Exhibit 10.7
GENERAL SECURITY AGREEMENT
EXECUTED by the parties as of the 26th day of August, 2008.

     
TO:
  BANK OF AMERICA, N.A.,
 
   
 
  on its own behalf as Lender (acting through its Canada branch) and as
Collateral Agent, for itself and on behalf of the Secured Parties (as such term
is defined in the Credit Agreement, hereinafter defined)
335 Madison Avenue, New York, New York 10017
 
   
 
  (hereinafter the “Collateral Agent”)
 
   
GRANTED BY:
  WARNACO OF CANADA COMPANY
 
   
 
  Having its registered office at 1959 Upper Water Street, Halifax, Nova Scotia,
Canada, B3J 3N2 and its principal place of business at 20600 Clark Graham Blvd.,
Baie d’Urfé, Québec, Canada, H9X 4B6
 
   
 
  (hereinafter the “Debtor”)

SECTION 1 — GRANT OF SECURITY INTEREST
1.1 Security Interest
As a general and continuing security for the payment and performance of the
Secured Obligations (as such term is defined in the Credit Agreement,
hereinafter defined) of the Debtor, the Debtor, IN CONSIDERATION OF THE SECURED
OBLIGATIONS and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, hereby grants, bargains, assigns
and transfers to the Collateral Agent (for itself and on behalf of the Secured
Parties), and grants to the Collateral Agent (for itself and on behalf of the
Secured Parties) a continuing security interest in all of the Debtor’s right,
title and interest in and to all the personal property, assets and undertakings
of the Debtor of whatsoever nature and kind, whether now owned or
hereafter-acquired by or on behalf of the Debtor, wherever located (the
“Collateral”) including, without limitation:
(a) Accounts Receivable
All debts, book debts, accounts, claims, demands, moneys and choses in action
whatsoever including, without limitation, claims against the Crown and claims
under insurance policies, which are now owned by or are due, owing or accruing
due to the Debtor or which may hereafter be owned by or become due, owing or
accruing due to the Debtor together with all contracts, securities, bills,
notes, lien notes, judgments, chattel mortgages, mortgages and all other rights,
benefits and documents now or hereafter taken, vested in or held by the Debtor
in respect of or as security for the same and the full benefit and advantage
thereof, and all rights of action or claims which the Debtor now has or may at
any time hereafter have against any person or persons, firm or corporation in
respect thereof (all of the foregoing being herein collectively called the
“Accounts Receivable”);
General Security Agreement — Warnaco of Canada Company (2008)

 

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(b) Inventory
All inventory of whatever kind now or hereafter owned by the Debtor or in which
the Debtor now or hereinafter has an interest or right of any kind, and all
accessions thereto and products thereof, including, without limitation, all
goods, merchandise, raw materials, goods in process, finished goods, packaging
and packing material and other tangible personal property now or hereafter held
for sale, lease, rental or resale or that are to be furnished or have been
furnished under a contract of service or that are to be used or consumed in the
business of the Debtor (all of the foregoing being herein collectively called
the “Inventory”);
(c) Equipment
All goods now or hereafter owned by the Debtor which are not inventory or
consumer goods as defined in the PPSA (as hereinafter defined) including,
without limitation, all fixtures, equipment, machinery, tools, furniture,
vehicles and other tangible personal property (all of the foregoing being herein
collectively called the “Equipment”);
(d) Chattel Paper, Instruments, Securities, etc.
All chattel paper, instruments, warehouse receipts, bills of lading and other
documents of title, whether negotiable or non-negotiable, shares, stock,
warrants, bonds, debentures, debenture stock or other securities (including,
without limitation, those described in Schedule “2” hereto), now or hereafter
owned by the Debtor;
(e) Intangibles
All intangibles now or hereafter owned by the Debtor including, without
limitation, all contractual rights, goodwill, patents, trade marks, trade names,
copyrights, industrial designs and other industrial or intellectual property or
rights therein, including, without limitation, those described in Schedule “5”
hereto;
(f) Books and Accounts, etc.
With respect to the personal property described in Paragraphs (a) to
(e) inclusive, all books, accounts, invoices, deeds, documents, writings,
letters, papers, security certificates and other records in any form evidencing
or relating thereto and all contracts, securities, instruments and other rights
and benefits in respect thereof;
General Security Agreement — Warnaco of Canada Company (2008)

 

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(g) Other Property
The uncalled capital, money, rights, bills of exchange, negotiable and
non-negotiable instruments, judgments and securities not otherwise described in
Paragraphs (a) to (f) inclusive;
(h) Replacements, etc.
With respect to the personal property described in Paragraphs (a) to
(g) inclusive, all substitutions and replacements thereof, increases, additions
and accessions thereto and any interest of the Debtor therein; and
(i) Proceeds
With respect to the personal property described in Paragraphs (a) to
(h) inclusive, personal property in any form or fixtures derived directly or
indirectly from any dealing with such property or that indemnifies or
compensates for such property destroyed or damaged and proceeds of proceeds
whether of the same type, class or kind as the original proceeds; provided,
however, that the foregoing grant of security interest shall not include a
security interest in any Excluded Property; and provided, further, that, if and
when any property shall cease to be Excluded Property, the Collateral Agent for
the benefit of the Secured Parties shall have, and at all times from and after
the date hereof be deemed to have had, a security interest in such property.
1.2 Definitions and Interpretation
In the present General Security Agreement (this “Agreement”):

  (a)  
Terms used herein and defined in the Personal Property Security Act (Ontario) or
similar legislation of any other Canadian jurisdiction, the laws of which are
required by such legislation to be applied in connection with the issue,
perfection, enforcement, opposability, validity or effect of security interests
(collectively the “PPSA”) shall have the same meanings as in the PPSA unless the
context otherwise requires;

  (b)  
Terms used herein and defined in the Securities Transfer Act (Ontario) (the
“STA”) shall have the same meanings as in the STA unless the context otherwise
requires;

  (c)  
Capitalized terms not otherwise defined herein shall have the same meanings as
ascribed to them in the Credit Agreement, unless the context otherwise requires;

  (d)  
Any reference to “Collateral” shall, unless the context otherwise requires,
refer to “Collateral or any part thereof”;

  (e)  
The term “security interest” and the grant of the “security interest” herein
provided for shall include, without limitation, a fixed mortgage, hypothecation,
pledge, charge and assignment of the Collateral in favour of the Collateral
Agent (for itself and on behalf of the Secured Parties);

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  (f)  
“Additional Pledged Collateral” means any Pledged Collateral acquired by the
Debtor after the date hereof and in which a security interest is granted
pursuant to Section 1 (Grant of Security Interest), including, to the extent a
security interest is granted therein pursuant to Section 1 (Grant of Security
Interest), (i) all Stock and Stock Equivalents of any Person that are acquired
by the Debtor after the date hereof, together with all certificates, instruments
or other documents representing any of the foregoing and all Security
Entitlements of the Debtor in respect of any of the foregoing, (ii) all
additional Indebtedness from time to time owed to the Debtor by any obligor on
the Pledged Debt Instruments and the Instruments evidencing such Indebtedness
and (iii) all interest, cash, Instruments and other property or Proceeds from
time to time received, receivable or otherwise distributed in respect of or in
exchange for any of the foregoing. “Additional Pledged Collateral” may be
Intangibles (including Intellectual Property), Instruments or Investment
Property;

  (g)  
“Blocked Account” means a deposit account maintained by the Debtor with a
Blocked Account Bank which account is the subject of an effective Blocked
Account Letter, and includes all monies on deposit therein and all certificates
and instruments, if any, representing or evidencing such Blocked Account;

  (h)  
“Blocked Account Bank” means a financial institution approved (such approval not
to be unreasonably withheld) by the Administrative Agent and with respect to
which the Debtor has delivered to the Collateral Agent an executed Blocked
Account Letter (hereinafter defined);

  (i)  
“Blocked Account Letter” means a letter agreement in a form acceptable to the
Collateral Agent, executed by the Debtor and the Collateral Agent and
acknowledged and agreed to by the relevant Blocked Account Bank;

  (j)  
“Cash Collateral Account” means any deposit account or Securities Account that
is (a) established by the Collateral Agent from time to time in its sole
discretion to receive cash and Cash Equivalents (or purchase cash or Cash
Equivalents with funds received) from the Debtor or any other Loan Party or
their Subsidiaries or Affiliates or Persons acting on their behalf pursuant to
the Loan Documents, (b) with such depositaries and securities intermediaries as
the Collateral Agent may determine in its sole discretion, (c) in the name of
the Collateral Agent (although such account may also have words referring to the
Debtor and the account’s purpose), (d) under the control of the Collateral Agent
and (e) in the case of a Securities Account, with respect to which the
Collateral Agent shall be the Entitlement Holder and the only Person authorized
to give Entitlement Orders with respect thereto, except as otherwise provided in
Section 3.9 hereof. Notwithstanding the foregoing, the Special Cash Collateral
Account shall not constitute a Cash Collateral Account;
    (k)  
“CCQ” means the Civil Code of Quebec;
    (l)  
“Certificated Security” has the meaning given to such term in the PPSA;
    (m)  
“CIPO” means the Canadian Intellectual Property Office;

  (n)  
“Collateral” has the meaning specified in Section 1.1 hereof;

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  (o)  
“Collateral Agent” shall include, in addition to the Collateral Agent referred
to in the preamble of the Credit Agreement, any successors and assigns to the
Collateral Agent appointed pursuant to the Credit Agreement and means the
“Collateral Agent” in its capacity as collateral agent for the benefit of the
Secured Parties with respect to the Secured Obligations;

  (p)  
“Control Account” means a securities account maintained by the Debtor with the
relevant approved Securities Intermediary which account is the subject of an
effective Control Account Agreement, and includes all monies and other assets on
deposit or otherwise held therein;

  (q)  
“Control Account Agreement” means a letter agreement in a form acceptable to the
Collateral Agent, executed by the Debtor, the Collateral Agent and the relevant
approved Securities Intermediary;

  (r)  
“Copyright License” means any agreement, whether written or oral, providing for
the grant by or to the Debtor of any right under any Copyright, including the
grant of any right to use, copy, publicly perform, display, create derivative
works of, manufacture, distribute, exploit or sell materials derived from any
Copyright;

  (s)  
“Copyrights” means (a) all copyrights arising under the laws of Canada, any
other country or any political subdivision thereof, whether registered or
unregistered and whether published or unpublished, all registrations and
recordings thereof and all applications for registration or recording in
connection therewith, including all registrations, recordings and applications
for registration or recording with CIPO or in any foreign counterparts thereof,
and (b) the right to obtain all renewals, reversions and extensions thereof;

  (t)  
“Credit Agreement” shall mean that certain Credit Agreement dated the date
hereof among, inter alia, the Debtor, as borrower, the financial institutions,
together with their respective successors and assigns, listed on the signature
pages thereof from time to time, as Lenders, and the Collateral Agent, as the
same may be amended, supplemented, revised, restated or replaced from time to
time;

  (u)  
“Discharge of Lender Claims” means the payment in full in cash of the principal
of, interest and premium, if any, on all Secured Obligations and, with respect
to Hedging Obligations, Hedging Obligations or letters of credit outstanding
thereunder, delivery of cash collateral or backstop letters of credit in respect
thereof in compliance with the terms hereof, of the Credit Agreement, in each
case after or concurrently with termination of all Commitments, and payment in
full in cash of any other Secured Obligations that are due and payable at or
prior to the time such principal and interest are paid;

(v) “Entitlement Holder” has the meaning given to such term in the PPSA;
(w) “Entitlement Order” has the meaning given to such term in the PPSA;
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  (x)  
“Excluded Property” means, collectively, (i) any permit, lease, license,
contract, instrument or other agreement held by the Debtor that validly
prohibits the creation by the Debtor of a Lien thereon, or any permit, lease,
license, contract, instrument or other agreement held by the Debtor to the
extent that any Requirement of Law applicable thereto prohibits the creation of
a Lien thereon, but only, in each case, to the extent, and for so long as, such
prohibition is not removed, terminated or rendered unenforceable or otherwise
deemed ineffective by the PPSA or any other Requirement of Law; and (ii) any
Equipment owned by the Debtor that is charged by a “purchase-money security
interest” (as defined in the PPSA) or subject to a Capital Lease if the contract
or other agreement in which such Lien is granted (or in the documentation
providing for such Capital Lease) prohibits or requires the consent of any
Person other than the Debtor as a condition to the creation of any other Lien on
such Equipment; provided, however, “Excluded Property” shall not include any
Proceeds, substitutions or replacements of Excluded Property (unless such
Proceeds, substitutions or replacements would constitute Excluded Property);
    (y)  
“Financial Assets” has the meaning given to such term in the PPSA;

  (z)  
“Hedging Obligations” means all obligations of any Person under any Hedging
Contract;

(aa) “Instrument” has the meaning given to such term in the PPSA;

  (bb)  
“Intellectual Property” means, collectively, (a) all right, title and interest
of the Debtor in intellectual property, whether arising under Canadian,
multinational or foreign laws or otherwise, including Copyrights, Copyright
Licenses, Patents, Patent Licenses, Trademarks, Trademark Licenses, trade
secrets, Internet domain names, Websites, advertising rights, rights in designs,
including registrations thereof, and rights in data, and (b) all rights to
income, royalties, proceeds and damages now or hereafter due and/or payable
under and with respect thereto, including all rights to sue and recover at law
or in equity for any past, present and future infringement, misappropriation,
dilution, violation or other impairment thereof;
    (cc)  
“Investment Property” has the meaning given to such term in the PPSA;

  (dd)  
“LLC” means each limited liability company in which the Debtor has an equity
interest, including those set forth on;

  (ee)  
“LLC Agreement” means each operating agreement with respect to a LLC, as each
agreement has heretofore been, and may hereafter be, amended, restated,
supplemented or otherwise modified from time to time;

  (ff)  
“Material Intellectual Property” means Intellectual Property owned by or
licensed to the Debtor and material to Debtor’s business;

  (gg)  
“Partnership” means each partnership in which the Debtor has an equity interest,
including those set forth on;

  (hh)  
“Partnership Agreement” means each partnership agreement governing a
Partnership, as each such agreement has heretofore been, and may hereafter be,
amended, restated, supplemented or otherwise modified;

  (ii)  
“Patent License” means all agreements, whether written or oral, providing for
the grant by or to the Debtor of any right to manufacture, have manufactured,
use, import, lease, sell or offer for sale any product, design or process
covered in whole or in part by a Patent;

General Security Agreement — Warnaco of Canada Company (2008)

 

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  (jj)  
“Patents” means (a) all patents of Canada or any other country or patent rights
arising under multinational laws, (b) all applications for patents of Canada or
any other country or patent rights arising under multinational laws and (c) all
rights to obtain any reissues, extensions, divisions, continuations and
continuations-in-part of the foregoing;

  (kk)  
“Pledged Certificated Stock” means all Certificated Securities and any other
Stock and Stock Equivalent of a Person evidenced by a certificate, Instrument or
other equivalent document, in each case owned by the Debtor, including all Stock
listed on;

  (ll)  
“Pledged Collateral” means, collectively, the Pledged Stock, Pledged Debt
Instruments, any other Investment Property of the Debtor (other than Pledged
Stock, Pledged Debt Instruments and other Investment Property whose value, in
the aggregate, does not exceed $1,000,000), all chattel paper, certificates or
other Instruments representing any of the foregoing and all Security
Entitlements of the Debtor in respect of any of the foregoing. Pledged
Collateral may be Intangibles, Instruments or Investment Property;

  (mm)  
“Pledged Debt Instrument” means all right, title and interest of the Debtor in
Instruments evidencing any Indebtedness owed to the Debtor, including all
Indebtedness described on, issued by the obligors named therein;

  (nn)  
“Pledged Stock” means all Pledged Certificated Stock and all Pledged
Uncertificated Stock;

  (oo)  
“Pledged Uncertificated Stock” means any Stock or Stock Equivalent of any Person
that is not a Pledged Certificated Stock, including all right, title and
interest of the Debtor as a limited or general partner in any Partnership or as
a member of any LLC and all right, title and interest of the Debtor in, to and
under any Partnership Agreement or LLC Agreement to which it is a party;
    (pp)  
“Receiver” shall have the meaning provided to such term in Section 6.4 hereof;

  (qq)  
“Registerable Intellectual Property” means any Intellectual Property in respect
of which ownership, title, security interests, hypothecs, charges or
encumbrances are capable of registration, recording or notation with any
applicable authority pursuant to applicable law;

  (rr)  
“Restricted Account” means a deposit account maintained by the Debtor with a
Restricted Account Bank which account is the subject of an effective Restricted
Account Letter, and includes all monies on deposit therein and all certificates
and instruments, if any, representing or evidencing such Restricted Account;

  (ss)  
“Restricted Account Bank” means a financial institution selected or approved
(such approval not to be unreasonably withheld) by the Administrative Agent and
with respect to which the Debtor has delivered an executed Restricted Account
Letter;

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  (tt)  
“Restricted Account Letter” means a letter agreement in a form acceptable to the
Administrative Agent, executed by the Debtor;

  (uu)  
“Securities Intermediaries” has the meaning given to such term in the PPSA;
    (vv)  
“Securities Account” has the meaning given to such term in the PPSA;
    (ww)  
“Security Entitlement” has the meaning given to such term in the PPSA;

  (xx)  
“Security Interest” means, collectively, each security interest, mortgage,
charge, assignment or transfer in or of Collateral granted or created by the
Debtor under this Agreement;

  (yy)  
“Third Party Intellectual Property Rights” means any right, title or interest of
any Person under patent, copyright, trademark or trade secret law or any other
statutory provision or common law doctrine relating to intellectual property or
proprietary rights;

  (zz)  
“Trademark License” means any agreement, whether written or oral, providing for
the grant by or to the Debtor of any right under any Trademark.;

  (aaa)  
“Trademarks” means (a) all trademarks, trade names, corporate names, company
names, business names, fictitious business names, trade styles, trade dress,
service marks, logos and other source or business identifiers, and, in each
case, all goodwill associated therewith, whether now existing or hereafter
adopted or acquired, all registrations and recordings thereof and all
applications for registration or recording in connection therewith, in each case
whether in CIPO or in any similar office or agency of Canada, any Province or
Territory thereof or any other country or any political subdivision thereof and
all common-law rights related thereto, and (b) the right to obtain all renewals
thereof; and

  (bbb)  
“UCC” means the Uniform Commercial Code as from time to time in effect in the
State of New York.

1.3 Leases
The last day of the term of any lease, oral or written, or any agreement
therefor, now held or hereafter acquired by the Debtor, shall be excepted from
the security interest hereby granted and shall not form part of the Collateral,
but the Debtor shall stand possessed of such one day remaining, upon trust to
assign and dispose of the same as the Collateral Agent or any assignee of such
lease or agreement shall direct. If any such lease or agreement therefor
contains a provision which provides in effect that such lease or agreement may
not be assigned, sub-leased, charged or encumbered without the leave, license,
consent or approval of the lessor, the application of the security interest
created hereby to any such lease or agreement shall be conditional upon such
leave, license, consent or approval having been obtained.
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1.4 Debtor Remains Liable
Notwithstanding anything herein to the contrary:

  (a)  
the Debtor shall remain liable under the contracts and agreements included in
the Collateral to the extent set forth therein to perform all its duties and
obligations thereunder to the same extent as if this Agreement had not been
executed;

  (b)  
the exercise by the Collateral Agent of any of the rights or remedies hereunder
shall not release the Debtor from any of its duties or obligations under the
contracts and agreements included in the Collateral; and

  (c)  
the Collateral Agent shall not have any obligation or liability under the
contracts and agreements included in the Collateral by reason of this Agreement,
nor shall the Collateral Agent be obligated to perform any of the obligations or
duties of the Debtor thereunder or to take any action to collect or enforce any
claim for payment assigned hereunder.

SECTION 2 — REPRESENTATIONS AND WARRANTIES
To induce the Lenders, the Issuers, the Collateral Agent and the Administrative
Agent to enter into the Credit Agreement, the Debtor hereby represents and
warrants each of the following to the Lenders, the Issuers, the Collateral
Agent, the Administrative Agent and the other Secured Parties:
2.1 Title; No Other Liens
Except for the Liens granted to the Collateral Agent pursuant to this Agreement
and the other Liens permitted to exist on the Collateral under the Credit
Agreement, the Debtor (a) is the record and beneficial owner of the Pledged
Collateral pledged by it hereunder constituting Instruments or Certificated
Securities, (b) is the Entitlement Holder of all such Pledged Collateral
constituting Investment Property held in a Securities Account and (c) has rights
in or the power to collaterally transfer each other item of Collateral in which
a Lien is granted by it hereunder, free and clear of any Lien (other than Liens
for taxes not yet due and payable).
2.2 Perfection and Priority
The security interests granted pursuant to this Agreement shall constitute valid
and continuing perfected security interests in favour of the Collateral Agent in
the Collateral for which perfection is governed by the PPSA or filing with CIPO
upon (i) in the case of all Collateral in which a security interest may be
perfected by filing a financing statement under the PPSA, the completion of the
filings and other actions specified on (which, in the case of all filings and
other documents referred to on such schedule, have been delivered to the
Collateral Agent in completed and duly executed form), (ii) the delivery to the
Collateral Agent of all Collateral consisting of Instruments and Certificated
Securities, in each case properly endorsed for transfer to the Collateral Agent
or in blank, (iii) the execution of Control Account Agreements with respect to
Investment Property not in certificated form, (iv) the execution of a Blocked
Account Letter with respect to all deposit accounts of the Debtor as specified
in Section 3.8(a)(i) hereto, (v) all appropriate filings having been made with
CIPO and (vi) the receipt by the Collateral Agent of the consent of the issuer
or nominated person with respect to each letter-of-credit right. Such security
interests shall be prior to all other Liens on the Collateral except for
Customary Permitted Liens having priority over the Collateral Agent’s Liens by
operation of law or otherwise as permitted hereunder or under the Credit
Agreement.
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2.3 Jurisdiction of Organization; Chief Executive Office
On the Closing Date, the Debtor’s jurisdiction of organization, legal name,
organizational identification number, if any, and the location of its chief
executive office or sole place of business is specified on and, to the extent
different from that on the Closing Date, such also lists all jurisdictions of
organization, legal names and locations of such Debtor’s chief executive office
or sole place of business for the period beginning five years preceding the date
hereof.
2.4 Inventory and Equipment
Schedule 4 (Location of Inventory and Equipment) sets forth each location at
which the Debtor’s Inventory and Equipment (other than mobile goods and
Inventory or Equipment in transit) is kept on the Closing Date.
2.5 Pledged Collateral

  (a)  
The Pledged Stock that constitutes Pledged Collateral pledged hereunder by the
Debtor is listed on and constitutes that percentage of the issued and
outstanding equity of all classes of each issuer thereof as set forth on.

  (b)  
All of the Pledged Stock (other than Pledged Stock in limited liability
companies and partnerships) that constitutes Pledged Collateral has been duly
and validly issued and are fully paid and nonassessable.

  (c)  
All Pledged Collateral and, if applicable, any Additional Pledged Collateral,
consisting of Certificated Securities or Instruments has been delivered to the
Collateral Agent in accordance with Section 3.5(a) (Pledged Collateral) hereof,
and Section 7.11 of the Credit Agreement and such other pledge agreement or
other Collateral Documents entered into by the Debtor in favour of the
Collateral Agent.

  (d)  
Subject to Section 3.5(a), all Pledged Collateral held by a Securities
Intermediary in a Securities Account is subject to a Control Account Agreement.

  (e)  
Other than Pledged Stock constituting Intangibles, there is no Pledged
Collateral other than (i) that represented by Certificated Securities or (ii)
Instruments in the possession of the Collateral Agent or that consisting of
Financial Assets held in a Securities Account that is subject to a Control
Account Agreement.

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  (f)  
The Constituent Documents of any Person governing any Pledged Stock do not
prohibit (i) the Collateral Agent, upon the occurrence and during the
continuance of an Event of Default, from exercising all of the rights of the
Debtor granting the security interest therein, and (ii) a transferee or assignee
of Stock of such Person from becoming a member, partner or, as the case may be,
other holder of such Pledged Stock to the same extent as the Debtor entitled to
participate in the management of such Person and, pursuant to the Constituent
Documents of any Person governing any Pledged Stock, upon the transfer of the
entire interest of the Debtor, the Debtor shall cease to be a member, partner
or, as the case may be, other holder of such Pledged Stock.

2.6 Deposit Accounts; Securities Accounts
The only deposit accounts or Securities Accounts maintained by the Debtor on the
Closing Date are those listed on Schedule 7 (Deposit Accounts and Securities
Accounts), which sets forth such information for the Debtor and which clearly
identifies each deposit account which is maintained as a concentration account
by the Debtor.
2.7 Accounts
No amount payable to the Debtor under or in connection with any account is
evidenced by any Instrument or Chattel Paper that has not been delivered to the
Collateral Agent, properly endorsed for transfer, to the extent delivery is
required by Section 3.6 (Delivery of Instruments and Chattel Paper).
2.8 Intellectual Property

  (a)  
(i) sets forth a true and complete list of all Intellectual Property of the
Debtor on the date hereof (other than licenses to commercial off-the-shelf
software), separately identifying that owned by the Debtor and that licensed by
or to such Debtor and (ii) sets forth a true and complete list of all Material
Intellectual Property owned by or licensed to the Debtor on the date hereof
(other than licenses to commercial off-the-shelf software), separately
identifying that owned by the Debtor and that licensed by or to the Debtor. The
Material Intellectual Property set forth on constitutes all of the material
intellectual property rights necessary for the Debtor to conduct its business as
currently and as proposed to be conducted.

  (b)  
On the date hereof, all Material Intellectual Property owned by the Debtor is
valid, in full force and effect, subsisting, unexpired and enforceable, has not
been adjudged invalid and has not been abandoned. To the knowledge of the
Debtor, the business of the Debtor, and the use of the Material Intellectual
Property in connection therewith, does not infringe, misappropriate, dilute or
violate any Third Party Intellectual Property Rights. The Debtor is not party to
or the subject of any pending or, to the Debtor’s knowledge, threatened claim of
infringement, misappropriation, dilution or violation of any Third Party
Intellectual Property Rights, and there are no facts or circumstances that the
Debtor reasonably believes are likely to form the basis for any such claim, and
the Debtor has not received written notice of any such claim, or a written offer
of a license to any Third Party Intellectual Property Rights, or any written
notice regarding the existence of any Third Party Intellectual Property Rights
that would be likely to have a Material Adverse Effect on the Debtor or
otherwise would impair any Material Intellectual Property.

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  (c)  
Except as set forth in (c), on the date hereof, none of the Material
Intellectual Property owned by the Debtor is the subject of any licensing or
franchise agreement pursuant to which the Debtor is the licensor or franchisor.

  (d)  
No holding, decision or judgment has been rendered by any Governmental Authority
challenging the Debtor’s rights in the Material Intellectual Property or that
would limit or otherwise impair the ownership, use, validity or enforceability
of any Material Intellectual Property.

  (e)  
No action or proceeding challenging the Debtor’s rights in the Intellectual
Property or the ownership, use, validity or enforceability of any Material
Intellectual Property owned by the Debtor is on the date hereof pending or, to
the knowledge of the Debtor, threatened. There are no claims, judgments or
settlements to be paid by the Debtor relating to the Material Intellectual
Property. To the Debtor’s knowledge, no Person has been or is infringing,
misappropriating, diluting or violating the Material Intellectual Property owned
by the Debtor.

  (f)  
The Debtor is not in material breach of any Copyright License, Patent License or
Trademark License nor in breach of any Material License. The consummation of the
transactions contemplated by this Agreement shall not impair any of the Debtor’s
right in, cause a breach of, or impair the validity or enforceability of, any
Material Intellectual Property.

SECTION 3 — COVENANTS OF THE DEBTOR
The Debtor agrees with the Collateral Agent to the following, as long as any
Secured Obligation or Commitment remains outstanding and, in each case, unless
the Requisite Lenders otherwise consent in writing:
3.1 Generally
The Debtor shall (a) except for the security interest created by this Agreement,
not create or suffer to exist any Lien upon or with respect to any Collateral,
except Liens permitted under Section 8.2 (Liens, Etc.) of the Credit Agreement,
(b) not use or permit any Collateral to be used unlawfully or in violation of
any provision of this Agreement, any other Loan Document, any Requirement of Law
or any policy of insurance covering the Collateral, (c) not sell, transfer or
assign (by operation of law or otherwise) any Collateral except as permitted
under the Credit Agreement, (d) not enter into any agreement or undertaking
restricting the right or ability of the Debtor or the Collateral Agent to sell,
assign or transfer any Collateral except in connection with an Asset Sale
(i) that is permitted under Section 8.4 of the Credit Agreement or (ii) that is
pursuant to a contract which contains a condition precedent that consent under
the Credit Agreement be obtained.
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3.2 Maintenance of Perfected Security Interest; Further Documentation

  (a)  
The Debtor shall maintain the security interests created by this Agreement as
perfected security interests having at least the priority described in
Section 2.2 (Perfection and Priority) and shall defend such security interests
and such priority against the claims and demands of all Persons.

  (b)  
The Debtor shall furnish to the Collateral Agent from time to time statements
and schedules further identifying and describing the Collateral and such other
reports in connection with the Collateral as the Collateral Agent may reasonably
request in writing, all in detail and in form and substance reasonably
satisfactory to the Collateral Agent.

  (c)  
At any time and from time to time, upon the written request of the Collateral
Agent, and at the sole expense of the Debtor, the Debtor shall promptly and duly
execute and deliver to the Collateral Agent, and have recorded, such further
instruments and documents and take such further action as the Collateral Agent
may reasonably request (or be directed to request by the Administrative Agent at
the Administrative Agent’s reasonable request) for the purpose of obtaining or
preserving the full benefits of this Agreement and of the rights and powers
herein granted, including the filing of any financing or continuation statement
under the PPSA (or other similar laws) in effect in any jurisdiction with
respect to the security interests created hereby and the execution and delivery
of Blocked Account Letters or Restricted Account Letters and Control Account
Agreements.

3.3 Changes in Locations, Name, Etc.

  (a)  
Except upon 15 or more days’ prior written notice to the Collateral Agent and
delivery to the Collateral Agent of (i) all additional financing statements and
other documents reasonably requested by the Collateral Agent to maintain the
validity, perfection and priority of the security interests provided for herein
and (ii) if applicable, a written supplement to showing (A) any additional
locations at which Inventory or Equipment shall be kept or (B) any changes in
any location where Inventory or Equipment shall be kept that would require the
Collateral Agent to take any action to maintain perfected security interests in
such Collateral, the Debtor shall not do any of the following:

  (i)  
permit any Inventory or Equipment to be kept at a location other than those
listed on, except for Inventory or Equipment in transit;

  (ii)  
change its jurisdiction of organization from that referred to in Section 2.3
(Jurisdiction of Organization; Chief Executive Office); or

  (iii)  
change its legal name, or organizational identification number, if any, or
corporation, unlimited liability company, limited liability company or other
organizational structure to such an extent that any financing statement filed in
connection with this Agreement would become misleading.

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  (b)  
The Debtor shall keep and maintain at its own cost and expense satisfactory and
complete records of the Collateral, including a record of all payments received
and all credits granted with respect to the Collateral and all other dealings
with the Collateral.

3.4 Control
The Debtor shall not cause nor shall it permit any Person other than the
Collateral Agent to have control (as determined pursuant to the STA) of any
Financial Asset or Investment Property constituting part of the Collateral.
3.5 Pledged Collateral

  (a)  
The Debtor shall (i) deliver to the Collateral Agent for the benefit of the
Secured Parties, all certificates and Instruments representing or evidencing any
Pledged Collateral (including Additional Pledged Collateral), whether now
existing or hereafter acquired, in suitable form for transfer by delivery or, as
applicable, accompanied by such Debtor’s endorsement, where necessary, or duly
executed instruments of transfer or assignment in blank, all in form and
substance reasonably satisfactory to the Collateral Agent, together, in respect
of any Additional Pledged Collateral, with a pledge amendment, duly executed by
the Debtor, in a form reasonably acceptable to the Collateral Agent, an
acknowledgment, or such other documentation acceptable to the Collateral Agent
and (ii) maintain all other Pledged Collateral constituting Investment Property
in a Securities Account subject to a Control Account Agreement. The Collateral
Agent shall have the right, following an Event of Default and without notice to
the Debtor, to transfer to or to register in its name or in the name of its
nominees any Pledged Collateral. The Collateral Agent shall have the right at
any time to exchange any certificate or instrument representing or evidencing
any Pledged Collateral for certificates or instruments of smaller or larger
denominations.

  (b)  
Except as provided in Section 6 (Remedies on Default), the Debtor shall be
entitled to receive all cash dividends paid in respect of the Pledged Collateral
(other than liquidating or distributing dividends). Any sums paid upon or in
respect of any Pledged Collateral upon the liquidation or dissolution of any
issuer of any Pledged Collateral, any distribution of capital made on or in
respect of any Pledged Collateral or any property distributed upon or with
respect to any Pledged Collateral pursuant to the recapitalization or
reclassification of the capital of any issuer of Pledged Collateral or pursuant
to the reorganization thereof (except, in each case, to the extent resulting in
cash being distributed to the Debtor) shall, unless otherwise subject to a
perfected security interest (with the priorities contemplated herein) in favour
of the Collateral Agent, be delivered to the Collateral Agent to be held by it
hereunder as additional collateral security for the Secured Obligations. If any
sum of money or property so paid or distributed in respect of any Pledged
Collateral shall be received by the Debtor, the Debtor shall, until such money
or property is paid or delivered to the Collateral Agent, hold such money or
property in trust for the Collateral Agent, segregated from other funds of the
Debtor, as additional security for the Secured Obligations.

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  (c)  
Except as provided in Section 6 (Remedies on Default), the Debtor shall be
entitled to exercise all voting, consent and corporate, partnership, unlimited
liability company, limited liability company and similar rights with respect to
the Pledged Collateral; provided, however, that no vote shall be cast, consent
given or right exercised or other action taken by the Debtor that would impair
the Collateral, be inconsistent with or result in any violation of any provision
of the Credit Agreement, this Agreement or any other Loan Document or, without
prior notice to the Collateral Agent, enable or permit any issuer of Pledged
Collateral to issue any Stock or other equity Securities of any nature or to
issue any other securities convertible into or granting the right to purchase or
exchange for any Stock or other equity Securities of any nature of any issuer of
Pledged Collateral.

  (d)  
The Debtor shall not grant control (within the meaning of such term under the
STA) over any Investment Property to any Person other than the Collateral Agent.

  (e)  
In the case the Debtor is an issuer of Pledged Collateral, the Debtor agrees to
be bound by the terms of this Agreement relating to the Pledged Collateral
issued by it and shall comply with such terms insofar as such terms are
applicable to it. In the case the Debtor is a holder of any Stock or Stock
Equivalent in any Person that is an issuer of Pledged Collateral, the Debtor
consents to (i) the exercise of the rights granted to the Collateral Agent
hereunder (including those described in Section 6.10 (Pledged Collateral)), and
to the transfer of such Pledged Stock to the Collateral Agent or its nominee and
to the substitution of the Collateral Agent or its nominee as a holder of such
Pledged Stock with all the rights, powers and duties of other holders of Pledged
Stock of the same class and, if the Debtor having pledged such Pledged Stock
hereunder had any right, power or duty at the time of such pledge or at the time
of such substitution beyond that of such other holders, with all such additional
rights, powers and duties. The Debtor agrees to execute and deliver to the
Collateral Agent such certificates, agreements and other documents as may be
necessary to evidence, formalize or otherwise give effect to the consents given
in this clause (e).

  (f)  
The Debtor shall not, and shall not permit any of its Subsidiaries (to the
extent the Stock of such Subsidiary constitutes Collateral), without the consent
of the Collateral Agent, agree to any amendment of any Constituent Document that
in any way adversely affects the perfection of the security interest of the
Collateral Agent in the Pledged Collateral pledged by the Debtor hereunder or
any election to turn any previously uncertificated Stock that is part of the
Pledged Collateral into certificated Stock.

3.6 Delivery of Instruments and Chattel Paper
If any amount in excess of $250,000 payable under or in connection with any
Collateral owned by the Debtor shall be or become evidenced by an Instrument or
Chattel Paper, the Debtor shall promptly deliver such Instrument or Chattel
Paper to the Collateral Agent, duly indorsed in a manner satisfactory to the
Collateral Agent, or, if consented to by the Collateral Agent, shall mark all
such Instruments and Chattel Paper with the following legend: “This writing and
the obligations evidenced or secured hereby are subject to the security interest
of Bank of America, N.A., as Collateral Agent for the benefit of the Secured
Parties” (which legend shall be modified to reflect successor Collateral
Agents).
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3.7 Intellectual Property

  (a)  
The Debtor (either itself or through licensees) shall (and shall cause all
licensees or sublicensees thereof to) (i) continue to use each Trademark that is
Material Intellectual Property in order to maintain such Trademark in full force
and effect with respect to each class of goods for which such Trademark is
currently used, free from any claim of abandonment for non-use, (ii) maintain as
in the past the quality of products and services offered under such Trademark,
(iii) use such Trademark with the appropriate notice of registration and all
other notices and legends required by applicable Requirements of Law,
(iv) execute and file all documents necessary to perfect a security interest
pursuant to this Agreement in favour of the Collateral Agent promptly upon
adopting or using any mark that is confusingly similar or a colorable imitation
of such Trademark and (v) not do any act or knowingly omit to do any act (and
not permit or direct by express act or omission any licensee or sublicensee
thereof to do any act) whereby such Trademark (or any goodwill associated
therewith) may become destroyed, invalidated, impaired or harmed in any way;
provided, however, that (i) to (iii) and (v) above shall be subject to the good
faith exercise by the Debtor of its reasonable business judgment consistent with
past practices.

  (b)  
The Debtor shall not (and shall not permit or direct by express act or omission
any licensee or sublicensee thereof to) do any act, or omit to do any act,
whereby any Patent that is Material Intellectual Property may become forfeited,
abandoned or dedicated to the public.

  (c)  
The Debtor (i) shall not (and shall not permit or direct by express act or
omission any licensee or sublicensee thereof to) do any act or omit to do any
act whereby any portion of the Copyrights that is Material Intellectual Property
may become invalidated or otherwise impaired and (ii) shall not (and shall not
permit or direct by express act or omission any licensee or sublicensee thereof
to) do any act whereby any portion of the Copyrights that is Material
Intellectual Property may fall into the public domain.

  (d)  
The Debtor shall not knowingly (and shall not permit or direct by express act or
omission any licensee or sublicensee thereof to) do any act, or knowingly omit
to do any act, whereby any trade secret that is Material Intellectual Property
may become publicly available or otherwise unprotectable.

  (e)  
The Debtor shall not (and shall not permit or direct by express act or omission
any licensee or sublicensee thereof to) do any act that knowingly infringes,
misappropriates, dilutes or violates any Third Party Intellectual Property
Rights.

  (f)  
The Debtor shall promptly inform the Collateral Agent in writing of the
acquisition by the Debtor of any Registerable Intellectual Property, and the
Debtor shall execute and deliver, at its own expense, from time to time
amendments to this Agreement or additional security agreements or schedules as
may be required by the Collateral Agent in order that the Security Interest
shall attach to such Registerable Intellectual Property.

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  (g)  
The Debtor shall notify the Collateral Agent immediately if it knows, or has
reason to know, that any application for registration or recording, registration
or recording relating to any Material Intellectual Property may become
forfeited, abandoned or dedicated to the public, or of any adverse determination
or development (including the institution of, or any such determination or
development in, any proceeding in CIPO, the Federal Court of Canada or any other
court or tribunal in any other country) regarding Debtor’s ownership of, right
to use, interest in, or the validity or enforceability of, any Material
Intellectual Property or Debtor’s right to register the same or to own and
maintain the same.

  (h)  
As set forth below, whenever the Debtor, either by itself or through its counsel
or any agent or designee, shall file an application for the registration or
recording of any Intellectual Property with CIPO or any similar office or agency
within or outside Canada or register any Internet domain name, the Debtor shall
report such filing to the Collateral Agent within five Business Days after the
last day of the fiscal quarter in which such filing occurs. Upon request of the
Collateral Agent, the Debtor shall execute and deliver, and have recorded, all
agreements, instruments, documents and papers as the Collateral Agent may
request to evidence the Collateral Agent’s security interest in any such
Copyright, Patent, Trademark or Internet domain name and the goodwill and
intangibles of the Debtor relating thereto or represented thereby.

  (i)  
The Debtor shall take all reasonable actions that are (i) necessary (subject to
the good faith exercise by the Debtor of its reasonable business judgment
consistent with past practices) or (ii) requested by the Collateral Agent,
including in any proceeding before CIPO or any similar office or agency and any
Internet domain name registrar, to maintain and pursue each application for
registration or recording (and to obtain the relevant registration or recording)
and to maintain each registration and recording of any Copyright, Trademark,
Patent or Internet domain name that is Material Intellectual Property, including
filing of applications for renewal, affidavits of use, affidavits of
incontestability and opposition and interference and cancellation proceedings.

  (j)  
In the event that any Material Intellectual Property is infringed,
misappropriated, diluted or violated by a third party, the Debtor shall notify
the Collateral Agent promptly after the Debtor learns thereof. The Debtor shall
take appropriate action in response to any infringement, misappropriation,
dilution or violation of the Material Intellectual Property, including promptly
bringing suit for infringement, misappropriation, dilution or violation and to
recover all damages for such infringement, misappropriation, dilution or
violation, and shall take such other actions may be appropriate under the
circumstances to protect such Intellectual Property; provided, however, that the
foregoing shall be subject to the good faith exercise by the Debtor of its
reasonable business judgment consistent with past practices.

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  (k)  
Unless otherwise agreed to by the Collateral Agent the Debtor shall execute and
deliver to the Collateral Agent for filing in (i) the United States Copyright
Office or any similar office or agency a short-form copyright security agreement
in the form attached hereto as for all Copyrights of the Debtor registered
therein from time to time, (ii) in the United States Patent and Trademark Office
or any similar office or agency a short-form patent security agreement in the
form attached hereto as for all Patents of the Debtor registered therein from
time to time, (iii) the United States Patent and Trademark Office or any similar
office or agency and with the appropriate department or division of all
appropriate States of the United States a short-form trademark security
agreement in form attached hereto as for all Trademarks of the Debtor registered
therein from time to time and (iv) with the appropriate Internet domain name
registrar, a duly executed form of assignment of all Internet domain names of
the Debtor to the Collateral Agent (together with appropriate supporting
documentation as may be requested by the Collateral Agent) in form and substance
reasonably acceptable to the Collateral Agent. In the case of clause (iv) above,
the Debtor hereby authorizes the Collateral Agent to file such assignment in the
Debtor’s name and to otherwise perform in the name of the Debtor all other
necessary actions to complete such assignment, and the Debtor agrees to perform
all appropriate actions deemed necessary by the Collateral Agent for the
Collateral Agent to ensure such Internet domain name is registered in the name
of the Collateral Agent.

3.8 Cash Management; Deposit Accounts

  (a)  
On the Closing Date (or such later date as agreed by the Collateral Agent), the
Debtor shall cause to be delivered (i) to the Collateral Agent, a duly executed
and effective Blocked Account Letter for each existing deposit account
identified as a concentration account on Schedule 7 maintained by the Debtor and
(ii) to each Restricted Account Bank (with a copy to the Collateral Agent), a
Restricted Account Letter for each other deposit account (subject only to clause
(b) below) duly executed by the Debtor to each such deposit account.

  (b)  
The Debtor shall (i) deposit in a Blocked Account or Restricted Account all cash
and all Proceeds received by the Debtor and (ii) not establish or maintain any
deposit account with any financial or other institution other than a Blocked
Account Bank, a Restricted Account Bank, the Collateral Agent or the
Administrative Agent; provided, however, that the Debtor may at any time
maintain the following accounts not subject to this Section 3.8(b)(i) deposit
accounts or Securities Accounts (or their foreign equivalents) located outside
of Canada with cash or Cash Equivalents not in excess of an aggregate amount of
$3,000,000, (ii) deposit accounts or Securities Accounts located in Canada with
cash or Cash Equivalents not in excess of an aggregate amount of $1,000,000 and
(iii) payroll tax, employee deductions at source, withholding tax, goods and
services and sales tax, and other fiduciary accounts as required for operations
in the ordinary course of business.

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  (c)  
The Debtor shall instruct each account debtor or other Person obligated to make
a payment to the Debtor to make payment, or to continue to make payment, as the
case may be, to a lock-box linked to a Blocked Account or a Restricted Account,
as the case may be, and the Debtor shall deposit in a Blocked Account or a
Restricted Account all Proceeds received by the Debtor from any other Person
immediately upon receipt.

  (d)  
In the event (i) the Debtor or a Blocked Account Bank or Restricted Account Bank
shall, after the date hereof, terminate an agreement with respect to the
maintenance of a Blocked Account or Restricted Account, as the case may be, for
any reason, (ii) the Collateral Agent shall demand termination of a Blocked
Account Letter or a Restricted Account Letter as a result of the failure of a
Blocked Account Bank or Restricted Account Bank, as the case may be, to comply
with the terms of the applicable letter agreement or (iii) the Collateral Agent
determines in its sole discretion that the financial condition of a Blocked
Account Bank or Restricted Account Bank has materially deteriorated, then, in
each case, the Debtor shall notify all of its account debtors that were making
payments to such terminated Blocked Account Bank or Restricted Account Bank to
make all future payments to such other Blocked Account Bank or Restricted
Account Bank, as specified by the Collateral Agent.

  (e)  
The Collateral Agent agrees that it shall not deliver to any Blocked Account
Bank a sweep activation notice under any Blocked Account Letter with such
Blocked Account Bank unless there has occurred and is continuing an Event of
Default or Available Credit has been less than 15% of the Aggregate Borrowing
Limit for five or more consecutive Business Days.

3.9 Cash Collateral Accounts

  (a)  
The Collateral Agent may establish one or more Cash Collateral Accounts with
such depositaries and Securities Intermediaries as it in its sole discretion
shall determine. The Debtor agrees that each such Cash Collateral Account shall
be under the control of the Collateral Agent and that the Collateral Agent shall
be the Entitlement Holder with respect to each such Cash Collateral Account that
is a Securities Account and the only Person authorized to give Entitlement
Orders with respect to each such Securities Account. Without limiting the
foregoing, funds on deposit in any Cash Collateral Account may be invested in
Permitted Cash Equivalents at the direction of the Collateral Agent and, except
during the continuance of an Event of Default (unless otherwise agreed to by the
Administrative Agent in its sole discretion), the Collateral Agent agrees with
the Debtor to issue Entitlement Orders for such investments in Permitted Cash
Equivalents as requested by the Debtor; provided, however, that the Collateral
Agent shall not have any responsibility for, or bear any risk of loss of, any
such requested investment or income thereon and the Collateral

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Agent shall have no obligation to make or cause to be made any such investment
absent a request by the Borrower for a specific investment in Permitted Cash
Equivalents. Neither any Warnaco Entity nor any other Person claiming on behalf
of or through any Warnaco Entity shall have any right to demand payment of any
funds held in any Cash Collateral Account at any time prior to Discharge of
Lender Claims, except (i) as provided in Section 2.9(f) of the Credit Agreement
and (ii) that the Debtor may request that the Collateral Agent apply funds in
any Cash Collateral Account directly to the immediate payment of the Loans and
if paid in full then to the cash collateralization of Letter of Credit
Obligations (and not to be delivered to any Warnaco Entity). The Collateral
Agent shall apply all funds on deposit in a Cash Collateral Account as provided
in Section 2.9(f) of the Credit Agreement.
3.10 Vehicles
Upon the request of the Collateral Agent, within 30 days after the date of such
request and, with respect to any vehicle acquired by the Debtor subsequent to
the date of any such request, within 30 days after the date of acquisition
thereof, the Debtor shall file all applications for certificates of title or
ownership indicating the Collateral Agent’s first priority security interest in
the vehicle covered by such certificate and any other necessary documentation,
in each office in each jurisdiction that the Collateral Agent shall deem
advisable to perfect its security interests in the vehicles; provided, however,
that the aggregate value of all vehicles excepted from the application of this
Section 3.10 shall not exceed $1,000,000.
3.11 Payment of Obligations
The Debtor shall pay and discharge or otherwise satisfy at or before maturity or
before they become delinquent, as the case may be, all taxes, assessments and
governmental charges or levies imposed upon the Collateral or in respect of
income or profits therefrom, as well as all claims of any kind (including claims
for labor, materials and supplies) against or with respect to the Collateral,
except that no such charge need be paid if the amount or validity thereof is
currently being contested in good faith by appropriate proceedings, reserves in
conformity with Agreement Accounting Principles with respect thereto have been
provided on the books of the Debtor and such proceedings could not reasonably be
expected to result in the sale, forfeiture or loss of any material portion of
the Collateral or any interest therein.
SECTION 4 — SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS
All representations, warranties, covenants, agreements, undertakings and
conditions made in the Loan Documents, which, if not true, accurate and complete
when made and which, if not performed in accordance with the terms thereof, are
material, shall be considered to have been relied on by the Agents and the
Secured Parties and shall survive the execution and delivery of this Agreement
or any investigation made at any time by or on behalf of the Agents and any
disposition or payment of the Secured Obligations until repayment and
performance in full of the Secured Obligations and termination of all rights of
the Debtor that, if exercised, would result in the existence of Secured
Obligations.
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SECTION 5 — DEFAULT
5.1 Default
The Secured Obligations secured by this Agreement shall be immediately due and
payable in full and the security interests hereby constituted shall become
enforceable upon the occurrence and during the continuance of an Event of
Default (herein called a “Default”).
5.2 Demand Nature of Secured Obligations
The Debtor agrees that the provision of defaults in section 5.1 shall not
derogate from any demand nature of the Secured Obligations as provided in the
Credit Agreement as at any time without restriction, whether or not the Debtor
has complied with the provisions of this Agreement or any other agreement or
instrument between it and the Collateral Agent or any other Secured Party. The
Debtor agrees that upon the occurrence and during the continuance of a Default
under section 5.1, the security interests hereby constituted shall become
enforceable and the Collateral Agent shall be entitled to exercise and enforce
any or all of the remedies herein provided or which may otherwise be available
to the Collateral Agent by statute, at law or in equity and, upon demand by the
Administrative Agent pursuant to Section 9.2 (Remedies) of the Credit Agreement,
all amounts secured hereby shall immediately be paid to the Collateral Agent
(for itself and on behalf of the Secured Parties) by the Debtor.
SECTION 6 — REMEDIES ON DEFAULT
If the security interest hereby constituted becomes enforceable, the Collateral
Agent shall have, in addition to any other rights, remedies and powers which it
may have at law, in equity or under the PPSA, the CCQ or the UCC (whether or not
the CCQ or the UCC applies to the affected Collateral) the following rights,
remedies and powers upon the occurrence and during the continuance of an Event
of Default:
6.1 Power of Entry
The Debtor shall forthwith upon demand assemble and deliver to the Collateral
Agent possession of all of the Collateral at such place or places as may be
reasonably specified by the Collateral Agent. The Collateral Agent may take such
steps as it considers necessary or desirable to obtain possession of all or any
part of the Collateral and, to that end, the Debtor agrees that the Collateral
Agent, its servants or agents or Receiver (as hereinafter defined) may, at any
time, during the day or night, enter upon lands and premises where the
Collateral may be found for the purpose of taking possession of and/or removing
the Collateral or any part thereof. In the event of the Collateral Agent taking
possession of the Collateral, or any part thereof, the Collateral Agent shall
have the right to maintain the same upon the premises on which the Collateral
may then be situate. The Collateral Agent may take such action or do such things
as to render any Equipment unusable.
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6.2 Power of Sale
The Collateral Agent may sell, lease or otherwise dispose of all or any part of
the Collateral, as a whole or in separate parcels, by public auction, private
tender or by private contract, with or without notice, except as otherwise
required by applicable law, with or without advertising and without any other
formality, all of which are hereby waived by the Debtor. Such sale, lease or
disposition shall be on such terms and conditions as to credit and otherwise and
as to upset or reserve bid or price as to the Collateral Agent, in its sole
discretion, may seem advantageous. If such sale, transfer or disposition is made
on credit or part cash and part credit, the Collateral Agent need only credit
against the Secured Obligations the actual cash received at the time of the
sale. Any payments made pursuant to any credit granted at the time of the sale
shall be credited against the Secured Obligations as they are received. The
Collateral Agent may buy in or rescind or vary any contract for sale of all or
any of the Collateral and may resell without being answerable for any loss
occasioned thereby. Any such sale, lease or disposition may take place whether
or not the Collateral Agent has taken possession of the Collateral. The
Collateral Agent may, before any such sale, lease or disposition, perform any
commercially reasonable repair, processing or preparation for disposition and
the amount so paid or expended shall be deemed advanced to the Debtor by the
Collateral Agent, shall become part of the Secured Obligations, shall bear
interest at the highest rate per annum charged by the Collateral Agent on the
Secured Obligations or any part thereof and shall be secured by this Agreement.
6.3 Validity of Sale
No person dealing with the Collateral Agent or its servants or agents shall be
concerned to inquire whether the security hereby constituted has become
enforceable, whether the powers which the Collateral Agent is purporting to
exercise have become exercisable, whether any money remains due on the security
of the Collateral, as to the necessity or expedience of the stipulations and
conditions subject to which any sale, lease or disposition shall be made,
otherwise as to the propriety or regularity of any sale or any other dealing by
the Collateral Agent with the Collateral or to see to the application of any
money paid to the Collateral Agent. In the absence of fraud on the part of such
persons, such dealings shall be deemed, so far as regards the safety and
protection of such person, to be within the powers hereby conferred and to be
valid and effective accordingly.
6.4 Receiver-Manager
The Collateral Agent may, in addition to any other rights it may have, appoint
by instrument in writing a receiver or receiver and manager (both of which are
herein called a “Receiver”) of all or any part of the Collateral or may
institute proceedings in any court of competent jurisdiction for the appointment
of such a Receiver. Any such Receiver is hereby given and shall have the same
powers and rights and exclusions and limitations of liability as the Collateral
Agent has under this Agreement, at law or in equity. In exercising any such
powers, any such Receiver shall, to the extent permitted by law, act as and for
all purposes shall be deemed to be the agent of the Debtor and the Collateral
Agent and the Secured Parties shall not be responsible for any act or default of
any such Receiver. The Collateral Agent may appoint one or more Receivers
hereunder and may remove any such Receiver or Receivers and appoint another or
others in his or their stead from time to time. Any Receiver so appointed may be
an officer or employee of the Collateral Agent. A court need not appoint, ratify
the appointment by the Collateral Agent of or otherwise supervise in any manner
the actions of any Receiver. Upon the Debtor receiving notice from the
Collateral Agent of the taking of possession of the Collateral or the
appointment of a Receiver, all powers, functions, rights and privileges of each
of the directors and officers of the Debtor with respect to the Collateral shall
cease, unless specifically continued by the written consent of the Collateral
Agent.
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6.5 Carrying on Business
The Collateral Agent may carry on, or concur in the carrying on of, all or any
part of the business or undertaking of the Debtor, may, to the exclusion of all
others, including the Debtor, enter upon, occupy and use all or any of the
premises, buildings, plant and undertaking of or occupied or used by the Debtor
and may use all or any of the tools, machinery, equipment and intangibles of the
Debtor for such time as the Collateral Agent sees fit, free of charge, to carry
on the business of the Debtor and, if applicable, to manufacture or complete the
manufacture of any Inventory and to pack and ship the finished product.
6.6 Dealing with Collateral
The Collateral Agent may seize, collect, realize, dispose of, enforce, release
to third parties or otherwise deal with the Collateral or any part thereof in
such manner, upon such terms and conditions and at such time or times as may
seem to it advisable, all of which without notice to the Debtor except as
otherwise required by any applicable law. The Collateral Agent may demand, sue
for and receive any Accounts Receivable with or without notice to the Debtor,
give such receipts, discharges and extensions of time and make such compromises
in respect of any Accounts Receivable which may, in the Agent’s absolute
discretion, seem bad or doubtful. The Collateral Agent may charge on its own
behalf and pay to others, sums for costs and expenses incurred including,
without limitation, legal fees and expenses on a solicitor and his own client
scale and Receivers’ and accounting fees, in or in connection with seizing,
collecting, realizing, disposing, enforcing or otherwise dealing with the
Collateral and in connection with the protection and enforcement of the rights
of the Collateral Agent hereunder including, without limitation, in connection
with advice with respect to any of the foregoing. The amount of such sums shall
be deemed advanced to the Debtor by the Collateral Agent, shall become part of
the Secured Obligations, shall bear interest at the highest rate per annum
charged by the Collateral Agent on the Secured Obligations or any part thereof
and shall be secured by this Agreement.
6.7 Right to Use
For the purposes of enabling the Collateral Agent to exercise its rights and
remedies under this Agreement (including, without limiting the terms of this
Section 6, in order to take possession of, hold, preserve, process, assemble,
prepare for sale, market for sale, complete production of, advertise for sale
and sell or otherwise dispose of the Collateral) at such time as the Collateral
Agent shall be lawfully entitled to exercise such rights and remedies, the
Debtor hereby grants to the Collateral Agent (for itself and on behalf of the
Secured Parties) an irrevocable, nonexclusive license (exercisable without
payment of royalty or other compensation to the Debtor) to use, license or
sublicense all of the Debtor’s present and future property, whether real or
personal, including, without limitation, all labels, patents, copyrights, rights
of use of any name, trade secrets, trade names, trademarks, services marks, and
advertising matter, or any other property of any nature or of a similar nature
now owned or hereafter acquired by the Debtor, and wherever the same may be
located, and including such license access to all media in which any of the
licensed items may be recorded or stored and to all computer software and
programs used for the compilation or printout thereof and all of the Debtor’s
rights under all licenses and all franchise agreements shall inure to the
Collateral Agent.
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6.8 Retention of Collateral
Upon notice to the Debtor and subject to any obligation to dispose of any of the
Collateral, as provided in the PPSA, the Collateral Agent may elect to retain
all or any part of the Collateral in satisfaction of the Secured Obligations or
any of them.
6.9 Accounts and Payments in Respect of Intangibles

  (a)  
In addition to, and not in substitution for, any similar requirement in the
Credit Agreement, if required by the Collateral Agent at any time during the
continuance of an Event of Default, any payment of Accounts Receivable or
payment in respect of Intangibles, when collected by the Debtor, shall be
forthwith (and, in any event, within two Business Days) deposited by the Debtor
in the exact form received, duly indorsed by the Debtor to the Collateral Agent,
in a Blocked Account or a Cash Collateral Account, subject to withdrawal by the
Collateral Agent as provided in Section 6.11 (Proceeds to be Turned Over To
Collateral Agent). Until so turned over, such payment shall be held by the
Debtor in trust for the Collateral Agent, segregated from other funds of the
Debtor. Each such deposit of Proceeds of Accounts Receivable and payments in
respect of Intangibles shall be accompanied by a report identifying in
reasonable detail the nature and source of the payments included in the deposit.

  (b)  
At the Collateral Agent’s request, during the continuance of an Event of
Default, the Debtor shall deliver to the Collateral Agent all original and other
documents evidencing, and relating to, the agreements and transactions that gave
rise to the Accounts Receivable or payments in respect of Intangibles, including
all original orders, invoices and shipping receipts.

  (c)  
Subject to the terms of the Credit Agreement, the Collateral Agent may, without
notice, at any time during the continuance of an Event of Default, limit or
terminate the authority of the Debtor to collect its Accounts Receivable or
amounts due under Intangibles or any thereof.

  (d)  
The Collateral Agent in its own name or in the name of others may at any time
during the continuance of an Event of Default communicate with account debtors
to verify with them to the Collateral Agent’s satisfaction the existence, amount
and terms of any Account or amounts due under any Intangible.

  (e)  
Upon the request of the Collateral Agent at any time during the continuance of
an Event of Default, the Debtor shall notify account debtors that it has granted
to the Collateral Agent a lien on and security interest in, all of its right,
title and interest in, to and under the Accounts Receivable or Intangibles that
have been collaterally assigned to the Collateral Agent and that payments in
respect thereof shall be made directly to the Collateral Agent. In addition, the
Collateral Agent may at any time during the continuance of an Event of Default,
to the extent permitted by applicable law, enforce the Debtor’s rights against
such account debtors and obligors of Intangibles.

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  (f)  
Anything herein to the contrary notwithstanding, the Debtor shall remain liable
under each of the Accounts Receivable and payments in respect of Intangibles to
observe and perform all the conditions and obligations to be observed and
performed by it thereunder, all in accordance with the terms of any agreement
giving rise thereto. Neither the Collateral Agent nor any other Secured Party
shall have any obligation or liability under any agreement giving rise to an
Account or a payment in respect of an Intangible by reason of or arising out of
this Agreement or the receipt by the Collateral Agent or any other Secured Party
of any payment relating thereto, nor shall the Collateral Agent nor any other
Secured Party be obligated in any manner to perform any obligation of the Debtor
under or pursuant to any agreement giving rise to an Account or a payment in
respect of an Intangible, to make any payment, to make any inquiry as to the
nature or the sufficiency of any payment received by it or as to the sufficiency
of any performance by any party thereunder, to present or file any claim, to
take any action to enforce any performance or to collect the payment of any
amounts that may have been assigned to it or to which it may be entitled at any
time or times.

6.10 Pledged Collateral

  (a)  
During the continuance of an Event of Default, upon notice by the Collateral
Agent to the Debtor, (i) the Collateral Agent shall have the right to receive
any Proceeds of the Pledged Collateral and make application thereof to the
Secured Obligations in the order set forth in the Credit Agreement and (ii) the
Collateral Agent or its nominee may exercise (A) any voting, consent, corporate
and other right pertaining to the Pledged Collateral at any meeting of
shareholders, partners or members, as the case may be, of the relevant issuer or
issuers of Pledged Collateral or otherwise and (B) any right of conversion,
exchange and subscription and any other right, privilege or option pertaining to
the Pledged Collateral as if it were the absolute owner thereof (including the
right to exchange at its discretion any of the Pledged Collateral upon the
merger, consolidation, reorganization, recapitalization or other fundamental
change in the corporate structure of any issuer of Pledged Stock and the right
to deposit and deliver any Pledged Collateral with any committee, depositary,
transfer agent, registrar or other designated agency upon such terms and
conditions as the Collateral Agent may determine), all without liability except
to account for property actually received by it; provided, however, that the
Collateral Agent shall have no duty to the Debtor to exercise any such right,
privilege or option and shall not be responsible for any failure to do so or
delay in so doing.

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  (b)  
In order to permit the Collateral Agent to exercise the voting and other
consensual rights that it may be entitled to exercise pursuant hereto and to
receive all dividends and other distributions that it may be entitled to receive
hereunder, (i) the Debtor shall promptly execute and deliver (or cause to be
executed and delivered) to the Collateral Agent all such proxies, dividend
payment orders and other instruments as the Collateral Agent may from time to
time reasonably request and (ii) without limiting the effect of clause
(i) above, the Debtor hereby grants to the Collateral Agent an irrevocable proxy
to vote all or any part of the Pledged Collateral and to exercise all other
rights, powers, privileges and remedies to which a holder of the Pledged
Collateral would be entitled (including giving or withholding written consents
of shareholders, partners or members, as the case may be, calling special
meetings of shareholders, partners or members, as the case may be, and voting at
such meetings), which proxy shall be effective, automatically and without the
necessity of any action (including any transfer of any Pledged Collateral on the
record books of the issuer thereof) by any other person (including the issuer of
such Pledged Collateral or any officer or agent thereof) during the continuance
of an Event of Default and which proxy shall only terminate upon Discharge of
Lender Claims.

  (c)  
The Debtor hereby expressly authorizes and instructs each issuer of any Pledged
Collateral pledged hereunder by the Debtor to (i) comply with any instruction
received by it from the Collateral Agent in writing that (A) states that an
Event of Default has occurred and is continuing and (B) is otherwise in
accordance with the terms of this Agreement, without any other or further
instructions from the Debtor, and the Debtor agrees that such issuer shall be
fully protected in so complying and (ii) unless otherwise expressly permitted
hereby, pay any dividend or other payment with respect to the Pledged Collateral
directly to the Collateral Agent

6.11 Proceeds to be Turned Over To Collateral Agent
Unless otherwise expressly provided in the Credit Agreement, all Proceeds
received by the Collateral Agent hereunder in cash or Cash Equivalents shall be
held by the Collateral Agent in a Cash Collateral Account. All Proceeds
constituting Reinvestment Prepayment Amounts (as defined in the Credit
Agreement) or the cash collateralization of Letters of Credit (as defined in the
Credit Agreement) while held by the Collateral Agent in a Cash Collateral
Account (or by the Debtor in trust for the Collateral Agent) shall continue to
be held as collateral security for the Secured Obligations and shall not
constitute payment thereof until applied as provided in the Credit Agreement.
6.12 Registration Rights

  (a)  
During the continuance of an Event of Default, if the Collateral Agent shall
determine to exercise its right to sell any of the Pledged Collateral, and if in
the reasonable opinion of the Collateral Agent it is necessary or advisable to
have the Pledged Collateral, or any portion thereof, registered under the
provisions of the STA or any similar securities laws in any other applicable
jurisdiction (the “Securities Act”), the Debtor shall use its reasonable efforts
to cause the issuer thereof to (i) execute and deliver, and cause the directors
and officers of such issuer to execute and deliver, all such instruments and
documents, and do or cause to be done all such other acts as may be, in the
opinion of the Collateral Agent, necessary or advisable to register the Pledged
Collateral, or that portion thereof to be sold, under the provisions of the
Securities Act, (ii) use its reasonable efforts to cause the registration
statement relating thereto to

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become effective and to remain effective for a period of one year from the date
of the first public offering of the Pledged Collateral, or that portion thereof
to be sold and (iii) make all amendments thereto or to the related prospectus
that, in the opinion of the Collateral Agent, are necessary or advisable, all in
conformity with the requirements of the Securities Act and the rules and
regulations of any securities commission applicable thereto. The Debtor agrees
to cause such issuer to comply with the provisions of the applicable securities
laws of any jurisdiction that the Collateral Agent shall designate and to make
available to its security holders, as soon as practicable, an earnings statement
(which need not be audited) satisfying the provisions of the Securities Act.

  (b)  
The Debtor recognizes that the Collateral Agent may be unable to effect a public
sale of any Pledged Collateral by reason of certain prohibitions contained in
the Securities Act and applicable regulations or otherwise or may determine that
a public sale is impracticable or not commercially reasonable and, accordingly,
may resort to one or more private sales thereof to a restricted group of
purchasers that shall be obliged to agree, among other things, to acquire such
securities for their own account for investment and not with a view to the
distribution or resale thereof. The Debtor acknowledges and agrees that any such
private sale may result in prices and other terms less favourable than if such
sale were a public sale and, notwithstanding such circumstances, agrees that any
such private sale shall be deemed to have been made in a commercially reasonable
manner. The Collateral Agent shall be under no obligation to delay a sale of any
Pledged Collateral for the period of time necessary to permit the issuer thereof
to register such securities for public sale under the Securities Act, even if
such issuer would agree to do so.

  (c)  
During the continuance of an Event of Default, the Debtor agrees to use its best
efforts to do or cause to be done all such other acts as may be necessary to
make such sale or sales of all or any portion of the Pledged Collateral pursuant
to this Section 6.12 valid and binding and in compliance with all other
applicable Requirements of Law. The Debtor further agrees that a breach of any
covenant contained in this Section 6.12 will cause irreparable injury to the
Collateral Agent and the other Secured Parties, that the Collateral Agent and
the other Secured Parties have no adequate remedy at law in respect of such
breach and, as a consequence, that each and every covenant contained in this
Section 6.12 shall be specifically enforceable against the Debtor, and the
Debtor hereby waives and agrees not to assert any defense against an action for
specific performance of such covenants except for a defense that no Event of
Default has occurred under the Credit Agreement.

6.13 Pay Encumbrances
The Collateral Agent may pay any encumbrance that may exist or be threatened
against the Collateral. In addition, the Collateral Agent may borrow money
required for the maintenance, preservation or protection of the Collateral or
for the carrying on of the business or undertaking of the Debtor and may grant
further security interests in the Collateral in priority to the security
interest created hereby as security for the money so borrowed. In every such
case the amounts so paid or borrowed together with costs, charges and expenses
incurred in connection therewith shall be deemed to have been advanced to the
Debtor by the Collateral Agent, shall become part of the Secured Obligations,
shall bear interest at the highest rate per annum charged by the Collateral
Agent on the Secured Obligations or any part thereof and shall be secured by
this Agreement.
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6.14 Application of Payments Against Secured Obligations
Any and all payments made in respect of the Secured Obligations from time to
time and moneys realized on the Collateral shall be applied in accordance with
Section 2.13 of the Credit Agreement. Any insurance moneys received by the
Collateral Agent pursuant to this Agreement may, at the option of the Collateral
Agent, be applied to rebuilding or repairing the Collateral or be applied
against the Secured Obligations in accordance with the provisions of this
Section.
6.15 Set-Off
The Secured Obligations will be paid by the Debtor without regard to any
equities between the Debtor and the Collateral Agent and/or any Secured Party or
any right of set-off or cross-claim. Any indebtedness owing by the Collateral
Agent and/or any Secured Party to the Debtor may be set off and applied by the
Collateral Agent against the Secured Obligations at any time or from time to
time either before or after maturity, without demand upon or notice to anyone.
6.16 Deficiency
The Debtor shall remain liable for any deficiency if the proceeds of any sale or
other disposition of the Collateral are insufficient to pay the Secured
Obligations and the reasonable fees and disbursements of any attorney employed
by the Collateral Agent or any other Secured Party to collect such deficiency.
6.17 Agent Not Liable
Neither the Collateral Agent nor any of the other Secured Parties shall be
(a) liable or accountable for any failure to seize, collect, realize, dispose
of, enforce or otherwise deal with the Collateral, (b) bound to institute
proceedings for any such purposes or for the purpose of preserving any rights of
the Collateral Agent, the Debtor or any other person, firm or corporation in
respect of the Collateral, or (c) liable or responsible for any loss, cost or
damage whatsoever which may arise in respect of any such failure including,
without limitation, resulting from the negligence of the Collateral Agent or any
of its officers, servants, agents, solicitors, attorneys, Receivers or otherwise
except for its, his, her or their gross negligence or willful misconduct.
Neither the Collateral Agent nor any of the other Secured Parties, nor their
respective officers, servants, agents or Receivers shall be liable by reason of
any entry into possession of the Collateral or any part thereof, to account as a
mortgagee in possession, for anything except actual receipts, for any loss on
realization, for any act or omission for which a mortgagee in possession might
be liable, for any negligence in the carrying on or occupation of the business
or undertaking of the Debtor as provided in Section 6.5 or for any loss, cost,
damage or expense whatsoever which may arise in respect of any such actions,
omissions or negligence except for its, his, her or their gross negligence or
willful misconduct.
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6.18 Extensions of Time
The Collateral Agent and any of the Secured Parties may grant renewals,
extensions of time and other indulgences, take and give up securities, accept
compositions, grant releases and discharges, perfect or fail to perfect any
securities, release any part of the Collateral to third parties and otherwise
deal or fail to deal with the Debtor, debtors of the Debtor, guarantors,
sureties and others and with the Collateral and other securities as they may see
fit, all without prejudice to the liability of the Debtor to the Collateral
Agent and the Secured Parties or the Collateral Agent’s and Secured Parties’
rights and powers under this Agreement.
6.19 Rights in Addition
The rights and powers conferred by this Section 6 are in supplement of and in
addition to and not in substitution for any other rights or powers the
Collateral Agent may have from time to time under this Agreement or under
applicable law. The Collateral Agent may proceed by way of any action, suit,
remedy or other proceeding at law or in equity and no such remedy for the
enforcement of the rights of the Collateral Agent shall be exclusive of or
dependent on any other such remedy. Any one or more of such remedies may from
time to time be exercised separately or in combination.
SECTION 7 — DEALING WITH COLLATERAL BY THE DEBTOR
7.1 Sale of Inventory
Prior to the occurrence of a Default, the Debtor may, to the extent permitted
hereunder or as permitted in the Credit Agreement, in the ordinary course of its
business and on customary trade terms, lease or sell items of Inventory, so that
the purchaser thereof takes title clear of the security interest hereby created.
If such sale or lease results in an Account Receivable, such Account Receivable
shall be subject to the security interest hereby created.
SECTION 8 — GENERAL
8.1 Security in Addition
The security hereby constituted is not in substitution for any other security
for the Secured Obligations or for any other agreement between the parties
creating a security interest or hypothec in all or part of the Collateral,
whether heretofore or hereafter made, and such security and such agreements
shall be deemed to be continued and not affected hereby unless expressly
provided to the contrary in writing and signed by the Collateral Agent and the
Debtor. The taking of any action or proceedings or refraining from so doing, or
any other dealing with any other security for the Secured Obligations or any
part thereof, shall not release or affect the security interest created by this
Agreement and the taking of the security interest hereby created or any
proceedings hereunder for the realization of the security interest hereby
created shall not release or affect any other security held by the Collateral
Agent for the repayment of or performance of the Secured Obligations.
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8.2 Amendments in Writing
None of the terms or provisions of this Agreement may be waived, amended,
supplemented or otherwise modified except in accordance with Section 11.1
(Amendments, Waivers, Etc.) of the Credit Agreement; provided, however, that
annexes to this Agreement may be supplemented (but no existing provisions may be
modified and no Collateral may be released except as provided in Section 8.11)
through amendments in a form reasonably acceptable to the Collateral Agent, in
each case duly executed by the Collateral Agent and the Debtor.
8.3 Notices
All notices, requests and demands to or upon the Collateral Agent or the Debtor
hereunder shall be effected in the manner provided for in Section 11.8 (Notices,
Etc.) of the Credit Agreement; provided, however, that any such notice, request
or demand to or upon the Debtor shall be addressed to the Debtor’s notice
address set forth in such Section 11.8 or to its principal place of business as
set forth herein.
8.4 No Waiver by Course of Conduct; Cumulative Remedies
Neither the Collateral Agent nor any other Secured Party shall by any act
(except by a written instrument pursuant to Section 8.2 (Amendments in
Writing)), delay, indulgence, omission or otherwise be deemed to have waived any
right or remedy hereunder or to have acquiesced in any Default or Event of
Default. No failure to exercise, nor any delay in exercising, on the part of the
Collateral Agent or any other Secured Party, any right, power or privilege
hereunder shall operate as a waiver thereof. No single or partial exercise of
any right, power or privilege hereunder shall preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. A
waiver by the Collateral Agent or any other Secured Party of any right or remedy
hereunder on any one occasion shall not be construed as a bar to any right or
remedy that the Collateral Agent or such other Secured Party would otherwise
have on any future occasion. The rights and remedies herein provided are
cumulative, may be exercised singly or concurrently and are not exclusive of any
other rights or remedies provided by law.
8.5 Successors and Assigns
This Agreement shall be binding upon the successors and assigns of the Debtor
and shall inure to the benefit of the Collateral Agent and each other Secured
Party and their successors and assigns; provided, however, that the Debtor may
not assign, transfer or delegate any of its rights or obligations under this
Agreement without the prior written consent of the Collateral Agent.
8.6 Counterparts
This Agreement may be executed by one or more of the parties to this Agreement
on any number of separate counterparts (including by telecopy), each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Signature pages may be
detached from multiple counterparts and attached to a single counterpart so that
all signature pages are attached to the same document. Delivery of an executed
counterpart by telecopy or electronic transmission (in pdf format) shall be
effective as delivery of a manually executed counterpart.
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8.7 Severability
Any provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
8.8 Section Headings
The Section titles and subtitles contained in this Agreement are, and shall be,
without substantive meaning or content of any kind whatsoever and are not part
of the agreement of the parties hereto.
8.9 Entire Agreement
This Agreement, together with the other Loan Documents, represents the entire
agreement of the parties and supersedes all prior agreements and understandings
relating to the subject matter hereto concerning the Secured Obligations.
8.10 Additional Debtors
Pursuant to Section 7.11 (Additional Personal Property Collateral and
Guaranties) of the Credit Agreement, the Debtor shall be required to cause any
Subsidiary to execute and deliver to the Collateral Agent a General Security
Agreement substantially in the form hereof unless otherwise agreed by the
Administrative Agent.
8.11 Release of Collateral

  (a)  
At the time provided in Section 10.7(b)(i) of the Credit Agreement, the
Collateral shall be released from the Liens hereby and this Agreement and all
obligations (other than those expressly stated to survive such termination) of
the Collateral Agent and the Debtor hereunder shall terminate, all without
delivery of any instrument or performance of any act by any party, and all
rights to the Collateral shall revert to the Debtor. At the request and sole
expense of the Debtor following any such termination, the Collateral Agent shall
deliver to the Debtor any Collateral of the Debtor held by the Collateral Agent
hereunder and execute and deliver to the Debtor, at the sole expense of the
Debtor, such documents as the Debtor shall reasonably request to evidence such
termination.

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  (b)  
If the Collateral Agent shall be directed or permitted pursuant to Section
10.7(b)(ii) or (iii) of the Credit Agreement to release any Lien created hereby
upon any Collateral (including any Collateral sold or disposed of by the Debtor
in a transaction permitted by the Credit Agreement), such Collateral shall be
released from the Lien created hereby to the extent provided under, and subject
to the terms and conditions set forth in, Section 10.7(b)(ii) or (iii) of the
Credit Agreement. In connection therewith but subject to the terms of the Credit
Agreement, the Collateral Agent, at the request and sole expense of the Debtor,
shall execute and deliver to the Debtor, all releases or other documents
reasonably necessary or desirable for the release of the Lien created hereby on
such Collateral.

  (c)  
At the request and sole expense of the Debtor, the Debtor shall be released from
its obligations hereunder in the event that all the capital stock of the Debtor
shall be so sold or disposed (but only so long as such sale or other disposition
is permitted under the Credit Agreement); provided, however, that the Debtor
shall have delivered to the Collateral Agent, at least ten Business Days prior
to the date of the proposed release, a written request for release identifying
the Debtor and the terms of the sale or other disposition in reasonable detail,
including the price thereof and any expenses in connection therewith, together
with a certification by the Debtor in form and substance satisfactory to the
Collateral Agent stating that such transaction is in compliance with the Loan
Documents.

8.12 Reinstatement
The Debtor further agrees that, if any payment made by any Loan Party or other
Person and applied to any of the Secured Obligations is at any time annulled,
avoided, set aside, rescinded, invalidated, declared to be fraudulent or
preferential or otherwise required to be refunded or repaid, or the proceeds of
Collateral are required to be returned by any Secured Party to such Loan Party
or other Person, its estate, trustee, receiver or any other party, including the
Debtor, under any bankruptcy law, provincial or federal law, common law or
equitable cause, then, to the extent of such payment or repayment, any Lien or
other Collateral securing such liability shall be and remain in full force and
effect, as fully as if such payment had never been made or, if prior thereto the
Lien granted hereby or other Collateral securing such liability hereunder shall
have been released or terminated, such Lien or other Collateral shall be
reinstated in full force and effect, and such prior release or termination shall
not diminish, release, discharge, impair or otherwise affect any Lien or other
Collateral securing the obligations of the Debtor in respect of the amount of
such payment.
8.13 Submission to Jurisdiction; Service of Process

  (a)  
Any legal action or proceeding with respect to this Agreement may be brought in
the courts of the Province of Ontario, and, by execution and delivery of this
Agreement, the Debtor hereby accepts for itself and in respect of its property,
generally and unconditionally, the jurisdiction of the aforesaid court. The
Debtor hereby irrevocably waives any objection, including any objection to the
laying of venue or based on the grounds of forum non conveniens, that it may now
or hereafter have to the bringing of any such action or proceeding in such
respective jurisdictions.

General Security Agreement — Warnaco of Canada Company (2008)

 

32

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  (b)  
The Debtor hereby irrevocably consents to the service of any and all legal
process, summons, notices and documents in any suit, action or proceeding
brought in Canada arising out of or in connection with this Agreement by the
mailing (by registered or certified mail, postage prepaid) or delivering of a
copy of such process to the Debtor at the address specified in Section 11.8
(Notices, Etc.) of the Credit Agreement. The Debtor agrees that a final judgment
in any such action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
law.

  (c)  
Nothing contained in this Section 8.13 shall affect the right of the Collateral
Agent or any other Secured Party to serve process in any other manner permitted
by law or commence legal proceedings or otherwise proceed against the Debtor in
any other jurisdiction.

8.14 Further Assurances
The Debtor shall at all times do, execute, acknowledge and deliver or cause to
be done, executed, acknowledged or delivered all and singular every such further
acts, deeds, conveyances, instruments, transfers, assignments, security
agreements and assurances as the Collateral Agent may reasonably require in
order to give effect to the provisions and purposes of this Agreement including,
without limitation, in respect of the Collateral Agent’s enforcement of the
security and its realization on the Collateral, and for the better granting,
transferring, assigning, charging, setting over, assuring, confirming and/or
perfecting the security interest of the Collateral Agent in the Collateral
pursuant to this Agreement. The Debtor hereby constitutes and appoints any
officer of the Collateral Agent at its above address, or any Receiver appointed
by the Court or the Collateral Agent as provided herein, the true and lawful
attorney of the Debtor irrevocably with full power of substitution to do, make
and execute all such assignments, documents, acts, matters or things with the
right to use the name of the Debtor whenever and wherever it may be deemed
necessary or expedient. The Debtor hereby authorizes the Collateral Agent to
file such proofs of claim and other documents as may be necessary or advisable
in order to prove its claim in any bankruptcy, proposed winding-up or other
proceeding relating to the Debtor. Notwithstanding anything to the contrary in
this paragraph, the Collateral Agent agrees that it shall not exercise any right
under the power of attorney provided for in this paragraph unless an Event of
Default shall be continuing.
Without limiting the generality of the foregoing, the Debtor:

  (a)  
shall, upon receipt of notice to do so by the Collateral Agent, mark
conspicuously each chattel paper evidencing or relating to Accounts Receivable
and each related contract and, at the request of the Collateral Agent, each of
its records pertaining to the Collateral with a legend, in form and substance
satisfactory to the Collateral Agent, indicating that such chattel paper,
related contract or Collateral is subject to the security interests granted
hereby;

  (b)  
shall, if any Accounts Receivable shall be evidenced by a promissory note or
other instrument or chattel paper, deliver and pledge to the Collateral Agent
hereunder such note, instrument or chattel paper duly endorsed and accompanied
by duly executed instruments of transfer or assignment, all in form and
substance satisfactory to the Collateral Agent;

General Security Agreement — Warnaco of Canada Company (2008)

 

33

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  (c)  
shall execute and file such financing or continuation statements, or amendments,
thereto, and such other instruments or notices, as may be necessary or
desirable, or as the Collateral Agent may request, in order to perfect and
preserve the security interests granted or purported to be granted hereby;

  (d)  
hereby authorizes the Collateral Agent to file one or more financing or
continuation statements, and amendments thereto, relative to all or any part of
the Collateral without the signature of the Debtor, where permitted by law; and

  (e)  
shall furnish to the Collateral Agent from time to time, upon request,
statements and schedules further identifying and describing the Collateral and
such other reports in connection with the Collateral as the Collateral Agent may
reasonably request, all in reasonable detail.

8.15 Continuing Security Interest and Discharge
This Agreement shall create a continuing security interest in the Collateral and
shall remain in full force and effect until payment and performance in full of
the Secured Obligations and the termination of the Credit Agreement,
notwithstanding any dealing between the Collateral Agent and the Debtor or any
guarantor in respect of the Secured Obligations or any release, exchange,
non-perfection, amendment, waiver, consent or departure from or in respect of
any or all of the terms or provision of any security held for the Secured
Obligations.
8.16 Governing Law
This Agreement shall be governed by and construed in accordance with the laws of
the Province of Ontario and the laws of Canada applicable therein, except as
required by mandatory provisions of law and except to the extent that the
validity or perfection of the security interests hereunder, or remedies
hereunder, in respect of any particular Collateral are governed by the laws of a
jurisdiction other than the Province of Ontario.
8.17 Provisions Reasonable
The Debtor expressly acknowledges and agrees that the provisions of this
Agreement and, in particular, those respecting remedies and powers of the
Collateral Agent against the Debtor, its business and the Collateral upon
default, are commercially reasonable and not manifestly unreasonable.
8.18 Precedence
In the event that any provisions of this Agreement contradict, are inconsistent
with and are otherwise incapable of being construed in conjunction with the
provisions (including any rights, remedies and covenants therein) of the Credit
Agreement, the provisions of the Credit Agreement shall take precedence over
those contained in this Agreement. Notwithstanding the foregoing, in the event
that any provision of the Credit Agreement relating to the grant or perfection
of a security interest in Collateral, if any, conflict with, contradict, are
inconsistent and are otherwise incapable of being construed in conjunction with
the provisions of this Agreement, such provisions of this Agreement shall take
precedence over those contained in the Credit Agreement.
General Security Agreement — Warnaco of Canada Company (2008)

 

34

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8.19 Number and Gender
In this Agreement, words importing the singular number include the plural and
vice-versa and words importing gender include all genders.
8.20 Indemnity and Expenses

  (a)  
The Debtor agrees to indemnify and save harmless the Collateral Agent and the
Secured Parties from and against any and all claims, losses and liabilities
arising out of or resulting out of or resulting from this Agreement (including,
without limitation, enforcement of this Agreement).

  (b)  
The Debtor will upon demand pay to the Collateral Agent the amount of any and
all expenses, including the fees and disbursements of its counsel and of any
experts and agents, which the Collateral Agent may incur in connection with
(i) the administration of this Agreement, (ii) the custody, preservation, use or
operation of, or the sale of, collection from, or other realization upon, any of
the Collateral, (iii) the exercise or enforcement of any of the rights or
remedies of the Collateral Agent hereunder or (iv) the failure by the Debtor to
perform or observe any of the provisions hereunder.

8.21 Judgment Currency
If, for the purposes of obtaining or enforcing judgment in any court or for any
other purpose hereunder or in connection herewith, it is necessary to convert a
sum due hereunder in any currency into another currency, such conversion shall
be carried out to the extent and in the manner provided in the Credit Agreement.
8.22 Language
The parties hereto acknowledge that they have requested and are satisfied that
this Agreement, as well as all notices, actions and legal proceedings be drawn
up in the English language. Les parties à cette convention reconnaissent
qu’elles ont exigé que cette convention ainsi que tous avis, actions et
procédures légales soient rédigés et exécutés en anglais et s’en déclarent
satisfaites.
[the remainder of this page is intentionally left blank]
[signature page follows]
General Security Agreement — Warnaco of Canada Company (2008)

 

35

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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement at the place and as of the date first above written.

            WARNACO OF CANADA COMPANY,
as Debtor
      Per: /s/ Lawrence R. Rutkowski         Name:   Lawrence R. Rutkowski     
  Title:   Vice-President        BANK OF AMERICA, N.A.,
as Collateral Agent
      Per:  /s/ Kevin W. Corcoran         Name:   Kevin W. Corcoran       
Title:   Vice President   

General Security Agreement — Warnaco of Canada Company (2008)

 

 

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Annex 1
To
General Security Agreement
Form of Short Form Copyright Security Agreement
Copyright Security Agreement, dated as of August  _____, 2008, by [Warnaco of
Canada Company or 4278941 Canada Inc.] (the “Grantor”) in favour of Bank of
America, N.A. (“BofA”), as collateral agent for the Secured Parties (in such
capacity, together with its successors and assigns in such capacity, the
“Collateral Agent”).
W i t n e s s e t h:
Whereas, pursuant to a Credit Agreement, dated as of August  _____, 2008 (as the
same may be amended, restated, supplemented or otherwise modified from time to
time, the “Credit Agreement”), among, inter alia, Warnaco of Canada Company (the
“Borrower”), the Lenders and Issuers party thereto, BofA, as administrative
agent and collateral agent for the Lenders and Issuers, the Lenders and the
Issuers have severally agreed to make extensions of credit to the Borrower upon
the terms and subject to the conditions set forth therein;
Now, therefore, in consideration of the premises and to induce the Lenders, the
Issuers, the Administrative Agent and the Collateral Agent to enter into the
Credit Agreement and to induce the Lenders and the Issuers to make their
respective extensions of credit to the Borrower thereunder, the Grantor hereby
agrees with the Collateral Agent as follows:
Section 1. Defined Terms
Unless otherwise defined herein, terms defined in the Security Agreement and
used herein have the meaning given to them in the Security Agreement.
Section 2. Grant of Security Interest in Copyright Collateral
The Grantor, as collateral security for the full, prompt and complete payment
and performance when due (whether at stated maturity, by acceleration or
otherwise) of the Secured Obligations of the Grantor, hereby conveys, mortgages,
pledges and hypothecates to the Collateral Agent for the benefit of the Secured
Parties, and grants to the Collateral Agent for the benefit of the Secured
Parties a lien on and security interest in, all of its right, title and interest
in, to and under the following Collateral of the Grantor (the “Copyright
Collateral”):
(a) all of its Copyrights and Copyright Licenses pursuant to which it has been
granted any exclusive rights to Copyrights, including, without limitation, those
referred to on Schedule I hereto;
(b) all renewals, reversions and extensions of the foregoing; and

 

 

--------------------------------------------------------------------------------

 

(c) all Proceeds of any or all of the foregoing, including, without limitation,
all rights to income, royalties, proceeds and damages now or hereafter due
and/or payable under any Copyright and with respect thereto, including, without
limitation, all rights to sue and recover at law or in equity for any past,
present and future infringement, misappropriation, dilution, violation or other
impairment thereof.
Section 3. Security Agreement
The security interest granted pursuant to this Copyright Security Agreement is
granted in conjunction with the security interest granted to the Collateral
Agent pursuant to the Security Agreement and the Grantor hereby acknowledges and
affirms that the rights and remedies of the Collateral Agent with respect to the
security interest in the Copyright Collateral made and granted hereby are more
fully set forth in the Security Agreement, the terms and provisions of which are
incorporated by reference herein as if fully set forth herein.
[Signature Pages Follow]

 

 

--------------------------------------------------------------------------------

 

In witness whereof, the Grantor has caused this Copyright Security Agreement to
be executed and delivered by its duly authorized officer as of the date first
set forth above.

            Very truly yours,

[Grantor],
as Grantor
      By:           Name:           Title:        

          Accepted and Agreed
as of the date first above written:    
 
        Bank of America, N.A.,
as Collateral Agent for the Secured Parties    
 
       
By:
       
 
 
 
Name:    
 
  Title:    

[Signature Page to Copyright Security Agreement]

 

 

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Acknowledgment of Grantor

             
State of                          
)          
 
)     ss.
County of                       
)          

On this  _____  day of  _____ __, 20_____  before me personally appeared  _____,
proved to me on the basis of satisfactory evidence to be the person who executed
the foregoing instrument on behalf of  _____, who being by me duly sworn did
depose and say that he is an authorized officer of said corporation, that the
said instrument was signed on behalf of said corporation as authorized by its
Board of Directors and that he acknowledged said instrument to be the free act
and deed of said corporation.

         
 
 
 
Notary Public    

[Acknowledgement of Grantor for Copyright Security Agreement]

 

 

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Schedule I
to
Copyright Security Agreement
Copyright Registrations

1.  
REGISTERED COPYRIGHTS
     
[Include Copyright Title, Country, Author, Claimant, Registration Number and
Date]
  2.  
COPYRIGHT APPLICATIONS
     
[Include Copyright Title, Country, Claimant and Date Filed]
  3.  
EXCLUSIVE COPYRIGHT LICENSES

 

 

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Annex 2
to
General Security Agreement
Form of Short Form Patent Security Agreement
Patent Security Agreement, dated as of August  _____, 2008, by [Warnaco of
Canada Company or 4278941 Canada Inc.] (the “Grantor”) in favour of Bank of
America, N.A. (“BofA”), as collateral agent for the Secured Parties (as defined
in the Credit Agreement referred to below) (in such capacity, together with its
successors and assigns in such capacity, the “Collateral Agent”).
W i t n e s s e t h:
Whereas, pursuant to a Credit Agreement, dated as of August  _____, 2008 (as the
same may be amended, restated, supplemented or otherwise modified from time to
time, the “Credit Agreement”), among, inter alia, Warnaco of Canada Company (the
“Borrower”), the Lenders and Issuers party thereto, BofA, as administrative
agent and collateral agent for the Lenders and Issuers, the Lenders and the
Issuers have severally agreed to make extensions of credit to the Borrower upon
the terms and subject to the conditions set forth therein;
Now, therefore, in consideration of the premises and to induce the Lenders, the
Issuers, the Administrative Agent and the Collateral Agent to enter into the
Credit Agreement and to induce the Lenders and the Issuers to make their
respective extensions of credit to the Borrower thereunder, the Grantor hereby
agrees with the Collateral Agent as follows:
Section 1. Defined Terms
Unless otherwise defined herein, terms defined in the Credit Agreement or in the
Security Agreement and used herein have the meaning given to them in the Credit
Agreement or the Security Agreement.
Section 2. Grant of Security Interest in Patent Collateral
The Grantor, as collateral security for the full, prompt and complete payment
and performance when due (whether at stated maturity, by acceleration or
otherwise) of the Secured Obligations of the Grantor, hereby conveys, mortgages,
pledges and hypothecates to the Collateral Agent for the benefit of the Secured
Parties, and grants to the Collateral Agent for the benefit of the Secured
Parties a lien on and security interest in, all of its right, title and interest
in, to and under the following Collateral of the Grantor (the “Patent
Collateral”):
(a) all of its Patents, including, without limitation, those referred to on
Schedule I hereto;

 

 

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(b) all reissues, continuations, divisions, continuations, renewals and
extensions of the foregoing; and
(c) all Proceeds of any or all of the foregoing, including, without limitation,
all rights to income, royalties, proceeds and damages now or hereafter due
and/or payable under any Patent and with respect thereto, including, without
limitation, all rights to sue and recover at law or in equity for any past,
present and future infringement, misappropriation, dilution, violation or other
impairment thereof.
Section 3. Security Agreement
The security interest granted pursuant to this Patent Security Agreement is
granted in conjunction with the security interest granted to the Collateral
Agent pursuant to the Security Agreement and the Grantor hereby acknowledges and
affirms that the rights and remedies of the Collateral Agent with respect to the
security interest in the Patent Collateral made and granted hereby are more
fully set forth in the Security Agreement, the terms and provisions of which are
incorporated by reference herein as if fully set forth herein.
[Signature Pages Follow]

 

 

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In witness whereof, the Grantor has caused this Patent Security Agreement to be
executed and delivered by its duly authorized officer as of the date first set
forth above.

            Very truly yours,

[Grantor],
as Grantor
      By:           Name:           Title:        

          Accepted and Agreed as of the date first above written:    
 
        Bank of America, N.A.,
as Collateral Agent for the Secured Parties    
 
       
By:
       
 
       
 
  Name:    
 
  Title:    

[Signature Page to Patent Security Agreement]

 

 

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Acknowledgement of Grantor

             
State of                          
)          
 
)     ss.
County of                       
)          

On this  _____  day of  _____, 20_____  before me personally appeared  _____,
proved to me on the basis of satisfactory evidence to be the person who executed
the foregoing instrument on behalf of  _____, who being by me duly sworn did
depose and say that he is an authorized officer of said corporation, that the
said instrument was signed on behalf of said corporation as authorized by its
Board of Directors and that he acknowledged said instrument to be the free act
and deed of said corporation.

         
 
 
 
Notary Public    

Acknowledgement of Grantor for Patent Security Agreement

 

 

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Schedule I
to
Patent Security Agreement
Patent Registrations

1.  
PATENTS
     
[Include Patent Title, Patent Number, Country, Owner and Issue Date]
  2.  
PATENT APPLICATIONS
     
[Include Patent Title, Serial Number, Country, Owner and Filing Date]

 

 

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Annex 3
to
General Security Agreement
Form of Short Form Trademark Security Agreement
Trademark Security Agreement, dated as of August  _____, 2008, by [Warnaco of
Canada Company or 4278941 Canada Inc.] (the “Grantor”) in favour of Bank of
America, N.A. (“BofA”), as collateral agent for the Secured Parties (as defined
in the Credit Agreement referred to below) (in such capacity, together with its
successors and assigns in such capacity, the “Collateral Agent”).
W i t n e s s e t h:
Whereas, pursuant to a Credit Agreement, dated as of August  _____, 2008 (as the
same may be amended, restated, supplemented or otherwise modified from time to
time, the “Credit Agreement”), among, inter alia, Warnaco of Canada Company (the
“Borrower”), the Lenders and Issuers party thereto, BofA, as administrative
agent and collateral agent for the Lenders and Issuers, the Lenders and the
Issuers have severally agreed to make extensions of credit to the Borrower upon
the terms and subject to the conditions set forth therein;
Now, therefore, in consideration of the premises and to induce the Lenders, the
Issuers, the Administrative Agent and the Collateral Agent to enter into the
Credit Agreement and to induce the Lenders and the Issuers to make their
respective extensions of credit to the Borrower thereunder, the Grantor hereby
agrees with the Collateral Agent as follows:
Section 1. Defined Terms
Unless otherwise defined herein, terms defined in the Credit Agreement or in the
Security Agreement and used herein have the meaning given to them in the Credit
Agreement or the Security Agreement.
Section 2. Grant of Security Interest in Trademark Collateral
The Grantor, as collateral security for the full, prompt and complete payment
and performance when due (whether at stated maturity, by acceleration or
otherwise) of the Secured Obligations of the Grantor, hereby mortgages, pledges
and hypothecates to the Collateral Agent for the benefit of the Secured Parties,
and grants to the Collateral Agent for the benefit of the Secured Parties a lien
on and security interest in, all of its right, title and interest in, to and
under the following Collateral of the Grantor (the “Trademark Collateral”):
1. all of its Trademarks, including, without limitation, those referred to on
Schedule I hereto;

 

 

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2. all renewals and extensions of the foregoing;
3. all goodwill of the business connected with the use of, and symbolized by,
each such Trademark; and
4. all Proceeds of any or all of the foregoing, including, without limitation,
all rights to income, royalties, proceeds and damages now or hereafter due
and/or payable under any Trademark and with respect thereto, including, without
limitation, all rights to sue and recover at law or in equity for any past,
present and future infringement, misappropriation, dilution, violation or other
impairment thereof.
Section 3. Security Agreement
The security interest granted pursuant to this Trademark Security Agreement is
granted in conjunction with the security interest granted to the Collateral
Agent pursuant to the Security Agreement and the Grantor hereby acknowledges and
affirms that the rights and remedies of the Collateral Agent with respect to the
security interest in the Trademark Collateral made and granted hereby are more
fully set forth in the Security Agreement, the terms and provisions of which are
incorporated by reference herein as if fully set forth herein.
[Signature Pages Follow]

 

 

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In witness whereof, the Grantor has caused this Trademark Security Agreement to
be executed and delivered by its duly authorized officer as of the date first
set forth above.

            Very truly yours,

[Grantor],
as Grantor
      By:           Name:           Title:        

          Accepted and Agreed
as of the date first above written:    
 
        Bank of America, N.A.,
as Collateral Agent for the Secured Parties    
 
       
By:
       
 
       
 
  Name:    
 
  Title:    

Signature Page to Trademark Security Agreement

 

 

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Acknowledgement of Grantor

             
State of                          
)          
 
)     ss.
County of                       
)          

On this  _____  day of  _____, 20_____  before me personally appeared  _____,
proved to me on the basis of satisfactory evidence to be the person who executed
the foregoing instrument on behalf of  _____, who being by me duly sworn did
depose and say that he is an authorized officer of said corporation, that the
said instrument was signed on behalf of said corporation as authorized by its
Board of Directors and that he acknowledged said instrument to be the free act
and deed of said corporation.

         
 
 
 
Notary Public    

Acknowledgement of Grantor for Trademark Security Agreement

 

 

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Schedule I
to
Trademark Security Agreement
Trademark Registrations

1.  
REGISTERED TRADEMARKS
     
[Include Trademark, Country, Owner, Registration Number and Date of
Registration]
  2.  
TRADEMARK APPLICATIONS
     
[Include Trademark, Country, Owner, Application Number and Date of Filing]