Tarrant Apparel Group – ‘424B5’ on 1/27/04

On:  Tuesday, 1/27/04, at 1:53pm ET   ·   Accession #:  1170918-4-47   ·   File #:  333-111092

in

this entire Filing. an “Entity” Search.

Show

Documents searched

and

each “hit”. the 1st “hit”.

↓↑Hints

Prospectus   —   Rule 424(b)(5)
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 424B5       Prospectus                                            30    135K 

Document Table of Contents

424B5
1st Page of 30
TOC
↑Top
Previous
Next
↓Bottom
Just 1st
 
PROSPECTUS SUPPLEMENT                                                           

                                                Filed pursuant to Rule 424(b)(5)
                                                     Registration No. 333-111092

 TARRANT APPAREL GROUP

COMMON STOCK
 WARRANTS TO PURCHASE COMMON STOCK
 COMMON STOCK ISSUABLE UPON EXERCISE OF WARRANTS

         We are offering  1,200,000  shares of our common stock at a fixed price
of $3.35 per share  through  this  prospectus  supplement  and the  accompanying
prospectus to certain institutional  investors. The gross proceeds from the sale
of these 1,200,000 shares are $4,020,000.  After payment of placement agent fees
of 7% of the gross  proceeds to Sanders  Morris  Harris Inc. for its services as
placement  agent,  we would  receive  proceeds  from the sale of these shares as
follows:                                                                        

                                           PER
                                                         SHARE         TOTAL
                                                        ----------    ----------
Offering Price .................................        $    3.350    $4,020,000
Placement Agent Fees ...........................        $     .235    $  282,000
Proceeds to Tarrant Apparel Group                                               
   (before expenses) ...........................        $    3.115    $3,738,000

         We are also offering  Sanders  Morris Harris Inc. a warrant to purchase
30,000 shares of our common stock  through this  prospectus  supplement  and the
accompanying prospectus. The warrant being offered to Sanders Morris Harris Inc.
has an exercise price of $3.35 per share and expires on January 23, 2009. We are
issuing this warrant to Sanders Morris Harris Inc. as partial  consideration for
its services as placement agent.                                                

         You  should  read  this  prospectus  supplement  and  the  accompanying
prospectus carefully before you invest in our securities.                       

         Our common stock is traded on the NASDAQ  National  Market System under
the symbol  "TAGS." On January 22,  2004,  the last  reported  sale price of the
common stock on the NASDAQ National Market System was $3.29 per share.          

         INVESTING  IN  OUR  SECURITIES   INVOLVES  RISKS.  SEE  "RISK  FACTORS"
BEGINNING ON PAGE 4 OF THE  ACCOMPANYING  PROSPECTUS TO READ ABOUT THE RISKS YOU
SHOULD CONSIDER CAREFULLY BEFORE BUYING SHARES OF OUR COMMON STOCK.             

----------

         Neither the Securities and Exchange Commission nor any state securities
commission has approved or  disapproved  of these  securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense.                                                               

----------

[SANDERS MORRIS HARRIS LOGO]

The date of this prospectus is January 23, 2004.

424B5
2nd Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 2nd
 TABLE OF CONTENTS

                              PROSPECTUS SUPPLEMENT                         PAGE

ABOUT THIS PROSPECTUS SUPPLEMENT.............................................S-3
TARRANT APPAREL GROUP........................................................S-3
THE OFFERING ................................................................S-4
RISK FACTORS.................................................................S-6
FORWARD-LOOKING STATEMENTS...................................................S-6
USE OF PROCEEDS..............................................................S-6
DESCRIPTION OF THE WARRANT...................................................S-7
PLAN OF DISTRIBUTION.........................................................S-9
WHERE YOU CAN FIND MORE INFORMATION.........................................S-11
LEGAL MATTERS...............................................................S-12
EXPERTS.....................................................................S-12

PROSPECTUS

ABOUT THIS PROSPECTUS..........................................................3
TARRANT APPAREL GROUP..........................................................3
RISK FACTORS...................................................................4
FORWARD-LOOKING STATEMENTS....................................................10
USE OF PROCEEDS...............................................................10
DILUTION......................................................................10
DESCRIPTION OF THE COMMON STOCK AND PREFERRED STOCK WE MAY OFFER..............11
DESCRIPTION OF THE WARRANTS WE MAY OFFER......................................15
PLAN OF DISTRIBUTION..........................................................16
WHERE YOU CAN FIND MORE INFORMATION...........................................17
LEGAL MATTERS.................................................................18
EXPERTS.......................................................................18

         YOU SHOULD RELY ONLY ON THE  INFORMATION  PROVIDED OR  INCORPORATED  BY
REFERENCE IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS. WE HAVE
NOT AUTHORIZED  ANYONE TO PROVIDE YOU WITH DIFFERENT OR ADDITIONAL  INFORMATION.
YOU SHOULD NOT ASSUME THAT THE INFORMATION IN THIS PROSPECTUS  SUPPLEMENT OR THE
ACCOMPANYING  PROSPECTUS  IS  ACCURATE  AS OF ANY  DATE  OTHER  THAN  ITS  DATE,
REGARDLESS  OF THE  TIME  OF  DELIVERY  OF  THIS  PROSPECTUS  SUPPLEMENT  OR THE
ACCOMPANYING PROSPECTUS OR ANY SALE OF COMMON STOCK OR ISSUANCE OF WARRANTS.    

         This prospectus  supplement and the accompanying  prospectus are offers
to sell and  solicitations  of  offers  to buy the  securities  offered  by this
prospectus  supplement  only in  jurisdictions  where  the  offers  or sales are
permitted.                                                                      

         In this prospectus supplement,  "Tarrant Apparel Group," "we," "us" and
"our" refer to Tarrant  Apparel Group and do not refer to the placement agent in
connection with this offering.                                                  

S-2 

424B5
3rd Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 3rd
ABOUT THIS PROSPECTUS SUPPLEMENT

         This prospectus supplement and the accompanying  prospectus are part of
a  Registration  Statement  on Form S-3 that we filed  with the  Securities  and
Exchange Commission utilizing a "shelf" registration  process.  Under this shelf
process,  we may sell common  stock,  preferred  stock and  warrants  for equity
securities from time to time in one or more offerings up to an aggregate initial
public offering price of $20,000,000.  This prospectus  supplement describes the
specific  details  regarding this offering,  including the price,  the amount of
common  stock  and  warrants  being  offered,  the  risks  of  investing  in our
securities and the placement agent  arrangements.  The  accompanying  prospectus
provides  general  information  about  us,  some of which,  such as the  section
entitled "Plan of Distribution," may not apply to this offering.  If information
in this prospectus  supplement is inconsistent with the accompanying  prospectus
or the  information  filed  with the SEC  prior  to the date of this  prospectus
supplement  and  incorporated  herein  by  reference,  you  should  rely on this
prospectus  supplement.  You should read both this prospectus supplement and the
accompanying  prospectus together with the additional  information about Tarrant
Apparel Group  described in this prospectus  supplement in the section  entitled
"Where You Can Find More Information."                                          

 TARRANT APPAREL GROUP

         Tarrant  Apparel  Group  is a  leading  provider  of  apparel,  serving
specialty  retailers,  mass  merchandisers and department store chains and major
international  brands  located  primarily  in the  United  States by  designing,
merchandising, contracting for the manufacture of, and selling primarily casual,
moderately-priced  apparel  for women,  men and  children.  Our major  customers
include specialty retailers, such as Express, a division of The Limited, as well
as Lane Bryant,  Lerner New York, Wet Seal,  Federated  Department Stores,  J.C.
Penney,  K-Mart,   Kohl's,   Mervyns,  Sears  and  Wal-Mart.  Our  products  are
manufactured in a variety of woven and knit fabrications and include jeans wear,
casual pants,  t-shirts,  shorts,  blouses,  shirts and other tops,  dresses and
jackets.                                                                        

         We were  incorporated  in California in September  1988.  Our executive
offices are located at 3151 East Washington Boulevard,  Los Angeles,  California
90023, and our telephone  number is (323) 780-8250.  Information on our website,
www.tags.com, does not constitute part of this prospectus.                      

S-3 

424B5
4th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 4th
THE OFFERING

         The following summary highlights  selected  information about the terms
of our common stock, the warrants and the common stock issuable upon exercise of
the  warrants.  For a  more  detailed  description  of  our  common  stock,  see
"Description  of  the  Common  Stock  and  Preferred  Stock  We May  Offer"  and
"Description of the Warrants We May Offer" in the accompanying  prospectus,  and
"Description of the Warrant" in this prospectus supplement.                     

Issuer                                Tarrant Apparel Group                     

Common stock offered by us            1,200,000 shares                          

Warrant offered to Sanders            The  warrant   being  offered  to  Sanders
Morris Harris Inc.                    Morris    Harris   Inc.    is    initially
                                      exercisable  for an  aggregate  of  30,000
                                      shares of our  common  stock,  subject  to
                                      adjustment   as   described   below  under
                    "Adjustment of warrant."

Expiration of warrant                 The  warrant   being  offered  to  Sanders
                                      Morris  Harris Inc. is scheduled to expire
                                      at 5:00 p.m.  Los Angeles  time on January
     23, 2009.

Exercise of  warrant                  The  warrant   being  offered  to  Sanders
                                      Morris    Harris   Inc.    is    initially
                                      exercisable  at an exercise price of $3.35
                                      per  share,   subject  to   adjustment  as
                                      described   below  under   "Adjustment  of
      warrants."

Adjustment of warrant                 The  number of shares of common  stock for
                                      which,  and the  price per share at which,
                                      the  warrant   being  offered  to  Sanders
                                      Morris  Harris  Inc.  is  exercisable  are
                                      subject to adjustment in case we (1) pay a
                                      dividend  in shares of common  stock,  (2)
                                      subdivide our outstanding shares of common
                                      stock into a greater number of shares, (3)
                                      combine our outstanding  common stock into
                                      a  smaller  number  of  shares  of  common
                                      stock,  or (4) issue any  shares of common
                                      stock in a reclassification  of our common
                                      stock,  in each case as  described  in the
                                      Common  Stock   Purchase   Warrant  to  be
                                      entered into between us and Sanders Morris
       Harris Inc.

Transfer of  warrant                  The  warrant   being  offered  to  Sanders
                                      Morris   Harris   Inc.   will  be   freely
                                      transferable   (subject  to  the  one-year
                                      transfer   restrictions   imposed  by  the
                                      National    Association    of   Securities
                                      Dealers,   Inc.).   See   "Description  of
                      Warrant--Transferability."

Listing of common stock               Our  common  stock is listed on the NASDAQ
and warrant                           National  Market  System  under the symbol
                                      "TAGS."  The  warrant   being  offered  to
                                      Sanders  Morris  Harris Inc. is not listed
                                      on NASDAQ or any other securities exchange
                                      and we do not  intend to  arrange  for any
                                      exchange or quotation  system or automated
                                      quotation  system  to  list or  quote  the
    warrant.

 S-4

424B5
5th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 5th
Common stock to be outstanding        28,814,763  shares,   including  1,200,000
after this offering*                  shares being purchased  immediately by the
                                      institutional investors, but excluding the
                                      30,000 shares underlying the warrant to be
                                 offered to Sanders Morris Harris Inc.

Dividend policy                       We have not paid any cash dividends on our
                                      common  stock  in  the  past  and  do  not
                                      anticipate  paying any cash  dividends  on
                                      our  common   stock  in  the   foreseeable
   future.

Use of  proceeds                      We intend to use the net proceeds from the
                                      sale of common stock in this  offering for
                                      working    capital   and   other   general
               corporate purposes.

                                      There can be no assurance that the warrant
                                      being  offered  to Sanders  Morris  Harris
                                      Inc.  will be exercised  before it expires
                                      or that we will receive any proceeds  from
                                      the offering of the  warrant.  Even if the
                                      warrant is  exercised,  we cannot  predict
                                      when such exercise will occur and when any
                      proceeds will be received.

----------------                                                                

*        The  number  of shares of common  stock to be  outstanding  after  this
         offering is based on 27,614,763 shares  outstanding on the date of this
prospectus supplement, and does not include:                  

         o        an aggregate of 9,880,069 shares of common stock issuable upon
                  exercise of options and warrants  (including the warrant to be
                  offered to Sanders  Morris Harris Inc.)  outstanding as of the
                  date  of  this  prospectus  supplement,  at  weighted  average
exercise prices of $6.88 per share; and     

         o        1,531,663  shares  available  for grant as of the date of this
       prospectus supplement under our stock option plans.

S-5 

424B5
6th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 6th
RISK FACTORS

         INVESTING IN OUR SECURITIES  INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD
CAREFULLY  CONSIDER THE RISKS DESCRIBED UNDER "RISK FACTORS" BEGINNING ON PAGE 4
OF THE  ACCOMPANYING  PROSPECTUS  IN  CONJUNCTION  WITH  THE  OTHER  INFORMATION
CONTAINED OR  INCORPORATED  BY REFERENCE IN THIS  PROSPECTUS  SUPPLEMENT AND THE
ACCOMPANYING  PROSPECTUS  BEFORE  MAKING A DECISION TO PURCHASE OUR  SECURITIES.
ALSO CONSIDER  CAREFULLY THE STATEMENTS UNDER  "FORWARD-LOOKING  STATEMENTS." IF
ANY OF THE RISKS DESCRIBED IN THE ACCOMPANYING  PROSPECTUS OR OTHER  INFORMATION
INCORPORATED  BY REFERENCE IN THIS  PROSPECTUS  SUPPLEMENT AND THE  ACCOMPANYING
PROSPECTUS  ACTUALLY  OCCURS,  OUR BUSINESS,  FINANCIAL  CONDITION OR RESULTS OF
OPERATIONS WOULD LIKELY MATERIALLY  SUFFER. IF THIS OCCURS, THE TRADING PRICE OF
OUR COMMON  STOCK COULD  DECLINE,  AND YOU MAY LOSE ALL OR PART OF THE MONEY YOU
PAID TO BUY OUR SECURITIES.                                                     

FORWARD-LOOKING STATEMENTS

         This  prospectus  supplement  and the  accompanying  prospectus and the
information  incorporated by reference into this  prospectus  supplement and the
accompanying  prospectus  contain  statements  that  constitute  forward-looking
statements  within the meaning of Section 27A of the  Securities Act of 1933 and
Section 21E of the Exchange Act of 1934, both as amended.  These forward-looking
statements are subject to various risks and uncertainties.  The  forward-looking
statements include, without limitation, statements regarding our future business
plans and strategies and our future financial position or results of operations,
as well as other statements that are not historical.  You can find many of these
statements  by looking  for words like  "will",  "may",  "believes",  "expects",
"anticipates",  "plans" and  "estimates"  and for similar  expressions.  Because
forward-looking  statements  involve  risks  and  uncertainties,  there are many
factors  that could  cause the actual  results to differ  materially  from those
expressed  or  implied.   These  include,  but  are  not  limited  to,  economic
conditions.   Any  forward-looking  statements  are  not  guarantees  of  future
performance  and  involve  risks and  uncertainties.  Actual  results may differ
materially  from  those   projected  in  this  prospectus   supplement  and  the
accompanying prospectus and the information  incorporated by reference into this
prospectus supplement and the accompanying  prospectus contain, for the reasons,
among  others,  described  in  the  Risk  Factors  section  of  this  prospectus
supplement  beginning  on page S-6.  You should  read the Risk  Factors  section
carefully,   and  should  not  place  undue  reliance  on  any   forward-looking
statements,  which speak only as of the date of this prospectus  supplement.  We
undertake  no  obligation  to release  publicly  any updated  information  about
forward-looking  statements to reflect events or  circumstances  occurring after
the  date  of  this  prospectus  supplement  or to  reflect  the  occurrence  of
unanticipated events.                                                           

 USE OF PROCEEDS

         We estimate that the net proceeds to us from the sale of shares in this
offering will be approximately $3,688,000,  after deducting placement agent fees
of $282,000 and estimated  expenses of $50,000.  There can be no assurance  that
the warrant  offered to Sanders  Morris Harris Inc. will be exercised  before it
expires or that we will receive any  proceeds  from the offering of the warrant.
Even if the warrant is  exercised,  we cannot  predict when such  exercise  will
occur and when any proceeds will be received.                                   

         We intend to use any net proceeds from the sale of  securities  offered
by this  prospectus  supplement  and the  accompanying  prospectus  for  working
capital and other  general  corporate  purposes.  Pending any of these uses,  we
intend  to  invest  the  net   proceeds   of  this   offering   in   short-term,
interest-bearing  instruments  or  other  investment-grade  securities.  We will
retain broad discretion in allocating the net proceeds of this offering.        

S-6 

424B5
7th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 7th
DESCRIPTION OF THE WARRANT

GENERAL                                                                         

         The terms of the warrant will be set forth in a Common  Stock  Purchase
Warrant  between us and Sanders Morris Harris Inc. The  description of the terms
of the warrant  below is  qualified in all respects by reference to the terms of
the Common Stock Purchase Warrant,  which is being  incorporated by reference in
this prospectus supplement.  A warrant does not entitle the holder to any rights
as a shareholder  of Tarrant  Apparel Group or to receive any dividends  paid on
the common stock.                                                               

WARRANT OFFERED TO SANDERS MORRIS HARRIS INC.                                   

         The  warrant  offered  to  Sanders  Morris  Harris  Inc.  is  initially
exercisable  for up to an aggregate of 30,000  shares of common stock (one share
for every 40 shares sold in this  offering)  at an  exercise  price of $3.35 per
share  of  common  stock,   subject  to  adjustment  as  described  below  under
"Adjustments."  The warrant provides that the exercise price may be paid by wire
transfer or  cashier's  check.  The warrant  also may be exercised on a cashless
basis.                                                                          

FRACTIONAL SHARES                                                               

         No fractional  shares of common stock will be issued in connection with
the exercise of the warrant.  As to any fractional  share to which the holder of
the warrant  would  otherwise be  entitled,  we will pay the holder an amount in
cash equal to the fractional amount multiplied by the exercise price.           

EXPIRATION                                                                      

         The warrant  will expire at 5:00 p.m.  Los Angeles  time on January 23,
2009.                                                                           

ADJUSTMENTS                                                                     

         The number of shares of common stock for which, and the price per share
at which,  the warrant is  exercisable  are subject to adjustment in case we (1)
pay a dividend in shares of common stock,  (2) subdivide our outstanding  shares
of common  stock into a greater  number of shares,  (3) combine our  outstanding
common stock into a smaller  number of shares of common stock,  or (4) issue any
shares of common stock in a  reclassification  of our common stock, in each case
as provided in the Common Stock Purchase Warrant.                               

TRANSFERABILITY                                                                 

         The warrant will be freely  transferable  by Sanders Morris Harris Inc.
upon surrender of the warrant at our principal executive offices,  together with
a written assignment in the form attached thereto and any funds necessary to pay
any transfer taxes payable upon the transfer; PROVIDED, HOWEVER, for a period of
one-year  following  the date of issuance,  the warrant to be offered to Sanders
Morris  Harris Inc.,  and any shares of common stock issued upon exercise of the
warrant,  will be subject to transfer restrictions imposed by the regulations of
the National Association of Securities Dealers,  Inc. ("NASD"),  and the warrant
will  contain  a  restrictive  legend  to this  effect.  The  NASD  restrictions
generally  prohibit  the  transfer of the  warrant,  and of any shares of common
stock issued upon exercise of the warrant,  other than to bona fide officers and
partners of Sanders Morris Harris Inc.                                          

S-7 

424B5
8th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 8th
LISTING                                                                         

         The warrant will not be listed on the NASDAQ  National Market System or
any other securities exchange or automated quotation system and we do not intend
to arrange for any exchange or quotation system to list or quote the warrant.   

RESERVATION OF SHARES                                                           

         We have  authorized  and  reserved  for  issuance a number of shares of
common stock as are issuable upon the exercise of the warrant.  The common stock
issued upon exercise of the warrant,  when paid for and issued, will be duly and
validly issued, fully paid and non-assessable.                                  

S-8 

424B5
9th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 9th
PLAN OF DISTRIBUTION

PLACEMENT AGENT AGREEMENT                                                       

         Pursuant to a placement  agent  agreement  dated  January 23, 2004,  we
engaged  Sanders  Morris  Harris  Inc.,  or "SMH,"  to act as our  non-exclusive
placement  agent in connection  with the offering  described in this  prospectus
supplement,  which is being conducted under our shelf registration statement, of
which this  prospectus  supplement is a part. SMH is a registered  broker dealer
and NASD  member firm with its  principal  office  located at 600 Travis,  Suite
3100,  Houston,  Texas 77002.  Under the terms of the placement agent agreement,
SMH has agreed to use its best efforts in connection  with the issuance and sale
by us of the shares in this  offering.  The placement  agent  agreement does not
give rise to any commitment by SMH to purchase any securities, and SMH will have
no authority to bind us by virtue of the placement  agent  agreement.  Under the
placement  agent  agreement,  the  obligations  of SMH are subject to normal and
customary  closing  conditions.  We have agreed to indemnify SMH against certain
liabilities  arising in connection  with the engagement,  including  liabilities
under federal  securities laws, or to contribute to payments SMH may be required
to make because of these liabilities.                                           

         SMH has performed  investment  banking and financial  advisory services
and participated in the private  placement of equity securities for us for which
they have  received  customary  fees and  reimbursement  of their  out-of-pocket
expenses. SMH may, from time to time, in the future engage in transactions with,
or  perform  services  for,  us and our  affiliates  in the  ordinary  course of
business.                                                                       

THE OFFERING                                                                    

         In this transaction,  we are directly selling to certain  institutional
investors,  1,200,000  shares of our common  stock at a fixed price of $3.35 per
share.                                                                          

         The shares of common stock sold in this  offering will be quoted on the
Nasdaq National Market.                                                         

         It is possible  that not all of the shares of our common stock  offered
pursuant to this  prospectus  supplement  will be sold at the closing,  in which
case our net proceeds would be reduced.                                         

         In connection with the offering,  SMH may engage in  transactions  that
stabilize,  maintain,  or otherwise affect the market price of our common stock.
Any of these  activities  may maintain the market price of our common stock at a
level above that which might otherwise prevail in the open market. The placement
agent is not required to engage in these  activities and, if commenced,  may end
any of these  activities at any time. In connection with this offering,  SMH may
distribute prospectuses electronically.                                         

COMMISSIONS, FEES AND EXPENSES OF THE OFFERING                                  

         We have agreed to pay SMH a placement  fee of 7% of the gross  proceeds
of this  offering.  We will also issue to SMH as partial  consideration  for its
services as placement  agent a warrant to purchase  30,000  shares (one share of
common  stock for every 40 shares sold in this  offering) of our common stock at
an exercise  price of $3.35 per share,  payable in cash. The warrant also may be
exercised on a cashless basis.  The warrant will have a term of five years.  The
warrant will be freely transferable by SMH; provided,  however,  the warrant and
any shares of common stock issued upon exercise of the warrant, may not be sold,
transferred, assigned, or hypothecated for a period of one year from the date of
issuance except to officers or partners (not directors) of SMH. See "Description
of Warrant--Transferability."                                                   

         We have also agreed to  reimburse  SMH for up to $30,000 of  reasonable
out-of-pocket expenses incurred in connection with this offering, subject to the
limitation on the amount of reimburseable expenses set forth below.             

S-9 

424B5
10th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 10th
         The  following  table  shows the  placement  agent fee  (excluding  the
warrant to be offered to SMH) to be paid by us in connection with this offering,
per share of common stock and in total:                                         

                                                      PER SHARE          TOTAL
                                                       ---------        --------
Placement Agent Fee .......................            $    .235        $282,000

         We  estimate  that  the  total  expenses  of  the  offering,  excluding
placement agent fees, will be $50,000.  This estimate  includes expenses related
to the filing of this  prospectus  supplement,  printing  costs,  transfer agent
fees, and our legal and accounting fees and costs.                              

         The maximum commission or discount (including reimbursable expenses and
the value of any warrant received by the member or broker-dealer) to be received
by any NASD member or independent  broker-dealer in connection with any offering
of securities under this prospectus supplement will not exceed 8.0% of the gross
proceeds of the offering.                                                       

S-10

424B5
11th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 11th
 WHERE YOU CAN FIND MORE INFORMATION

         We have filed a  registration  statement  on Form S-3 with the SEC with
respect  to the  common  stock  offered by this  prospectus  supplement  and the
accompanying  prospectus.   This  prospectus  supplement  and  the  accompanying
prospectus,  which  constitute  a part  of the  registration  statement,  do not
contain all of the  information set forth in the  registration  statement or the
exhibits and schedules that are part of the registration statement. You may read
and copy any  document we file at the SEC's public  reference  room at 450 Fifth
Street, N.W., Washington, D.C. 20549. We refer you to the registration statement
and the exhibits and schedules  thereto for further  information with respect to
us and our common  stock.  Please  call the SEC at  1-800-SEC-0330  for  further
information on the public  reference room. Our SEC filings are also available to
the public from the SEC's website at www.sec.gov.                               

         We are subject to the information and periodic  reporting  requirements
of  the  Securities   Exchange  Act  of  1934  and,  in  accordance  with  those
requirements, will continue to file periodic reports, proxy statements and other
information  with the SEC. These periodic  reports,  proxy  statements and other
information  will be available  for  inspection  and copying at the SEC's public
reference rooms and the SEC's website referred to above.                        

         The SEC allows us to "incorporate by reference" the information we file
with the SEC, which means that we can disclose  important  information to you by
referring to those  documents.  We incorporate by reference the documents listed
below and any additional documents filed by us with the SEC under Section 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until this offering of
securities is  terminated.  The  information  we  incorporate by reference is an
important part of this prospectus  supplement,  and any information that we file
later with the SEC will automatically update and supersede this information.    

The documents we incorporate by reference are:                

         1.       Our Annual Report on Form 10-K for the year ended December 31,
2002 (File No. 000-26430);                  

         2.       Our  Amendment No. 1 to our Annual Report on Form 10-K for the
                  year ended  December 31, 2002,  as filed on May 15, 2003 (File
No. 000-26430)                              

         3.       Our Quarterly  Report on Form 10-Q for the quarter ended March
31, 2003 (File No. 000-26430);              

         4.       Our  Quarterly  Report on Form 10-Q for the quarter ended June
30, 2003 (File No. 000-26430);              

         5.       Our  Quarterly  Report  on Form  10-Q  for the  quarter  ended
September 30, 2003 (File No. 000-26430);    

         6.       Our Current Report on Form 8-K as filed on April 4, 2003 (File
No. 000-26430);                             

         7.       Our Current  Report on Form 8-K as filed on May 16, 2003 (File
No. 000-26430);                             

         8.       Our Current Report on Form 8-K as filed on July 10, 2003 (File
No. 000-26430);                             

         9.       Our  Current  Report on Form 8-K as filed on August  18,  2003
(File No. 000-26430);                       

         10.      Our  Current  Report on Form 8-K as filed on October  27, 2003
(File No. 000-26430);                       

         11.      Our Current  Report on Form 8-K as filed on November  14, 2003
(File No. 000-26430);                       

         12.      Our Current  Report on Form 8-K as filed on November  21, 2003
(File No. 000-26430);                       

         13.      Our Current  Report on Form 8-K as filed on December  10, 2003
(File No. 000-26006);                       

S-11

424B5
12th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 12th
         14.      Our Current Report on Form 8-K/A as filed on December 12, 2003
(File No. 000-26006);                       

         15.      The   description  of  the  Common  Stock  of  the  Registrant
                  contained in the Registrant's  Registration Statements on Form
                  8-A as filed on May 4, 1995 (File No.  000-26006) and November
                  21, 2003 (File No.  000-26006),  including  any  amendment  or
                  report filed for the purpose of updating such description; and

         16.      All other  reports  filed by us pursuant  to Section  13(a) or
                  15(d) of the  Securities  Exchange Act of 1934 since  December
                  31, 2002,  including  all such reports filed after the date of
                  the initial registration  statement and prior to effectiveness
of the registration statement.              

         You may  request a copy of these  filings,  at no cost,  by  writing or
calling  us at  Tarrant  Apparel  Group,  3151 East  Washington  Boulevard,  Los
Angeles, California 90023, telephone number (323) 780-8250,  Attention:  Patrick
Chow.                                                                           

         You should rely only on the information contained in this prospectus or
any supplement and in the documents incorporated by reference above. We have not
authorized anyone else to provide you with different information. You should not
assume that the  information  in this  prospectus  or any  supplement  or in the
documents  incorporated by reference is accurate on any date other than the date
on the front of those documents.                                                

 LEGAL MATTERS

         Stubbs Alderton & Markiles,  LLP, Encino,  California,  has rendered to
Tarrant Apparel Group a legal opinion as to the validity of the common stock and
warrants offered pursuant to this prospectus  supplement.  Certain legal matters
with respect to the  legality of the common  stock being  offered will be passed
upon for the placement agent by Thompson & Knight, LLP, Houston, Texas.         

 EXPERTS

         The  consolidated   financial   statements  of  Tarrant  Apparel  Group
appearing  in Tarrant  Apparel  Group's  Annual  Report (Form 10-K) for the year
ended  December  31,  2002 have been  audited by Ernst & Young LLP,  independent
auditors,  as set forth in their report thereon and  incorporated  by reference.
Such consolidated  financial  statements are incorporated herein by reference in
reliance  upon such  report  given on the  authority  of such firm as experts in
accounting and auditing.                                                        

S-12

424B5
13th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 13th
PROSPECTUS                        $20,000,000                                   

 TARRANT APPAREL GROUP

COMMON STOCK
 PREFERRED STOCK
WARRANTS

----------

         This prospectus  relates to common stock,  preferred stock and warrants
for  equity  securities  which  we may  sell  from  time  to time in one or more
offerings up to an aggregate  initial public offering price of  $20,000,000.  We
will provide  specific terms of these sales in  supplements to this  prospectus.
You should read this prospectus and each supplement carefully before you invest.
This prospectus may not be used to offer and sell securities unless  accompanied
by a prospectus supplement.                                                     

         We currently have an effective registration statement on Form S-3 (File
No. 333-110090) relating to the offer and sale of up to 11,423,052 shares of our
common stock by the selling  shareholders  named in the  prospectus  included in
that  registration  statement.  The offer and sale by Tarrant of the  securities
described in this prospectus and any prospectus supplement is not related to the
offer and sale by the selling shareholders of their shares of our common stock. 

         Our common stock is traded on the NASDAQ  National  Market System under
the symbol  "TAGS." On December 10, 2003,  the last  reported  sale price of the
common stock on the NASDAQ National Market System was $3.90 per share.          

         SEE  "RISK  FACTORS"  BEGINNING  ON PAGE 4 TO READ  ABOUT THE RISKS YOU
SHOULD CONSIDER CAREFULLY BEFORE BUYING SHARES OF OUR COMMON STOCK.             

----------

         Neither the Securities and Exchange Commission nor any state securities
commission has approved or  disapproved  of these  securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense.                                                               

----------

 The date of this prospectus is December 23, 2003.

424B5
14th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 14th
 TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

ABOUT THIS PROSPECTUS..........................................................3

TARRANT APPAREL GROUP..........................................................3

RISK FACTORS...................................................................4

FORWARD-LOOKING STATEMENTS....................................................10

USE OF PROCEEDS...............................................................10

DILUTION......................................................................11

DESCRIPTION OF THE COMMON STOCK AND PREFERRED STOCK WE MAY OFFER..............11

DESCRIPTION OF THE WARRANTS WE MAY OFFER......................................15

PLAN OF DISTRIBUTION..........................................................16

WHERE YOU CAN FIND MORE INFORMATION...........................................17

LEGAL MATTERS.................................................................18

EXPERTS.......................................................................18

2 

424B5
15th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 15th
 ABOUT THIS PROSPECTUS

         This prospectus is part of a Registration Statement on Form S-3 that we
filed  with  the  Securities  and  Exchange   Commission   utilizing  a  "shelf"
registration  process.  Under  this shelf  process,  we may sell  common  stock,
preferred  stock and warrants for equity  securities from time to time in one or
more offerings up to an aggregate  initial public offering price of $20,000,000.
This prospectus provides you with a general description of the securities we may
offer. Each time we sell any securities under this prospectus, we will provide a
prospectus  supplement that will contain specific information about the terms of
that  offering.  The  prospectus  supplement  may also  add,  update  or  change
information  contained in this prospectus.  You should read both this prospectus
and any prospectus  supplement  together with additional  information  described
below under the heading "Where You Can Find More Information."                  

 TARRANT APPAREL GROUP

         Tarrant  Apparel  Group  is a  leading  provider  of  apparel,  serving
specialty  retailers,  mass  merchandisers and department store chains and major
international  brands  located  primarily  in the  United  States by  designing,
merchandising, contracting for the manufacture of, and selling primarily casual,
moderately-priced  apparel  for women,  men and  children.  Our major  customers
include specialty retailers, such as Express, a division of The Limited, as well
as Lane Bryant,  Lerner New York, Wet Seal,  Federated  Department Stores,  J.C.
Penney,  K-Mart,   Kohl's,   Mervyns,  Sears  and  Wal-Mart.  Our  products  are
manufactured in a variety of woven and knit fabrications and include jeans wear,
casual pants,  t-shirts,  shorts,  blouses,  shirts and other tops,  dresses and
jackets.                                                                        

         We were  incorporated  in California in September  1988.  Our executive
offices are located at 3151 East Washington Boulevard,  Los Angeles,  California
90023, and our telephone  number is (323) 780-8250.  Information on our website,
www.tags.com, does not constitute part of this prospectus.                      

3 

424B5
16th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 16th
RISK FACTORS

         YOU SHOULD CAREFULLY  CONSIDER THE FOLLOWING RISKS BEFORE YOU DECIDE TO
BUY OUR SECURITIES. THE RISKS AND UNCERTAINTIES DESCRIBED BELOW ARE THE MATERIAL
ONES FACING OUR COMPANY.  IF ANY OF THE  FOLLOWING  RISKS  ACTUALLY  OCCUR,  OUR
BUSINESS,  FINANCIAL  CONDITION OR RESULTS OF OPERATIONS WOULD LIKELY SUFFER. IF
THIS OCCURS,  THE TRADING PRICE OF OUR COMMON STOCK COULD  DECLINE,  AND YOU MAY
LOSE ALL OR PART OF THE MONEY YOU PAID TO BUY OUR SECURITIES.                   

RISKS ASSOCIATED WITH THIS OFFERING                                             
-----------------------------------                                             

INSIDERS OWN A SIGNIFICANT  PORTION OF OUR COMMON  STOCK,  WHICH COULD LIMIT OUR
SHAREHOLDERS' ABILITY TO INFLUENCE THE OUTCOME OF KEY TRANSACTIONS.             

         As of December 10, 2003, our executive officers and directors and their
affiliates  owned  approximately  30.2% of the outstanding  shares of our common
stock. Gerard Guez, our Chief Executive Officer and Chairman,  and Todd Kay, our
President  and  Vice  Chairman,   alone  own   approximately   20.4%  and  9.4%,
respectively,  of the  outstanding  shares of our common  stock at December  10,
2003.  Accordingly,  our executive  officers and  directors  have the ability to
affect  the  outcome  of, or exert  considerable  influence  over,  all  matters
requiring shareholder approval,  including the election and removal of directors
and any change in control.  This  concentration of ownership of our common stock
could have the effect of  delaying  or  preventing  a change of control of us or
otherwise  discouraging  or preventing a potential  acquirer from  attempting to
obtain control of us. This, in turn,  could have a negative effect on the market
price of our common stock. It could also prevent our shareholders from realizing
a premium over the market prices for their shares of common stock.              

WE HAVE ADOPTED A NUMBER OF ANTI-TAKEOVER MEASURES THAT MAY DEPRESS THE PRICE OF
OUR COMMON STOCK.                                                               

         Our shareholders rights plan, our ability to issue additional shares of
preferred stock and some provisions of our articles of incorporation  and bylaws
could make it more difficult for a third party to make an  unsolicited  takeover
attempt of us. These anti-takeover  measures may depress the price of our common
stock by making it more difficult for third parties to acquire us by offering to
purchase shares of our stock at a premium to its market price.                  

OUR STOCK PRICE HAS BEEN VOLATILE.                                              

         Our common stock is quoted on the NASDAQ  National  Market System,  and
there can be substantial volatility in the market price of our common stock. The
market  price of our common  stock has been,  and is likely to  continue  to be,
subject  to  significant  fluctuations  due to a variety of  factors,  including
quarterly variations in operating results, operating results which vary from the
expectations  of  securities  analysts  and  investors,   changes  in  financial
estimates,  changes in market valuations of competitors,  announcements by us or
our competitors of a material nature,  loss of one or more customers,  additions
or  departures of key  personnel,  future sales of common stock and stock market
price and volume  fluctuations.  In  addition,  general  political  and economic
conditions such as a recession,  or interest rate or currency rate  fluctuations
may adversely affect the market price of our common stock.                      

         In addition,  the stock market in general has experienced extreme price
and volume fluctuations that have affected the market price of our common stock.
Often, price fluctuations are unrelated to operating performance of the specific
companies whose stock is affected.  In the past, following periods of volatility
in the market price of a company's stock, securities class action litigation has
occurred  against  the  issuing  company.  If we were  subject  to this  type of
litigation in the future,  we could incur  substantial  costs and a diversion of
our  management's  attention and resources,  each of which could have a         

4 

424B5
17th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 17th
material adverse effect on our revenue and earnings.  Any adverse  determination
in this type of litigation could also subject us to significant liabilities.    

ABSENCE OF DIVIDENDS COULD REDUCE OUR ATTRACTIVENESS TO YOU.                    

         Some investors  favor  companies that pay  dividends,  particularly  in
general  downturns  in the stock  market.  We have not declared or paid any cash
dividends on our common stock. We currently intend to retain any future earnings
for funding growth, and we do not currently  anticipate paying cash dividends on
our  common  stock  in the  foreseeable  future.  Additionally,  we  cannot  pay
dividends on our common stock unless the terms of our bank credit facilities and
outstanding  preferred  stock,  if any,  permit the payment of  dividends on our
common stock.  Because we may not pay dividends,  your return on this investment
likely depends on your selling our stock at a profit.                           

RISKS RELATED TO OUR BUSINESS                                                   
-----------------------------                                                   

WE DEPEND ON A GROUP OF KEY CUSTOMERS FOR A SIGNIFICANT  PORTION OF OUR SALES. A
SIGNIFICANT  ADVERSE  CHANGE  IN A  CUSTOMER  RELATIONSHIP  OR  IN A  CUSTOMER'S
FINANCIAL POSITION COULD HARM OUR BUSINESS AND FINANCIAL CONDITION.             

         Express (a division of The Limited)  accounted for approximately  13.5%
and  10.2%  of our net  sales  for the  first  nine  months  of 2003  and  2002,
respectively.  Lane Bryant  accounted for 12.2% and 20% of our net sales for the
first nine months of 2003 and 2002, respectively.  Lerner New York accounted for
7.2% and  10.7% of our net sales  for the  first  nine  months of 2003 and 2002,
respectively.   We  believe  that  consolidation  in  the  retail  industry  has
centralized  purchasing  decisions  and given  customers  greater  leverage over
suppliers like us, and we expect this trend to continue.  If this  consolidation
continues, our net sales and results of operations may be increasingly sensitive
to  deterioration in the financial  condition of, or other adverse  developments
with, one or more of our customers.                                             

         While  we have  long-standing  customer  relationships,  we do not have
long-term  contracts with any of them,  including Express.  Purchases  generally
occur on an order-by-order  basis, and relationships exist as long as there is a
perceived  benefit to both  parties.  A decision  by a major  customer,  whether
motivated by competitive  considerations,  financial difficulties,  and economic
conditions  or  otherwise,  to decrease its  purchases  from us or to change its
manner of doing  business  with us,  could  adversely  affect our  business  and
financial  condition.  In addition,  during  recent  years,  various  retailers,
including  some of our  customers,  have  experienced  significant  changes  and
difficulties,  including consolidation of ownership, increased centralization of
purchasing decisions, restructurings, bankruptcies and liquidations.            

         These and other financial problems of some of our retailers, as well as
general  weakness  in the retail  environment,  increase  the risk of  extending
credit  to  these  retailers.   A  significant  adverse  change  in  a  customer
relationship  or in a customer's  financial  position could cause us to limit or
discontinue  business with that customer,  require us to assume more credit risk
relating to that  customer's  receivables,  limit our ability to collect amounts
related to previous purchases by that customer, or result in required prepayment
of our  receivables  securitization  arrangements,  all of which  could harm our
business and financial condition.                                               

FAILURE TO MANAGE OUR GROWTH AND EXPANSION COULD IMPAIR OUR BUSINESS.           

         Since our inception,  we have experienced  periods of rapid growth.  No
assurance can be given that we will be successful in  maintaining  or increasing
our sales in the  future.  Any future  growth in sales will  require  additional
working capital and may place a significant strain on our management, management
information systems, inventory management,  production capability,  distribution
facilities and receivables  management.  Any disruption in our order processing,
sourcing or  distribution  systems  could cause orders                          

5 

424B5
18th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 18th
to be shipped late, and under industry practices, retailers generally can cancel
orders or refuse to accept goods due to late shipment.  Such  cancellations  and
returns  would result in a reduction in revenue,  increased  administrative  and
shipping costs and a further burden on our distribution facilities.             

OUR OPERATING RESULTS MAY FLUCTUATE SIGNIFICANTLY.                              

         We have experienced, and expect to continue to experience,  substantial
variations  in our net sales and operating  results from quarter to quarter.  We
believe that the factors which influence this  variability of quarterly  results
include  the  timing of our  introduction  of new  product  lines,  the level of
consumer  acceptance  of each new product  line,  general  economic and industry
conditions  that  affect  consumer   spending  and  retailer   purchasing,   the
availability of manufacturing  capacity, the seasonality of the markets in which
we participate,  the timing of trade shows,  the product mix of customer orders,
the timing of the placement or  cancellation  of customer  orders,  the weather,
transportation  delays,  quotas,  the  occurrence  of charge  backs in excess of
reserves and the timing of  expenditures  in anticipation of increased sales and
actions  of  competitors.  Due to  fluctuations  in our  revenue  and  operating
expenses,  we  believe  that  period-to-period  comparisons  of our  results  of
operations are not a good indication of our future  performance.  It is possible
that in some future quarter or quarters, our operating results will be below the
expectations of securities analysts or investors.  In that case, our stock price
could fluctuate significantly or decline.                                       

INCREASES IN THE PRICE OF RAW  MATERIALS  OR THEIR  REDUCED  AVAILABILITY  COULD
INCREASE OUR COST OF SALES AND DECREASE OUR PROFITABILITY.                      

         The principal raw material used in our apparel is cotton. The price and
availability  of cotton may fluctuate  significantly,  depending on a variety of
factors,   including  crop  yields,  weather,   supply  conditions,   government
regulation,  economic climate and other unpredictable  factors. Any raw material
price increases could increase our cost of sales and decrease our  profitability
unless we are able to pass  higher  prices on to our  customers.  Moreover,  any
decrease  in the  availability  of cotton  could  impair our ability to meet our
production requirements in a timely manner.                                     

THE SUCCESS OF OUR  BUSINESS  DEPENDS UPON OUR ABILITY TO OFFER  INNOVATIVE  AND
UPGRADED PRODUCTS.                                                              

         The apparel industry is  characterized  by constant product  innovation
due to  changing  consumer  preferences,  and by the  rapid  replication  of new
products by competitors.  As a result,  our success depends in large part on our
ability to continuously  develop,  market and deliver  innovative  products at a
pace and intensity  competitive  with other  manufacturers  in our segments.  In
addition, we must create products that appeal to multiple consumer segments at a
range of price points.  Any failure on our part to regularly develop  innovative
products and update core products could:                                        

         o        limit our  ability  to  differentiate,  segment  and price our
products;                                   

         o        adversely  affect  retail  and  consumer   acceptance  of  our
products; and                               

o        limit sales growth.                                  

         The increasing  importance of product innovation in apparel requires us
to strengthen our internal research and commercialization  capabilities, to rely
on successful commercial  relationships with third parties such as fiber, fabric
and  finishing  providers  and to  compete  and  negotiate  effectively  for new
technologies and product components.                                            

6 

424B5
19th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 19th
THE FINANCIAL CONDITION OF OUR CUSTOMERS COULD AFFECT OUR RESULTS OF OPERATIONS.

         Certain retailers, including some of our customers, have experienced in
the past,  and may  experience  in the  future,  financial  difficulties,  which
increase  the risk of  extending  credit  to such  retailers  and the risk  that
financial  failure will  eliminate a customer  entirely.  These  retailers  have
attempted to improve their own operating  efficiencies  by  concentrating  their
purchasing  power among a narrowing group of vendors.  There can be no assurance
that we will remain a preferred vendor for our existing customers. A decrease in
business from or loss of a major customer  could have a material  adverse effect
on our results of  operations.  There can be no  assurance  that our factor will
approve the extension of credit to certain retail customers in the future.  If a
customer's  credit is not approved by the factor, we could assume the collection
risk on sales to the customer itself, require that the customer provide a letter
of credit, or choose not to make sales to the customer.                         

THE  SUCCESS  OF OUR  BUSINESS  DEPENDS ON OUR  ABILITY  TO  ATTRACT  AND RETAIN
QUALIFIED EMPLOYEES.                                                            

         We need  talented  and  experienced  personnel  in a  number  of  areas
including  our  core  business   activities.   Our  success  is  dependent  upon
strengthening  our  management  depth  across our  business at a rapid pace.  An
inability  to retain and attract  qualified  personnel or the loss of any of our
current  key  executives  could harm our  business.  Our  ability to attract and
retain qualified  employees is adversely affected by the Los Angeles location of
our  corporate  headquarters  due to the high cost of living in the Los  Angeles
area.                                                                           

WE DEPEND ON OUR COMPUTER AND COMMUNICATIONS SYSTEMS.                           

         As  a  multi-national   corporation,   we  rely  on  our  computer  and
communication  network to operate efficiently.  Any interruption of this service
from power loss,  telecommunications  failure, weather, natural disasters or any
similar  event  could  have  a  material  adverse  affect  on our  business  and
operations. Additionally, hackers and computer viruses have disrupted operations
at many major companies. We may be vulnerable to similar acts of sabotage, which
could have a material adverse effect on our business and operations.            

WE MAY REQUIRE ADDITIONAL CAPITAL IN THE FUTURE.                                

         We may not be able to fund our  future  growth or react to  competitive
pressures if we lack sufficient funds.  Currently, we believe we have sufficient
cash on hand and cash available through our bank credit facilities,  issuance of
long-term  debt,  proceeds  from loans from  affiliates,  and proceeds  from the
exercise  of stock  options  to fund  existing  operations  for the  foreseeable
future.  However,  in the future we may need to raise  additional  funds through
equity  or debt  financings  or  collaborative  relationships.  This  additional
funding  may not be  available  or, if  available,  it may not be  available  on
economically reasonable terms. In addition, any additional funding may result in
significant  dilution  to  existing  shareholders.  If  adequate  funds  are not
available,  we may be required to curtail our operations or obtain funds through
collaborative  partners  that may require us to release  material  rights to our
products.                                                                       

OUR BUSINESS IS SUBJECT TO RISKS ASSOCIATED WITH IMPORTING PRODUCTS.            

         Substantially  all of our  import  operations  are  subject  to tariffs
imposed  on  imported  products  and  quotas  imposed  by trade  agreements.  In
addition,  the countries in which our products are  manufactured or imported may
from  time to time  impose  additional  new  quotas,  duties,  tariffs  or other
restrictions on our imports or adversely modify existing  restrictions.  Adverse
changes in these import costs and  restrictions,  or our  suppliers'  failure to
comply with customs or similar laws,  could harm our business.  We cannot assure
that future trade  agreements will not provide our competitors with an advantage
over                                                                            

7 

424B5
20th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 20th
us, or increase our costs,  either of which could have an adverse  effect on our
business and financial condition.                                               

         Our operations are also subject to the effects of  international  trade
agreements and regulations such as the North American Free Trade Agreement,  and
the activities and regulations of the World Trade Organization. Generally, these
trade  agreements  benefit our  business by reducing or  eliminating  the duties
and/or  quotas  assessed  on  products  manufactured  in a  particular  country.
However, trade agreements can also impose requirements that adversely affect our
business,  such as  limiting  the  countries  from  which  we can  purchase  raw
materials  and setting  quotas on products  that may be imported into the United
States from a particular country. In addition,  the World Trade Organization may
commence a new round of trade  negotiations  that  liberalize  textile  trade by
further  eliminating  quotas or reducing  tariffs.  The elimination of quotas on
World Trade  Organization  member  countries by 2005 and other  effects of these
trade  agreements   could  result  in  increased   competition  from  developing
countries,  which  historically  have lower  labor  costs,  including  China and
Taiwan,  both of which recently became members of the World Trade  Organization.
This potential  increase in competition from developing  countries is one of the
several reasons why we have determined to lease our manufacturing  operations in
Mexico.                                                                         

         Our ability to import  products in a timely and  cost-effective  manner
may also be  affected  by  problems  at ports or issues  that  otherwise  affect
transportation and warehousing providers, such as labor disputes. These problems
could require us to locate  alternative ports or warehousing  providers to avoid
disruption to our customers.  These  alternatives  may not be available on short
notice or could  result in higher  transit  costs,  which  could have an adverse
impact on our business and financial condition.                                 

OUR DEPENDENCE ON INDEPENDENT  MANUFACTURERS  REDUCES OUR ABILITY TO CONTROL THE
MANUFACTURING  PROCESS,  WHICH  COULD HARM OUR  SALES,  REPUTATION  AND  OVERALL
PROFITABILITY.                                                                  

         We depend on independent contract  manufacturers to secure a sufficient
supply of raw  materials  and  maintain  sufficient  manufacturing  and shipping
capacity in an environment  characterized by declining  prices,  continuing cost
pressure and increased demands for product innovation and speed-to-market.  This
dependence  could  subject us to  difficulty  in  obtaining  timely  delivery of
products of acceptable  quality.  In addition,  a  contractor's  failure to ship
products  to us in a timely  manner or to meet the  required  quality  standards
could cause us to miss the delivery  date  requirements  of our  customers.  The
failure to make timely  deliveries  may cause our  customers  to cancel  orders,
refuse to accept  deliveries,  impose  non-compliance  charges  through  invoice
deductions or other charge-backs, demand reduced prices or reduce future orders,
any of which could harm our sales,  reputation and overall profitability.  We do
not have material  long-term  contracts with any of our independent  contractors
and any of these contractors may unilaterally  terminate their relationship with
us at  any  time.  To  the  extent  we  are  not  able  to  secure  or  maintain
relationships  with  independent  contractors  that  are  able  to  fulfill  our
requirements, our business would be harmed.                                     

         Although we monitor the compliance of our independent  contractors with
applicable  labor  laws,  we do not  control  our  contractors  or  their  labor
practices.  The violation of federal,  state or foreign labor laws by one of the
our  contractors  could result in our being  subject to fines and our goods that
are  manufactured  in  violation  of such laws  being  seized  or their  sale in
interstate  commerce being prohibited.  From time to time, we have been notified
by federal, state or foreign authorities that certain of our contractors are the
subject of investigations  or have been found to have violated  applicable labor
laws. To date, we have not been subject to any sanctions  that,  individually or
in the aggregate, have had a material adverse effect on our business, and we are
not aware of any facts on which any such sanctions could be based.  There can be
no assurance, however, that in the future we will not be subject to sanctions as
a result of violations of applicable labor laws by our contractors, or that such
sanctions will not have a material adverse effect on our business and results of
operations.  In  addition,  certain of our  customers,  including  The  Limited,
require  strict  compliance by their apparel  manufacturers,  including us, with
applicable labor laws and visit our facilities often.  There can be no assurance
that the violation of                                                           

8 

424B5
21st Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 21st
applicable labor laws by one of our contractors will not have a material adverse
effect on our relationship with our customers.                                  

OUR  BUSINESS IS SUBJECT TO RISKS OF  OPERATING  IN A FOREIGN  COUNTRY AND TRADE
RESTRICTIONS.                                                                   

         Approximately  97% of our products  were imported from outside the U.S.
in the third  quarter  of 2003,  and most of our fixed  assets  are  located  in
Mexico.  We are subject to the risks  associated  with doing business and owning
fixed assets in foreign countries, including, but not limited to, transportation
delays  and  interruptions,   political  instability,   expropriation,  currency
fluctuations and the imposition of tariffs,  import and export  controls,  other
non-tariff barriers (including changes in the allocation of quotas) and cultural
issues.  Any changes in those countries'  labor laws and government  regulations
may have a negative effect on our profitability.                                

WE CANNOT GUARANTEE THAT OUR FUTURE ACQUISITIONS WILL BE SUCCESSFUL.            

         In the future, we may seek to continue our growth through  acquisition.
We compete for acquisition and expansion opportunities with companies which have
significantly  greater financial and management  resources than us. There can be
no assurance  that  suitable  acquisition  or investment  opportunities  will be
identified,  that any of these  transactions  can be  consummated,  or that,  if
acquired,  these new  businesses can be integrated  successfully  and profitably
into our  operations.  These  acquisitions  and  investments  may also require a
significant  allocation of resources,  which will reduce our ability to focus on
the other portions of our business,  including many of the factors listed in the
prior risk factor.                                                              

RISKS ASSOCIATED WITH OUR INDUSTRY                                              
----------------------------------                                              

OUR SALES ARE HEAVILY INFLUENCED BY GENERAL ECONOMIC CYCLES.                    

         Apparel  is a cyclical  industry  that is  heavily  dependent  upon the
overall level of consumer spending.  Purchases of apparel and related goods tend
to be highly  correlated with cycles in the disposable  income of our consumers.
Our customers  anticipate and respond to adverse changes in economic  conditions
and uncertainty by reducing  inventories and canceling orders. As a result,  any
substantial deterioration in general economic conditions,  increases in interest
rates,  acts of war,  terrorist  or  political  events  that  diminish  consumer
spending and confidence in any of the regions in which we compete,  could reduce
our sales and adversely  affect our business and financial  condition.  This has
been  underscored  by the events of September 11, 2001 and the war in the Middle
East.                                                                           

OUR BUSINESS IS HIGHLY COMPETITIVE AND DEPENDS ON CONSUMER SPENDING PATTERNS.   

         The  apparel  industry  is highly  competitive.  We face a  variety  of
competitive challenges including:                                               

         o        anticipating  and  quickly  responding  to  changing  consumer
demands;                                    

         o        developing innovative,  high-quality products in sizes, colors
                  and styles that appeal to  consumers of varying age groups and
tastes;                                     

         o        competitively  pricing our  products  and  achieving  customer
perception of value; and                    

o        providing strong and effective marketing support.    

WE MUST SUCCESSFULLY  GAUGE FASHION TRENDS AND CHANGING CONSUMER  PREFERENCES TO
SUCCEED.                                                                        

         Our success is largely  dependent upon our ability to gauge the fashion
tastes of our customers and to provide  merchandise  that  satisfies  retail and
customer demand in a timely manner. The apparel                                 

9 

424B5
22nd Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 22nd
business  fluctuates  according to changes in consumer  preferences  dictated in
part by fashion  and  season.  To the  extent,  we  misjudge  the market for our
merchandise,  our sales may be adversely affected. Our ability to anticipate and
effectively respond to changing fashion trends depends in part on our ability to
attract and retain key  personnel  in our design,  merchandising  and  marketing
staff. Competition for these personnel is intense, and we cannot be sure that we
will be able to attract and retain a sufficient number of qualified personnel in
future periods.                                                                 

OUR BUSINESS IS SUBJECT TO SEASONAL TRENDS.                                     

         Historically,  our  operating  results  have been  subject to  seasonal
trends when measured on a quarterly  basis.  This trend is dependent on numerous
factors,  including the markets in which we operate,  holiday seasons,  consumer
demand,  climate,  economic  conditions  and numerous  other factors  beyond our
control.  There can be no assurance  that our historic  operating  patterns will
continue in future  periods as we cannot  influence  or  forecast  many of these
factors.                                                                        

FORWARD-LOOKING STATEMENTS

         This prospectus  contains  statements  that constitute  forward-looking
statements  within the meaning of Section 27A of the  Securities Act of 1933 and
Section 21E of the Exchange Act of 1934, both as amended.  These forward-looking
statements are subject to various risks and uncertainties.  The  forward-looking
statements include, without limitation, statements regarding our future business
plans and strategies and our future financial position or results of operations,
as well as other statements that are not historical.  You can find many of these
statements  by looking  for words like  "will",  "may",  "believes",  "expects",
"anticipates",  "plans" and  "estimates"  and for similar  expressions.  Because
forward-looking  statements  involve  risks  and  uncertainties,  there are many
factors  that could  cause the actual  results to differ  materially  from those
expressed  or  implied.   These  include,  but  are  not  limited  to,  economic
conditions.   Any  forward-looking  statements  are  not  guarantees  of  future
performance  and  involve  risks and  uncertainties.  Actual  results may differ
materially  from those  projected in this  prospectus,  for the  reasons,  among
others,  described in the Risk Factors  section  beginning on page 4. You should
read the Risk Factors section carefully,  and should not place undue reliance on
any  forward-looking  statements,  which  speak  only  as of the  date  of  this
prospectus.   We  undertake  no  obligation  to  release  publicly  any  updated
information about forward-looking  statements to reflect events or circumstances
occurring  after the date of this  prospectus  or to reflect the  occurrence  of
unanticipated events.                                                           

 USE OF PROCEEDS

         Unless otherwise indicated in the applicable prospectus supplement,  we
anticipate  that any net proceeds  from the sale of the  securities  that we may
offer under this prospectus and any accompanying  prospectus  supplement will be
used for general  corporate  purposes.  General  corporate  purposes may include
acquisitions,  investments, repayment of debt, capital expenditures,  repurchase
of our  capital  stock  and  any  other  purposes  that  we may  specify  in any
prospectus  supplement.  We may invest the net proceeds temporarily until we use
them for their stated purpose.                                                  

DILUTION

         Our net tangible book value at September 30, 2003 was  $69,750,000,  or
$3.72 per share of common stock.  Net tangible  book value per share  represents
total  tangible  assets  less  total  liabilities   divided  by  the  number  of
outstanding  shares of common stock on September 30, 2003.  Assuming we issue an
aggregate of $20,000,000 of common stock at an assumed public  offering price of
$3.90 per share (the last  reported sale price of the common stock on the NASDAQ
National  Market on December 10,  2003),  and our receipt of the  estimated  net
proceeds from the sale of those shares  (after  estimated  offering  expenses of
$38,000),  our adjusted net tangible book value at September 30, 2003 would have

10

424B5
23rd Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 23rd
been $89,712,000,  or $3.75 per share. This represents an immediate  increase in
our adjusted net tangible book value of $0.03 per share to existing shareholders
and an immediate dilution of $0.15 per share to new investors  purchasing common
stock in such offering. The following table illustrates this per share dilution:

Assumed public offering price per share (1)...........                  $   3.90
Net tangible book value per share                                   
at September 30, 2003...........................    $    3.72       
Increase in net tangible book value                                 
per share attributable to this offering.........         0.03       
                                             ---------
Net tangible book value per share after this                                    
   offering...........................................                      3.75
                                                                        --------
Dilution in net tangible book value per share                                   
   to new investors...................................                  $   0.15
                                                                        ========

----------                                                                      
(1)  We have  assumed  an  offering  price of $3.90 per share  based on the last
     reported  sale price of the common stock on the NASDAQ  National  Market on
     December 10, 2003.  The assumed  offering  price of the common stock at the
     time any common stock is offered hereby may differ  significantly  from the
offering price assumed for purposes of this Prospectus.               

         The  computations  in  the  table  above  assume  no  exercise  of  any
outstanding  stock options and warrants  after  September 30, 2003. At September
30, 2003 there were  options  and  warrants  outstanding  to purchase a total of
8,348,487  shares of common stock at a weighted  average exercise price of $7.55
per share. If any of these options are exercised, there will be further dilution
to new investors.                                                               

         If the  securities  offered by this  prospectus  are common  stock,  if
required,  a prospectus  supplement may include a revised dilution table setting
forth any increase in net tangible book value to existing  shareholders  and any
dilution to new investors based on the proposed number of shares of common stock
to be  offered  and  the  assumed  public  offering  price  at the  time of such
offering.                                                                       

DESCRIPTION OF THE COMMON STOCK AND PREFERRED STOCK WE MAY OFFER

         The  following  description  of our common stock and  preferred  stock,
together with the additional  information included in any applicable  prospectus
supplements,  summarizes  the material  terms and  provisions  of these types of
securities  but is not complete.  For the complete terms of our common stock and
preferred  stock,  please refer to our restated  articles of  incorporation,  as
amended,  and bylaws that are  incorporated  by reference into the  registration
statement which includes this  prospectus and, with respect to preferred  stock,
the  certificate  of  determination  which will be filed with the Securities and
Exchange Commission for each series of preferred stock we may designate, if any.
We also  refer  you to the  description  of our  common  stock  set forth in our
Registration Statement on Form 8-A filed with the SEC on May 4, 1995.           

         We will describe in a prospectus  supplement  the specific terms of any
common stock or preferred  stock we may offer  pursuant to this  prospectus.  If
indicated  in a  prospectus  supplement,  the  terms  of such  common  stock  or
preferred stock may differ from the terms described below.                      

COMMON STOCK                                                                    

         Under our restated articles of incorporation,  as amended, we may issue
up to 100  million  (100,000,000)  shares of common  stock.  The  holders of our
common  stock  are  entitled  to one vote for each  share  held of record on all
matters submitted to a vote of the shareholders. Subject to preferences that may
be applicable to any outstanding  preferred  stock,  holders of common stock are
entitled to receive                                                             

11

424B5
24th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 24th
ratably such  dividends as may be declared by the Tarrant board of directors out
of funds  legally  available  for that  purpose.  In the  event of  liquidation,
dissolution  or winding up of Tarrant,  the holders of common stock are entitled
to share ratably in all assets  remaining after payment of liabilities,  subject
to the prior distribution rights of any outstanding  preferred stock. The common
stock has no preemptive or conversion rights or other subscription rights. There
are no redemption or sinking fund provisions applicable to the common stock. The
outstanding shares of common stock are fully paid and non-assessable.           

         The transfer agent and registrar for our common stock is  Computershare
Trust Company, 350 Indiana Street, Suite 800, Golden, CO 80401.                 

PREFERRED STOCK                                                                 

         Under  our  restated  articles  of  incorporation  we may issue up to 2
million  (2,000,000)  shares of preferred stock. The number of authorized shares
of preferred stock includes  250,000 shares of Series B Preferred Stock issuable
pursuant  to the Rights  Agreement,  as  described  below  under the heading " -
Shareholder  Rights  Plan." No shares of preferred  stock or options to purchase
preferred  stock  are  currently  outstanding.  Our board of  directors  has the
authority,  without  further  action  by the  shareholders,  to  issue up to the
maximum  authorized  number of shares of preferred  stock in one or more series.
The  board  of  directors  also  has the  authority  to  designate  the  rights,
preferences, privileges and restrictions of each such series, including dividend
rights,  dividend rates,  conversion rights, voting rights, terms of redemption,
redemption prices, liquidation preferences and the number of shares constituting
any series. The rights, preferences,  privileges and restrictions of each series
will be fixed by the certificate of determination  relating to that series.  Any
or all of the rights of the  preferred  stock may be greater  than the rights of
the common stock.                                                               

         The  issuance  of  preferred  stock may have the  effect  of  delaying,
deferring or preventing a change in control of Tarrant without further action by
the  shareholders.  The issuance of preferred  stock with voting and  conversion
rights  may also  adversely  affect the  voting  power of the  holders of common
stock. In certain  circumstances,  an issuance of preferred stock could have the
effect of decreasing the market price of the common stock.                      

         Whenever preferred stock is to be sold pursuant to this prospectus,  we
will file a prospectus supplement relating to that sale which will specify:     

 o        the number of shares in the series of preferred stock;

         o        the  designation  for the series of preferred stock by number,
                  letter or title that  shall  distinguish  the series  from any
other series of preferred stock;            

         o        the  dividend  rate,  if any,  and whether  dividends  on that
                  series of preferred stock will be cumulative, noncumulative or
partially cumulative;                       

       o        the voting rights of that series of preferred stock, if any;

         o        any  conversion   provisions  applicable  to  that  series  of
preferred stock;                            

         o        any redemption or sinking fund  provisions  applicable to that
series of preferred stock;                  

         o        the  liquidation  preference  per  share  of  that  series  of
preferred stock, if any; and                

         o        the  terms  of  any  other  preferences  or  rights,  if  any,
 applicable to that series of preferred stock.

12

424B5
25th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 25th
CERTAIN EFFECTS OF AUTHORIZED BUT UNISSUED STOCK                                

         We have shares of common stock and preferred stock available for future
issuance without shareholder  approval.  These additional shares may be utilized
for a variety of corporate purposes,  including future public offerings to raise
additional capital,  facilitate corporate  acquisitions or payable as a dividend
on the capital stock.                                                           

         The  existence of unissued and  unreserved  common stock and  preferred
stock may enable our board of directors  to issue shares to persons  friendly to
current management or to issue preferred stock with terms that could render more
difficult or discourage an attempt to obtain control of us by means of a merger,
tender offer,  proxy contest or otherwise,  thereby protecting the continuity of
our  management.  In addition,  the issuance of preferred  stock could adversely
affect the voting power of holders of common stock and the likelihood  that such
holders will receive dividend payments and payments upon liquidation.           

SHAREHOLDER RIGHTS PLAN                                                         

         Each outstanding share of our common stock includes,  and each share of
common stock  offered  under this  prospectus  and the  accompanying  prospectus
supplement  will include,  one preferred  stock purchase right  (individually  a
"Right" and collectively  the "Rights") as provided under the Rights  Agreement,
dated November 21, 2003, between us and Computershare Trust Company.  Each Right
entitles the holder, until the earlier of December 12, 2013 or the redemption of
the Rights, to purchase one  one-thousandth of a share of our Series B Preferred
Stock, no par value (the "Series B Preferred Stock"),  at a price (the "Purchase
Price")  of $25.00  per one  one-thousandth  of a share (as may be  adjusted  to
reflect stock splits, stock dividends or certain other dilutive events since the
issuance of the Rights).  The Series B Preferred Stock is nonredeemable and will
have 1,000 votes per share  (subject to  adjustment).  We have reserved  250,000
shares of Series B Preferred Stock for issuance upon exercise of the Rights.    

         The Rights will become  exercisable  upon the  earliest to occur of (i)
the  tenth  day after the  acquisition  by a person  or group of  affiliated  or
associated persons (other than certain exempt persons or permitted  holders,  as
defined in the Rights  Agreement) of beneficial  ownership of 15% or more of our
outstanding  common stock, (ii) the tenth day after the commencement of a tender
or  exchange  offer the  consummation  of which would  result in the  beneficial
ownership by a person or group of  affiliated  or  associated  persons of 15% or
more of our  outstanding  common  stock,  (iii)  the tenth day after the date of
filing  of a  registration  statement  for any such  exchange  offer  under  the
Securities Act of 1933, and (iv) the tenth day after the date on which our Board
declares  any  person  or  group  of  affiliated  or  associated  persons  which
beneficially owns 10% or more of our outstanding  common stock to be an "Adverse
Person" (as described in the Rights Agreement).                                 

         Following the date the Rights become exercisable, the Rights would give
holders  (other than the acquiring  shareholder  who  triggered  exercise of the
Rights,  its affiliates and  transferees) the right to purchase from us, for the
Purchase  Price,  that  number of one  one-thousandth  (1/1000th)  of a share of
Series B Preferred  Stock (or, in certain  circumstances,  Common  Stock,  cash,
property  or other  securities  of ours)  having  a  market  value of twice  the
Purchase  Price of the Right.  Further,  in a merger,  consolidation  or sale or
transfer of 50% or more of the consolidated  assets or earning power of Tarrant,
each Right will be converted into the right to purchase, for the Purchase Price,
that  number of shares of common  stock of the  surviving  entity or (in certain
circumstances)  its parent  corporation,  which at the time of such  transaction
will have a market  value of twice the Purchase  Price of the Right.  The Rights
Agreement contains an exception for inadvertent acquisitions of more than 15% of
our common  stock,  so long as the holder  reduces its  ownership  below the 15%
threshold  within  five  business  days  following  notice  from  our  board  of
directors.                                                                      

13

424B5
26th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 26th
         Preferred  Stock  purchasable  upon  exercise of the Rights will not be
redeemable.  Each one  one-thousandth  (1/1000th) of a share of Preferred  Stock
will be entitled to participating dividends per one one-thousandth (1/1000th) of
a share equal to dividends which may from time to time be declared on a share of
Common Stock. In the event of  liquidation,  the Preferred Stock holders will be
entitled to a preferential  liquidation  payment.  These rights are protected by
customary anti-dilution provisions.                                             

         One Right will be issued in  respect of each share of our common  stock
issued before the earlier of December 12, 2013 or the  redemption of the Rights.
As of the date of this prospectus, the Rights are not exercisable,  certificates
representing the Rights have not been issued and the Rights  automatically trade
with shares of our common stock.                                                

         The Rights have  certain  anti-takeover  effects.  The Rights may cause
substantial  dilution to a person or group that  attempts to acquire  Tarrant on
terms not approved by our board of  directors.  The Rights  should not interfere
with any merger or other business combination approved by the Board prior to the
time that  holders of the Rights  become  entitled to exercise  their Rights for
Series B Preferred Stock (or securities of the surviving entity in a merger with
the  Company),  since until that time the Rights may be redeemed by the Board at
$0.001 per Right.                                                               

CERTAIN PROVISIONS OF OUR CHARTER AND BYLAWS                                    

         Our  restated  articles  of  incorporation  and  bylaws  could make the
acquisition of Tarrant and the removal of incumbent  officers and directors more
difficult. These provisions are expected to discourage certain types of coercive
takeover practices and inadequate takeover bids and to encourage persons seeking
to acquire  control of Tarrant to negotiate  with us first.  We believe that the
benefits of increased  protection of our potential ability to negotiate with the
proponent of an unfriendly  or  unsolicited  proposal to acquire or  restructure
Tarrant outweigh the disadvantages of discouraging such proposals because, among
other things,  negotiation of such  proposals  could result in an improvement of
their terms. These provisions provide for, among other things:                  

o        a classified board of directors;                     

        o        a prohibition on shareholder action through written consents;

         o        a requirement  that special meetings of shareholders be called
                  only by our board of  directors,  the chairman of our board of
                  directors,  our chief executive officer, our president,  or by
                  the  holders of shares  entitled  to cast not less than 10% of
the votes at the meeting;                   

         o        advance  notice  requirements  for  shareholder  proposals and
nominations;                                

         o        limitations on the ability of shareholders to amend,  alter or
           repeal our articles of incorporation or our bylaws; and

         o        the  authority  of our board of  directors  to issue,  without
                  shareholder  approval,  preferred stock with such terms as the
board of directors may determine.           

14

424B5
27th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 27th
DESCRIPTION OF THE WARRANTS WE MAY OFFER

         We may issue  warrants,  including  warrants to purchase  common stock,
preferred  stock,  or any  combination of the foregoing.  Warrants may be issued
independently or together with any securities and may be attached to or separate
from the securities.  The warrants will be issued under warrant agreements to be
entered into between us and the  recipient of the warrant or a warrant  agent as
detailed in the prospectus supplement relating to warrants being offered.       

         The applicable prospectus supplement will describe the following terms,
where  applicable,  of the warrants in respect of which this prospectus is being
delivered:                                                                      

o        the title of the warrants;                           

o        the aggregate number of the warrants;                

    o        the price or prices at which the warrants will be issued;

         o        the  currencies  in which the price or prices of the  warrants
may be payable;                             

         o        the designation,  amount,  and terms of the offered securities
purchasable upon exercise of the warrants;  

         o        the designation and terms of the other offered securities,  if
                  any,  with which the warrants are issued and the number of the
warrants issued with each security;         

         o        if  applicable,  the date on and after which the  warrants and
                  the  offered  securities  purchasable  upon  exercise  of  the
warrants will be separately transferable;   

         o        the price or prices at which and  currency  or  currencies  in
                  which the offered securities  purchasable upon exercise of the
warrants may be purchased;                  

         o        the date on which the right to  exercise  the  warrants  shall
          commence and the date on which the right shall expire;

         o        the  minimum or maximum  amount of the  warrants  which may be
exercised at any one time;                  

     o        information with respect to book-entry procedures, if any;

     o        a discussion of any federal income tax considerations; and

         o        any other  material  terms of the warrants,  including  terms,
                  procedures,  and  limitations  relating  to the  exchange  and
exercise of the warrants.                   

15

424B5
28th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 28th
PLAN OF DISTRIBUTION

We may sell the securities:                                   

o        through one or more underwriters or dealers,         

o        directly to purchasers, through agents, or           

 o        through a combination of any of these methods of sale.

We may distribute the securities:                             

         o        from time to time in one or more transactions at a fixed price
      or prices, which may be changed from time to time,

o        at market prices prevailing at the times of sale,    

 o        at prices related to such prevailing market prices, or

o        at negotiated prices.                                

         We will describe the method of  distribution  of the  securities in the
applicable prospectus supplement.                                               

         Underwriters, dealers or agents may receive compensation in the form of
discounts, concessions or commissions from us or our purchasers (as their agents
in  connection  with the sale of  securities).  These  underwriters,  dealers or
agents may be considered to be underwriters under the Securities Act of 1933. As
a  result,  discounts,  commissions,  or  profits  on  resale  received  by  the
underwriters,  dealers or agents may be treated as  underwriting  discounts  and
commissions.  Each  prospectus  supplement  will identify any such  underwriter,
dealer or agent,  and  describe any  compensation  received by them from us. Any
initial  public  offering  price and any  discounts  or  concessions  allowed or
reallowed or paid to dealers may be changed from time to time.                  

         Underwriters,  dealers  and agents may be  entitled,  under  agreements
entered  into  with  us,  to   indemnification   by  us  against  certain  civil
liabilities,  including  liabilities  under the  Securities  Act of 1933,  or to
contribution  with  respect to  payments  made by the  underwriters,  dealers or
agents, under agreements between us and the underwriters, dealers and agents.   

         We may  grant  underwriters  who  participate  in the  distribution  of
securities an option to purchase additional securities to cover over-allotments,
if any, in connection  with the  distribution.  Underwriters or agents and their
associates may be customers of, engage in transactions with, or perform services
for us in the ordinary course of business.                                      

         In connection with the offering of the securities, certain underwriters
and  selling  group  members  and their  respective  affiliates,  may  engage in
transactions  that stabilize,  maintain or otherwise  affect the market price of
the  applicable   securities.   These  transactions  may  include  stabilization
transactions effected in accordance with Rule 104 of Regulation M promulgated by
the SEC pursuant to which these persons may bid for or purchase  securities  for
the purpose of stabilizing their market price.                                  

         The  underwriters in an offering of securities may also create a "short
position"  for their account by selling more  securities in connection  with the
offering  than  they are  committed  to  purchase  from us.  In that  case,  the
underwriters  could  cover all or a  portion  of the  short  position  by either
purchasing securities in the open market following completion of the offering of
these securities or by exercising any  over-allotment  option granted to them by
us. In  addition,  any  managing  underwriter  may impose  "penalty  bids" under
contractual  arrangements  with other  underwriters,  which  means that they can
reclaim from an                                                                 

16

424B5
29th Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 29th
underwriter (or any selling group member  participating in the offering) for the
account of the other  underwriters,  the selling  concession  for the securities
that are distributed in the offering but subsequently  purchased for the account
of the  underwriters in the open market.  Any of the  transactions  described in
this paragraph or comparable transactions that are described in any accompanying
prospectus  supplement  may  result  in  the  maintenance  of the  price  of the
securities  at a level  above that  which  might  otherwise  prevail in the open
market.  None  of  the  transactions  described  in  this  paragraph  or  in  an
accompanying  prospectus supplement are required to be taken by any underwriters
and, if they are undertaken, may be discontinued at any time.                   

         Our common  stock is listed on the  NASDAQ  National  Market  under the
symbol  "TAGS."  Any  shares of  common  stock  sold  pursuant  to a  prospectus
supplement  will be listed on the NASDAQ  National  Market,  subject to official
notice of issuance.  The preferred  stock and any  securities  other than common
stock  that  we may  sell  pursuant  to  this  prospectus,  and  any  prospectus
supplement,  will be new issues of securities with no established trading market
and may or may not be listed on a national securities exchange. Any underwriters
or agents to or through  which we may sell  securities  may make a market in the
securities,  but these underwriters or agents will not be obligated to do so and
any of them may  discontinue  any market making at any time without  notice.  We
cannot,  therefore, give any assurance as to the liquidity of our trading market
for any securities that we may sell, other than our common stock.               

 WHERE YOU CAN FIND MORE INFORMATION

         We have filed a  registration  statement  on Form S-3 with the SEC with
respect to the common stock offered by this prospectus.  This prospectus,  which
constitutes a part of the  registration  statement,  does not contain all of the
information  set  forth  in  the  registration  statement  or the  exhibits  and
schedules that are part of the registration statement. You may read and copy any
document we file at the SEC's public  reference room at 450 Fifth Street,  N.W.,
Washington,  D.C.  20549.  We refer you to the  registration  statement  and the
exhibits and schedules  thereto for further  information  with respect to us and
our common stock.  Please call the SEC at 1-800-SEC-0330 for further information
on the public  reference  room. Our SEC filings are also available to the public
from the SEC's website at www.sec.gov.                                          

         We are subject to the information and periodic  reporting  requirements
of  the  Securities   Exchange  Act  of  1934  and,  in  accordance  with  those
requirements, will continue to file periodic reports, proxy statements and other
information  with the SEC. These periodic  reports,  proxy  statements and other
information  will be available  for  inspection  and copying at the SEC's public
reference rooms and the SEC's website referred to above.                        

         The SEC allows us to "incorporate by reference" the information we file
with the SEC, which means that we can disclose  important  information to you by
referring to those  documents.  We incorporate by reference the documents listed
below and any additional documents filed by us with the SEC under Section 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until this offering of
securities is  terminated.  The  information  we  incorporate by reference is an
important part of this  prospectus,  and any information that we file later with
the SEC will automatically update and supersede this information.               

The documents we incorporate by reference are:                

         1.       Our Annual Report on Form 10-K for the year ended December 31,
2002 (File No. 000-26430);                  

         2.       Our  Amendment No. 1 to our Annual Report on Form 10-K for the
                  year ended  December 31, 2002,  as filed on May 15, 2003 (File
No. 000-26430)                              

         3.       Our Quarterly  Report on Form 10-Q for the quarter ended March
31, 2003 (File No. 000-26430);              

17

424B5
Last Page of 30
TOC
1st
Previous
Next
↓Bottom
Just 30th
         4.       Our  Quarterly  Report on Form 10-Q for the quarter ended June
30, 2003 (File No. 000-26430);              

         5.       Our  Quarterly  Report  on Form  10-Q  for the  quarter  ended
September 30, 2003 (File No. 000-26430);    

         6.       Our Current Report on Form 8-K as filed on April 4, 2003 (File
No. 000-26430);                             

         7.       Our Current  Report on Form 8-K as filed on May 16, 2003 (File
No. 000-26430);                             

         8.       Our Current Report on Form 8-K as filed on July 10, 2003 (File
No. 000-26430);                             

         9.       Our  Current  Report on Form 8-K as filed on August  18,  2003
(File No. 000-26430);                       

         10.      Our  Current  Report on Form 8-K as filed on October  27, 2003
(File No. 000-26430);                       

         11.      Our Current  Report on Form 8-K as filed on November  14, 2003
(File No. 000-26430);                       

         12.      Our Current  Report on Form 8-K as filed on November  21, 2003
(File No. 000-26430);                       

         13.      Our Current  Report on Form 8-K as filed on December  10, 2003
(File No. 000-26430);                       

         14.      The   description  of  the  Common  Stock  of  the  Registrant
                  contained in the Registrant's  Registration  Statement on Form
                  8-A as filed on May 4, 1995  (File No.  000-26006),  including
                  any amendment or report filed for the purpose of updating such
description; and                            

         15.      All other  reports  filed by us pursuant  to Section  13(a) or
                  15(d) of the  Securities  Exchange Act of 1934 since  December
                  31, 2002,  including  all such reports filed after the date of
                  the initial registration  statement and prior to effectiveness
of the registration statement.              

         You may  request a copy of these  filings,  at no cost,  by  writing or
calling  us at  Tarrant  Apparel  Group,  3151 East  Washington  Boulevard,  Los
Angeles, California 90023, telephone number (323) 780-8250,  Attention:  Patrick
Chow.                                                                           

         You should rely only on the information contained in this prospectus or
any supplement and in the documents incorporated by reference above. We have not
authorized anyone else to provide you with different information. You should not
assume that the  information  in this  prospectus  or any  supplement  or in the
documents  incorporated by reference is accurate on any date other than the date
on the front of those documents.                                                

 LEGAL MATTERS

         Stubbs Alderton & Markiles,  LLP, Encino,  California,  has rendered to
Tarrant  Apparel  Group a legal  opinion as to the validity of the common stock,
preferred  stock and warrants for equity  securities  to be offered  pursuant to
this prospectus.                                                                

 EXPERTS

         The  consolidated  financial  statements  of the Tarrant  Apparel Group
appearing  in Tarrant  Apparel  Group's  Annual  Report (Form 10-K) for the year
ended  December  31,  2002 have been  audited by Ernst & Young LLP,  independent
auditors,  as set forth in their report thereon and  incorporated  by reference.
Such consolidated  financial  statements are incorporated herein by reference in
reliance  upon such  report  given on the  authority  of such firm as experts in
accounting and auditing.                                                        

18

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘424B5’ Filing		Date		First		Last			Other Filings
		12/12/13		25		26
		1/23/09		1		7
Filed on:		1/27/04							8-K
		1/23/04		1		9			8-K
		1/22/04		1
		12/23/03		13
		12/12/03		12					8-K/A
		12/10/03		11		30			8-K
		11/21/03		11		30			8-A12G,  8-K
		11/14/03		11		30			10-Q,  8-K
		10/27/03		11		30			8-K
		9/30/03		11		30			10-Q
		8/18/03		11		30			8-K
		7/10/03		11		30			8-K
		6/30/03		11		30			10-Q,  NT 10-Q
		5/16/03		11		30			10-Q,  8-K,  NT 10-Q
		5/15/03		11		29			10-K/A,  8-K,  NT 10-Q
		4/4/03		11		30			8-K,  PRE 14A
		3/31/03		11		29			10-K,  10-Q,  8-K,  NT 10-Q
		12/31/02		11		30			10-K,  10-K/A,  5,  5/A,  8-K
		9/11/01		21
		5/4/95		12		30
									List all Filings