be binding upon the Bank, each holder of any Secured\nObligation and the Company.\n             \n         5.05      Successors  and  Assigns.  This Agreement  shall  be\n                   ------------------------\nbinding   upon  and  inure  to  the  benefit  of  the  respective\nsuccessors and assigns of the Company, the Bank, and each  holder\nof  the  Secured Obligations (provided, however, that the Company\nshall  not  assign or transfer its rights hereunder  without  the\nprior written consent of the Bank).\n             \n===========================================================================\n             \n         5.06      Counterparts.  This Agreement may be executed in any\n                   ------------\nnumber  of  counterparts, all of which together shall  constitute\none  and  the same instrument and any of the parties  hereto  may\nexecute this Agreement by signing any such counterpart.\n\n         5.07      Agents.    The   Bank   may   employ   agents   and\n                   ------\nattorneys-in-fact  in  connection  herewith  and  shall  not   be\nresponsible  for the negligence or misconduct of any such  agents\nor attorneys-in-fact selected by it in good faith.\n            \n         5.08      Severability.  If any provision hereof is invalid and\n                   ------------\nunenforceable  in any jurisdiction, then, to the  fullest  extent\npermitted by law, (i) the other provisions hereof shall remain in\nfull force and effect in such jurisdiction and shall be liberally\nconstrued  in  favor  of  the Bank in  order  to  carry  out  the\nintentions of the parties hereto as nearly as may be possible and\n(ii)  the invalidity or unenforceability of any provision  hereof\nin   any   jurisdiction  shall  not  affect   the   validity   or\nenforceability of such provision in any other jurisdiction.\n                                             \n                          --------------                   \n                          \n=========================================================================\n\n                                             \n                                             _\n         IN  WITNESS WHEREOF, the parties hereto have caused  this\nSecurity  Agreement to be duly executed as of the  day  and  year\nfirst above written.\n\n                           ANNTAYLOR GLOBAL SOURCING, INC.\n\n                           By \/s\/\n                             _________________________\n                           Name:\n                           Title:\n                           \n                           Address for Notices:\n                           142 West 57th Street\n                           New York, NY  10019\n                           Telecopy: (212)\n\n                           THE HONGKONG AND SHANGHAI BANKING\n                           CORPORATION LIMITED, NEW YORK BRANCH\n\n                           By \/s\/\n                             _______________________\n                           Name:     Ian Wright\n                           Title:    Vice President\n                           \n                           Address for Notices:\n                           140 Broadway\n                           New York, NY  10005\n                           Attention:     NYK CBU TRS\n                           \n                           Telecopy: (212) 658-2813\n                                                          \n                                                          \n============================================================================\n                                                          \n                                                           ANNEX 1\n\n     \n                        LIST OF PLEDGED STOCK\n                               NONE\n\n\n\n\n\n\n============================================================================\n                                                          \n                                                           ANNEX 2\n\n                       LIST OF LOCATIONS\n\nAnnTaylor Global Sourcing, Inc.\n414 Chapel Street\nNew Haven, CT  06511\n\nLouisville Distribution Center\n7101 Distribution Drive\nLouisville, KY  40258\n\nFlag Trucking Services Company\n5 Dwight Place\nFairfield, NJ  07006\n\nSSCI\n1072 West Side Avenue\nJersey City, NJ  07306\n\nSummit Transportation\nBuilding 40\nHackensack Avenue\nKearny, NJ  07032\n\nAnnTaylor Global Sourcing, Inc.\n1372 Broadway\nNew York, New York  10018\n\nAnnTaylor Global Sourcing, Inc.\n142 West 57th Street\nNew York, NY  10019\n\nFreight-A-Ranger\n3275 Alum Creek Drive\nColumbus, OH  43207\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6710],"corporate_contracts_industries":[9494],"corporate_contracts_types":[9560,9570],"class_list":["post-41289","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-anntaylor-stores-corp","corporate_contracts_industries-retail__clothing","corporate_contracts_types-finance","corporate_contracts_types-finance__security"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/41289","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=41289"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=41289"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=41289"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=41289"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}