Deal Notes from Seller for LOI.

The buyer is Clothing Ventures, LLC (CV).From our discussions, we think CV wants to buy the assets of Elan, although it's possible buyer will want to re-structure the transaction after talking with tax advisers.

We've set a purchase price of $25million, and they are interested based on our financials though CV has said this amount will have to be reduced if we don't hit the targeted net income at the end of the year.

Please put together a simple LOI that we can give to Buyer to sign.We're ok with giving CV exclusivity so long as the deal is finished quickly.Also, we'd like to keep this deal confidential.We don't want our employees finding out about the sale until we get closer to closing.We've already signed a confidentiality agreement with CV for CV's due diligence for this deal.

Thanks.

Sincerely,

Brad Elan

President, Elan Fashion, Inc.