LOAN ASSIGNMENT


AGREEMENT


 


THIS LOAN ASSIGNMENT
AGREEMENT, dated June 25, 2012 by and between XL FASHIONS, INC., a Delaware corporation ("Seller") and SEACOAST HOLDINGS
(EFASHION), INC., a Delaware CORPORATION ("Buyer"). Seller and Buyer are sometimes hereinafter referred to individually
as a “Party” and collectively as the “Parties.”


 


RECITALS


 


WHEREAS, pursuant
to a Loan and Security Agreement originally dated as of April 18, 2008, as amended, supplemented or otherwise modified from time
to time, including but not limited to by Amendment to Loan Documents dated March 9, 2011, April I, 2010, December 30, 2010, April
21, 2011 and June 14, 2011 (collectively, the "Loan Agreement") and the other Loan Documents (as hereinafter defined),
Orix Venture Finance LLC (“Orix”) has made certain Loans (as defined in the Loan Agreement) to eFashion Solutions,
LLC ("Borrower");


 


WHEREAS, Pursuant
to an Assignment Agreement dated January 23, 2012 between Seller and Orix, the Loans and the Loan Documents were assigned from
Orix to Seller; and


 


WHEREAS, Seller now
desires to sell to Buyer, and Buyer desires to purchase from Seller the Assigned Interest (as defined herein).


 


NOW THEREFORE, in consideration
of the premises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
the Parties hereto agree as follows:


 


I.            Definitions.


 


A.           Assigned
Interest: Any and all rights, claims (including "claims" within the meaning of Section 101(5) of the Bankruptcy Code)
and causes of action of Seller against the Borrower or Orix and any other person or entity that arise under, from, in, to or in
connection with the Loans or the Loan Documents including without limitation: (i) all principal of and interest (whether heretofore
or hereafter accrued) on the Loans and all other amounts paid or payable to Seller from time to time under the Loan Documents from
and after the Effective Date (as defined herein); (ii) any and all payments and property received by or distributions to Seller
and/or Orix from and after the Effective Date (whether for principal, accrued and unpaid interest, fees or otherwise); (iii) all
collateral and security of any kind for or in respect of the foregoing as provided for in the Loan Documents and applicable law;
(iv) warrants to purchase Class A Preferred Units together with any registration rights and (v) all proceeds of any kind of the
foregoing.


 


B.           Assumed
Obligations: The obligations of Seller under the Loan Documents, including but not limited to the documents and filings listed
on Schedule A attached hereto, in respect of the Assigned Interest solely and to the extent arising on and after the Effective
Time (as defined herein).


 



    	 



    	 



    

 


C.           Loan
Documents: The Loan Agreement and all other documents and agreements under which the Assigned Interest or any part thereof
has been created and all material documents and agreements relating thereto, and all amendments, waivers and consents thereto.


 


D.           Person:
Any person, entity, regulatory body or governmental authority.


 


E.           Proceeds:
All proceeds of any kind of the Assigned Interest.


 


F.           Retained
Obligations: The obligations of Seller under the Loan Documents, including but not limited to the documents and filings listed
on Schedule A annexed hereto, in respect of the Assigned Interest solely and to the extent arising before the Effective
Time.


 


II.           Assignment
and Payment.


 


A.           Assignment.
Effective upon receipt of the Purchase Price (the "Effective Time"), Seller hereby irrevocably sells, transfers, assigns,
grants and conveys the Assigned Interest to Buyer; and the Buyer hereby assumes the Assumed Obligations; and Buyer from the Effective
Time shall be entitled to collect and receive the Assigned Interest and all Proceeds and to exercise and enforce all rights with
respect to the Assigned Interest.


 


B.           Payment.
In consideration of the sale and assignment of the Assigned Interest, Buyer shall pay to Seller (in immediately available funds
by wire transfer to the account set forth on Schedule B attached hereto) the purchase price equal to Nine Hundred Twenty
Five Thousand Dollars ($925,000.00) (the "Purchase Price") on or before close of business on June 27, 2012 with time
being of the essence with respect thereto.


 


III.          Seller's
Representations. Seller hereby represents and warrants to Buyer and its successors and assigns as of the Effective Time that:


 


A.           Seller
has full power and authority to assign the Assigned Interest and to enter into and perform this Agreement, and such assignment
and this Agreement have been duly authorized, are legal, valid and binding and enforceable against Seller, and are not in contravention
of any law, order or agreement by which Seller is bound.


 


B.           Seller
has made no prior assignment, hypothecation, pledge, conveyance, participation or other sale or transfer of the Assigned Interest
or of any interest therein. Seller is the sole legal and beneficial owner of the Assigned Interest and has good title thereto,
free and clear of all liens, claims and encumbrances of any kind.


 


C.           Seller
has not exercised or waived any rights in connection the Warrant to Purchase Class A Preferred Units.


 



    	 



    	 



    

 


D.           No
consents, notices, filings, approvals or authorizations are required to be made to or with or received from any person, entity,
or governmental body for the sale hereunder and consummation of the transactions contemplated by this Agreement.


 


E.           Seller
is a sophisticated seller with respect to the Assigned Interest, has adequate information concerning the business and financial
condition of the Borrower to make an informed decision regarding the Assigned Interest, and has independently, without reliance
on the Buyer and based on such information as it deemed appropriate, made its own analysis and decision to enter into this Agreement.


 


IV.         Buyer's
Representations. Buyer hereby represents and warrants to Seller and its successors and assigns, that:


 


A.           Buyer
has full power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby, and
has obtained all consents and approvals, and, to the best of its knowledge, made all registrations required in connection herewith.


 


B.           This
Agreement and any documents to be executed and delivered in connection herewith have been duly authorized by Buyer, are valid and
enforceable against Buyer in accordance with their terms and are not in contravention of any law, rule, regulation or agreement
by which Buyer is bound.


 


C.           Buyer
has made such examination, review and investigation of facts and circumstances necessary to evaluate the Assigned Interest as it
has deemed necessary or appropriate.


 


D.           Buyer
has made its credit determination and analysis based upon such information as Buyer deems sufficient to enter into this Agreement
and not based on any statements or representations by Seller except as expressly set forth herein.


 


E.           The
sale of the Assigned Interest hereunder is made without recourse, representation or warranty of any kind, except as expressly set
forth in this Agreement.


 


F.           Buyer
is a sophisticated buyer with respect to the Assigned Interest, has adequate information concerning the business and financial
condition of the Borrower to make an informed decision regarding the Assigned Interest, and has independently, without reliance
upon the Seller and based on such information as it deemed appropriate, made its own analysis and decision to enter into this Agreement,
Buyer acknowledges that Seller has advised Buyer that Borrower is in default under the Loan Documents and the Loans are due and
owing.


 



    	 



    	 



    

 


V.          Acknowledgments.
The Parties acknowledge, represent and warrant to each other that neither Party has made any representation or warranty, whether
express or implied, of any kind or character except as expressly set forth in this Agreement and the assignment and transfer of
the Assigned Interest by Seller to Buyer is irrevocable.


 


VI.         Payment
and Delivery by Seller. Subject to the occurrence of the Effective Time, Seller agrees to use commercially reasonable efforts
to have all Proceeds paid or delivered after the Effective Time to be paid or delivered directly to Buyer; in the event that Seller
nevertheless receives any Proceeds after the Effective Time: (a) Seller agrees to accept the same on behalf of Buyer, and to pay
or deliver the same within two (2) business day to Buyer in the same form received, with the endorsement of Seller, without cost
to Buyer, recourse or deduction in any manner, when necessary or appropriate; and (b) Seller shall have no legal, equitable or
beneficial interest in such Proceeds.


 


VII.        Indemnities.


 


A.           Seller
agrees to indemnify, defend and hold Buyer and its officers, directors, employees, agents, partners and controlling persons and
their successors, assigns (collectively, the "Buyer Indemnitees") harmless from and against any and all expenses, losses,
claims, damages and liabilities which are incurred by or threatened against the Buyer Indemnitees or any of them, including without
limitation attorneys' fees and expenses, caused by, or in any way resulting from or relating to: (i) Seller's breach of any of
the representations, warranties, covenants or agreements of Seller set forth in this Agreement and (ii) the Retained Obligations.


 


B.           Buyer
agrees to indemnify, defend and hold each of the Seller and its officers, directors, employees, agents, partners and controlling
persons (collectively, the "Seller Indemnitees") harmless from and against any and all expenses, losses, claims,
damages and liabilities which are incurred by or threatened against the Seller Indemnitees or any of them, including without limitation
reasonable attorneys' fees and expenses, caused by, or in any way resulting from or relating to: (i) Buyer's breach of any of the
representations, warranties, covenants or agreement of Buyer set forth in this Agreement and (ii) the Assumed Obligations.


 


VIII.      Costs
and Fees. Except as otherwise expressly provided for herein, each Party shall bear its own costs and expenses, including but
not limited to attorneys' fees and expenses, in connection with the closing of the transactions contemplated hereby.


 


IX.        Filings
and Further Assurances. Each of the Parties hereto agrees, at its own cost and expense, to execute and deliver, or to cause
to be executed and delivered, all such instruments (including all necessary endorsements) and to take all such action as the other
Party may reasonably request in order to (i) effectuate the intent and purposes of, and to carry out the terms of this Agreement,
and (ii) further effect the transfer of legal, beneficial and record ownership of the Assigned Interest to Buyer.


 



    	 



    	 



    

 


X.           Integration.
This Agreement constitutes the complete agreement of the Parties with respect to the subject matters referred to herein and supersedes
all prior or contemporaneous negotiations, promises, covenants, agreements or representations of every nature whatsoever with respect
thereto, all of which have become merged and finally integrated into this Agreement. This Agreement cannot be amended, modified
or supplemented except by an instrument in writing executed by both Parties.


 


XI.          Notices,
Payments and Deliveries. Notices shall be given by certified or registered mail or personally or by courier at the addresses
set forth on Schedule B attached hereto. Payments and deliveries of Proceeds shall be made as set forth on Schedule B.


 


XII.         Miscellaneous.
The terms of this Agreement shall be binding upon and shall inure to the benefit of the Parties and their respective successors
and assigns. All representations and warranties made herein shall survive the execution and delivery of this Agreement. This Agreement
may be executed in counterparts or by facsimile signature, each of which when so executed shall be an original, but all such counterparts
shall together constitute but one and the same instrument. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York without regard to any conflicts of laws provisions thereof. Each party to this Agreement hereby
irrevocably consents to the jurisdiction of the United States Court for the Southern District of New York and the Supreme Court
of the State of New York, County of New York in any action to enforce, interpret or construe any provision of this Agreement or
of any other agreement or document delivered in connection with this Agreement, and also hereby irrevocably waives any defense
of improper venue, forum non conveniens or lack of personal jurisdiction to any such action brought in those courts. Each
Party further irrevocably agrees that any action to enforce, interpret or construe any provision of this Agreement will be brought
only in one of those courts.


 


-SIGNATURE PAGES TO FOLLOW-


 



    	 



    	 



    

 


IN WITNESS WHEREOF, the undersigned have
executed and delivered this Loan Assignment Agreement as of the date first stated above.


 


	 	XL FASHIONS, INC.
	 	 	 
	 	By:	s/Ruben Azrak
	 	Name: 	Ruben Azrak
	 	Title:	CEO
	 	 	 
	 	SEACOAST HOLDINGS (EFASHION), INC.
	 	 	 
	 	By: 	s/Eben Moulton
	 	Name: 	Eben Moulton
	 	Title:	Partner


 



    	 



    	 



    

 


SCHEDULE A


List of Loan Documents


 


1.           Loan
and Security Agreement between ORIX Venture Finance LLC and eFashion Solutions, LLC dated April 18, 2008


2.           Schedule
to Loan Agreement


3.           Authorization
to File UCC-1 Financing Statement executed by Borrower dated March 27, 2008


4.           Warrant
to Purchase Class A Preferred Units issued by Borrower to ORIX


5.           Certified
Resolution and Incumbency Certificate of Borrower


6.           Disbursement
Instructions from Borrower to ORIX


7.           Confirmation
re closing Documents executed by Borrower


8.           Representations
and Warranties of Borrower dated February 26, 2008


9.           Control
Agreement among Borrower, ORIX and Morgan Stanley


10.         Letter
of instruction form ORIX to Morgan Stanley


11.         Payment
Agreement executed by UPS Capital Business Credit in favor of borrower and ORIX


12.         Amendment
to Registration Rights Agreement among Borrower, ORIX, and the other parties thereto


13.         Landlord
Agreement executed by 80-90 Enterprise A venue Associates, LLC with respect to premises located at 80 enterprise Avenue south,
Secaucus, New Jersey 07094


14.         Legal
Opinion of Olender Feldman LLP to ORIX


15.         Insurance-Lender's
Loss Payee Endorsement


16.         Amendment
to Loan Documents dated March 9, 2009, April 1, 2010, December 30, 2010, April 21, 2011 and June 14,2011.


17.         Debt
Subordination Agreement dated December___, 2010 with ABS Capital Partners V, L.P.


18.         Side
Letter dated June 14, 2011 with ABS Capital


19.         UCC-1
Financing Statement Filed in the office of the NJ Secretary of State


20.         Letter
to Wachovia Bank, dated January 13, 2012 regarding wiring of funds


21.         Letter
to Wachovia Bank, dated January 12,2012 regarding Notice


22.         Letter
to Morgan Stanley, dated January 12, 2012 regarding notice of control


23.         Letter
to Morgan Stanley, dated January 12, 2012 regarding no longer acting on Borrower's instruction


24.         Assignment
Agreement dated January 23, 2012 between ORIX and XL Fashions Inc.


 



    	 



    	 



    

 


SCHEDULE B


Notice, Payment and Delivery Instructions


 


To Seller:


 


Notices:


XL Fashions Inc.


1384 Broadway, 17th Floor


New York, New York 10018


Attention:       Chief
Executive Officer


 


With a copy to:


 


XL Fashions Inc.


1384 Broadway, 17th Floor


New York, New York 10018


Attention:        Legal
Department – General Counsel


 


Payments:


 


	Bank Name:	Gotham Bank
	City/State:	New York, New York
	ABA#:	026010605
	Account Name:	XLFashions, Inc.
	Account Number:	004068785
	Re:	eFashion


 


To Buyer:


 


Notices:


 


SEACOAST HOLDINGS (EFASHION),
INC.


55 Ferncrof Road, Suite 110


Danvers, Massachussets 01923


Attention: Thomas W. Gorman


Telephone: 978-750-1311


Email: tgorman@seacoastcapital.com


 






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