Exhibit 10.3
 AMENDED AND RESTATED FACTORING AND
FINANCING AGREEMENT
 The CIT Group/Commercial Services, Inc.
(as Lender)
 and
 Bernard Chaus, Inc.
Cynthia Steffe Acquisition, LLC
and
S.L. Danielle Acquisition, LLC
(as Borrowers)
 Dated: As of September 10, 2009
 
 *

    (Certain portions of this exhibit have been omitted based upon a request for confidential
treatment. Such portions have been filed separately with the Securities and Exchange Commission.)




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TABLE OF CONTENTS
 SECTION 1. Definitions
    
    
    2SECTION 2. Conditions Precedent
    
    
    14SECTION 3. Factoring
    
    
    16SECTION 4. Revolving Loans
    
    
    19SECTION 5. Letters of Credit
    
    
    23SECTION 6. Collateral
    
    
    26SECTION 7. Representations, Warranties and Covenants
    
    
    28SECTION 8. Interest, Fees and Expenses
    
    
    38SECTION 9. Powers
    
    
    42SECTION 10. Events of Default and Remedies
    
    
    43SECTION 11. Termination
    
    
    46SECTION 12. Miscellaneous
    
    
    47SECTION 13. INTENTIONALLY OMITTED
    
    
    49SECTION 14. Borrowing Agent
    
    
    49
 EXHIBITSExhibit A
    
    Borrowing Base CertificateSCHEDULESSchedule 1
    
    Collateral InformationSchedule 2(j)(b)
    
    Trade NamesSchedule 2(j)(c)
    
    Monthly Lease PaymentsSchedule 2(j)(d)
    
    Permitted LiensSchedule 2(k)
    
    Outstanding Closing Documents
 i




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THE CIT GROUP/COMMERCIAL SERVICES, INC. nd BERNARD CHAUS, INC. S.L. DANIELLE
ACQUISITION, LLC CYNTHIA STEFFE
ACQUISITION, LLC
       AMENDMENT AND RESTATEMENT
 Financing Agreement provided however




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SECTION 1. Definitions.
 Accounts
 Accounts Receivable
 A&R Financing Agreement
 Anniversary Date
 Anti-Terrorism Laws
 Applicable Margin
 Availability plus
 Availability Reserve
 2




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provided however
 Base Rate
 Base Rate Loans
 Blocked Person
 Borrowing Agent
 Borrowing Base less
 Borrowing Base Certificate
 Business Day
 3




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Capital Expenditures
 Capital Lease
 CIT Event
 CITs System
 Client Position Account
 Client Risk Accounts
 Closing Date
 Collateral
 Consolidated Balance Sheet
 Contract Year
 Copyrights
 Credit Risk
 Customer Claims
 Default
 Default Rate of Interest
 4




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Depository Accounts
 Documents of Title
 Early Termination Date
 Early Termination Fee provided however
 EBITDA
 Eligible Accounts
 plus
  5




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provided plus
 plus
  Equipment
 ERISA
 Event(s) of Default
 Factor Risk Accounts
 Fiscal Quarter
 6




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Fiscal Year
 Funds In Use Account
 GAAP
 General Intangibles
 Goods
 Guaranties
 Guarantors
 Guide
 Indebtedness
 Insurance Proceeds
 7




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Interest Expense
 Inventory
 Investment Property
 Issuer
 Ledger Debt
 Letters of Credit
 Letter of Credit Guaranty
 Letter of Credit Guaranty Fee
 Letter of Credit Sub-Line
 Leverage Ratio
 Loan Documents
 Loan Facility Fee
 8




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Minimum Factoring Fees
 Obligations
 Operating Leases
 Original Closing Date
 Other Collateral
 Out-of-Pocket Expenses
 9




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Patents
 Period
 Permitted Acquisition
 10




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Permitted Encumbrances
 Permitted Indebtedness
 11




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Permitted Investments
 Person
 Purchase Money Liens (a) (b)
 Purchase Price
 Real Estate
 Reports
 Returned Goods
 Revolving Credit Commitment
 Revolving Credit Limit
 12




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Revolving Line of Credit
 Revolving Line of Credit Fee (a) (b)
 Revolving Loans
 Subordinated Debt
 Subsidiaries
 Tangible Net Worth minus
 Taxes
 Total Assets
 Total Liabilities
 Trade Accounts Receivable
 Trademarks
 13




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UCC
 Waiver
 Working Day
 SECTION 2. Conditions Precedent.
  Financing Agreement and Other Loan Documents .
 Officers Certificate
 Absence of Default
 Legal Restraints/Litigation
 14




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Examination & Verification; Net Availability; Projections .
 Compliance with Laws
 Guaranties
 Collateral Assignment of Licenses .
 Additional Documents
 Schedules
 Outstanding Documents
 .
 Conditions to Each Extension of Credit
 15




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Representations and Warranties
 No Default
 Borrowing Base
  SECTION 3. Factoring
 Sale of Accounts
 Credit Approval
   16




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Purchase of Accounts
      17




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Chargeback
   The Client Service Guide
  18




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SECTION 4. Revolving Loans
    19




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20




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provided
   21




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22




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Access to CITs System
   SECTION 5. Letters of Credit
  23




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provided however
    24




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25




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SECTION 6. Collateral
        26




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27




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SECTION 7. Representations, Warranties and Covenants
  28




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29




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30




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31




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32




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th provided, however,
    33




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34




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Fiscal Quarter
    
    Tangible Net WorthSeptember 30, 2009
    
    $
    2,025,000December 31, 2009
    
    $
    752,000March 31, 2010
    
    $
    3,514,000June 30, 2010
    
    $
    4,200,000September 30, 2010
    
    $
    4,450,000December 31, 2010
    
    $
    4,700,000March 31, 2011
    
    $
    4,950,000June 30, 2011
    
    $
    5,200,000September 30, 2011 and the last day of each Fiscal Quarter ended thereafter
    
    $
    5,450,000
  Fiscal Quarter
    
    EBITDA3 months ending September 30, 2009
    
    $
    (625,000
    )6 months ending December 31, 2009
    
    $
    (1,786,000
    )9 months ending March 31, 2010
    
    $
    2,068,00012 months ending June 30, 2010
    
    $
    3,198,0003 months ending September 30, 2010 and for the 3 months ending on each September
30 thereafter
    
    $
    500,0006 months ending December 31, 2010 and for the 6 months ending each December 31
thereafter
    
    $
    1,000,0009 months ending March 31, 2011 and for the 9 months ending each March 31 thereafter
    
    $
    1,500,00012 months ending June 30, 2011 and for the 12 months ending each June 30 thereafter
    
    $
    2,000,000
 35




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Fiscal Quarter
    
    RatioSeptember 30, 2009
    
    
    11.40 to 1.0December 31, 2009
    
    
    25.20 to 1.0March 31, 2010
    
    
    7.80 to 1.0June 30, 2010
    
    
    3.75 to 1.0September 30, 2010
    
    
    6.00 to 1.0December 31, 2010
    
    
    6.00 to 1.0March 31, 2011
    
    
    6.00 to 1.0June 30, 2011
    
    
    6.00 to 1.0September 30, 2011 and the last day of each Fiscal Quarter ended thereafter
    
    
    6.00 to 1.0
      36




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37




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Section 7.16
  Schedule 7.18 provided however
 SECTION 8. Interest, Fees and Expenses
  38




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Factoring Fees and Other Charges.
 1 4
   39




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40




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41




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SECTION 9. Powers
    42




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SECTION 10. Events of Default and Remedies
     43




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44




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45




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SECTION 11. Termination
 provided however
 46




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SECTION 12. Miscellaneous
     THE COMPANIES, THE LENDER EACH HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION
OR PROCEEDING ARISING OUT OF THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREUNDER. THE
COMPANY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND CONSENTS TO SERVICE OF PROCESS BY
CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED. IN NO EVENT WILL THE LENDER BE LIABLE FOR
LOST PROFITS OR OTHER SPECIAL OR CONSEQUENTIAL DAMAGES.
 47




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(A)
    
    if to CIT, at:
The CIT Group/Commercial Services, Inc.
11 West 42nd Street
New York, New York 10036
Attn:   Regional Credit Manager
Fax:   212-461-5347(B)
    
    if to the Companies at:
Bernard Chaus, Inc.
530 Seventh Avenue

New York, New York 10018
Attn:   Barton Heminover
Fax:   212-869-4646With a courtesy copy of any material notice to the Companies counsel at:Dechert LLP
1095 Avenue of the Americas
New York, New York 10036-6797
Attn:   Martin Nussbaum
Fax:   1-212-698-3599
  THE VALIDITY, INTERPRETATION AND ENFORCEMENT OF THIS FINANCING AGREEMENT AND THE OTHER
LOAN DOCUMENTS SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE EXTENT THAT
ANY OTHER LOAN DOCUMENT INCLUDES AN EXPRESS ELECTION TO BE GOVERNED BY THE LAWS OF ANOTHER
JURISDICTION.
 48




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SECTION 13. INTENTIONALLY OMITTED
 SECTION 14. Borrowing Agent .
    49




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50




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IN WITNESS WHEREOF,
 THE CIT GROUP/COMMERCIAL SERVICES, INC., as Lender
and AgentBy:
    
    /s/ Kevin J. WinschName: Kevin J. WinschTitle:   Sr. Vice PresidentBERNARD CHAUS, INC.By:
    
    /s/ Barton HeminoverName: Barton HeminoverTitle:   CFOCYNTHIA STEFFE ACQUISITION, LLCBy:
    
    /s/ Barton HeminoverName: Barton HeminoverTitle:   CFOS.L. DANIELLE ACQUISITION, LLCBy:
    

/s/ Barton HeminoverName: Barton HeminoverTitle:   CFO




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EXHIBIT A
 BORROWING BASE CERTIFICATE
 Bernard Chaus, Inc.Borrowing BaseAs of September 10, 2009($000)Accts. Receivable Balance
    
    
    18,637Ineligibles
    
    
    777Eligible Accts. Receivable Balance
    
    
    17,860Accts. Receivable Availability
    
    
    15,002Loan Balance
    
    
    12,852F/G L/C Balance
    
    
    641Guarantees
    
    
    130Standby L/Cs
    
    
    467Total Debt
    
    
    14,090Net Availability
    
    
    912




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Schedule 1
 Collateral Information
 Exact Companies Name in State of Organization:Bernard Chaus, Inc.Cynthia Steffe Acquisition, LLCS.L. Danielle Acquisition, LLCState of Incorporation or Formation:Bernard Chaus, Inc.
    
    New YorkCynthia Steffe Acquisition, LLC
    
    New YorkS.L. Danielle Acquisition, LLC
    
    New YorkFederal Tax I.D. No.:Bernard Chaus, Inc.
    
    13-2807386Cynthia Steffe Acquisition, LLC
    
    Not availableS.L. Danielle Acquisition, LLC
    
    Not availableChief Executive Office:Bernard Chaus, Inc.
    
    530 Seventh Avenue
New York, New York 10018Cynthia Steffe Acquisition, LLC
    
    530 Seventh Avenue
 Schedule 1 - 1




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New York, New York 10018S.L. Danielle Acquisition, LLC
    
    530 Seventh Avenue
New York, New York 10018
 Collateral Locations:
  
 
  
 
 Schedule 1 - 2




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Schedule 2(j)(b)
 Trade Names
 
 Schedule 2(j)(b) - 1




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Schedule 2(j)(c)
 Monthly Lease Payments
 Location
    
    Address
    
    Monthly Rental PaymentAdministrative, Finance,
Computer Operations and
Personnel Offices
    
    800 Secaucus Road
Secaucus, NJ 07904
    
    $
    14,000Cynthia Steffe Acquisition, LLC Location
    
    550 Seventh Avenue
New York, New York 10018
    
    $
    25,339.17Chief Executive Office
    
    530 Seventh Avenue
New York, New York 10018
    
    $
    122,184
 Schedule 2(j)(c) - 1




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Schedule 2(j)(d)
 Permitted Liens
  Schedule 2(j)(d) - 1




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1.
    
    Borrowers shall deliver to Lender executed Landlord Waivers with (i) G&S Realty, 1,
Inc. for the property located at 530 Seventh Avenue, New York, NY and (ii) Alder Group for
the property located at 550 Seventh Avenue, New York, NY, each in form and substance
reasonably satisfactory to Lender.2.
    
    Borrowers shall deliver to Lender executed Warehouse Notification Letters with (i) PSDI
for the property located at 14141 Alondra Blvd., Santa Fe Springs, CA 90670 and (ii) IDS
Impac for the property located at 800 Secaucus Rd, Secaucus, NJ 0709461, each in form and
substance reasonably satisfactory to Lender.3.
    
    Borrowers shall deliver to Lender (i) a Loss Payable Endorsement to insurance policy
number 3587-3105 issued by Federal Insurance Company and (ii) an Additional Insured
Endorsement to insurance policy number 719011317 issued by One Beason Insurance Co., each
in form and substance reasonably satisfactory to Lender.
 Schedule 2(k) - 1