Exhibit 10.19TRADE FINANCE AND SECURITY AGREEMENT     THIS TRADE FINANCE AND SECURITY AGREEMENT is made and entered into as of the 18 day ofNovember 2004 between The Fashion House, Inc., a Delaware corporation having its principal placeof business at 6310 San Vicente Blvd. Suite 330, Los Angeles, CA 90048-5499 (“TFH”), and ITOCHUInternational Inc., a New York corporation having its principal place of business at 335 MadisonAvenue, New York, NY 10017 (“ITOCHU”)WITNESSETH.     WHEREAS, TFH sells and markets footwear;     WHEREAS, TFH has requested of ITOCHU trade financing in connection with themanufacture, distribution and sale of Merchandise to Retailers (as hereinafter defined)and ITOCHU is willing to extend such trade financing upon the terms set forth herein.     NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of *which are*hereby acknowledged, the mutual covenants set forth herein and the trade finance to beextended, the TFH and ITOCHU hereby agree as follows:ARTICLEDEFINITIONS     As used in this Trade Finance and Security Agreement, the following terms shall have thefollowing meanings, unless the context otherwise requires:     1.1 “Agreement” shall mean this Trade Finance and Security Agreement, as the same may fromtime to time be amended or supplemented.     1.2 “Business Day” shall mean a day other than a Saturday, Sunday, legal holiday or day onwhich commercial banks are authorized to be closed under the laws of the State of Maryland or theState of New York.
 

 
     1.3“Collateral” shall have the meaning set forth in Article 3 hereof.     1.4 “Default” shall mean the occurrence of any of the events specified in Section 7.1hereof, w7.1 hereof, whether or not any requirement for notice or lapse of time or other conditionprecedent has been satisfied.     1.5 “Event of Default” shall mean the occurrence of any of the events specified in Section 6.1hereof, provided that any requirement for notice or lapse of time or any other condition precedenthas been satisfied.     1,6 “Excepted Liens” shall mean: (i) Liens (as hereinafter defined) for taxes, assessments orother governmental charges or levies not yet *due or which are being*contested in good faith byappropriate action, and (ii) Liens in connection with workmen‘s compensation,unemployment insurance or other social security, pension or public liability obligations.     1.7 “Financial Statements” shall mean the financial statement or statements of TFH describedor referred to in Section 4.6 hereof.     1.8 “Governmental Requirement” shall mean any law, statute, code, ordinance, order, rule,regulation, judgment, decree, injunction, franchise, permit, certificate, license, authorizationor other direction or requirement (including, without limitation, any of the foregoing whichrelate to environmental standards or controls, energy regulations and occupational, safety andhealth standards or controls) of any (domestic or foreign) federal, state, county, municipal orother government, department, commission, board, court, agency or any other instrumentality of anyof them, which exercises jurisdiction over TFH or any of its Property.     1.9 “Indebtedness” shall mean any and all amounts owing or to be owing by TFH to ITOCHU inconnection with this Agreement or any Security Instrument.     1.10 “Invoice Amount” shall mean the landed duty price (including, without limitation, the price for Merchandise charged by the manufacturer, freight, duty and insurance), plus FourPercent (4%) for Merchandise paid for, imported and delivered by ITOCHU to TFH, in accordance withthe provisions of Article 2 of this Agreement.     1.11 “Lien” shall mean any interest in Property securing an obligation owed to, or a claimby, a Person (as hereinafter defined) other than the owner of the Property, whether such interestis based on the common law, statute or contract, and including but not limited to the lien orsecurity interest arising from a mortgage, encumbrance, pledge, security agreement, conditionalsale or trust receipt or a lease, consignment or bailment for security purposes. The term “Lien”shall include reservations, exceptions, encroachments, easements, rights of way, covenants,conditions, restrictions, leases and other title exceptions and encumbrances affecting Property.For the purposes of’ this Agreement, TFH shall be deemed to be the owner of any Property which ithas acquired or holds subject to a conditional sale agreement, financing lease or otherarrangement pursuant to which title to the Property has been retained by or vested in some otherPerson for security purposes.     1.12 “Material Adverse Effect” shall mean any material and adverse effect on (i)
 

 
the assets, liabilities, financial condition, business, operations, affairs or circumstancesof TFH from those reflected in the Financial Statements or from the facts represented or warrantedin this Agreement or any Security Instrument, or (ii) the ability of TFH to carry out its business as at,or as proposed at, the date of this Agreement to be conducted or meet its obligations under, thisAgreement or the Security Instruments on a timely basis.     1.13 “Merchandise” shall mean all                                                                                      1.14 “Person” shall mean any individual, corporation, partnership, joint venture, association,joint stock company, trust, unincorporated organization, government or any agency or politicalsubdivision thereof, or any other form of entity.     1.15 “Prime Rate” shall mean the rate of interest announced by [Citibank, N.A.] in New York,New York from time to time as its prime rate.     1.16 “Property “ shall mean any interest in any kind of property or asset, whether real,personal or mixed, or tangible or intangible.     1.17 “Retailers” shall mean all purchasers of Merchandise from TFH.     1.18 “Security Instruments” shall mean the agreements or instruments described or referred toin Section 3.4 hereof and any and all other agreements or instruments now or hereafter executedand delivered by TFH or any other Person (other than participation or similar agreements betweenITOCHU and any other bank or creditor with respect to any Indebtedness pursuant to this Agreement)in connection with, or as security for the payment or performance of this Agreement, as suchagreements may be amended or supplemented from time to time.     1.19 “Trade Finance” shall mean the amount paid by ITOCHU, for the benefit of TFH, for theproduction, import and delivery of Merchandise to TFH, and all costs and expenses incurred inconnection therewith.     1.20 Where the character or amount of any asset or liability or item of income or expense isrequired to be determined or any consolidation or other accounting computation is required to bemade for the purposes of this Agreement, this shall be done in accordance with generally acceptedaccounting principles applied on a basis consistent with those reflected by the FinancialStatements, except where such principles are inconsistent with the requirements of this Agreement.
 

 
ARTICLE 2AMOUNT AND TERMS TRADE FINANCE LOAN     2.1 Terms of Trade Finance. Subject to the terns and conditions and relying upon therepresentations and warranties set forth in this Agreement, ITOCHU agrees to provide TradeFinance to TFH as follows:          2.1.1 TFH shall send a written notice to lTOCHU setting forth therein (a) the name andaddress of the manufacturer; (b) the articles of Merchandise to be manufactured; (c) the amountof the manufacturer’s invoice; (d) the date of shipment by the manufacturer; and (e) such otherinformation requested by ITOCHU in connection with the Trade Finance. In addition, together withthe request for Trade Finance, TFH shall send to ITOCHU information with respect to such requestdetailing TFH’s (w) sales forecast for the Merchandise; (x) analysis of orders received; (y)analysis of markups; and (z) profit and. loss forecast. TFH shall not seek Trade Finance or loansfrom other Persons until ITOCHU has exercised its discretion in accordance with the provisions ofParagraph 2.1.2.          2.1.2 ITOCHU may, in its sole and absolute discretion, accept or reject TFH request for TradeFinance. In the event that ITOCHU chooses not to extend Trade Finance with respect to a particularrequest, TFH shall be permitted to seek financing from other Persons.          2.1.3 In the event that ITOCHU accepts TFH’s request for Trade Finance, ITOCHU shall open aletter or letters of credit in favor of the manufacturer set forth in the request of TFH, andotherwise in accordance with the information provided in such request. ITOCHU shall pay themanufacturer for all merchandise covered by the particular request, shall import all suchmerchandise and shall deliver such merchandise as instructed by TFH.          2.1.4 With respect to all merchandise delivered to TFH in accordance with the immediatelypreceding paragraph, ITOCHU shall deliver an invoice to TFH in the invoice amount. Such invoiceshall be due and payable within thirty (30) days from the date of invoice, without setoff,deduction or allowance, upon the same payment due terms as those pertaining to ITOCHU’s purchase ofthe particular merchandise from the manufacturer of such Merchandise. Invoices not paid, andinvoice amounts not received on the due date thereof shall accrue interest at the rate of theLIBOR, plus three and one half percent (3.5%)          2.1.5 If the date for the payment of any amount due ITOCHU falls on a day which is not aBusiness Day, then for all purposes of this Agreement, the same shall be deemed to have fallen onthe next following Business Day, and such extension of time shall in such case cause interest toaccrue on such amount.          2.1.6 At no time shall the amount of Trade Finance outstanding and unpaid by TFH to ITOCHUexceed the credit line, if any, set by Itochu in its sole discretion, at the time.
 

 
ARTICLESECURITY INTEREST     3.1 Grant of Security Interest. In consideration of the extension of TradeCredit described in Section 2.1 by ITOCHU to TFH and in order to secure the prompt and completeperformance and payment to ITOCHU as well as all costs and expenses incurred by ITOCHU incollection and enforcement of all Indebtedness of TFH to ITOCHU now existing or hereafterincurred, whether matured or unmatured, direct or contingent, and any. renewals and extensionsthereof and substitutions therefor, TFH hereby assigns and pledges to ITOCHU and grants toITOCHU a continuing security interest in and lien on the Collateral described in Section 3.2hereof:     3.2 Collateral. The collateral to be subject to the security interest grantedhereunder consist of all of TFH’s right, title and interest, whether now existing or hereafterarising, including, all property acquired subsequent to the date hereof, in and of to thefollowing:3.2.1 Equipment. All equipment in all of its forms used or employed in connectionwith TFH’s business or by TFH’s shareholders, employees or officers, wherever located, nowor hereafter existing, including, but not limited to, all goods, machinery, furnishings,fixtures, appliances, leasehold improvements, chattels and motor vehicles, together withall increases, parts, fittings, accessories, special tools and accessions now or hereafterattached thereto or used in connection therewith, and any and all replacements of orsubstitutions for all or any part. 3.2.2 Inventory. All inventory in all of its forms, wherever located, nowor hereafter existing, now or hereafter owned, including, but not limited to, (1) allraw materials and work in process therefor, finished goods thereof, and materials usedor consumed in the manufacture or production thereof (ii) goods in which TFH has aninterest in mass or a joint or other interest or right as consignee, (iii) goods whichare returned to or repossessed by TFH, and (iv) all other tangible personal propertynow owned or hereafter acquired and held for sale or lease or furnished or to befurnished under contracts of service or used or consumed in TFH’s business or by TFH’sshareholders, employees or officers, and (v) all additions and accessions thereto andsubstitutions therefor and products thereof and documents therefor;  3.2.3 Receivables and Related Contracts. All negotiable and non-negotiabledocuments now or at any time hereafter obtained or acquired by TFH and all accounts,accounts receivable, contract
 

 
   rights, notes, drafts, acceptances, chattel paper, instruments, generalintangibles, including any and all federal or state income tax refunds now orany time hereafter payable or paid to TFH and other obligations of any kind, now orhereafter existing, whether or not arising out of or in connection with the sale orlease of goods or the rendering of services, and all rights now or hereafterexisting in and to all security agreements, leases, and other contracts securing orotherwise relating to any such accounts, contract rights, notes, drafts andacceptances, chattel paper, instruments, general intangibles or obligations; and 3.2.4 Products. All proceeds of any and all of the foregoing Collateralincluding, without limitation, proceeds which constitute property of the typesdescribed in subsections 3.2.1, 3.2.2, and 3.2.3 of this Section 3.2 and, to theextent not otherwise included, all payments under insurance (whether or not ITOCHU isthe loss payee thereof), or any indemnity, warranty or guaranty, payable by reason ofloss or damage to or otherwise with respect to any of the foregoing Collateral. Theinclusion of proceeds in this Agreement does not authorize TFH to sell, dispose of orotherwise use the Collateral in any matter specifically not authorized hereby.     3.3 Insufficiency of Collateral. If, in the judgment of ITOCHU, the Collateral at anytime during which any Indebtedness hereunder is outstanding materially decreases in value, otherthan temporarily in the normal course of business and other than decreases in the value ofequipment which occur in the normal course of business, or if ITOCHU at any time reasonably deemsitself insecure, TFH shall either provide additional Collateral of like nature sufficient tosatisfy ITOCHU or reduce the amount of the total Indebtedness by an amount sufficient to satisfyITOCHU. In either such event, ITOCHU shall give TFH notice in writing of any deficiency in theCollateral, and TFH shall, within thirty (30) days of receipt of said notice, provide theadditional Collateral requested or reduce the amount of its Indebtedness to ITOCHU as specified inthe notice. TFH’s failure to comply with the requirements of any such notice shall constitute anEvent of Default.     3.4 Further Assurances Regarding Collateral — Documents. At the request of ITOCHU, TFHshall join in executing or shall execute, as appropriate, all financing statements and otherdocuments, in a form, satisfactory to ITOCHU, necessary to perfect ITOCHU’s security interesthereunder. TFH shall pay the costs of filing such statements and documents. TFH further irrevocablyauthorizes ITOCHU to conduct such searches of public filings as ITOCHU deems necessary or desirableand agrees to execute any and all documents and to cooperate with ITOCHU in respect of suchsearches and in the preparation of any required notices, statements and other documents relatingthereto. TFH warrants that no financing statement covering Collateral or any part or any proceedsthereof having priority over ITOCHU’s security interest created hereunder is presently on file inany public office.     3.5 Further Assurances Regarding Collateral. — EnforcingTFH’sRights. Unless otherwise directed by ITOCHU, TFH will (i) collect and enforce payment of allaccounts receivable, and (ii) enforce all rights by way of suretyship or guarantee which TFH nowhas or may hereafter require to enforce payment of accounts receivable and all rights in the natureof security interest whereby TFH may satisfy any account receivable out of Property.
 

 
     3.6 Further Assurances Regarding Collateral — Insurance. TFH shall at all times insureCollateral with insurers reasonably acceptable to ITOCHU against such casualties and in suchamounts as ITOCHU shall require. Such insurance shall be for the benefit of TFH and ITOCHU as theirinterests may appear. TFH will obtain endorsements to the policies pertaining to the Collateralnaming ITOCHU as additional loss payee as its interest may appear and containing provisions thatsuch policies will not be cancelled without thirty (30) days prior written notice having been givenby the insurance company to ITOCHU.     3.7 Further Assurances Regarding Collateral — Payment ofTaxes andAssessments. TFH shall promptly pay when due all taxes and assessments on Collateral or for itsuse and operation and shall not permit the assessment against it or the Collateral of any Liens orencumbrances as a result of its failure to timely pay same.     3.8 Further Assurances Regarding Collateral — Maintenance of Collateral. TFH shallkeep the Collateral in good order and repair and shall not waste or destroy it or any part thereof.TFH shall not use the Collateral in violation of any statute, regulation or ordinance.ARTICLE 4REPRESENTATIONS AND WARRANTIES     In order to induce ITOCHU to enter *into this Agreement*and to extend the Trade Financedescribed herein, *TFH hereby*represents and warrants to ITOCHU (which representations andwarranties will survive the execution of this Agreement and the extension of Trade Credithereunder) that:     4.1 Corporate Existence. TFH is a corporation duly organized, legally existingand in good standing under the laws of the State of Delaware and is duly qualified as a *foreign*corporation in all jurisdictions wherein the Property owned or the business transacted by it makessuch qualification necessary.     4.2 Corporate Power and Authorization. TFH is duly authorized *and empowered to*execute, deliver and perform this Agreement and the Security Instruments and all corporate actionon TFH’s part requisite for the execution, delivery and performance of this Agreement and theSecurity Instruments has been duly and effectively taken.     4.3 Binding Obligations. This Agreement does, and the SecurityInstruments upon their creation, issuance, execution and delivery will, constitute validand binding obligations of TFH, enforceable in accordance with their terms (except that enforcementmay be subject to any applicable bankruptcy, insolvency or similar laws affecting the enforcementof creditors’ rights generally).     4.4 No Legal Bar or _Resultant Lien. This Agreement and the Security Instruments donot and will not violate any provisions of the articles or certificate of incorporation or by-lawsof TFH, or any contract, agreement, instrument, or Governmental Requirement to .whichTFH is subject, or result in the creation or imposition of any Lien upon any Property of TFH, otherthan those permitted by this Agreement,     4.5 No Consent. TFH’s execution, delivery and performance of this Agreement and
 

 
the Security Instruments do not require the consent or approval of any other Personincluding, without limitation, any regulatory authority or governmental body of the United Statesof America or any state thereof or any political subdivision of the United States of America orany state thereof.     4.6 Financial Condition. The unaudited pro forma balance sheet of TFH as of                    , which has been delivered to ITOCHU, has been prepared in accordance with generally accepted accounting principles, consistently applied, and fully andaccurately presents the financial condition of TFH as at the date and for the period stated. Nochange, either in any case or in the aggregate, has since occurred in the condition, financial orotherwise, of the TFH which would have a Material Adverse Effect.     4.7 Liabilities: Litigation. Except for liabilities incurred in the normal course ofbusiness, TFH has no material (individually or in the aggregate) liabilities, direct orcontingent, except as disclosed or referred to in the Financial Statements. At the date of thisAgreement there is no litigation, legal, administrative or arbitral proceeding, investigation orother action of any nature pending or, to the knowledge of TFH, threatened against or affectingTFH which involves the possibility of any judgment or liability not fully covered byinsurance,and which would have a Material Adverse Effect. No unusual or undulyburdensome restriction or restraint exists by contract, law or governmental regulation orotherwise relative to the business or Property of TFH, which, if enforced against TFH, wouldprevent TFH from conducting its business as now conducted or have a Material Adverse Effect.     4.8 Taxes: Governmental Charges. TFH has filed all tax returns and reports requiredto be filed and has paid all taxes, assessments, fees and other governmental charges levied uponit or upon any of its Property or income which are due and payable, including interest andpenalties, or has provided adequate reserves for the payment thereof     4.9 Titles, etc. TFH has good title to its material (individually or in theaggregate) Property, free and clear of all Liens except (i) Liens referred to in the FinancialStatements, (ii) Excepted Liens and minor irregularities in title which do not materiallyinterfere with the occupation, use and enjoyment by TFH of any of its Property in the normalcourse of business as presently conducted or materially impair the value thereof for such business, or (iii) Liensotherwise permitted or contemplated by this Agreement or the Security Instruments.     4.10 Defaults. TFH is not in default, nor has any event or circumstance occurredwhich, but for the passage of time or the giving of notice, or both, would constitute a defaultunder any loan or credit agreement, the License Agreement, indenture, mortgage, deed of trust,security agreement or other agreement or instrument evidencing or pertaining to any indebtedness orobligation of TFH, or under any material agreement or other instrument to which TFH is a party orby which TFH is bound.     4.11 Compliance with the Law. TFH:          (a) is not in violation of any Governmental Requirement; and          (b) has not failed to obtain any license, *permit,*franchise or other *governmental*authorization necessary to the ownership of any of its Property or the conduct
 

 
of its business in the usual course which violation or failure would have (in the event suchviolation or failure were asserted by any Person through appropriate action) a Material AdverseEffect     4.13 No Material Misstatements. No information, exhibit or report requested by ITOCHUand furnished to ITOCHU by TFH in connection with the negotiation of this Agreement contains anymaterial misstatement of fact or, to the knowledge of *any officer of*TFH, omits to state amaterial fact necessary to make the statement contained therein not materially misleading.     4.14 Subsidiaries. TFH has no Subsidiaries.     4.15 Location of Business and Offices. TFH’s principal place *of*business and chiefexecutive offices are located at the address stated in the caption of this Agreement.ARTICLEAFFIRMATIVE COVENANTS     TFH will at all times comply with the covenants contained in this Article 5, from the datehereof and for so long as any part of the Indebtedness is outstanding.     5.1 Financial Statements and Reports. TFH will promptly furnish to ITOCHU from timeto time upon request such information regarding the business and affairs and financial conditionof TFH as ITOCHU may reasonably request, including (without limitation), Annual Reports, QuarterlyReports, Monthly Reports, Audit Reports and Tax Returns,     5.2 Taxes and Other Liens. In addition to its obligations under Sections 3.7 and 3.8 hereof,TFH will pay and discharge promptly all taxes, assessments and governmental charges or leviesimposed upon it or upon the income or any Property of TFH as well as all claims of any kind(including claims for labor, materials, supplies and rent) which, if unpaid, might become a Lienupon any or all of the Property of TFH; provided, however, that TFH shall not be required to payany such tax, assessment, charge, levy or claim if the amount, applicability or validity thereofshall currently be contested in good faith by appropriate proceedings diligently conducted by oron behalf of TFH, and if TFH shall have set up reserves therefor adequate under generally acceptedaccounting principles.     5.3 Maintenance. TFH will (i) maintain its corporate existence, *rights and*franchises; (ii) observe and comply with all Governmental Requirements; and (iii) maintain itsProperties (and any Properties leased by or consigned to it or held under title retention orconditional sales contracts) in good and workable condition at all times and make all repairs,replacements, additions, betterments and improvements to its Property as are needful and proper sothat the business carried on in connection therewith may be conducted properly and efficiently atall times.
 

 
     5.4 Further Assurances. TFH will cure promptly any defects in the creation and theexecution and delivery of this Agreement and the Security Instruments. TFH at its expense willpromptly execute and deliver to ITOCHU upon request all such other and further documents,agreements and instruments in compliance with or accomplishment of the covenants and agreements ofTFH in this Agreement and the Security Instruments or to further evidence and more fully describethe Collateral intended as security, or to correct any omissions in the Security Instruments, ormore fully to state the security obligations set out herein or in any of the Security Instruments,or to perfect, protect or preserve any Liens created pursuant to any of the Security Instruments,or to make any recordings, to file any notices, or obtain any consents, all as may be necessary orappropriate in. connection therewith.     5.5 Reimbursement of Expenses. In addition to its obligations under Sections 3.4 and3.7 hereof, TFH will pay all fees, charges or taxes for the recording or filing of SecurityInstruments. TFH will also pay all out-of-pocket expenses of ITOCHU in connection with theadministration of this Agreement and the Security Instruments. TFH will, upon request, promptlyreimburse ITOCHU for all amounts expended, advanced or incurred by ITOCHU to satisfy anyobligation of TPH under this Agreement or any other Security Instrument, or to enforce the rightsof ITOCHU under this Agreement or any other Security Instrument, which amounts will include allcourt costs, attorneys’ fees (including, without limitation, for trial, appeal or otherproceedings), fees of auditors and accountants, and investigation expenses reasonably incurred byITOCHU in connection with any such matters, together with interest at the Prime Rate plus 2% oneach such amount from the date of written demand or request by 1TOCHU for reimbursement until thedate of reimbursement to ITOCHU.     5.6 Insurance. In addition to its obligations under Section 3.6 hereof, TFHwill maintain and continue to maintain with financially sound and reputable insurers, insurancewith respect to its Property and business against such liabilities, casualties, risks andcontingencies and in such types and amounts as is customary in the case of Persons engaged in thesame or similar business and similarly situated. Upon request of ITOCHU, TFH will furnish or causeto be furnished to ITOCHU from time to time a summary of the insurance coverage of TFH in form andsubstance satisfactory to ITOCHU and, if requested, will furnish ITOCHU copies of the applicablepolicies. In the case of any fire, accident or other casualty causing loss or damage to anyProperty of TFH, the proceeds of such policies shall be used (i) to repair or replace the damagedProperty, or (ii) to prepay the Indebtedness.     5.7 Accounts and Records. TFH will keep books of record and account in which full,true and correct entries will be made of all dealings or transactions in relation to its businessand activities, in accordance with generally accepted accounting principles, consistently appliedexcept only for changes in accounting principles or practices with which TFH’s independent publicaccountants concur.     5.8 Right of Inspection. TFH will permit any officer, employee or agent of ITOCHU tovisit and inspect any of the Property of TFH, examine TFH’s books of record and accounts, takecopies and extracts therefrom, and discuss the affairs, finances and accounts of TFH with TM’sofficers, accountants and auditors, all at such reasonable times and as often as ITOCHU maydesire.     5.9 Notice of Certain Events; TFH shall promptly notify ITOCHU if TFHlearns of the occurrence of (i) any event which constitutes a Default, together with a detailedstatement by a responsible officer of TFH of the steps being taken to cure the effect of suchDefault; or (ii) any legal, judicial or regulatory proceedings affecting TFH or any of theProperty of TFH in which the
 

 
amount involved is material and is not covered by insurance or which, if adverselydetermined, would have a Material Adverse Effect; or (iii) any dispute between TFH and anygovernmental or regulatory body or any other Person which, if adversely determined, would have aMaterial Adverse Effect; or (iv) any event or condition having a Material Adverse Effect includingany material default by TFH under any contract with or obligation to a Person and any amendment toany such contract.     5.10 Location of Collateral. TFH shall keep and maintain the Collateral (other *than*vehicles) at the locations set forth in Exhibit A, unless ten (10) or more Business Days prior tomoving any Collateral to another location or locations, TFH notifies ITOCHU of such movement andspecifies the location or locations (to include address and county). The principal place ofbusiness and chief executive offices of TFH and the office where TFH keeps its records concerningthe Collateral is set forth in the caption hereof.     5.11 Delivery of Original, Executed Documents. TFH shall promptly execute and deliverto ITOCHU original forms of Uniform Commercial Code Financing statements for Ming by ITOCHU in alljurisdictions deemed appropriate by ITOCHU.     5.12 Indemnification. The parties hereto acknowledge and agree that TFH shall have theexclusive obligation for the content and quality of the Merchandise manufactured and, consequently,TFH shall indemnify ITOCHU, hold ITOCHU harmless and defend ITOCHU from and against any loss to orclaim asserted against ITOCHU arising from any cause whatsoever, including, but not limited toclaims of defects in or quality or content of Merchandise, any and all claims by Retailers,manufacturers or Customs officials or non-payment or cancellation of orders by Retailers. ITOCHUDISCLAIMS ANY AND ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WARRANTIES RELATING TO WORKMANSHIP,MERCHANTIBILI TY OR FITNESS FOR A PARTICULAR PURPOSE.     5.13 License Agreement. Throughout the term of this Agreement or so long as any Indebtedness owedby TFH to ITOCHU shawl be and remain outstanding, TFH shall perform or omit to perform any actwhich would cause TFH to be in default under the License Agreement or cause the License Agreementto be terminated.ARTICLEEVENTS OF DEFAULT     6.1 Events. Any of the following events shall be considered an “Event of Default” asthat term is used herein:          (a) Payments — default is made in the payment or prepayment when due of any Indebtedness orinterest thereon, and such default continues unremedied for a period of ten. (10) days; orRepresentations and Warranties — any representation or warranty by TFH or other Person(including any officer or accountant thereof) herein or in any Security Instrument, or in anycertificate, statement (including financial statements), request or other document furnishedpursuant to or under this Agreement or any Security Instrument proves to have been incorrect in.
 

 
any material respect as of the date when made, and such default continues unremedied for aperiod of thirty (30) days after the earlier of (i) notice thereof being given by ITOCHU to TFH, or(ii) such default otherwise becoming known to TFH (except in the case of technical defaults orconditions which are not material to TFH’s ability to perform hereunder); or          (b) Affirmative Covenants — default is made in the due observance or performance by TFH ofany of the covenants or agreements contained in Article S of this Agreement, and such defaultcontinues unremedied for a period of thirty (30) days after the earlier of (i) notice thereofbeing given by ITOCHU to TFH, or (ii) such default otherwise becoming known to TFH (except in thecase of technical defaults or conditions which are not material to TFH’s ability to performhereunder); or          (c) Security Instrument Obligations — default is made in the due observance or earlier ofnotice thereof being given by ITOCHU to TFH, or (ii) such default otherwise becoming known to TFH(except in the case of technical defaults or conditions which are not material to TFH’s ability toperform hereunder), or (iii) the expiration of any applicable grace period which may be expresslyallowed under such Security Instrument; or          (e) Involuntary Bankruptcy or Other Proceedings — an involuntary case or other proceedingcommenced against TFH which seeks liquidation, reorganization or other relief with respect to it orits debts or other liabilities under any bankruptcy, insolvency or other similar law now orhereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian orother similar official of it or any substantial part of its Property, and such involuntary case orother proceeding is not terminated within thirty (30) days; or an order for relief against TFHshall be entered in any such proceeding under the U.S. Bankruptcy Code; or          (f) Voluntary Petitions, etc. — TFH commences a voluntary case or other proceeding seekingliquidation, reorganization or other relief with respect to itself or its debts or otherliabilities under any bankruptcy, insolvency or other similar law now or hereafter in effect orseeking the appointment of a trustee, receiver, liquidator, custodian or other similar official ofit or any substantial part of its Property, or shall consent to any such relief or to theappointment of or taking possession by any such official in an involuntary case or other proceedingcommenced against it, or shall make a general assignment for the benefit of creditors, or shallfail generally to, or shall admit in writing its inability to, pay its debts generally as theybecome due, or shall take any corporate action to authorize or effect any of the foregoing; or          (g) Discontinuance of Business — TFH discontinues its usual business; or          (h) Default on Other Debt — TFH defaults in any payment of principal of or interest on anyother obligation for the payment of money beyond any period of grace provided with respect thereto,or any event or condition occurs (and any period of grace provided with respect thereto expires)under any agreement, term, or provision contained in any agreement or instrument under or by whichany such obligation is created, evidenced or secured if the effect thereof (upon giving of notice,lapse of time, or both) is to cause such obligation to become due before its stated maturity or topermit the holder(s) of such obligations or the trustees) under any such agreement or instrument tocause such obligation to become due prior to its stated maturity (except in the case of technicaldefaults or conditions which are not material to TFH’s ability to perform hereunder), whether ornot waived by the holder(s) of such
 

 
obligation or *such*trustee(s); or          (i) Undischarged Judgments — TFH fails within thirty (30) days to *pay,*satisfy or otherwisedischarge any judgment or order for the payment of money in excess of $5,000 that is not otherwisebeing satisfied in accordance with its terms and is not stayed on appeal or otherwise beingappropriately contested in good faith; or          (j) Security Instruments — the Security Instruments referred to in Section 3.4 hereof afterdelivery thereof shall for any reason, except to the extent permitted by the terms thereof, ceaseto be in full force and effect and valid, binding and enforceable (except as enforceability may belimited as stated in Section 43 hereof) in accordance with their terms, or cease to create a validand perfected Lien of the priority required thereby on any of the Collateral purported to becovered thereby, or the TFf1 (or any other Person who may have granted or purported to grant suchLien) shall so state in writing.     6.2 Remedies. Upon the occurrence of any Event of Default described in paragraphs6.1(e) or (f) hereof; or in paragraph 6.1(j) to the extent that such paragraph refers toparagraphs 6.1(e) or (f) hereof, the obligations, if any, of the ITOCHU hereunder shallimmediately terminate, and *the*entire principal amount of all Indebtedness then outstanding*together with*interest then accrued thereon shall automatically become immediately due andpayable, all without written notice and without presentment, demand, protest, notice of protest ordishonor or any other notice of default of any kind, all of which are hereby expressly waived byTFH. Upon the occurrence and at any time during the continuance of any other Event of Defaultspecified in Section 6.1 hereof, ITOCHU may by written notice to TFH (i) declare the entireprincipal amount of all Indebtedness then outstanding together with interest then accrued thereonto be immediately due and payable without presentment, demand, protest, notice of protest ordishonor, notice of intention to accelerate or other notice of default of any kind, all of whichare hereby expressly waived by TFH, and/or (ii) terminate the obligations, if any, of ITOCHUhereunder unless and until ITOCHU shall reinstate same in writing.ARTICLEMISCELLANEOUS     7.1 Notices. Any notice required or permitted to be given under or in connection withthis Agreement or the Security Instruments (except as may otherwise be expressly required therein)shall be in writing and shall be mailed by first class or express mail, postage prepaid, or sentby, telex, telegram, telecopy or other similar *form of rapid*transmission confirmed by mailing (byfirst class or express mail, postage prepaid) written confirmation at substantially the same timeas such rapid transmission, or personally delivered to an officer of the receiving party. All suchcommunications shall be mailed, sent or delivered, to the addressee at its address shown in thecaption of this Agreement, or to such other address or to such individual’s or department’sattention as the addressee may have furnished the other party in writing.Any communication so addressed and mailed shall be deemed to be given when so mailed, and anynotice so sent by rapid transmission shall be deemed to be given when receipt of such
 

 
transmission is acknowledged, and any communication so delivered in person shall be deemed to begiven when receipted for by, or actually received by, an authorized officer of TFH or ITOCHIJ, asthe case may be.     7.2 Amendments and Waivers. Any provision of this Agreement or the SecurityInstruments may be amended or waived if, but only if, such amendment or waiver is in writingand is signed by TFH (and/or any other Person which is a party to any Security Instrumentbeing amended or with respect to which a waiver is being obtained) and .ITOCHU.     7.3 Invalidity. In the event that any one or more of the provisions contained inthis Agreement or in any Security Instrument is, for any reason, deemed to be invalid, illegalor unenforceable in any respect, such invalidity, illegality or unenforceability shall notaffect any other provision of this Agreement or any other Security Instrument.     7.4 Successors and Assigns. All covenants and agreements made by or on behalf ofTFH in this Agreement and any Security Instrument shall bind its successors and assigns andshall inure to the benefit of ITOCHU and its successors and assigns. TFH shall not, however,have the right to assign its rights under this Agreement or any interest herein, without theprior written consent of ITOCHU. In the event ITOCHU assigns all or any of its rightshereunder, it will give TFH ten (10) days’ prior notice thereof.     7.5 Renewal, Extension or Rearrangement. All provisions of this Agreement and ofany Security Instrument shall apply with equal force and effect to each and all promissorynotes hereinafter executed by TFH which in whole or in part represent a renewal, extension forany period, increase or rearrangement of any part of the Indebtedness or of any part of suchother indebtedness,     7.6 Waivers. No course of dealing on the part of ITOCHU, its officers, employees,consultants or agents, nor any failure or delay by ITOCHU with respect to exercising anyright, power or privilege of ITOCHU under this Agreement or any Security Instrument shalloperate as a waiver thereof, except as otherwise provided in Section 8.2 hereof.     7.7 Cumulative Rights. All rights and remedies of ITOCHU under this Agreement andeach Security Instrument shall be cumulative, and the exercise or partial exercise of any suchright or remedy shall not preclude the exercise of any other right or remedy.     7.8 Singular and Plural. Words used herein in the singular, where the context sopermits, shall be deemed to include the plural and vice versa. The definitions of words in thesingular herein shall apply to such words when used in the plural where the context sopermits and vice versa.     7.9 Construction. This Agreement is a contract made under and shall beconstrued in accordance with and governed by the laws of the United States of America and theState of New York, as such laws are now in effect and, with respect to usury laws, if any, applicable to ITOCHUand to the extent allowed thereby, as such laws may hereafter be in effect which allow a higher maximum nonusurious interest rate than such laws now allow.     7.10 Interest. It is the intention of the parties hereto to conform strictlyto all usury laws applicable to ITOCHU. Accordingly, if the transactions contemplatedhereby
 

 
would be usurious under applicable law (including the laws of the United States ofAmerica and the State of New York), then, in that event, notwithstanding anything to thecontrary, this Agreement or in any Security Instrument or agreement entered into inconnection with or as security, it is agreed as follows:          7.10.1 The aggregate of all consideration which constitutes interest under lawapplicable to ITOCHU that is contracted for, taken, reserved, charged or received under,this Agreement or under any of the aforesaid Security Instruments or agreements orotherwise in connection herewith shall under no circumstances exceed the maximum amount ofnonusurious interest, if any, allowed by such applicable law, and any excess shall becredited by ITOCHU to the principal amount of the Indebtedness (or, if the principal amountof the Indebtedness shall have been paid in full, refunded to TFH); and          7.10.2 In the event that the maturity of Indebtedness accelerated by reason of anyEvent of Default under this Agreement or otherwise, or in the event of any required ofpermitted prepayment, then such consideration that constitutes interest under lawapplicable to ITOCHU may never include more than the maximum amount of nonusuriousinterest, if any, allowed by such applicable law, and excess interest, if any, provided forin this Agreement or otherwise shall be cancelled automatically as of the date of suchacceleration or prepayment and, if theretofore paid, shall be credited by ITOCHU on theprincipal amount of the Indebtedness (or, if the principal amount of the Indebtedness shallhave been paid in full, refunded by ITOCHU to TFH).     7.11 References. The words “herein,” “hereof,” “hereunder” and other words ofsimilar import when used in this Agreement refer to this Agreement as a whole, and not toany particular article, section, subsection, paragraph or subparagraph.     7.12 Taxes. etc, Any taxes (excluding income taxes) payable or deemed payableby any federal, state or local authority in respect of this Agreement or any SecurityInstruments shall be paid by TFH, together with interest and penalties, if any.     7.13 Governmental Regulation. Anything contained in this Agreement to thecontrary notwithstanding, ITOCHU shall not be obligated to extend credit to TFH in anamount in violation of any limitation or prohibition provided by any applicable statute,regulation or ordinance.     7.14 Entire Agreement. This Agreement and the Security Instruments embody theentire agreement and understanding among the parties hereto and supersede all prioragreements and understandings among them relating to the subject matter thereof.     7.15 Exhibits. The exhibits attached to this Agreement are incorporated herein andshall be considered a part of this Agreement for the purposes stated herein, except that in theevent of any conflict between any of the provisions of such exhibits and the provisions of thisAgreement, the provisions of this Agreement shall prevail.     7.16 Readings, All headings to articles or other divisions of this Agreement or theexhibits hereto are only for the convenience of the parties and shall not be construed to have anyeffect or meaning with respect to the content thereof; such content being controlling as to the
 

 
agreement among the parties hereto.     7.17 Jurisdiction. All actions or proceedings with respect to this Agreement or theSecurity Instruments must be instituted in the courts of New York County of the State of New Yorkor the United States District Court for the Southern District of New York and, by execution anddelivery of this Agreement, TFH irrevocably and unconditionally submits to the jurisdiction (bothsubject matter and personal) of each such court, and irrevocably and unconditionally waives (i) anyobjection it may now or hereafter have to the laying of venue in any of such courts, and (ii) anyclaim that any action or proceeding brought in any of such courts has been brought in aninconvenient forum. TFH waives its right to a jury trial in any such proceedings.     7.18 Counterparts. This Agreement may be executed in two (2) or more counterparts, andit shall not be necessary that the signatures of all parties hereto be contained on any onecounterpart hereof. Each counterpart shall be deemed an original, but all of which together shallconstitute one and the same instrument.     IN WITNESS WHEREOF, the parties hereto have caused this instrument to be duly executed as ofthe date first above written.       TFH: The Fashion House Inc.         By:              Name:           Title         ITOCHU ITOCHU International Inc.         By:              Name           Title