Exhibit 1.01
EXECUTION COPY
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ANNTAYLOR STORES CORPORATION
$180,975,000
Convertible Subordinated Debentures due 2019
PURCHASE AGREEMENT
Dated: June 14, 1999
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ANNTAYLOR STORES CORPORATION
$180,975,000
CONVERTIBLE SUBORDINATED DEBENTURES DUE 2019
PURCHASE AGREEMENT
June 14, 1999
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
BANC OF AMERICA SECURITIES LLC
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
▇▇▇▇▇▇▇ ▇▇▇▇▇ World Headquarters
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
AnnTaylor Stores Corporation (the "Company"), a Delaware
corporation, proposes, subject to the terms and conditions stated herein,
to issue and sell to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ &
▇▇▇▇▇ Incorporated ("▇▇▇▇▇▇▇ ▇▇▇▇▇") and Banc of America Securities LLC
(together with ▇▇▇▇▇▇▇ ▇▇▇▇▇, the "Initial Purchasers"), acting severally
and not jointly, $180,975,000 aggregate principal amount at maturity of its
Convertible Subordinated Debentures due 2019 (the "Firm Debentures"), and,
at the election of the Initial Purchasers, solely to cover overallotments,
if any, in connection with the offering of the Firm Debentures, up to
$18,097,500 aggregate principal amount at maturity of additional
Convertible Subordinated Debentures due 2019 (the "Additional Debentures").
The Firm Debentures and any Additional Debentures that the Initial
Purchasers elect to purchase are collectively referred to as the
"Debentures". The Debentures will be convertible at the option of the
holder thereof into shares of common stock of the Company (the "Conversion
Shares"). The Debentures are more fully described in the Offering
Memorandum referred to below. The Debentures will be issued pursuant to an
indenture (the "Indenture"), to be dated as of June 18, 1999, among the
Company, AnnTaylor, Inc., a Delaware corporation and a wholly owned
subsidiary of the Company (the "Guarantor"), and The Bank of New York, as
trustee (the "Trustee"). The obligations of the Company under the
Debentures and the Indenture will be guaranteed by the Guarantor pursuant
to the terms of the Indenture (the "Subsidiary Guarantee").
The Debentures and the Conversion Shares are collectively
referred to herein as the "Securities". This Agreement, the Indenture, the
Securities and the Registration Rights Agreement (as defined below) are
referred to collectively as the "Operative Documents". Capitalized terms
used herein without definition have the respective meanings specified in
the Offering Memorandum.
The Debentures will be offered and sold to the Initial
Purchasers without registration under the Securities Act of 1933, as
amended (the "1933 Act"), in reliance upon exemptions from the registration
requirements of the 1933 Act. In connection with the sale of the
Debentures, the Company has prepared a preliminary offering memorandum
dated June 14, 1999 (the "Preliminary Offering Memorandum") and a final
offering memorandum dated the date hereof (such final offering memorandum,
in the form first furnished to the Initial Purchasers for use in connection
with the offering and sale of the Debentures, or if such form is not so
used, in the form subsequently furnished for such use, the "Offering
Memorandum"), each setting forth certain information concerning the
Company, the Guarantor and the Securities. The Company and the Guarantor
hereby confirm that they have authorized the use of the Preliminary
Offering Memorandum and the Offering Memorandum in connection with the
offer and resale of the Debentures by the Initial Purchasers. Unless stated
to the contrary, all references herein to the Offering Memorandum are to
the Offering Memorandum at the date hereof (the "Execution Time") and are
not meant to include any amendment or supplement thereto subsequent to the
Execution Time. If the Company prepares a supplement dated the date hereof
to the Preliminary Offering Memorandum containing only pricing related
information, then the term "Offering Memorandum" for purposes of this
Agreement shall refer collectively to the Preliminary Offering Memorandum
and such supplement.
The Company and the Guarantor understand that the Initial
Purchasers propose to make an offering of the Debentures only on the terms,
subject to the conditions and in the manner set forth in the Offering
Memorandum and Section 3 hereof, as soon as the Initial Purchasers deem
advisable after this Agreement has been executed and delivered.
The Initial Purchasers and other holders of Securities
(including subsequent transferees) will be entitled to the benefits of the
registration rights agreement, to be dated as of the Closing Time (the
"Registration Rights Agreement"), among the Company, the Guarantor and the
Initial Purchasers, in the form attached as Exhibit A. Pursuant to the
Registration Rights Agreement, the Company will agree to file with the
Securities and Exchange Commission (the "Commission") a shelf registration
statement pursuant to Rule 415 under the 1933 Act relating to resales of
the Debentures and the Conversion Shares by holders thereof, and to use
their best efforts to cause such shelf registration statement to be
declared effective.
All references in this Agreement to financial statements and
schedules and other information that is "contained", "included" or "stated"
in the Offering Memorandum (and all other references of like import) shall
be deemed to mean and include all such financial statements and schedules
and other information that is or is deemed to be incorporated by reference
in the Offering Memorandum; and all references in this Agreement to
amendments or supplements to the Offering Memorandum shall be deemed to
mean and include the filing of any document under the Securities Exchange
Act of 1934, as amended (the "1934 Act"), that is or is deemed to be
incorporated by reference in the Offering Memorandum.
Section 1. Representations and Warranties. (a) The Company and
the Guarantor represent and warrant to and agree with the Initial
Purchasers that:
(i) As of their respective dates, none of the Offering
Memorandum or any amendment or supplement thereto, and as of the
Closing Time, the Offering Memorandum, as amended or supplemented to
such time, contained or will contain an untrue statement of a
material fact or omitted or will omit to state a material fact
necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; except
that this representation and warranty does not apply to statements or
omissions made in reliance upon and in conformity with information
furnished in writing or confirmed in writing to the Company by or on
behalf of the Initial Purchasers expressly for use in the Offering
Memorandum.
(ii) The Debentures satisfy the eligibility requirements of
Rule 144A(d)(3) under the 1933 Act.
(iii) None of the Company, the Guarantor or any of their
affiliates (as such term is defined in Rule 501(b) of Regulation D
under the 1933 Act ("Regulation D")), or any person acting on behalf
of the foregoing (other than the Initial Purchasers, as to which no
representation or warranty is made) has, directly or indirectly, made
offers or sales of any security, or solicited offers to buy any
security, under circumstances that would require the registration of
the Securities under the 1933 Act.
(iv) None of the Company, the Guarantor or any of its
affiliates (as such term is defined in Rule 501(b) of Regulation D)
or any person (other than the Initial Purchasers, as to which no
representation or warranty is made) acting on the Company's or the
Guarantor's behalf has engaged, in connection with the offering of
the Debentures, in any form of general solicitation or general
advertising within the meaning of Rule 502(c) under the 1933 Act.
(v) Assuming the accuracy of the representations and warranties
and compliance with the agreements of the Initial Purchasers in
Section 3 hereof, it is not necessary in connection with the offer,
sale and delivery of the Debentures to the Initial Purchasers, or in
connection with the initial resale of the Debentures by the Initial
Purchasers in accordance with this Agreement, to register the
Debentures under the 1933 Act or to qualify the Indenture under the
Trust Indenture Act of 1939, as amended (the "Trust Indenture Act").
(vi) Deloitte & Touche LLP, who is reporting upon the financial
statements and schedules included in the Offering Memorandum, are
independent public accountants as required by the 1933 Act and the
applicable rules and regulations thereunder.
(vii) This Agreement has been duly authorized, executed and
delivered by the Company and the Guarantor.
(viii)Each of the Company and the Guarantor has all corporate
power and authority to execute, deliver and perform its obligations
under this Agreement, the Indenture and the Registration Rights
Agreement.
(ix) As of the Closing Time, the Registration Rights Agreement
will have been duly authorized, executed and delivered by the Company
and the Guarantor and upon such execution by the Company and the
Guarantor (assuming the due authorization, execution and delivery
thereof by the other parties thereto) the Registration Rights
Agreement will constitute the valid and binding obligation of the
Company and the Guarantor enforceable against the Company and the
Guarantor in accordance with the terms thereof, except as enforcement
thereof may be limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers),
reorganization, moratorium or similar laws affecting enforcement of
creditors' rights generally and except as enforcement thereof is
subject to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law), and
except as any rights to indemnity and contribution may be limited by
federal and state securities laws and public policy considerations.
(x) The consolidated financial statements included or
incorporated by reference in the Offering Memorandum present fairly
the consolidated financial position of the Company and the Guarantor
as of the dates indicated and the consolidated results of operations
and the consolidated cash flows of the Company and the Guarantor for
the periods specified. Such financial statements have been prepared
in conformity with generally accepted accounting principles applied
on a consistent basis throughout the periods involved.
(xi) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware
with corporate power and authority under such laws to own, lease and
operate its properties and conduct its business as described in the
Offering Memorandum; and the Company is duly qualified to transact
business as a foreign corporation and is in good standing in each
other jurisdiction in which it owns or leases property of a nature,
or transacts business of a type, that would make such qualification
necessary, except to the extent that the failure to so qualify or be
in good standing would not have a material adverse effect on the
Company and the Guarantor, considered as one enterprise. The Company
is not engaged in any business other than acting as a holding company
for the capital stock of the Guarantor.
(xii) The Company's only subsidiaries are those set out in
Schedule B hereto. The Guarantor is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Delaware with corporate power under such laws to own, lease and
operate its properties and conduct its business; the Guarantor is
duly qualified to transact business as a foreign corporation and is
in good standing in each other jurisdiction in which it owns or
leases property of a nature, or transacts business of a type, that
would make such qualification necessary, except to the extent that
the failure to so qualify or be in good standing would not have a
material adverse effect on the Company and the Guarantor, considered
as one enterprise. All of the outstanding shares of capital stock of
the Guarantor have been duly authorized and validly issued and are
fully paid and nonassessable and are owned, directly or indirectly,
by the Company free and clear of any pledge, lien, security interest,
charge, claim, equity or encumbrance of any kind, except as provided
in or pursuant to the Credit Agreement, dated as of June 30, 1998
(the "Bank Credit Agreement"), as amended, between the Guarantor and
the lenders named therein.
(xiii) The Company had at the date indicated a duly authorized,
issued and outstanding capitalization as set forth in the Offering
Memorandum in the column entitled "Actual" under the caption
"Capitalization"; and the Debentures, the Conversion Shares, the
Subsidiary Guarantee, the Registration Rights Agreement and the
Indenture conform in all material respects to the descriptions
thereof in the Offering Memorandum under the caption "Description of
the Debentures" and "Description of Capital Stock".
(xiv) All of the outstanding shares of capital stock of the
Company have been duly authorized and validly issued and are fully
paid and nonassessable; no holder thereof is or will be subject to
personal liability by reason of being such a holder; and none of the
outstanding shares of capital stock of the Company was issued in
violation of the preemptive rights of any stockholder of the Company.
(xv) The Indenture has been duly authorized by the Company and
the Guarantor, will be substantially in the form heretofore delivered
to the Initial Purchasers, and when validly executed and delivered by
the Company, the Guarantor and the Trustee, will constitute a valid
and binding obligation of the Company and the Guarantor, enforceable
against the Company and the Guarantor in accordance with its terms,
except as enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws
affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law).
(xvi) The Debentures have been duly authorized by the Company.
When executed, authenticated, issued and delivered in the manner
provided for in the Indenture and sold and paid for as provided in
this Agreement, the Debentures will constitute valid and binding
obligations of the Company, entitled to the benefits of the Indenture
and enforceable against the Company in accordance with their terms,
except as enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws
affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law).
(xvii) Neither the Company nor the Guarantor is, or after
giving effect to the consummation of the transactions contemplated
herein, will be, an "investment company" within the meaning of The
Investment Company Act of 1940, as amended; neither the Company nor
the Guarantor is directly or indirectly controlled by, or acting on
behalf of any person which is, an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
(xviii) The Conversion Shares have been duly authorized and
validly reserved for issuance upon conversion of the Debentures by
all necessary corporate action of the Company and, when duly issued
by the Company upon such conversion, will be validly issued, fully
paid and nonassessable; no holder thereof will be subject to personal
liability for obligations of the Company solely by reason of being
such a holder; and the issuance of the Conversion Shares will not be
subject to preemptive or similar rights.
(xix) Since the respective dates as of which information is
given in the Offering Memorandum, except as otherwise stated therein
or contemplated thereby, there has not been (A) any material adverse
change in the condition (financial or otherwise), earnings, business
affairs or business prospects of the Company and the Guarantor,
considered as one enterprise, whether or not arising in the ordinary
course of business, or (B) any dividend or distribution of any kind
declared, paid or made by the Company on its capital stock.
(xx) Neither the Company nor the Guarantor is in default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or instrument to which it
is a party or by which it may be bound or to which any of its
properties may be subject, except for such defaults that would not
have a material adverse effect on the condition (financial or
otherwise), earnings, business affairs or business prospects of the
Company or the Guarantor considered as one enterprise. The issuance,
sale and delivery of the Debentures by the Company, the execution,
delivery and performance by the Company and the Guarantor of this
Agreement, the Indenture and the Registration Rights Agreement, the
consummation by the Company and the Guarantor of the transactions
contemplated hereby, thereby and in the Offering Memorandum and
compliance by the Company and the Guarantor with the terms of the
foregoing have been duly authorized by all necessary action on the
part of the Company and the Guarantor and do not and will not result
in any violation of the charter or by-laws of the Company or the
Guarantor and do not and will not conflict with, or result in a
breach of any of the terms or provisions of, or constitute a default
under, or give rise to any right to accelerate the maturity or
require the prepayment of any indebtedness under, or result in the
creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or the Guarantor under (A) any
contract, indenture, mortgage, loan agreement, note, lease or other
agreement or instrument to which the Company or the Guarantor is a
party or by which either of them may be bound or to which any of
their properties may be subject (except for such conflicts, breaches
or defaults or liens, charges or encumbrances that would not have a
material adverse effect on the condition (financial or otherwise),
earnings, business affairs or business prospects of the Company or
the Guarantor, considered as one enterprise) or (B) any existing
applicable law, rule, regulation, judgment, order or decree of any
government, governmental instrumentality or court, domestic or
foreign, having jurisdiction over the Company or the Guarantor or any
of their respective properties.
(xxi) No authorization, approval, consent or license of any
government, governmental instrumentality or court, domestic or
foreign is necessary in connection with the offering, issuance or
sale of the Debentures and the Conversion Shares by the Company, or
is required for the valid authorization, execution, delivery and
performance by the Company or the Guarantor of the Operative
Documents to which the Company or the Guarantor is a party or the
consummation by the Company or the Guarantor of the transactions
contemplated therein, except such as may be required by the
securities or Blue Sky laws of the various states in connection with
the offer and sale of the Debentures or by the federal and state
securities laws in connection with the registration obligations under
the Registration Rights Agreement.
(xxii) Except as disclosed in the Offering Memorandum, there is
no action, suit or proceeding before or by any government,
governmental instrumentality or court, domestic or foreign, now
pending or, to the knowledge of the Company, threatened against the
Company or the Guarantor that is required to be disclosed in the
Offering Memorandum or that is reasonably expected by the Company to
result in any material adverse change in the condition (financial or
otherwise), earnings, business affairs or business prospects of the
Company and the Guarantor, considered as one enterprise, or that is
reasonably expected by the Company to materially and adversely affect
the consummation of the transactions contemplated by this Agreement.
The aggregate of all pending legal or governmental proceedings to
which the Company or the Guarantor is a party that are not described
in the Offering Memorandum, including ordinary routine litigation
incidental to the business of the Company or the Guarantor, as the
case may be, is not reasonably expected by the Company to have a
material adverse effect on the condition (financial or otherwise),
earnings, business affairs or business prospects of the Company or
the Guarantor, considered as one enterprise.
(xxiii) The Company and the Guarantor each owns, possesses or
has obtained all material governmental licenses, permits,
certificates, consents, orders, approvals and other authorizations
necessary to own or lease, as the case may be, and to operate its
properties and to carry on its business as presently conducted,
except where the failure to possess such licenses, permits,
certificates, consents, orders, approvals or other authorizations
would not have a material adverse effect on the condition (financial
or otherwise), earnings, business affairs or business prospects of
the Company and the Guarantor, considered as one enterprise, and
neither the Company nor the Guarantor has received any notice of
proceedings relating to revocation or modification of any such
licenses, permits, certificates, consents, orders, approvals or
authorizations, which, in the reasonable judgment of the Company, if
the subject of an unfavorable decision, ruling or finding, would have
a material adverse effect on the condition (financial or otherwise),
earnings, business affairs or business prospects of the Company and
the Guarantor, considered as one enterprise.
(xxiv) The Company and the Guarantor each owns or possesses, or
can acquire on reasonable terms, adequate patents, patent licenses,
trademarks, service marks and trade names necessary to carry on its
business as presently conducted, and neither the Company nor the
Guarantor has received any notice of infringement of or conflict with
asserted rights of others with respect to any patents, patent
licenses, trademarks, service marks or trade names that in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, could materially adversely affect the condition (financial
or otherwise), earnings, business affairs or business prospects of
the Company and the Guarantor, considered as one enterprise.
(xxv) Neither the Company nor the Guarantor has taken or will
take, directly or indirectly, any action designed to, or that the
Company reasonably believes would cause or result in, stabilization
or manipulation of the price of the Debentures or the common stock.
(xxvi) The Company has obtained the written agreement of its
executive officers to the effect that, for a period of 60 days from
the date hereof, such persons will not, without the prior written
consent of the Initial Purchasers, which consent will not be
unreasonably withheld, directly or indirectly, sell, offer to sell,
grant any option for the sale of, or otherwise dispose of any shares
of common stock or securities convertible into or exchangeable or
exercisable for common stock ("convertible securities"); provided,
however, that during such 60-day period, (i) such shares of common
stock or convertible securities may be transferred by will or the
laws of descent and distribution, (ii) such persons may make gifts of
shares of common stock or convertible securities or transfer such
shares of common stock or convertible securities to family trusts, so
long as the donee agrees to be bound by the foregoing restriction in
the same manner as it applies to such persons.
(xxvii) Except as disclosed in the Offering Memorandum and
except as would not individually or in the aggregate have a material
adverse effect on the condition (financial or otherwise), earnings,
business affairs or business prospects of the Company and the
Guarantor, considered as one enterprise, (A) the Company and the
Guarantor are in compliance with all applicable Environmental Laws,
(B) the Company and the Guarantor have all permits, authorizations
and approvals required under any applicable Environmental Laws and
are each in compliance with their requirements, (C) there are no
pending or threatened Environmental Claims against the Company or the
Guarantor, and (D) there are no circumstances with respect to any
property or operations of the Company or the Guarantor that the
Company reasonably believes would form the basis of an Environmental
Claim against the Company or the Guarantor.
For purposes of this Agreement, the following terms shall
have the following meanings: "Environmental Law" means any United
States federal, state, local or municipal statute, law, rule,
regulation, ordinance, code, policy or rule of common law and any
judicial or administrative interpretation thereof including any
judicial or administrative order, consent decree or judgment,
relating to the environment, health, safety or any chemical, material
or substance, exposure to which is prohibited, limited or regulated
by any governmental authority. "Environmental Claims" means any and
all administrative, regulatory or judicial actions, suits, demands,
demand letters, claims, liens, notices of noncompliance or violation,
investigations or proceedings relating in any way to any
Environmental Law.
(xxviii) The Debentures have been designated PORTAL eligible
securities in accordance with the rules and regulations of the
National Association of Securities Dealers, Inc. ("NASD").
(xxix) Each of the Company and the Guarantor has reviewed its
operations to evaluate the extent to which the business or operations
of the Company or the Guarantor will be affected by the Year 2000
Problem (that is, any significant risk that computer hardware or
software applications used by the Company and the Guarantor will not,
in the case of dates or time periods occurring after December 31,
1999, function at least as effectively as in the case of dates or
time periods occurring prior to January 1, 2000); as a result of such
review, neither the Company nor the Guarantor has any reason to
believe, and does not believe, that there are any issues related to
the Company's or the Guarantor's preparedness to address the Year
2000 Problem that are of a character required to be described or
referred to in the Offering Memorandum which have not been accurately
described in the Offering Memorandum.
(b) Any certificate signed by any officer of the Company or the
Guarantor and delivered to the Initial Purchasers or to counsel for the
Initial Purchasers shall be deemed a representation and warranty by the
Company or the Guarantor, as the case may be, to the Initial Purchasers as
to the matters covered thereby.
Section 2. Sale and Delivery to the Initial Purchasers;
Closing. (a) On the basis of the representations and warranties herein
contained, and subject to the terms and conditions herein set forth, the
Company agrees to sell to the Initial Purchasers, and the Initial
Purchasers agree to purchase from the Company, acting severally and not
jointly, at the purchase price per $1,000 principal amount at maturity of
$535.98 (i) an aggregate principal amount at maturity of $180,975,000 of
Firm Debentures, and (ii) in the event and to the extent that the Initial
Purchasers shall elect to purchase Additional Debentures pursuant to the
paragraph immediately following, up to an aggregate principal amount at
maturity of $18,097,500 of Additional Debentures.
(b) The Company hereby grants to the Initial Purchasers the
right to purchase at its election up to aggregate principal amount at
maturity of $18,097,500 of Additional Debentures, at the purchase price per
security set forth in the immediately preceding paragraph, for the sole
purpose of covering overallotments in the sale of the Firm Debentures. Any
such election to purchase Additional Debentures shall be exercised by
written notice from the Initial Purchasers to the Company, within 30 days
after the date of this Agreement, setting forth the aggregate principal
amount at maturity of Additional Debentures to be purchased and the date on
which such Additional Debentures are to be delivered. Any such time and
date of delivery (a "Date of Delivery") shall be determined by the Initial
Purchasers but shall not be later than seven full business days after the
exercise of said option, nor in any event prior to the Closing Time (as
defined below). If the option is exercised as to all or any portion of the
Additional Debentures, each of the Initial Purchasers, acting severally and
not jointly, will purchase that proportion of the total number of
Additional Debentures then being purchased which the number of Firm
Debentures set forth in Schedule A opposite the name of such Initial
Purchaser bears to the total number of Firm Debentures, subject in each
case to such adjustments as ▇▇▇▇▇▇▇ ▇▇▇▇▇ in its discretion shall make to
eliminate any sales or purchases of fractional securities.
(c) Payment of the purchase price for, and delivery of
certificates for, the Firm Debentures shall be made at the offices of
Shearman & Sterling, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, at
9:00 A.M., New York City time, on June 18, 1999 or such later date and time
not more than two full business days thereafter as the Initial Purchasers
and the Company shall determine (such date and time of payment and delivery
being herein called the "Closing Time"). In addition, in the event that any
or all of the Additional Debentures are purchased by the Initial
Purchasers, payment of the purchase price for, and delivery of certificates
for, such Additional Debentures shall be made at the offices of Shearman &
Sterling set forth above, or at such other place as the Company and the
Initial Purchasers shall determine, on the Date of Delivery as specified in
the notice from the Initial Purchasers to the Company. Payment shall be
made to the Company by wire transfer of immediately available funds to a
bank account designated by the Company against delivery to the Initial
Purchasers of the Firm Debentures and the Additional Debentures, if any, to
be purchased by it.
(d) Certificates for the Firm Debentures and the Additional
Debentures to be purchased by the Initial Purchasers shall be in such
denominations and registered in such names as the Initial Purchasers may
request in writing at least two full business days before the Closing Time
or the Date of Delivery, as the case may be. The certificates for the Firm
Debentures and the Additional Debentures will be made available in New York
City for examination and packaging by the Initial Purchasers not later than
9:00 A.M. on the business day immediately prior to the Closing Time or the
Date of Delivery, as the case may be.
(e) It is understood that ▇▇▇▇▇▇▇ ▇▇▇▇▇ is authorized, for the
account of the Initial Purchasers, to accept delivery of, receipt for, and
make payment of the purchase price for, the Debentures that each Initial
Purchaser has agreed to purchase. ▇▇▇▇▇▇▇ ▇▇▇▇▇ may (but shall not be
obligated to) make payment of the purchase price for the Firm Debentures
and the Additional Debentures, if any, to be purchased by any Initial
Purchaser whose funds shall not have been received by the Closing Time or
the Date of Delivery, as the case may be, but such payment shall not
relieve such Initial Purchaser from its obligations hereunder.
Section 3. Resale of the Securities. Each of the Initial
Purchasers, severally and not jointly, represents and warrants to, and
agrees with, the Company and the Guarantor that:
(a) it is a Qualified Institutional Buyer and an "accredited
investor" within the meaning of Rule 501(a) under the 1933 Act;
(b) it has not offered or sold, and will not offer or sell, any
Debentures except (i) to persons whom it reasonably believes to be
Qualified Institutional Buyers, or (ii) to a limited number of other
institutional accredited investors whom it believes to be "accredited
investors" (as defined in Rule 501(a) (1), (2), (3) or (7) of
Regulation D) that, prior to their purchase of the Debentures,
deliver to it a letter substantially in the form of Exhibit A to the
Offering Memorandum;
(c) neither it nor any of its U.S. affiliates or any person
acting on its or their behalf has made or will make offers or sales
of the Debentures in the United States by means of any form of
general solicitation or general advertising (within the meaning of
Regulation D) or in any manner involving a public offering (within
the meaning of Section 4(2) under the 1933 Act) in the United States;
Section 4. Certain Covenants the Company. The Company and the
Guarantor each covenants with the Initial Purchasers as follows:
(a) The Company will furnish to the Initial Purchasers and
counsel for the Initial Purchasers, without charge, as many copies of
the Preliminary Offering Memorandum and the Offering Memorandum and
any amendments or supplements thereto as the Initial Purchasers and
its counsel may reasonably request.
(b) The Company will give the Initial Purchasers notice of its
intention to prepare any amendment or supplement to the Preliminary
Offering Memorandum or the Offering Memorandum, will furnish the
Initial Purchasers and counsel to the Initial Purchasers with copies
of any such amendment or supplement and will not distribute any such
amendment or supplement to which the Initial Purchasers or counsel
for the Initial Purchasers shall reasonably object.
(c) If at any time prior to completion of the distribution of
the Securities by the Initial Purchasers to purchasers who are not
their affiliates (as determined by the Initial Purchasers) any event
shall occur or condition exist as a result of which it is necessary,
in the opinion of counsel for the Initial Purchasers or counsel for
the Company, to amend the Offering Memorandum or amend or supplement
any Offering Memorandum in order that each Offering Memorandum, as
then amended or supplemented, will not include an untrue statement of
a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances
existing at the time it is delivered to a purchaser, not misleading
or if, in the reasonable opinion of the Initial Purchasers or counsel
to the Initial Purchasers, such amendment or supplement is necessary
to comply with applicable law, the Company will, subject to paragraph
(b) of this Section 4, promptly prepare such amendment or supplement
as may be necessary to correct such untrue statement or omission or
to effect such compliance (in form and substance reasonably agreed
upon by counsel to the Initial Purchasers), so that as so amended or
supplemented, the statements in the Offering Memorandum will not
include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in
the light of the circumstances existing at the time it is delivered
to a purchaser, not misleading or so that such Offering Memorandum as
so amended or supplemented will comply with applicable law, as the
case may be, and furnish to the Initial Purchasers such number of
copies of such amendment or supplement as the Initial Purchasers may
reasonably request. The Company agrees to notify the Initial
Purchasers in writing to suspend use of the Offering Memorandum as
promptly as practicable after the occurrence of an event specified in
this paragraph (c), and the Initial Purchasers hereby agree upon
receipt of such notice from the Company to suspend use of the
Offering Memorandum until the Company has amended or supplemented the
Offering Memorandum to correct such misstatement or omission or to
effect such compliance.
(d) Notwithstanding any provision of paragraph (b) or (c) to
the contrary, however, the Company's obligations under paragraphs (b)
and (c) and the Initial Purchasers' obligations under paragraph (c)
shall terminate on the earlier to occur of (i) the effective date of
a shelf registration statement with respect to the Securities filed
pursuant to the Registration Rights Agreement and (ii) the date upon
which the Initial Purchasers and their affiliates cease to hold
Securities acquired as part of their initial distribution, but in any
event not later than nine months from the Closing Time.
(e) None of the Company, the Guarantor, any of their affiliates
(as defined in Rule 501(b) under the 1933 Act), or any person acting
on behalf of the foregoing (other than the Initial Purchasers), will
engage in any form of general solicitation or general advertising
(within the meaning of Regulation D) in connection with any offer or
sale of the Securities in the United States prior to the
effectiveness of a registration statement with respect to the
Securities.
(f) None of the Company, the Guarantor or any of their
affiliates (as defined in Rule 501(b) under the ▇▇▇▇ ▇▇▇) will,
directly or indirectly, make offers or sales of any security, or
solicit offers to buy any security, under circumstances that would
require the registration of the Securities under the 1933 Act.
(g) So long as any of the Securities are "restricted
securities" within the meaning of Rule 144(a)(3) under the 1933 Act,
the Company will, during any period in which it is not subject to and
in compliance with, Section 13 or 15(d) of the 1934 Act, provide to
each holder of such restricted securities and to each prospective
purchaser (as designated by such holder) of such restricted
securities, upon the request of such holder or prospective purchaser,
any information required to be provided by Rule 144A(d)(4) under the
1933 Act. This covenant is intended to be for the benefit of the
holders, and the prospective purchasers designated by such holders,
from time to time of such restricted securities.
(h) Each Debenture will bear the following legend until such
legend shall no longer be necessary or advisable because the
Debentures are no longer subject to the restrictions on transfer
described herein:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES
LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS
SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY BY
ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER
SUCH SECURITY, PRIOR TO THE DATE WHICH IS TWO YEARS AFTER THE LATER
OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH
ANNTAYLOR STORES CORPORATION (THE "COMPANY") OR ANY AFFILIATE OF THE
COMPANY WAS THE OWNER OF THIS SECURITY OR ANY PREDECESSOR OF THIS
SECURITY (THE "RESALE RESTRICTION TERMINATION DATE") ONLY (A) TO THE
COMPANY, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE
FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE
144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO
WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT
OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S
UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED
INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (a)(1), (2), (3) OR (7)
OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THE SECURITY
FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
"ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A VIEW
TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN
VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE COMPANY'S AND THE TRANSFER AGENT'S RIGHT PRIOR TO ANY
SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (D), (E) OR (F)
TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION
AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii) IN
EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF
TRANSFER IN THE FORM APPEARING ON THIS SECURITY IS COMPLETED AND
DELIVERED BY THE TRANSFEROR TO THE TRANSFER AGENT. THIS LEGEND WILL
BE REMOVED UPON THE REQUEST OF A HOLDER AFTER THE RESALE RESTRICTION
TERMINATION DATE.
(i) Each Conversion Share, if any, will bear the following
legend until such legend shall no longer be necessary or advisable
because the Conversion Shares are no longer subject to the
restrictions on transfer described herein:
THE COMMON STOCK EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
STATE SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE
HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE WHICH IS
TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE OF THE
CONVERTIBLE SUBORDINATED DEBENTURES DUE 2019 UPON THE CONVERSION OF
WHICH THE COMMON STOCK EVIDENCED HEREBY WAS ISSUED AND THE LAST DATE
ON WHICH ANNTAYLOR STORES CORPORATION (THE "COMPANY") OR ANY
AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF THIS SECURITY) (THE "RESALE RESTRICTION TERMINATION
DATE") ONLY (A) TO THE COMPANY, (B) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C) FOR SO LONG AS
THE COMPANY COMMON STOCK IS ELIGIBLE FOR RESALE PURSUANT TO RULE
144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT
THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES
TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF
SUBPARAGRAPH (a)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES
ACT THAT IS ACQUIRING THE SECURITIES FOR ITS OWN ACCOUNT, OR FOR THE
ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR", FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN
CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT,
OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE
TRANSFER AGENT'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i)
PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM AND (ii) IN EACH OF THE FOREGOING CASES,
TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON
THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE
TRANSFER AGENT. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE
HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
(j) The Company will arrange for the registration and
qualification of the Debentures for offering and sale under the
applicable securities or "blue sky" laws of such states and other
jurisdictions as the Initial Purchasers may reasonably designate in
connection with the resale of the Securities as contemplated by this
Agreement and the Offering Memorandum and will continue such
qualifications in effect for as long as may be necessary to complete
the distribution of the Debentures; provided that in no event shall
the Company be obligated to (i) qualify as a foreign corporation or
as a dealer in securities in any jurisdiction where it would not
otherwise be required to so qualify but for this Section 4(k), (ii)
file any general consent to service of process in any jurisdiction
where it is not at the Closing Time then so subject, (iii) subject
itself to taxation in any such jurisdiction if it is not so subject
or (iv) register the Debentures under the 1933 Act except in
accordance with the Registration Rights Agreement. The Company shall
promptly advise the Initial Purchasers of the receipt by the Company
of any notification with respect to the suspension of the
qualification or exemption from qualification of the Debentures for
offering or sale in any jurisdiction or the institution of any
proceeding for such purpose.
(k) The Company will use the proceeds received from the issue
and sale of the Debentures in the manner specified in the Offering
Memorandum under the caption "Use of Proceeds".
(l) Neither the Company nor the Guarantor shall, directly or
indirectly, for a period of 90 days after the date hereof, except
with the prior written consent of the Initial Purchasers, offer, sell
or enter into any agreement to sell, or otherwise dispose of (a) any
convertible stock or any other security of the Company or the
Guarantor that is substantially similar to the Debentures, (b) any
shares of any class of common stock of the Company or the Guarantor
(other than (i) the Conversion Shares, or (ii) shares of common stock
issuable pursuant to the exercise of options and warrants outstanding
as of the date hereof, (iii) the grant of stock options or other
stock-based awards (and the exercise or vesting thereof) to
directors, officers and employees of the Company (including pursuant
to the Company's Associate Discount Stock Purchase Plan) or the
Guarantor, (iv) as may be required pursuant to the Certificate of
Incorporation of the Company, and (v) such shares of common stock
issuable upon the conversion of the outstanding 8 1/2% Convertible
Preferred Securities and the outstanding 8 1/2% Convertible Common
Securities of AnnTaylor Finance Trust, a Delaware business trust), or
(c) any other securities which are convertible into, or exercisable
or exchangeable for, any of (a) or (b).
Section 5. Payment of Expenses. The Company and the Guarantor
will pay all costs and expenses incident to the performance of their
obligations under this Agreement, including (a) the preparation and
printing of the Preliminary Offering Memorandum and the Offering Memorandum
(including financial statements and exhibits) and any amendments or
supplements thereto, and the cost of furnishing copies thereto to the
Initial Purchasers, (b) the preparation, issuance, printing and
distribution of the Debentures and any survey of state securities or "blue
sky" laws or legal investment memoranda ("Blue Sky Survey"), (c) the
delivery of the Debentures to the Initial Purchasers, including any stock
transfer taxes payable upon the sale of the Debentures to the Initial
Purchasers, (d) the fees and disbursements of the Company's and the
Guarantor's counsel and accountants, (e) the qualification of the
Debentures under the applicable state securities or "blue sky" laws in
accordance with Section 4(k), including filing fees and fees and
disbursements of counsel for the Initial Purchasers in connection therewith
and in connection with the Blue Sky Survey, (f) any filing fees in
connection with any filing for review of the offering with the NASD, (g)
any fees charged by rating agencies for rating the Debentures, (h) the fees
and expenses of the Trustee and the transfer agent and registrar for the
common stock, including the fees and disbursements of counsel for such
Trustee and the transfer agent and registrar, (i) all expenses and listing
fees in connection with the application for designation of the Securities
as PORTAL eligible securities and (j) the cost of qualifying the Debentures
with The Depository Trust Company.
If the sale of the Debentures provided for herein is not
consummated because any condition to the obligations of the Initial
Purchasers set forth in Section 6 is not satisfied or because this
Agreement is terminated pursuant to Section 11(a)(i) other than by reason
of a default by the Initial Purchasers in payment for the Debentures at the
Closing Time, the Company and the Guarantor shall reimburse the Initial
Purchasers promptly upon demand for all reasonable out-of-pocket expenses
(including reasonable fees and disbursements of counsel to the Initial
Purchasers) that shall have been incurred by it in connection with the
proposed purchase and sale of the Debentures.
Section 6. Conditions of Initial Purchasers' Obligations. The
obligations of the Initial Purchasers to purchase and pay for the
Debentures that it has agreed to purchase pursuant to this Agreement are
subject to the accuracy of the representations and warranties of the
Company and the Guarantor contained herein or in certificates of any
officer of the Company or the Guarantor delivered pursuant to the
provisions hereof, to the performance by the Company and the Guarantor of
their respective obligations hereunder, and to the following further
conditions:
(a) At the Closing Time, the Initial Purchasers shall have
received a signed opinion of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP,
counsel for the Company, dated as of the Closing Time, in form and
substance satisfactory to counsel for the Initial Purchasers, to the effect
that:
(i) The Indenture has been duly authorized, executed and
delivered by the Company and the Guarantor and, when duly authorized,
executed and delivered by the Trustee, will constitute a valid and
binding obligation of the Company and the Guarantor, enforceable
against the Company and the Guarantor in accordance with its terms,
except as enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws
affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law) and except that the waive of stay or extension laws
contained in Section 515 of the Indenture may be unenforceable.
(ii) The Debentures have been duly authorized by the Company
and when the Debentures have been duly authenticated by the Trustee
in the manner described in its certificate delivered to the Initial
Purchasers and paid for by the Initial Purchasers (which fact such
counsel need not determine by an inspection of the Debentures) on the
date hereof, the Debentures will be duly executed, issued and
delivered by the Company and constitute valid and binding obligations
of the Company entitled to the benefits of the Indenture and
enforceable against the Company in accordance with their terms,
except as enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws
affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law) and except that the waive of stay or extension laws
contained in Section 515 of the Indenture may be unenforceable.
(iii) The Conversion Shares have been duly authorized by the
Company, reserved for issuance upon conversion of the Debentures and,
if and when issued in accordance with the Indenture at conversion
prices at or in excess of the par value of such Conversion Shares,
will be validly issued, fully paid and nonassessable; and no holder
thereof will be subject to personal liability by reason of being such
a holder.
(iv) This Agreement has been duly authorized, executed and
delivered by the Company and the Guarantor.
(v) The Registration Rights Agreement has been duly authorized,
executed and delivered by the Company and the Guarantor and
constitutes a valid and binding agreement of the Company and the
Guarantor, enforceable against the Company and the Guarantor in
accordance with its terms, except to the extent that enforcement
thereof may be limited by (a) bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating
to creditors' rights generally and (b) general principles of equity
(regardless of whether enforceability is considered in a proceeding
at law or in equity), and except to the extent that the right to
indemnity and contribution contained in the Registration Rights
Agreement may be limited by state or federal securities laws or the
public policy underlying such laws.
(vi) The holders of outstanding shares of capital stock of the
Company are not entitled to any preemptive rights under the
Certificate of Incorporation or By-Laws of the Company or the law of
the State of Delaware to subscribe for the Debentures or the
Conversion Shares.
(vii) No authorization, approval, consent or license of any New
York, Delaware or United States federal government, governmental
instrumentality or court that, in the opinion of such counsel, are
normally applicable to transactions of the type contemplated by this
Agreement (other than United States, state and foreign securities or
blue sky laws and the rules and regulations of the NASD) ("Applicable
Laws"), is required for the issuance and sale of the Debentures by
the Company to the Initial Purchasers pursuant to this Agreement, or
the performance by the Company or the Guarantor of its obligations in
this Agreement, the Indenture, the Debentures and the Registration
Rights Agreement, except such as may be required under state
securities law or under federal and state securities laws in
connection with the registration obligations under the Registration
Rights Agreement.
(viii) The statements made in the Offering Memorandum under the
captions "Description of Debentures" and "Description of Capital
Stock", insofar as such statements purport to summarize certain
provisions of the Debentures, the Conversion Shares, the Subsidiary
Guarantee, the Indenture, the Registration Rights Agreement and the
Certificate of Incorporation of the Company, to the extent that they
constitute matters of law or legal conclusions, have been reviewed by
such counsel and fairly summarize the information required to be
disclosed therein in all material respects;
(ix) The execution, delivery and performance by the Company and
the Guarantor of this Agreement, the Indenture and the Registration
Rights Agreement, the consummation by the Company and the Guarantor
of the transactions contemplated hereby and thereby and in the
Offering Memorandum, compliance by the Company and the Guarantor with
the terms of the foregoing and the application of the proceeds from
the sale of the Debentures as contemplated by the Offering Memorandum
do not and will not result in any violation of the charter or by-laws
of the Company or the Guarantor, and do not and will not conflict
with, or result in a breach of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition
of any lien, charge or encumbrance upon any property or assets of the
Company or the Guarantor under (A) any agreement or instrument set
forth on Schedule I to such counsel's opinion, (B) any existing
Applicable Law, or (C) any judgment, order or decree under Applicable
Laws of any New York, Delaware or federal government, governmental
instrumentality or court having jurisdiction over the Company or the
Guarantor or any of their respective properties of which such counsel
is aware. Such counsel need express no opinion, however, as to
whether the execution, delivery and performance by the Company or the
Guarantor of any of the agreements identified in the preceding
sentence will constitute a violation of or a default under any
covenant, restriction or provision with respect to financial ratios
or tests or any aspect of the financial condition or results of
operations of the Company or the Guarantor.
(x) When the Debentures are issued and delivered pursuant to
this Agreement, such securities will not be of the same class (within
the meaning of Rule 144A under the ▇▇▇▇ ▇▇▇) as securities of the
Company listed on a national securities exchange registered under
Section 6 of the 1934 Act or quoted in a U.S. automated inter-dealer
quotation system.
(xi) Assuming (a) the accuracy of the representations and
warranties of the Company and the Guarantor set forth in Section 1 of
this Agreement and of the Initial Purchasers set forth in Section 3
of this Agreement, (b) the due performance by the Company and the
Guarantor of the covenants and agreements set forth in Section 4 of
this Agreement and the due performance by the Initial Purchasers of
the covenants and agreements set forth in Section 3 of this
Agreement, (c) compliance by the Initial Purchasers with the offering
and transfer procedures and restrictions described in the Offering
Memorandum and (d) the accuracy of the representations and warranties
made in accordance with the Offering Memorandum by purchasers to whom
the Initial Purchasers initially resell Debentures, the offer, sale
and delivery of the Debentures to the Initial Purchasers in the
manner contemplated by the Purchase Agreement and the Offering
Memorandum and the initial resale of the Debentures by the Initial
Purchasers in the manner contemplated in the Offering Memorandum and
this Agreement do not require registration under the 1933 Act, it
being understood that such counsel need express no opinion as to any
subsequent resale of any Debentures, and neither the Indenture nor
the Debentures are required to be qualified under the Trust Indenture
Act of 1939, as amended.
(xii) Neither the Company nor the Guarantor is required to be
registered under the Investment Company Act of 1940, as amended.
(xiii) The Company has been duly incorporated and is validly
existing in good standing as a corporation and the Company has the
power and authority to (a) execute and deliver, and to perform its
obligations under, this Agreement, the Indenture and the Registration
Rights Agreement and (b) issue and perform its obligations under the
Debentures under Delaware law.
(xiv) The Guarantor has been duly incorporated and is validly
existing in good standing as a corporation and the Guarantor has the
power and authority to (a) execute and deliver, and to perform its
obligations under, this Agreement, the Indenture and the Registration
Rights Agreement and (b) issue and perform its obligations under the
Subsidiary Guarantee under Delaware law.
(xv) Under the Indenture, the issuance of the Debentures and
the Conversion
Shares is not subject to preemptive rights.
(xvi) The statements made in the Offering Memorandum set forth
under the captions "Offering Memorandum Summary --The Offering--
Original Issue Discount" and "United States Federal Income Taxation",
fairly present in all material respects the principal U.S. federal
income tax consequences of an investment in the Debentures.
In addition, such opinion shall state that such counsel have
participated in the preparation of the Offering Memorandum and in
conferences with officers and other representatives of the Company and the
Guarantor, representatives of the independent public accountants for the
Company and the Guarantor, and with representatives and counsel of the
Initial Purchasers at which the contents of the Offering Memorandum and
related matters were discussed and, although such counsel need not pass
upon or assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Offering Memorandum, on the
basis of the foregoing, no facts have come to the attention of such counsel
that have caused them to believe that the Offering Memorandum or any
amendment thereto (except for the financial statements and other financial
data included therein or omitted therefrom, as to which such counsel need
express no opinion) at the time any such amended or supplemented Offering
Memorandum was issued or at the Closing Time, contained or contains an
untrue statement of a material fact or omitted or omits to state a material
fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading except that such counsel need express no opinion or
belief with respect to the financial statements, schedules and other
financial data included therein or omitted therefrom.
Such opinion shall be to such further effect with respect to
other legal matters relating to this Agreement and the Securities as
counsel for the Initial Purchasers may reasonably request. In giving such
opinion, such counsel may state that, insofar as such opinion involves
factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and the Guarantor and certificates
of public officials; provided that such certificates have been delivered to
the Initial Purchasers.
(b) At the Closing Time, the Initial Purchasers shall have
received a signed opinion of ▇▇▇▇▇▇▇ F.L. ▇▇▇▇▇▇▇▇▇▇▇, general counsel of
the Company, dated as of the Closing Time, in form and substance
satisfactory to counsel for the Initial Purchasers, to the effect that:
(i) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware
with corporate power and authority under such laws to own, lease and
operate its properties and conduct its business as described in the
Offering Memorandum.
(ii) The Company is duly qualified to transact business as a
foreign corporation and is in good standing in each other
jurisdiction in which it owns or leases property of a nature, or
transacts business of a type, that would make such qualification
necessary, except to the extent that the failure to so qualify or be
in good standing would not have a material adverse effect on the
Company and the Guarantor, considered as one enterprise.
(iii) The Guarantor is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware
with corporate power and authority under such laws to own, lease and
operate its properties and conduct its business.
(iv) The Guarantor is duly qualified to transact business as a
foreign corporation and is in good standing in each other
jurisdiction in which it owns or leases property of a nature, or
transacts business of a type, that would make such qualification
necessary, except to the extent that the failure to so qualify or be
in good standing would not have a material adverse effect on the
Company and the Guarantor, considered as one enterprise.
(v) The Company has an authorized capitalization as set forth
in the Offering Memorandum; all of the outstanding shares of capital
stock of the Company have been duly authorized and validly issued and
are fully paid and nonassessable; no holder thereof is or will be
subject to personal liability by reason of being such a holder; and
none of the outstanding shares of capital stock of the Company was
issued in violation of the preemptive rights of any stockholder of
the Company arising by operation of law or under the charter or
by-laws of the Company.
(vi) All of the outstanding shares of capital stock of the
Guarantor have been duly authorized and validly issued and are fully
paid and nonassessable; all of such shares are owned by the Company,
free and clear of any pledge, lien, security interest, charge, claim,
equity or encumbrance of any kind (other than pursuant to the Bank
Credit Agreement); no holder thereof is subject to personal liability
by reason of being such a holder; and none of such shares was issued
in violation of the preemptive rights of any stockholder of the
Guarantor arising by operation of law or under the charter or by-laws
of the Guarantor.
(vii) Other than described in the Offering Memorandum, such
counsel does not know of any statutes or regulations, or any pending
or threatened legal or governmental proceedings to which the Company
or the Guarantor is a party or to which the assets of the Company or
the Guarantor is subject which, individually or in the aggregate,
would have a material adverse effect on the Company and the
Guarantor, considered as one enterprise.
(viii) Except to the extent described in the Offering
Memorandum, to the knowledge of such counsel, no default exists in
the performance or observance of any material obligation, agreement,
covenant or condition contained in any contract, indenture, loan
agreement, note, lease or other agreement or instrument that is
described or referred to in the Offering Memorandum. Such counsel
need express no opinion, however, as to any defaults relating to a
violation of or a default under any covenant, restriction or
provision with respect to financial ratios or tests or any aspect of
the financial condition or results of operations of the Company or
the Guarantor.
In addition, such opinion shall state that such counsel has
participated in the preparation of the Offering Memorandum and in
conferences with officers and other representatives of the Company and the
Guarantor, representatives of the independent public accountants for the
Company and the Guarantor, and with representatives and counsel of the
Initial Purchasers at which the contents of the Offering Memorandum and
related matters were discussed and, although such counsel need not pass
upon or assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Offering Memorandum, on the
basis of the foregoing, no facts have come to the attention of such counsel
that have caused such counsel to believe that the Offering Memorandum or
any amendment thereto (except for the financial statements and other
financial data included therein or omitted therefrom, as to which such
counsel need express no opinion) at the time any such amended or
supplemented Offering Memorandum was issued or at the Closing Time,
contained or contains an untrue statement of a material fact or omitted or
omits to state a material fact required to be stated therein or necessary
in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading except that such counsel need
express no opinion or belief with respect to the financial statements,
schedules and other financial data included therein or omitted therefrom.
Such opinion shall be to such further effect with respect to
other legal matters relating to this Agreement and the Securities as
counsel for the Initial Purchasers may reasonably request. In giving such
opinion, such counsel may state that, insofar as such opinion involves
factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and the Guarantor and certificates
of public officials; provided that such certificates have been delivered to
the Initial Purchasers.
(c) At the Closing Time, the Initial Purchasers shall have
received the favorable opinion of Shearman & Sterling, counsel for the
Initial Purchasers, dated as of the Closing Time, to the effect that the
opinions delivered pursuant to Sections 6(a) and 6(b) appear on their face
to be appropriately responsive to the requirements of this Agreement
except, specifying the same, to the extent waived by you, and with respect
to the incorporation and legal existence of the Company, the Securities,
the due authorization, execution and delivery of this Agreement, the
absence of the requirement to register under the 1933 Act the initial sale
of the Debentures and such other related matters as the Initial Purchasers
may require. Such counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem proper,
upon certificates of officers of the Company and the Guarantor and
certificates of public officials.
(d) At the Closing Time, (i) the Offering Memorandum, as it may
then be amended or supplemented, shall not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, (ii)
there shall not have been, since the respective dates as of which
information is given in the Offering Memorandum, any material adverse
change in the condition (financial or otherwise), earnings, business
affairs or business prospects of the Company or the Guarantor, considered
as one enterprise, whether or not arising in the ordinary course of
business, (iii) no action, suit or proceeding shall be pending or, to the
knowledge of the Company, threatened against the Company or the Guarantor
other than as set forth in the Offering Memorandum or in any supplement
thereto and no proceedings shall be pending or, to the knowledge of the
Company, threatened against the Company or the Guarantor before or by any
government, governmental instrumentality or court, domestic or foreign,
that could be reasonably expected to result in any material adverse change
in the condition (financial or otherwise), earnings, business affairs or
business prospects of the Company and the Guarantor considered as one
enterprise, other than as set forth in the Offering Memorandum, (iv) the
Initial Purchasers, the Company and the Guarantor shall have complied in
all material respects with all agreements and satisfied all conditions on
their respective parts to be performed or satisfied at or prior to the
Closing Time and (v) the representations and warranties of the Company and
the Guarantor set forth in Section 1(a) shall be accurate as though
expressly made at and as of the Closing Time. At the Closing Time, the
Initial Purchasers shall have received a certificate of the Chief Financial
Officer and the Chairman and Chief Executive Officer of the Company and of
the Guarantor, dated as of the Closing Time, to such effect.
(e) At the time that this Agreement is executed by the Company
and the Guarantor, the Initial Purchasers shall have received from Deloitte
& Touche LLP a letter in the form attached hereto as Exhibit B, dated such
date, and otherwise in form and substance satisfactory to the Initial
Purchasers.
(f) At the Closing Time, the Initial Purchasers shall have
received from Deloitte & Touche LLP a letter, in form and substance
satisfactory to the Initial Purchasers and dated as of the Closing Time, to
the effect that they reaffirm the statements made in the letter furnished
pursuant to Section 6(e), except that the specified date referred to shall
be a date not more than four days prior to the Closing Time.
(g) At the Closing Time, counsel for the Initial Purchasers
shall have been furnished with all such documents, certificates and
opinions as they may reasonably request for the purpose of enabling them to
pass upon the issuance and sale of the Securities as contemplated in this
Agreement and in order to evidence the accuracy and completeness of any of
the representations, warranties or statements of the Company and the
Guarantor, the performance of any of the covenants of the Company and the
Guarantor, or the fulfillment of any of the conditions herein contained;
and all proceedings taken by the Company and the Guarantor at or prior to
the Closing Time in connection with the authorization, issuance and sale of
the Securities as contemplated in this Agreement shall be satisfactory in
form and substance to the Initial Purchasers and to counsel for the Initial
Purchasers.
(h) At the Closing Time, the Company, the Guarantor and the
Initial Purchasers shall have entered into the Registration Rights
Agreement, and the Registration Rights Agreement shall be in full force and
effect.
(i) At the Closing Time, there shall not be any pending or
threatened legal or governmental proceedings with respect to any of the
transactions contemplated in this Agreement.
If any of the conditions specified in this Section 6 shall not
have been fulfilled when and as required by this Agreement, this Agreement
may be terminated by the Initial Purchasers on notice to the Company at any
time at or prior to the Closing Time, and such termination shall be without
liability of such party to the other party, except as provided in Section 5
herein. Notwithstanding any such termination, the provisions of Sections 8
and 9 shall remain in effect.
Section 7. Conditions to Purchase of Additional Debentures. In
the event that the Initial Purchasers exercise their option granted in
Section 2 to purchase all or any of the Additional Debentures and the Date
of Delivery determined by you pursuant to Section 2 is later than the
Closing Time, the obligations of the Initial Purchasers to purchase and pay
for the Additional Debentures that they shall have agreed to purchase
pursuant to this Agreement are subject to the accuracy of the
representations and warranties of the Company and the Guarantor herein
contained, to the performance by the Company and the Guarantor of their
obligations hereunder and to the following further conditions:
(a) At the Date of Delivery, the provisions of Sections 6(d)(i)
through 6(d)(iv) shall have been complied with at and as of the Date of
Delivery and, at the Date of Delivery, the Initial Purchasers shall have
received a certificate of the Chairman or an Executive Vice President, and
the Treasurer or Controller, of the Company and of the Guarantor, dated as
of the Date of Delivery, to such effect.
(b) At the Date of Delivery, the Initial Purchasers shall have
received the favorable opinion of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP,
counsel for the Company and the Guarantor in a form and substance
satisfactory to counsel for the Initial Purchasers, dated as of the Date of
Delivery, relating to the Additional Debentures and otherwise to the same
effect as the opinions required by Section 6(a).
(c) At each applicable Date of Delivery, the Initial Purchasers
shall have received a signed opinion of ▇▇▇▇▇▇▇ F.L. Barandiaran, general
counsel for the Company and the Guarantor, dated as of such Date of
Delivery, in form and substance satisfactory to counsel for the Initial
Purchasers, to the same effect as the opinion required by Section 6(b).
(d) At the Date of Delivery, the Initial Purchasers shall have
received the favorable opinion of Shearman & Sterling, counsel for the
Initial Purchasers, dated as of the Date of Delivery, relating to the
Additional Debentures and otherwise to the same effect as the opinion
required by Section 6(c).
(e) At the Date of Delivery, the Initial Purchasers shall have
received a letter from Deloitte & Touche, in form and substance
satisfactory to the Initial Purchasers and dated as of the Date of
Delivery, to the effect that they reaffirm the statements made in the
letter furnished pursuant to Section 6(f), except that the specified date
referred to shall be a date not more than three days prior to the Date of
Delivery.
(f) At the Date of Delivery, counsel for the Initial Purchasers
shall have been furnished with all such documents, certificates and
opinions as they may reasonably request for the purpose of enabling them to
pass upon the issuance and sale of the Additional Debentures as
contemplated in this Agreement in order to evidence the accuracy and
completeness of any of the representations, warranties or statements of the
Company and the Guarantor, the performance of any of the covenants of the
Company and the Guarantor, or the fulfillment of any of the conditions
herein contained; and all proceedings taken by the Company and the
Guarantor at or prior to the Date of Delivery in connection with the
authorization, issuance and sale of the Additional Debentures as
contemplated in this Agreement shall be satisfactory in form and substance
to the Initial Purchasers and their counsel.
Section 8. Indemnification. (a) The Company and the Guarantor
agree jointly and severally to indemnify and hold harmless each Initial
Purchaser and each person, if any, who controls any Initial Purchaser
within the meaning of Section 15 of the 1933 Act to the extent and in the
manner set forth in clauses (i), (ii) and (iii) below:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of an untrue statement
or alleged untrue statement of a material fact included in any
preliminary offering memorandum or the Offering Memorandum (or any
amendment or supplement thereto), including all documents
incorporated therein by reference, or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or investigation or
proceeding by any governmental agency or body, commenced or
threatened, or of any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or
omission, if such settlement is effected with the written consent of
the Company; and
(iii) against any and all expense whatsoever, as incurred
(including, subject to Section 8(c) hereof, the reasonable fees and
disbursements of counsel chosen by the Initial Purchasers),
reasonably incurred in investigating, preparing or defending against
any litigation, or investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever
based upon any such untrue statement or omission, or any such alleged
untrue statement or omission, to the extent that any such expense is
not paid under subparagraph (i) or (ii) above;
provided, however, that this indemnity agreement does not apply to any
loss, liability, claim, damage or expense to the extent arising out of an
untrue statement or omission or alleged untrue statement or omission made
in reliance upon and in conformity with written information furnished to
the Company by any Initial Purchasers expressly for use in the Offering
Memorandum (or any amendment or supplement thereto), or any preliminary
offering memorandum; provided further that the foregoing indemnification
with respect to any preliminary offering memorandum shall not inure to the
benefit of the Initial Purchasers (or any person controlling such Initial
Purchasers) from whom the person asserting any such losses, claims, damages
or liabilities purchased any of the Debentures if a copy of the Offering
Memorandum (as then amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) was not sent or given by
or on behalf of such Initial Purchasers on the initial resale to such
person, if such is required by law, at or prior to the written confirmation
of the sale of such Debentures to such person and if the Offering
Memorandum (as so amended or supplemented) would have cured the defect
giving rise to such loss, claim, damage or liability.
(b) Each Initial Purchaser severally agrees to indemnify and
hold harmless the Company, the Guarantor, and their respective directors
and officers and each person, if any, who controls the Company and the
Guarantor within the meaning of Section 15 of the 1933 Act against any and
all loss, liability, claim, damage and expense described in the indemnity
agreement in Section 8(a), as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in
the Offering Memorandum (or any amendment or supplement thereto) or any
preliminary offering memorandum in reliance upon and in conformity with
written information furnished to the Company by such Initial Purchasers
expressly for use in the Offering Memorandum (or any amendment or
supplement thereto), or such preliminary offering memorandum.
(c) Each indemnified party shall give prompt notice to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve it from any liability that it may have otherwise
than on account of this indemnity agreement. An indemnifying party may
participate at its own expense in the defense of such action. In no event
shall the indemnifying party or parties be liable for the fees and expenses
of more than one counsel for all indemnified parties in connection with any
one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances.
If it so elects within a reasonable time after receipt of such notice, an
indemnifying party, jointly with any other indemnifying parties receiving
such notice, may assume the defense of such action with counsel chosen by
it and approved by the indemnified parties defendant in such action, unless
such indemnified parties reasonably object to such assumption on the ground
that there may be legal defenses available to them which are different from
or are in addition to those available to such indemnifying party. If an
indemnifying party assumes the defense of such action, the indemnifying
parties shall not be liable for any fees and expenses of counsel for the
indemnified parties incurred thereafter in connection with such action.
Section 9. Contribution. In order to provide for just and
equitable contribution in circumstances under which the indemnity provided
for in Section 8 is for any reason held to be unenforceable by the
indemnified parties although applicable in accordance with its terms, the
Company, the Guarantor and the Initial Purchasers shall contribute to the
aggregate losses, liabilities, claims, damages and expenses of the nature
contemplated by such indemnity incurred by the Company, the Guarantor and
one or more of the Initial Purchasers, as incurred, in such proportions
that the Initial Purchasers are responsible for that portion represented by
the percentage that the Initial Purchasers' discount appearing under the
heading "Plan of Distribution" of the Offering Memorandum bears to the
offering price appearing thereon; provided, however, that no person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section,
each person, if any, who controls an Initial Purchaser within the meaning
of Section 15 of the 1933 Act shall have the same rights to contribution as
such Initial Purchaser, and each director and officer of the Company and
the Guarantor and each person, if any, who controls the Company and the
Guarantor within the meaning of Section 15 of the 1933 Act shall have the
same rights to contribution as the Company and the Guarantor. The Initial
Purchasers' respective obligations to contribute pursuant to this Section 9
are several in proportion to the number of Debentures set forth opposite
their respective names in Schedule A hereto and not joint.
Section 10. Representations, Warranties and Agreements to
Survive Delivery. The representations, warranties, indemnities, agreements
and other statements of the Company, the Guarantor and their respective
officers and of the Initial Purchasers set forth in or made pursuant to
this Agreement will remain operative and in full force and effect
regardless of any investigation made by or on behalf of the Company, the
Guarantor, the Initial Purchasers or any controlling person thereof and
will survive delivery of and payment for the Securities.
Section 11. Termination of Agreement. (a) The Initial
Purchasers may terminate this Agreement, by notice to the Company at any
time at or prior to the Closing Time (i) if there has been, since the
respective dates as of which information is given in the Offering
Memorandum, any material adverse change in the condition (financial or
otherwise), earnings, business affairs or business prospects of the Company
and the Guarantor, considered as one enterprise, whether or not arising in
the ordinary course of business, (ii) if there has occurred any material
adverse change in the financial markets in the United States or
internationally or any outbreak of hostilities or escalation of existing
hostilities or other calamity or crisis the effect of which on the
financial markets of the United States or internationally is such as to
make it, in the judgment of the Initial Purchasers, impracticable to market
the Securities, or enforce contracts for the sale of the Debentures, (iii)
if trading in any securities of the Company has been suspended by the
Commission or the New York Stock Exchange, or if trading generally on the
New York Stock Exchange or in the over-the-counter market has been
suspended, or minimum or maximum prices for trading have been fixed, or
maximum ranges for prices for securities have been required, by such
exchange or by order of the Commission or any other governmental authority
or (iv) if a banking moratorium has been declared by either federal or New
York authorities.
(b) If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other
party, except to the extent provided in Section 5. Notwithstanding any such
termination, the provisions of Sections 8 and 9 shall remain in effect.
(c) This Agreement may also terminate pursuant to the
provisions of Section 6, with the effect stated in such Section.
Section 12. Default by One or More of the Initial Purchasers.
If one or more of the Initial Purchasers shall fail at the Closing Time to
purchase the Debentures that it or they are obligated to purchase pursuant
to this Agreement (the "Defaulted Securities"), ▇▇▇▇▇▇▇ ▇▇▇▇▇ shall have
the right, within 24 hours thereafter, to make arrangements for one or more
of the non-defaulting Initial Purchasers, or any other initial purchasers,
to purchase all, but not less than all, of the Defaulted Securities in such
amounts as may be agreed upon and upon the terms set forth in this
Agreement; if, however, you have not completed such arrangements within
such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10%
of the total number of Firm Debentures, the non-defaulting Initial
Purchasers shall be obligated to purchase the full amount thereof in the
proportions that their respective Initial Share underwriting obligation
proportions bear to the underwriting obligation proportions of all
non-defaulting Initial Purchasers, or
(b) if the number of Defaulted Securities exceeds 10% of the
total number of Firm Debentures, this Agreement shall terminate without
liability on the part of any non-defaulting Initial Purchaser.
No action taken pursuant to this Section shall relieve any
defaulting Initial Purchaser from liability in respect of its default.
In the event of any such default that does not result in a
termination of this Agreement, either ▇▇▇▇▇▇▇ ▇▇▇▇▇ or the Company shall
have the right to postpone the Closing Time for a period not exceeding
seven days in order to effect any required changes in the Offering
Memorandum or in any other documents or arrangements. As used herein, the
term "Initial Purchaser" includes any person substituted for any Initial
Purchaser under this Section 12.
Section 13. Notices. All notices and other communications under
this Agreement shall be in writing and shall be deemed to have been duly
given if delivered, mailed or transmitted by any standard form of
telecommunication. Notices to the Initial Purchasers shall be directed to
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated, at
▇▇▇▇▇▇▇ ▇▇▇▇▇ World Headquarters, North Tower, World ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ (telecopier no.: (▇▇▇) ▇▇▇-▇▇▇▇), attention of
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇; and notices to the Company and the Guarantor shall be
directed to the Company at AnnTaylor Stores Corporation, ▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (telecopier no.: (▇▇▇) ▇▇▇-▇▇▇▇),
attention of ▇▇▇▇▇▇▇ F.L. ▇▇▇▇▇▇▇▇▇▇▇, Esq.
Section 14. Parties. This Agreement is made solely for the
benefit of the several Initial Purchasers, the Company and the Guarantor
and, to the extent expressed, any person who controls the Company, the
Guarantor or any of the Initial Purchasers within the meaning of Section 15
of the 1933 Act, and the directors of the Company and the Guarantor and
their respective officers, employees and trustees, and its executors,
administrators, successors and assigns and, subject to the provisions of
Section 12, no other person shall acquire or have any right under or by
virtue of this Agreement. The term "successors and assigns" shall not
include any purchaser, as such purchaser, from any of the Initial
Purchasers of the Securities.
Section 15. Governing Law and Time. This Agreement shall be
governed by the laws of the State of New York. Specified times of the day
refer to New York City time.
Section 16. Counterparts. This Agreement may be executed in one
or more counterparts and when a counterpart has been executed by each
party, all such counterparts taken together shall constitute one and the
same agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
If the foregoing is in accordance with the Initial Purchasers'
understanding of our agreement, please sign and return to us a counterpart
hereof, whereupon this instrument will become a binding agreement among the
Company, the Guarantor and the Initial Purchasers in accordance with its
terms.
Very truly yours,
ANNTAYLOR STORES CORPORATION
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
______________________________
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: Executive Vice President - CFO
ANNTAYLOR, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
______________________________
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: Executive Vice President - CFO
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
Confirmed and accepted as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
BANC OF AMERICA SECURITIES LLC
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
_________________________________
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
SCHEDULE A
Aggregate Principal Amount at
Maturity of Firm Debentures
Initial Purchaser to be Purchased
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated.................. 90,487,500
Banc of America Securities LLC............... 90,487,500
----------
Total.................................. 180,975,000
===========
SCHEDULE B
SUBSIDIARIES OF ANNTAYLOR STORES CORPORATION ("ATSC")
AnnTaylor Finance Trust Common securities 100% owned by ATSC;
Preferred securities (TOPrS) publicly
held
AnnTaylor, Inc. ("ATI") Common Stock 100% owned by ATSC
AnnTaylor Travel, Inc. Common Stock 100% owned by ATI
AnnTaylor Distribution Services, Inc. Common Stock 100% owned by ATI
AnnTaylor Loft, Inc. Common Stock 100% owned by ATI
AnnTaylor Sourcing Far East Limited 149,999 ordinary shares owned by
ATI; ("ATS-Far East") 1 ordinary share held by ATSC
AnnTaylor Italy S.r.l. Common Stock 100% owned by ATS-Far
East
AnnTaylor Sourcing Italy S.r.l. Common Stock 100% owned by ATS-Far
(assets formerly part of Cygne Italy) East
AnnTaylor of Puerto Rico, Inc. Incorporated; shares to be issued.
Anticipate Common Stock will be 100%
owned by either ATS-Far East or ATI
Annco, Inc. Incorporated; shares to be issued.
Common Stock to be 100% owned by ATI
