Document:

Exhibit 10.27

 Exhibit 10.27 
 AMENDMENT NO. 6, CONSENT AND WAIVER TO CREDIT AGREEMENT OF 
 AMERICAN APPAREL (USA), LLC

 This AMENDMENT NO. 6, CONSENT AND WAIVER (this “Amendment”), dated as of May 15, 2008, is among American Apparel
(USA), LLC (f/k/a AAI Acquisition LLC (successor by merger to American Apparel, Inc.)), a California limited liability company (the “Borrower”), the Facility Guarantors thereto (the “Guarantors”) and SOF
Investments, L.P.—Private IV, as lender (the “Lender”), parties to the Credit Agreement dated as of January 18, 2007 (as amended by that certain Amendment No. 1 and Waiver to Credit Agreement of American Apparel, Inc.
dated as of July 2, 2007, that certain Amendment No. 2 and Waiver to Credit Agreement of American Apparel, Inc. dated as of November 9, 2007, that certain Amendment No. 3 and Waiver to Credit Agreement of American Apparel, Inc.
dated as of November 28, 2007, that certain Amendment No. 4 and Waiver to Credit Agreement of American Apparel, Inc. dated as of December 12, 2007 and that certain Amendment No. 5 and Waiver to Credit Agreement of American
Apparel (USA), LLC dated as of February 29, 2008, the “Credit Agreement”). Capitalized terms used herein but not defined herein are used as defined in the Credit Agreement. 
 WITNESSETH: 
 WHEREAS, the Borrower has
notified Lender that (a) the Borrower breached paragraph (a) of Section 6.11 (Financial Covenants) of the Credit Agreement (the “Fixed Charge Coverage Ratio Covenant”) by failing to maintain a Consolidated
Fixed Charge Coverage Ratio of 1.05 to 1.00 for the four Fiscal Quarter period ended on March 31, 2008 (the “Fixed Charge Coverage Ratio Default”), (b) the Borrower breached paragraph (b) of Section 6.12
(Capital Expenditures) of the Credit Agreement (the “Capital Expenditures Covenant”) by incurring, or by permitting any of its Subsidiaries to incur, Capital Expenditures in excess of $5,000,000 during the Fiscal Quarter ending
March 31, 2008 (the “Capital Expenditures Default”), (c) the Borrower breached Section 6.04 (Investments, Loans, Advances, Guarantees and Acquisitions) of the Credit Agreement by entering into the Asset
Purchase Agreement dated as of April 8, 2008 (the “Dye House Purchase Agreement”, an executed copy of which is attached on Schedule A) by and between the Borrower and USDF, a California corporation (the “Dye
House Default”), (d) the Borrower breached Section 6.01 (Indebtedness and Other Obligations) of the Credit Agreement by permitting American Apparel Japan Yugen Kaisha to incur Indebtedness on the terms set forth on
Schedule B (the “Japanese Indebtedness Default”), (e) the Borrower breached Section 6.04 (Investments, Loans, Advances, Guarantees and Acquisitions) and Section 6.08 (Transactions with Affiliates)
of the Credit Agreement by making intercompany loans and other transfers of cash to certain Foreign Subsidiaries as described on Part A of Schedule C, which Investments are not Permitted Investments (the “March Investments
Default”) and by making further intercompany loans and other transfers of cash to certain Foreign Subsidiaries as described on Part B of Schedule C, which Investments are not Permitted Investments (the “May Investments
Default” and, together with the March Investments Default, the “Investments Default”), and (f) an Event of Default exists under Section 7.01(q) (Events of Default) for Borrower’s failure to comply with
certain provisions of the Existing First Lien Credit Agreement, which constitutes Events of Default under Sections 7.01(d), (e) and (r) of the Existing First Lien Credit Agreement (the “Cross-Default” and, together with
the Fixed Charge Coverage Ratio Default, the Capital Expenditures Default, the Dye House Default, the Japanese Indebtedness Default and the Investments Default, the “Specified Events of Defaults”); 
 WHEREAS, the Borrower has requested that the Lender waive the Specified Events of Defaults and compliance with the Fixed Charge Coverage Ratio Covenant
for the four Fiscal Quarter period ended on March 31, 2008 and with the Capital Expenditures Covenant for the Fiscal Quarter ending March 31, 2008 and further amend the Credit Agreement as set forth herein; 
 WHEREAS, the Borrower has also requested that the Lender consent to the acquisition of certain assets of USDF on the terms set forth in the Dye House
Purchase Agreement; and 

 AMENDMENT NO. 6, CONSENT AND
WAIVER 
 OF AMERICAN APPAREL (USA), LLC 
  

 WHEREAS, the Lender agrees, subject to the limitations and conditions set forth herein, (a) to
waive the Specified Events of Defaults and compliance with the Fixed Charge Coverage Ratio Covenant for the four Fiscal Quarter period ended on March 31, 2008 and with the Capital Expenditures Covenant for the Fiscal Quarter ending
March 31, 2008, (b) to amend the Credit Agreement as set forth herein and (c) to consent to the acquisition of certain assets of USDF on the terms set forth in the Dye House Purchase Agreement. 
 NOW, THEREFORE, in consideration of the premises and the covenants and obligations contained herein the parties hereto agree as follows: 
  

	 	Section 1.	Waiver 

 Effective as of the Amendment
Effective Date and subject to the satisfaction (or due waiver) of the conditions set forth in Section 4 (Conditions Precedent to the Effectiveness of this Amendment) hereof, the Lender waives the following: (a) the Fixed Charge
Coverage Ratio Default, the Capital Expenditures Default, the Japanese Indebtedness Default, the March Investments Default and the Cross-Default (only with respect to those Events of Default under the Existing First Lien Credit Agreement which
occurred on or before March 31, 2008), each as of March 31, 2008, (b) the Dye House Default, the May Investments Default and the Cross-Default (with respect to those Events of Default under the Existing First Lien Credit Agreement
which occurred after March 31, 2008), each as of the Amendment Effective Date, and (c) compliance with the Fixed Charge Coverage Ratio Covenant for the four Fiscal Quarter period ending on March 31, 2008 and with the Capital
Expenditures Covenant for the Fiscal Quarter ending March 31, 2008, each as of March 31, 2008; provided, however, that the waiver set forth in this paragraph shall not constitute a consent or waiver with respect to any failure to
comply after the Amendment Effective Date with the Credit Agreement as amended hereby. 
  

	 	Section 2.	Amendment to the Credit Agreement 

 Effective
as of the Amendment Effective Date and subject to the satisfaction (or due waiver) of the conditions set forth in Section 4 (Conditions Precedent to the Effectiveness of this Amendment) hereof, clause (b) of Section 6.12
(Capital Expenditures) of the Credit Agreement is hereby amended by deleting”$18,000,000” in the first line thereof and replacing it with “$21,000,000.” 
  

	 	Section 3.	Consent 

 The Lender consents to the
acquisition of certain assets of USDF on the terms set forth in the Dye House Purchase Agreement and further agrees that such Investment shall not be included in the calculation of any Permitted Investment. For the purposes of Section 6.12 of
the Credit Agreement, such Investment shall not constitute Capital Expenditures. 
  

	 	Section 4.	Conditions Precedent to the Effectiveness of this Amendment 

 This Amendment shall become effective as of the date first written above when, and only when, each of the following conditions precedent shall have been satisfied (the “Amendment Effective Date”) or
duly waived by the Lender: 
 (a) Certain Documents. The Administrative Agent shall have received the following documents, each in form
and substance satisfactory to the Lender, which satisfaction shall be evidenced by the execution and delivery by the Lender of this Amendment, and dated the Amendment Effective Date (when applicable): 
 (i) this Amendment, duly executed by the Borrower, each Guarantor and the Lender; and 
 (ii) an executed copy of the Waiver and Consent to Credit Agreement with respect to the Existing First Lien Credit Agreement. 
  

 2 

 AMENDMENT NO. 6, CONSENT AND
WAIVER 
 OF AMERICAN APPAREL (USA), LLC 
  

 (b) Corporate and Other Proceedings. All corporate and other proceedings, and all documents,
instruments and other legal matters in connection with the transactions contemplated by this Amendment shall be satisfactory in all respects to the Lender, which satisfaction shall be evidenced by the execution and delivery by the Lender of this
Amendment. 
 (c) Representations and Warranties. Each of the representations and warranties contained in Section 5
(Representations and Warranties) below are true and correct. 
 (d) No Default or Event of Default. After giving effect to this
Amendment, no Default or Event of Default shall have occurred and be continuing as of the date hereof. 
 (e) No Litigation. No
litigation shall have been commenced against any Loan Party or any of its Subsidiaries, either on the date hereof or the Amendment Effective Date, seeking to restrain or enjoin (whether temporarily, preliminarily or permanently) the performance of
any action by any Loan Party required or contemplated by this Amendment or the Credit Agreement or any Loan Document, in either case as amended hereby. 
 (f) Fees and Expenses Paid. The Borrower shall have paid all Obligations due, after giving effect to this Amendment, on or before the later of the date hereof and the Amendment Effective Date including, without
limitation, the fees set forth in Section 5 (Fees and Expenses) hereof and all costs and expenses of the Lender in connection with the preparation, reproduction, execution and delivery of this Amendment and all other Loan Documents
entered into in connection herewith (including, without limitation, the reasonable fees and out-of-pocket expenses of counsel for the Lender with respect thereto and all other Loan Documents) and all other costs, expenses and fees due under any Loan
Document. 
 (g) No Default or Event of Default Under Existing First Lien Credit Agreement. No default or event of default shall have
occurred and be continuing with respect to the Existing First Lien Credit Agreement on the date hereof. 
  

	 	Section 5.	Representations and Warranties 

 On and as of
the date hereof and as of the Amendment Effective Date, after giving effect to this Amendment, the Borrower hereby represents and warrants to the Lender as follows: 
 (a) this Amendment has been duly authorized, executed and delivered by the Borrower and each Guarantor and constitutes a legal, valid and binding obligation of the Borrower and each Guarantor, enforceable against the
Borrower and each Guarantor in accordance with its terms and the Credit Agreement as amended by this Amendment and constitutes the legal, valid and binding obligation of the Borrower and each Guarantor, enforceable against the Borrower and each
Guarantor in accordance with its terms; 
 (b) each of the representations and warranties contained in Article III (Representations and
Warranties) of the Credit Agreement, the other Loan Documents or otherwise made in writing in connection therewith are true and correct in all material respects on and as of the date hereof and the Amendment Effective Date, in each case as if
made on and as of such date except (i) to the extent that such representations and warranties specifically relate to a specific date, in which case such representations and warranties shall be true and correct in all material respects as of
such specific date and (ii) to the extent that such statement was subsequently corrected and such correction was presented to the Lender; provided, however, that references therein to the “Credit Agreement” shall
be deemed to refer to the Credit Agreement as amended by this Amendment after giving effect to the consents and waivers set forth herein; 
 (c) no Default or Event of Default has occurred and is continuing; 
 (d) no litigation has been commenced against any Loan Party or
any of its Subsidiaries seeking to restrain or enjoin (whether temporarily, preliminarily or permanently) the performance of any action by any Loan Party 

  

 3 

 AMENDMENT NO. 6, CONSENT AND
WAIVER 
 OF AMERICAN APPAREL (USA), LLC 
  

 
required or contemplated by this Amendment, the Credit Agreement or any Loan Document, in each case as amended hereby (if applicable); and 
 (e) each of the Consolidated Fixed Charge Coverage Ratio for the four Fiscal Quarter period ended on March 31, 2008 and the amount of Capital
Expenditures for the Fiscal Quarter ending March 31, 2008 is as set forth on Schedule D hereto. 
  

	 	Section 6.	Fees and Expenses 

 The Borrower and each
other Loan Party agrees to pay on demand in accordance with the terms of Section 9.03(a) (Expenses; Indemnity; Damage Waiver) of the Credit Agreement all costs and expenses of the Lender in connection with the preparation, reproduction,
execution and delivery of this Amendment and all other Loan Documents entered into in connection herewith (including, without limitation, the reasonable fees and out-of-pocket expenses of counsel for the Lender with respect thereto and all other
Loan Documents). 
  

	 	Section 7.	Covenant 

 Each Loan Party hereby covenants
that, at such time when the Loan Parties shall enter into an amendment to the Existing First Lien Credit Agreement and related documents, it shall enter into an amendment to the Credit Agreement and related documents, which amendment to the Credit
Agreement and related documents shall be in form and substance satisfactory to the Lender and may, among other things, effect a joinder by American Apparel, Inc. (f/k/a Endeavor Acquisition Corp.) to the Loan Documents, whereby American Apparel,
Inc. (f/k/a Endeavor Acquisition Corp.) shall become a Facility Guarantor thereunder. The failure by the Loan Parties to enter into such amendment to the Credit Agreement and related documents contemporaneously with an amendment to the Existing
First Lien Credit Agreement and related documents shall constitute an Event of Default under the Credit Agreement. 
  

	 	Section 8.	Financial Statements for Fiscal Month Ending April 30, 2008 

 The parties hereto acknowledge and agree that notwithstanding anything in the Credit Agreement to the contrary, the date by which the Borrower shall deliver (a) the Consolidated balance sheet and related
statements of operations, stockholders’ equity and cash flows of the Borrower and its Subsidiaries pursuant to Section 5.01(b) of the Credit Agreement and (b) the Compliance Certificate referred to in Section 5.01(d) of the
Credit Agreement for the Fiscal Month ending April 30, 2008, is hereby extended to June 9, 2008. 
  

	 	Section 9.	Reference to the Effect on the Loan Documents 

 (a) As of the Amendment Effective Date, each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof,” “herein,” or words of like import, and each
reference in the other Loan Documents to the Credit Agreement (including, without limitation, by means of words like “thereunder”, “thereof” and words of like import), shall mean and be a reference to the Credit
Agreement as amended hereby, and this Amendment and the Credit Agreement shall be read together and construed as a single instrument. Each of the table of contents and lists of Exhibits and Schedules of the Credit Agreement shall be amended to
reflect the changes made in this Amendment as of the Amendment Effective Date. 
 (b) Except as expressly amended hereby or specifically
waived above, all of the terms and provisions of the Credit Agreement and all other Loan Documents are and shall remain in full force and effect and are hereby ratified and confirmed. 
  

 4 

 AMENDMENT NO. 6, CONSENT AND
WAIVER 
 OF AMERICAN APPAREL (USA), LLC 
  

 (c) The execution, delivery and effectiveness of this Amendment shall not, except as expressly
provided herein, operate as a waiver of any right, power or remedy of the Lender under any of the Loan Documents, nor constitute a waiver or amendment of any other provision of any of the Loan Documents or for any purpose except as expressly set
forth herein. 
 (d) This Amendment is a Loan Document. 
  

	 	Section 10.	Consent of Guarantors 

 Each Guarantor hereby
consents to this Amendment and agrees that the terms hereof shall not affect in any way its obligations and liabilities under the Loan Documents (as amended and otherwise expressly modified hereby), all of which obligations and liabilities shall
remain in full force and effect and each of which is hereby reaffirmed (as amended and otherwise expressly modified hereby). 
  

	 	Section 11.	Execution in Counterparts 

 This Amendment
may be executed in any number of counterparts and by different parties in separate counterparts, 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 separate 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 shall be effective as delivery of a
manually executed counterpart of this Amendment. 
  

	 	Section 12.	Governing Law 

 This Amendment shall be
governed by and construed in accordance with the law of the State of New York. 
  

	 	Section 13.	Section; Titles 

 The section titles
contained in this Amendment are and shall be without substantive meaning or content of any kind whatsoever and are not a part of the agreement between the parties hereto, except when used to reference a section. Any reference to the number of a
clause, sub-clause or subsection of any Loan Document immediately followed by a reference in parenthesis to the title of the section of such Loan Document containing such clause, subclause or subsection is a reference to such clause, sub-clause or
subsection and not to the entire section; provided, however, that, in case of direct conflict between the reference to the title and the reference to the number of such section, the reference to the title shall govern absent manifest
error. If any reference to the number of a section (but not to any clause, sub-clause or subsection thereof) of any Loan Document is followed immediately by a reference in parenthesis to the title of a section of any Loan Document, the title
reference shall govern in case of direct conflict absent manifest error. 
  

	 	Section 14.	Notices 

 All communications and notices
hereunder shall be given as provided in the Credit Agreement or, as the case may be, the Guaranty. 
  

	 	Section 15.	Severability 

 The fact that any term or
provision of this Amendment is held invalid, illegal or unenforceable as to any person in any situation in any jurisdiction shall not affect the validity, enforceability or legality of the remaining terms or provisions hereof or the validity,
enforceability or legality of such offending term or provision in any other situation, or jurisdiction or as applied to any person. 
  

 5 

 AMENDMENT NO. 6, CONSENT AND
WAIVER 
 OF AMERICAN APPAREL (USA), LLC 
  

	 	Section 16.	Successors 

 The terms of this Amendment
shall be binding upon, and shall inure to the benefit of, the parties hereto and their respective successors and assigns. 
  

	 	Section 17.	Waiver of Jury Trial 

 EACH OF THE PARTIES
HERETO IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH RESPECT TO THIS AMENDMENT OR ANY OTHER LOAN DOCUMENT. 
  

 6 

 IN WITNESS WHEREOF, the parties hereto have caused
this Amendment to be executed by their respective officers and general partners thereunto duly authorized, as of the date first written above. 
  

			
	 AMERICAN APPAREL (USA), LLC (f/k/a AAI
 Acquisition LLC (successor by merger to
 American Apparel, Inc.)),
 as Borrower

		
	By:	 	 
		 	 Name:
 Title:

	
	 SOF INVESTMENTS, L.P. - PRIVATE IV,
 as Lender

		
	By:	 	 
		 	 Name:
 Title:

  
  
 [SIGNATURE PAGE TO AMENDMENT NO. 6, CONSENT AND WAIVER] 

			
	GUARANTORS:
	
	 AMERICAN APPAREL, LLC, as Facility
 Guarantor

	
	 By: AMERICAN APPAREL (USA), LLC (f/k/a
 AAI Acquisition LLC (successor by merger to
 American Apparel, Inc.))

	
	By:                                      
                                        
                  
	Name:                                     
                                        
             
	Title:                                     
                                        
               
	
	 FRESH AIR FREIGHT, INC.,
 as Facility Guarantor

	
	By:                                      
                                        
                  
	Name:                                     
                                        
             
	Title:                                     
                                        
               
	
	KCL KNITTING, LLC, as Facility Guarantor
	
	 By: AMERICAN APPAREL (USA), LLC (f/k/a
 AAI Acquisition LLC (successor by merger to
 American Apparel, Inc.))

	
	By:                                      
                                        
                  
	Name:                                     
                                        
             
	Title:                                     
                                        
               
	
	 AMERICAN APPAREL RETAIL, INC.,
 as Facility Guarantor

	
	By:                                      
                                        
                  
	Name:                                     
                                        
             
	Title:                                     
                                        
               
	
	 AMERICAN APPAREL DYEING &
 FINISHING, INC., as Facility Guarantor

	
	By:                                      
                                        
                  
	Name:                                     
                                        
             
	Title:

 [SIGNATURE PAGE TO AMENDMENT NO. 6, CONSENT AND WAIVER] 

 Schedule A 
 Dye House Purchase Agreement 
 See attached. 

 Schedule B 
 Indebtedness of American Apparel Japan Yugen Kaisha 

 Schedule C 
 Non-Permitted Investments 

 Schedule D 
 Financial Covenants 
 (a) The Consolidated Fixed Charge Coverage Ratio for the four Fiscal Quarter period ended on
March 31, 2008 is 0.38. 
 (b) The amount of Capital Expenditures for the Fiscal Quarter ending March 31, 2008 is $14,791,354.Exhibit 10.28

 Exhibit 10.28 
 WAIVER AND CONSENT TO CREDIT AGREEMENT 
 LASALLE RETAIL FINANCE 
  
  
 Date: May     , 2008 
 THIS WAIVER AND CONSENT TO CREDIT AGREEMENT (this
“Waiver”) is made to the Credit Agreement (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) dated as of July 2, 2007 by and among: 
 AMERICAN APPAREL (USA), LLC (f/k/a AAI Acquisition LLC (successor by merger to American Apparel, Inc.)), a California limited liability company, as
agent for itself and the other Borrowers party thereto (in such capacity, the “Lead Borrower”); 
 THE BORROWERS now
or hereafter party to the Credit Agreement; 
 THE FACILITY GUARANTORS now or hereafter party to the Credit Agreement; 
 LASALLE BUSINESS CREDIT, LLC, AS AGENT FOR LASALLE BANK MIDWEST NATIONAL ASSOCIATION, ACTING THROUGH ITS DIVISION, LASALLE RETAIL FINANCE, with
offices at 100 Federal Street, 9th Floor, Boston, Massachusetts 02110, as administrative agent (in such capacity, the “Administrative Agent”) for its own benefit and the benefit of the other Credit Parties; 
 LASALLE BUSINESS CREDIT, LLC, AS AGENT FOR LASALLE BANK MIDWEST NATIONAL ASSOCIATION, ACTING THROUGH ITS DIVISION, LASALLE RETAIL FINANCE, with
offices at 100 Federal Street, 9th Floor, Boston, Massachusetts 02110, as collateral agent (in such capacity, the “Collateral Agent”, and together with the Administrative Agent, individually an “Agent” and
collectively, the “Agents”) for its own benefit and the benefit of the other Credit Parties; 
 WELLS FARGO RETAIL
FINANCE, LLC, with offices at One Boston Place, 19th Floor, Boston, Massachusetts 02108, as collateral monitoring agent (in such capacity, the “Collateral Monitoring Agent”) for its own benefit and the benefit of the other
Credit Parties; 
 the LENDERS party to the Credit Agreement; and 
 LASALLE BANK NATIONAL ASSOCIATION, a national banking association with offices at 135 South LaSalle Street, Chicago, Illinois 60603, as Issuing
Bank; 
 in consideration of the mutual covenants herein contained and benefits to be derived herefrom. 
  

 1 

 BACKGROUND 
 A. The Lead Borrower has advised the Agents that certain Events of Default have occurred as a result of the Loan Parties’ failure to comply with, among other things, certain financial performance covenants and other covenants, as more
particularly set forth on Exhibit A annexed hereto (collectively, the “Financial and Compliance Events of Default”). 
 B. The Lead
Borrower has further advised the Agents that the Lead Borrower has entered into that certain Asset Purchase Agreement dated as of April 8, 2008 (“the “APA”) by and between USDF, a California corporation (the
“Seller”), and the Lead Borrower, pursuant to which the Lead Borrower has agreed to purchase certain assets (the “Purchased Assets”) of the Seller’s garment dying and finishing business (the
“Acquisition”) for the aggregate sum of approximately $3,500,000.00 (the “Purchase Price”). The Lead Borrower has further advised the Agents that the Lead Borrower has commenced making payments of the Purchase Price
to Seller in respect of such Acquisition. Absent the consent of the Agents and the Required Lenders, the Acquisition would constitute an Event of Default (the “Acquisition Event of Default”, and together with the Financial and
Compliance Events of Default, collectively, the “Specified Events of Default”) under Section 7.01(d) of the Credit Agreement as a result of the failure of the Loan Parties to comply with Section 6.04 of the Credit
Agreement. Furthermore, the commencement of the payment of the Purchase Price constitutes a Default under Section 7.01(d) as a result of the failure of the Loan Parties to comply with Section 6.04 of the Credit Agreement (relating to
investments and acquisitions). 
 C. In light of the foregoing, the Lead Borrower has requested that the Agents and the Required Lenders consent to the
Acquisition and waive the Specified Events of Default. The Agents and the Required Lenders are willing to waive the Specified Events of Default, on the terms and conditions set forth herein 
 Accordingly, it is hereby agreed as follows: 
  

	1.	Waiver of Specified Events of Default. The Agents and the Required Lenders hereby waive the Specified Events of Default. The Loan Parties acknowledge and agree that:

  

	 	(a)	The foregoing waiver is a one-time waiver and shall not be deemed to constitute a waiver of any other Event of Default or a waiver of any other requirement of the Credit Agreement
with respect to any other circumstance, including, without limitation, any failure by the Loan Parties to comply with the financial performance covenants or other covenants set forth in Sections 5.01, 6.01, 6.04 or 6.08. 

  

	 	(b)	The consent and waiver provided above shall not take effect upon the execution of this Agreement, and shall only take effect upon satisfaction of each and all of the requirements of
Section 2, below. 

  

	2.	Conditions to Effectiveness. The Waiver provided in Section 1 above shall be effective as of (i) with respect to the Specified Events of Default referred to in
Items 1 and 2 of Exhibit A, February 29, 2008, (ii) with respect to the Specified Events of Default referred to in Items 3 through 11 of Exhibit A, March 31, 2008, and (iii) with respect to the Acquisition Event of Default and
the Specified Events of Default referred to in Items 12 through 16 of Exhibit A, the date hereof, in each case upon the fulfillment of the following conditions precedent: 

  

	 	(a)	All actions on the part of the Loan Parties necessary for the valid execution, delivery, and performance by the Loan Parties of this Waiver shall have been duly and effectively
taken. 

  

	 	(b)	The Administrative Agent shall have received an original copy of this Waiver duly executed and delivered by the Loan Parties, the Agents, and the Required Lenders.

  

	 	(c)	 The Administrative Agent shall have received a copy of that certain Amendment No. 6, Consent and Waiver to Credit Agreement of American Apparel (USA), LLC, dated as
of the date hereof, with respect to the SOF Investments Loan (the “SOF Waiver”), duly executed by all parties thereto, pursuant to which SOF Investments shall have waived the defaults arising from, among other things, the 

  

 2 

	 	 
breaches by the Lead Borrower (as Borrower with respect to the SOF Investments Loan) of Section 5.01, Section 6.04, Section 6.11 or
Section 6.12 of the “Credit Agreement” (as such term is defined in the SOF Waiver). 

  

	 	(d)	The Administrative Agent shall have received, for the ratable benefit of the Lenders executing this Waiver, a waiver fee in the amount of $93,750.00, which shall be fully earned on
the date hereof and shall not be subject to refund or rebate in whole or in part under any circumstance. The Administrative Agent is hereby authorized to make a Credit Extension to pay the waiver fee. 

  

	 	(e)	The Administrative Agent shall have instituted an Availability Reserve under the Borrowing Base (which Availability Reserve shall be in addition to all other Reserves under the
Borrowing Base) in the amount of $4,500,000, which Availability Reserve shall remain in place until satisfaction of the obligations of the Loan Parties set forth in Section 3 hereof. 

  

	 	(f)	The Administrative Agent shall have received reimbursement from the Loan Parties for all reasonable costs, expenses, and legal fees incurred by the Administrative Agent through May
    , 2008 in connection with the negotiation, preparation, and execution of this Waiver. Provided that the Administrative Agent shall have notified the Lead Borrower of the amount of such costs, expenses, and legal fees incurred
through such date, the Administrative Agent is hereby authorized to make a Credit Extension to reimburse the Administrative Agent for such costs, expenses, and legal fees. Each of the Loan Parties acknowledges and agrees that additional statements
for all reasonable costs, expenses, and legal fees incurred by the Administrative Agent in connection with the negotiation, preparation, and execution of this Waiver for periods after May     , 2008 will be rendered and paid as
set forth in the Credit Agreement. 

  

	3.	Amendment; Joinder; Pledge. Each Loan Party hereby agrees to enter into, by May 31, 2008, each in form and substance satisfactory to the Agents and each Lender in their
discretion, (i) an amendment to the Credit Agreement and related documents, which amendment and related documents may, among other things, (a) effect a joinder by American Apparel, Inc. (f/k/a Endeavor Acquisition Corp.) to the Loan
Documents, whereby American Apparel, Inc. (f/k/a Endeavor Acquisition Corp.) shall become a Facility Guarantor thereunder, and (b) delete certain financial performance covenants, including, without limitation, the financial performance covenant
relating to Capital Expenditures, in each case in accordance with the Summary of Terms and Conditions set forth as Exhibit B hereto, and (ii) an amendment to the Pledge Agreement, pursuant to which, among other things, the parties
thereto shall amend Schedule I thereto to include all Subsidiaries in existence as of the date of such amendment. The failure of the Loan Parties to enter into the foregoing amendments and related documents by May 31, 2008 shall constitute an
Event of Default under the Credit Agreement for all purposes but shall not invalidate the waiver provided in Section 1 above. 

  

	4.	 No Continuing Waiver. The Loan Parties acknowledge and agree that since the Closing Date, in addition to the Specified Events of Default, certain Events of
Default (together with the Specified Events of Default, collectively, the “Past Events of Default”) have occurred as a result of the Loan Parties’ actions in violation of the Credit Agreement and failure to obtain prior consent
from the Agents and the Lenders for such actions, as such Past Events of Default are more specifically described herein and in (i) that certain Default Waiver dated as of November 23, 2007, by and among the Administrative Agent, certain of
the Lenders, and the Lead Borrower, (ii) that certain Second Amendment and Waiver dated as of November 26, 2007, by and between, among others, the Agents, the certain of the Lenders, and the Loan Parties, (iii) that certain Waiver and
Consent dated as of December 28, 2007, by and among the Agents, certain of the Lenders, and the Lead Borrower, and (iv) that certain Waiver to Credit Agreement dated as of February 29, 2008, by and among the Agents, the Lenders and
the Loan Parties. The Agents and the Lenders have consented to waive such Past Events of Default based on their consideration of certain facts and circumstances presented at the time of each request from the Loan Parties for such waiver. The Loan
Parties further acknowledge and agree that the Agents and the Lenders are under no obligation to waive any future Event of Default arising after the 

  

 3 

	 	 
date hereof and that the Agents and the Lenders shall determine whether to waive any such Event of Default based on facts and circumstances in existence when
such Event of Default arises. Nothing herein or in any other communication with any Agent or any Lender shall be deemed an agreement by any Agent or any Lender to forbear from exercising any and all of their rights, remedies, powers, and privileges
with respect to any other Events of Default. 

  

	5.	Financial Statements for Fiscal Month Ending April 30, 2008. The parties hereto acknowledge and agree that notwithstanding anything in the Credit Agreement to the
contrary, the date by which the Lead Borrower shall have furnished to the Administrative Agent the financial statements and Compliance Certificate referred to in Section 5.01(b) and Section 5.01(c) of the Credit Agreement for the Fiscal
Month ended April 30, 2008, is hereby extended by ten (10) days to June 9, 2008. 

  

	6.	Representations and Warranties; Ratification of Loan Documents. In order to induce the Agents and the Lenders to enter into this Waiver, each Loan Party hereby represents and
warrants that except for the Specified Events of Default, no Default or Event of Default by any Loan Party exists under the Credit Agreement or under any other Loan Document. Except as expressly provided in this Waiver, all terms and conditions of
the Credit Agreement and the other Loan Documents shall remain in full force and effect. The Loan Parties hereby ratify, confirm, and re-affirm all terms and provisions of the Loan Documents, except that any representation or warranty made as of a
specific date shall be true and correct only as of the date so specified. 

  

	7.	Acknowledgement of Obligations. Each of the Loan Parties hereby acknowledges and agrees that there is no basis nor set of facts on which any amount (or any portion thereof)
owed by the Loan Parties under the Credit Agreement and the Loan Documents could be reduced, offset, waived, or forgiven, by rescission or otherwise; nor is there any claim, counterclaim, offset, or defense (or other right, remedy, or basis having a
similar effect) available to any of the Loan Parties with regard thereto; nor is there any basis on which the terms and conditions of any of the Obligations could be claimed to be other than as stated on the written instruments which evidence such
Obligations. 

  

	8.	Waiver of Claims and Release. Each of the Loan Parties hereby acknowledges and agrees that it has no offsets, defenses, claims, or counterclaims against the Agents, the
Lenders, or their respective parents, affiliates, predecessors, successors, or assigns, or their officers, directors, employees, attorneys, or representatives, with respect to the Obligations, or otherwise, and that if any of the Loan Parties now
has, or ever did have, any offsets, defenses, claims, or counterclaims against such Persons, whether known or unknown, at law or in equity, from the beginning of the world through this date and through the time of execution of this Waiver, all of
them are hereby expressly WAIVED, and each of the Loan Parties hereby RELEASES such Persons from any liability therefor. 

  

	9.	Binding Effect. The terms and provisions hereof shall be binding upon and inure to the benefit of the parties hereto and their representatives, successors and assigns.

  

	10.	Multiple Counterparts. This Waiver may be executed in multiple counterparts, each of which shall constitute an original and together which shall constitute but one and the
same instrument. 

  

	11.	Governing Law. This Waiver shall be construed, governed, and enforced pursuant to the laws of the Commonwealth of Massachusetts, without giving effect to principles of
conflicts of laws. 

  

	12.	Loan Document. This Waiver shall constitute a Loan Document for all purposes. Capitalized terms used herein but not otherwise defined herein shall have the meanings assigned
to them in the Credit Agreement. 

 [signature pages follow] 
  

 4 

 IN WITNESS WHEREOF, the parties hereto have duly executed this Waiver as of the date above first written.
This Waiver is intended to take effect as a sealed instrument. 
  

			
	 AMERICAN APPAREL (USA), LLC,
 as Lead
Borrower and as a Borrower

		
	By:	 	 
		
	Name:	 	 
		
	Title:	 	 
	
	 AMERICAN APPAREL RETAIL, INC.,
 as a
Borrower

		
	By:	 	 
		
	Name:	 	 
		
	Title:	 	 
	
	AMERICAN APPAREL DYEING & FINISHING, INC., as a Borrower
		
	By:	 	 
		
	Name:	 	 
		
	Title:	 	 

					
	
	KCL KNITTING, LLC, as a Borrower
		
	By:	 	American Apparel (USA), LLC, its sole member
			
		 	By:	 	 
			
		 	Name:	 	 
			
		 	Title:	 	 

 Signature Page to Waiver to Credit Agreement 

					
	AMERICAN APPAREL, LLC, as a Facility Guarantor
		
	By:	 	American Apparel (USA), LLC, its sole member
			
		 	By:	 	 
			
		 	Name:	 	 
			
		 	Title:	 	 

			
	
	FRESH AIR FREIGHT, INC., as a Facility Guarantor
		
	By:	 	 
		
	Name:	 	 
		
	Title:	 	 

  
 Signature Page to
Waiver to Credit Agreement 
  

			
	 LASALLE BUSINESS CREDIT, LLC,
 As
Agent for LaSalle Bank Midwest National Association, acting through its division, LaSalle Retail Finance, as Administrative Agent, as Collateral Agent, as Swingline Lender and as Lender

		
	By:	 	 
		
	Name:	 	Stephen J. Garvin
		
	Title:	 	Vice President
	
	LASALLE BANK NATIONAL ASSOCIATION, as Issuing Bank
		
	By:	 	 
		
	Name:	 	Stephen J. Garvin
		
	Title:	 	Vice President

  
 Signature Page to
Waiver to Credit Agreement 

			
	 WELLS FARGO RETAIL FINANCE, LLC,
 as
Collateral Monitoring Agent and as a Lender

		
	By:	 	 
		
	Name:	 	Emily Abrahamson
		
	Title:	 	Assistant Vice President/Account Executive

  
  
  
 Signature Page to Waiver to Credit Agreement 

			
	 NATIONAL CITY BUSINESS CREDIT, INC.,
 as a Lender

		
	By:	 	 
		
	Name:	 	Kathryn C. Ellero
		
	Title:	 	Vice President

  
  
  
 Signature Page to Waiver to Credit Agreement 

 Exhibit A 
 Financial and Compliance Events of Default 
 1. The Loan Parties have failed to deliver, within thirty (30) days
following the end of the Fiscal Month ending January 31, 2008, the financial statements for such Fiscal Month, which are required to be delivered pursuant to Section 5.01(b) of the Credit Agreement. Such failure constitutes an Event of
Default under Section 7.01(e) of the Credit Agreement. 
 2. The Loan Parties have failed to deliver, within thirty (30) days following the end of
the Fiscal Month ending January 31, 2008, the Compliance Certificate for such Fiscal Month, which is required to be delivered pursuant to Section 5.01(c) of the Credit Agreement. Such failure constitutes an Event of Default under
Section 7.01(e) of the Credit Agreement. 
 3. The Loan Parties failed to deliver, within thirty (30) days following the end of the Fiscal Month
ending February 29, 2008, the financial statements for such Fiscal Month, which are required to be delivered pursuant to Section 5.01(b) of the Credit Agreement. Such failure constitutes an Event of Default under Section 7.01(e) of
the Credit Agreement. 
 4. The Loan Parties have failed to deliver, within thirty (30) days following the end of the Fiscal Month ending
February 29, 2008, the Compliance Certificate for such Fiscal Month, which is required to be delivered pursuant to Section 5.01(c) of the Credit Agreement. Such failure constitutes an Event of Default under Section 7.01(e) of the
Credit Agreement. 
 5. The Loan Parties have failed to deliver, within thirty (30) days following the end of the Fiscal Month ending March 31,
2008, the financial statements for such Fiscal Month, which are required to be delivered pursuant to Section 5.01(b) of the Credit Agreement. Such failure constitutes an Event of Default under Section 7.01(e) of the Credit Agreement.

 6. The Loan Parties have failed to deliver, within thirty (30) days following the end of the Fiscal Month ending March 31, 2008, the Compliance
Certificate for such Fiscal Month, which is required to be delivered pursuant to Section 5.01(c) of the Credit Agreement. Such failure constitutes an Event of Default under Section 7.01(e) of the Credit Agreement. 
 7. The Loan Parties have violated the financial performance covenant set forth in Section 2 of Exhibit M of the Credit Agreement by making Capital Expenditures in
excess of $5,000,000.00 during the Fiscal Quarter ending March 31, 2008, as more specifically described below: 
  

				
	 Covenant
	  	Actual Capital Expenditures
as of March 31, 2008
	 Not more than $5,000,000.00
	  	$	14,791,354.00

 Such violation constitutes an Event of Default under Section 7.01(d) of the Credit Agreement. 
 8. The Loan Parties have violated the financial performance covenant set forth in Section 4 of Exhibit M of the Credit Agreement by failing to maintain a
Consolidated Fixed Charge Coverage Ratio of not less than 1:00 to 1.00 for the Fiscal Quarter ending March 31, 2008, as more specifically described below: 
  

			
	 Covenant
	  	Actual
	 Not less than 1.00 to 1.00
	  	0.6510 to 1.00

 Such violation constitutes an Event of Default under Section 7.01(d) of the Credit Agreement. 
  

 Exhibit A to Waiver to Credit Agreement 

 9. The Loan Parties have violated Section 6.01 of the Credit Agreement by permitting American Apparel Japan Yugen
Kaisha, a Subsidiary of a Loan Party, to incur Indebtedness to a Person in the amount of JPM100,000,000. Such violation constitutes an Event of Default under Section 7.01(d) of the Credit Agreement. 
 10. The Loan Parties have violated Sections 6.04 and 6.08 of the Credit Agreement by making intercompany loans and other transfers to certain Subsidiaries of the Loan
Parties prior to March 31, 2008, including, without limitation, Subsidiaries organized or to be organized under the laws of China, which act is an Investment that is not a Permitted Investment. Such violation constitutes an Event of Default
under Section 7.01(d) of the Credit Agreement. 
 11. The Loan Parties have materially breached the documents, instruments and agreements executed in
connection with the SOF Investments Loan by engaging in the actions referred to with respect to the Acquisition Event of Default and Items 1 through 10 of this Exhibit A. Such breach constitutes an Event of Default under Section 7.01(r) of the
Credit Agreement. 
 12. The Loan Parties have violated Sections 6.04 and 6.08 of the Credit Agreement by making intercompany loans and other transfers to
certain Subsidiaries of the Loan Parties during the months of April and May, 2008, including, without limitation, Subsidiaries organized or to be organized under the laws of Brazil and China, which act is an Investment that is not a Permitted
Investment. Such violation constitutes an Event of Default under Section 7.01(d) of the Credit Agreement. 
 13. The Loan Parties have violated the
financial performance covenant set forth in Section 2 of Exhibit M of the Credit Agreement by making Capital Expenditures in excess of $5,000,000.00 during the Fiscal Quarter ending June 30, 2008. Such violation constitutes an Event of
Default under Section 7.01(d) of the Credit Agreement. 
 14. The Loan Parties have violated the financial performance covenant set forth in
Section 2 of Exhibit M of the Credit Agreement by making Capital Expenditures in excess of $17,500,000.00 during the Fiscal Year ending December 31, 2008. Such violation constitutes an Event of Default under Section 7.01(d) of the
Credit Agreement. 
 15. The Lead Borrower has advised the Agents and the Lenders that the Loan Parties are likely to fail to comply with the financial
performance covenant set forth in Section 4 of Exhibit M to the Credit Agreement relating to Consolidated Fixed Charge Coverage Ratio for the Fiscal Quarter ending June 30, 2008. Such likely failure constitutes a Default under
Section 7.01(d) of the Credit Agreement. 
 16. The Loan Parties have materially breached the documents, instruments and agreements executed in
connection with the SOF Investments Loan by engaging in the actions referred to with respect to Items 12 through 15 of this Exhibit A. Such breach constitutes an Event of Default under Section 7.01(r) of the Credit Agreement. 
  

 Exhibit A to Waiver to Credit Agreement 

 Exhibit B 
 Summary of Terms and Conditions 
 1077959.9 
  

 Exhibit B to Waiver to Credit Agreement

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