SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 3, 1994
PETRIE STORES CORPORATION
(Exact Name of Registrant as Specified in Charter)
New York 1-6166 36-213-7966
(State or Other Jurisdiction of (Commission) (I.R.S. Employer
Incorporation) File Number) Identification No.)
70 Enterprise Avenue, Secaucus, New Jersey 07084
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (201) 866-3600
N/A
(Former Name or Former Address, if Changed Since Last Report)
INDEX TO EXHIBITS APPEARS ON PAGE 8
Item 5. Other Events.
A. Amendment No. 1 to the Stock Purchase Agreement
with WP Investors, Inc.
On November 3, 1994, Petrie Stores Corporation,
a New York corporation (the "Company") entered into
Amendment No. 1 to the Stock Purchase Agreement
("Amendment No. 1") with WP Investors, Inc., a Delaware
corporation ("WP"), amending the Stock Purchase Agreement
(the "Stock Purchase Agreement"), dated as of August 23,
1994, by and between the Company and WP.
Pursuant to Amendment No. 1, certain covenants
in the Stock Purchase Agreement relating to WP's
acquisition of the common stock of a Delaware subsidiary
of the Company ("Retail Holding Company"), to which all
of the retail operations of the Company will be
transferred, have been amended. Under Amendment No. 1,
WP has covenanted that it will comply with a commitment
letter (the "Commitment Letter"), dated as of November 3,
1994, by and among WP, Warburg Pincus Investors, L.P.,
Chemical Bank, the Chase Manhattan Bank N.A., Chemical
Securities Inc. and Chase Securities Inc. WP has further
covenanted that it will not amend, modify or waive any
provision of the Commitment Letter, or waive any of its
rights thereunder. The Company has covenanted with
respect to certain liabilities of the Company not being
assumed by WP that the Company shall provide, by means of
(i) an irrevocable letter of credit, (ii) a holdback of a
portion of the Purchase Price (as defined in the Stock
Purchase Agreement), a first priority, perfected lien in
collateral with adequate assurances as to value or
comparable security or (iii) other comparable
arrangements reasonably acceptable to WP, $67.5 million
for the payment of such liabilities.
Pursuant to Amendment No. 1, the Company has
waived certain conditions to the closing of the Stock
Purchase Agreement, including, among others, (i) certain
representations and warranties, (ii) the receipt by the
Company of a private letter ruling from the Internal
Revenue Service to the effect that the transactions
contemplated by the Acquisition Agreement, dated as of
April 20, 1994 and amended as of May 10, 1994 (the "Toys
Agreement"), by and between the Company and Toys "R" Us,
Inc., a Delaware corporation ("Toys 'R' Us"), will not
give rise to taxable income to the Company, Toys "R" Us
or the Company's shareholders and (iii) the satisfaction
or waiver of all conditions in the Toys Agreement. WP
has waived the following conditions, among others: (i)
the obtaining of certain landlord consents and (ii)
certain representations and warranties. Additionally,
WP's financing condition has been amended to provide that
WP's obligations under the Stock Purchase Agreement are
conditioned upon WP obtaining the financing contemplated
by the Commitment Letter, provided, however, that WP may
not rely on this condition as grounds for not
consummating the stock purchase if it has not satisfied
the covenants with respect to the Commitment Letter
described above.
A Confirmation Letter, dated as of November 3,
1994 (the "Confirmation Letter"), has been executed by WP
and Milton Petrie, by act of his attorneys-in-fact, and
has been consented and agreed to by Toys "R" Us. The
Confirmation Letter provides that the Voting Agreement,
dated as of August 23, 1994, by and between WP and Milton
Petrie, shall remain unchanged and in full force and
effect following the execution of Amendment No. 1.
A copy of Amendment No. 1 to the Stock Purchase
Agreement, dated as of November 3, 1994, is filed as
Exhibit 10.1 to this Report and is incorporated herein by
reference. A copy of the Confirmation Letter, dated as
of November 3, 1994, is filed as Exhibit 99.1 to this
Report and is incorporated herein by reference. A copy
of the Press Release, issued November 3, 1994, announcing
the execution of Amendment No. 1 is filed as Exhibit 99.2
to this Report and is incorporated herein by reference. A
copy of the Stock Purchase Agreement, dated as of
November 3, 1994 was previously filed as an exhibit to
the Company's Current Report on Form 8-K, filed August
23, 1994, and is incorporated herein by reference.
B. Redemption of 8% Convertible Subordinated
Debentures Due December 15, 2010.
The Company announced on November 10, 1994 that
it is calling for redemption on December 12, 1994 all of
its outstanding 8% Convertible Subordinated Debentures
due December 15, 2010 (the "Debentures") at a redemption
price of $1,008 per $1,000 principal amount of
Debentures, together with accrued and unpaid interest
thereon of $39.333 per $1,000 principal amount of
Debentures, from June 15, 1994 to, but not including,
December 12, 1994.
The holders of the Debentures have the right to
convert the Debentures into approximately 45.1977 shares
of the Corporation's common stock for each $1,000
principal amount of Debentures and such right expires at
3:00 p.m. New York time on December 12, 1994. Holders of
the Debentures must surrender the Debentures to Chemical
Bank, New York, for conversion or redemption.
If all of the outstanding Debentures were
redeemed on December 12, 1994, the aggregate amount
necessary for redemption would be $129,414,786.55
(including $123,566,000 for principal, $988,528 for
premium and $4,860,258.55 for accrued interest from June
15, 1994 to, but not including, December 12, 1994). If
all of the outstanding Debentures were converted into the
Corporation's common stock, approximately 5,584,903
additional shares of the Corporation's common stock would
be issued upon such conversion.
A copy of the Notice of Redemption, dated as of
November 10, 1994, is filed as Exhibit 99.3 to this
Report and is incorporated herein by reference. A copy
of the Press Release, issued November 10, 1994,
announcing the redemption of the Debentures, is filed as
Exhibit 99.4 to this Report and is incorporated herein by
reference.
C. Receipt of Private Letter Ruling from Internal
Revenue Service
On November 15, 1994, the Corporation and Toys
"R" Us received a favorable private letter ruling from
the Internal Revenue Service (the "IRS Ruling") holding
that the proposed exchange by the Corporation of
approximately 39.9 million shares of Toys "R" Us Common
Stock and cash for shares of Toys "R" Us Common Stock and
the distribution by the Corporation of such shares to the
Corporation's shareholders upon the liquidation of the
Corporation, all as contemplated by the Toys Agreement,
will qualify as a tax-free reorganization under the
Internal Revenue Code of 1986, as amended. Furthermore,
the IRS Ruling provides that neither the Corporation nor
Toys "R" Us will recognize any gain on such exchange, and
the Corporation and its shareholders will not recognize a
gain on the distribution of the Corporation's shares of
Toys "R" Us Common Stock in the subsequent liquidation of
the Corporation. In addition, the Corporation's
shareholders will not recognize any income with respect
to any shares of Toys "R" Us Common Stock placed into a
liquidating trust in order to secure the Corporation's
contingent liabilities.
A copy of the Press Release, issued November
17, 1994, announcing the receipt of the IRS Ruling, is
filed as Exhibit 99.5 to this Report and is incorporated
herein by reference.
Item 7. Financial Statements, Pro Forma
Financial Information and Exhibits.
(c) Exhibits.
Exhibit No. Description
10.1 Amendment No. 1 to the Stock Purchase
Agreement, dated as of November 3, 1994.
99.1 Confirmation Letter, dated as of November
3, 1994.
99.2 Press Release, issued November 3, 1994.
99.3 Notice of Redemption, dated as of November
10, 1994.
99.4 Press Release, issued November 10, 1994.
99.5 Press Release, issued November 17, 1994.
Signatures
Pursuant to the requirements of the Securities
Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned
thereunto duly authorized.
Dated: November 17, 1994
PETRIE STORES CORPORATION
By: /s/ Peter A. Left
Name: Peter A. Left
Title: Vice Chairman, Chief
Operating Officer,
Chief Financial Officer
and Secretary
Exhibit Index
Sequentially
Numbered
Exhibit Description Page
10.1 Amendment No. 1 to the
Stock Purchase
Agreement, dated as of
November 3, 1994.
99.1 Confirmation Letter,
dated as of November 3,
1994.
99.2 Press Release, issued
November 3, 1994.
99.3 Notice of Redemption,
dated as of November 10,
1994.
99.4 Press Release, issued
November 10, 1994.
99.5 Press Release, issued
November 17, 1994.
AMENDMENT NO. 1 TO THE STOCK PURCHASE AGREEMENT
This AMENDMENT NO. 1 (the "Amendment") to the Stock
Purchase Agreement (the "Stock Purchase Agreement"), dated as of
August 23, 1994, by and between Petrie Stores Corporation, a New
York corporation ("Seller") and WP Investors, Inc., a Delaware
corporation ("Buyer") is being entered into as of November 3,
1994.
Whereas, Seller and Buyer desire to amend the Stock
Purchase Agreement to provide that Seller shall provide for the
payment by Seller and/or the Liquidating Trust of certain tax
liabilities arising out of or related to, certain past sales or
other dispositions by Seller or its subsidiaries of shares of
Toys Common Stock; and
Whereas, Seller and Buyer desire to amend the Stock
Purchase Agreement to waive certain conditions to each party's
respective obligations to consummate the Stock Purchase.
Now, Therefore, in consideration of the foregoing and
the mutual covenants and agreements contained herein, and
intending to be legally bound hereby, the parties hereto agree as
follows:
Section 1. Definitions; References. Unless
otherwise specifically defined herein, each term used herein
shall have the meaning assigned to such term in the Stock
Purchase Agreement. Each reference to "hereof", "herein",
"hereunder", "hereby" and "this Agreement" shall from and after
the date hereof refer to the Stock Purchase Agreement as amended
by this Amendment.
Section 2. Amendment to Introduction. The
Introduction to the Stock Purchase Agreement is amended to be and
read in its entirety as follows:
"STOCK PURCHASE AGREEMENT, dated as of August 23,
1994, and amended as of November 3, 1994 (this
"Agreement"), by and between Petrie Stores Corporation,
a New York corporation ("Seller") and WP Investors,
Inc., a Delaware corporation ("Buyer")."
Section 3. Amendment to Time and Place of Closing.
Section 2.1 of the Stock Purchase Agreement is
amended to delete the reference therein to October 31,
1994 and to insert in its place December 9,1994.
Section 4. Amendment to Covenants of the Parties.
A. Section 5.9 of the Stock Purchase Agreement is
amended to be and read in its entirety as follows:
"Financing. (a) Any financing procured by the
Buyer to purchase the Shares pursuant to this
Agreement and to consummate the transactions
contemplated hereby shall include an equity
contribution by E.M. Warburg, Pincus & Co., Inc.
and/or one or more of its affiliates in the amount
of not less than $100 million; provided, however,
that such equity contribution may be reduced to
the extent not necessary for the Buyer to perform
the covenant set forth in Section 5.6.
(b) Buyer hereby expressly acknowledges that
Seller, in agreeing to Buyer's conditions to
consummation of the Stock Purchase as set forth in
Section 7.3(d) hereof, has relied upon the
existence and terms of that certain commitment
letter and the Summary of Terms and Conditions, a
copy of which has been provided to Seller
(collectively, the "Commitment Letter"), dated as
of November 3, 1994, by and among Buyer, WP
Investors, Inc., Warburg Pincus Investors, L.P.,
Chemical Bank and The Chase Manhattan Bank, N.A.
(collectively, the "Managing Agents"), and
Chemical Securities Inc. and Chase Securities,
Inc. (collectively, the "Arrangers"). For the
benefit of Buyer and Seller, Buyer hereby
covenants and agrees that prior to the Closing
Buyer will comply fully with all of the terms,
provisions and conditions set forth in the
Commitment Letter, the Facility (as defined in the
Commitment Letter), the definitive documentation
for the Facility described therein or any
transaction contemplated thereby (collectively,
the "Financing") and any related fee letters. For
the benefit of Seller, Buyer hereby further
covenants and agrees that Buyer will not amend,
modify or waive any term or provision of the
Commitment Letter or waive any of its rights
thereunder, in any event so as to make it less
likely that the condition set forth in Section
7.3(d) hereof will be satisfied."
B. Section 5.17 of the Stock Purchase Agreement is
amended to be and read in its entirety as follows:
"On or prior to the Closing Date, Seller shall
provide in a manner reasonably satisfactory to
Buyer for the payment by Seller and the
Liquidating Trust to Buyer, the Company and its
subsidiaries of the Excluded Liabilities (to the
extent not previously paid) in a manner adequate
to provide for the collection of the Excluded
Liabilities, taking into account the assets and
other liabilities of the Liquidating Trust (which
in the case of the Excluded Liabilities arising
pursuant to Section 5.14 and Section
6.1(b)(y)(ii)(B) shall include the provision for
the payment thereof by means of an irrevocable
letter of credit, a holdback of a portion of the
Purchase Price, a first priority, perfected lien
in collateral with adequate assurances as to value
or comparable security or other comparable
arrangements reasonably acceptable to Buyer;
provided, however, that (i) such provision in the
case of liabilities arising pursuant to Section
5.14 shall provide for the payment thereof in
full, (ii) such provision shall neither limit the
liability of Seller and the Liquidating Trust not
otherwise limited by this Agreement nor shall such
provision enlarge any liability of Seller and the
Liquidating Trust otherwise limited by this
Agreement or otherwise, and (iii) such provision
shall be $67.5 million)."
Section 5. Amendment to Tax Matters.
A. Section 6.1(b) of the Stock Purchase Agreement is
amended to be and read in its entirety as follows:
"Seller and the Liquidating Trust shall, and
hereby do, indemnify and hold Buyer, the Company
and the Company's subsidiaries harmless against
(x) the failure to be true in any material respect
of any representations and statements of fact
included in the Ruling Request, to the extent that
they relate to the Seller or its subsidiaries, and
(y) (i) Taxes of Seller or its subsidiaries or any
reduction in losses, deductions, credits or
similar items of tax benefit but excluding any
reduction in the tax basis of assets ("Tax
Benefits") of the Company or any of its
subsidiaries arising from the transfer, as
contemplated by Section 3.16 hereof, to the
Company and its subsidiaries of assets and
liabilities of Seller and certain of its
subsidiaries and the stock of other subsidiaries
of Seller and (ii) any Taxes of Seller or its
subsidiaries or any reduction in Tax Benefits of
the Company or its subsidiaries arising out of or
relating to (A) the Toys Shares or the Toys
Transaction, (B) the federal examination of the
disposition during March and July of 1988 by
Seller or certain of its subsidiaries of shares of
Toys Common Stock in connection with the
conversion or redemption of certain debentures,
and (C) the sale or other disposition by Seller of
any Toys Common Stock or stock or assets of the
Seller or its subsidiaries subsequent to the
Closing not acquired or owned subsequent to the
Closing by Buyer, Company or Company's
subsidiaries. Buyer and the Company shall, and
hereby do, indemnify Seller and the Liquidating
Trust harmless against any and all other Taxes
imposed on the Seller, the Company, or any
subsidiaries of the Company, whether or not such
Taxes arose prior or subsequent to the Closing,
except Taxes imposed upon Seller or subsidiaries
of Seller subsequent to Closing that are
attributable to any taxable period after the
Closing Date. For purposes of this subsection, (x)
the amount of any Tax indemnified pursuant hereto
shall be equal to the excess of (A) the liability
for Taxes of the entity (or group) liable for such
Tax for any taxable period or periods affected by
the relevant item, over (B) the liability for
Taxes of such entity (or group) for such taxable
period or periods calculated without regard to the
item with respect to which the indemnification is
made, and (y) the taxable period to which any Tax
is deemed to be attributable will be determined by
treating the period ending on the Closing Date as
a separate taxable period for purposes of all
Taxes."
B. Section 6.1 of the Stock Purchase Agreement is
amended to add a new subsection (g) which shall be
and read in its entirety as follows:
"(g) Seller agrees that if as the result of any
audit adjustment made by any taxing authority with
respect to any Taxes against which Buyer and the
Company have indemnified Seller and the
Liquidating Trust, Seller receives a Tax Benefit,
then Seller or the Liquidating Trust shall pay to
Buyer the amount of such Tax Benefit within 15
days of (i) the filing of a return in which such
Tax Benefit is actually utilized to reduce any
liability for Taxes, or (ii) the receipt of any
refund of Taxes arising out of the application of
such Tax Benefit."
C. Section 6.2(a) of the Stock Purchase Agreement is
amended to be and read in its entirety as follows:
"Buyer shall have the right, at its own expense,
to control any audit or examination by any Taxing
Authority, to initiate any claim for refund or
file any amended Tax Return, and to contest,
resolve and defend against any assessment, notice
of deficiency, or other adjustment or proposed
adjustment of Taxes for all taxable periods of the
Company and its subsidiaries; provided, however,
that Seller (or the Liquidating Trust or any agent
or successor thereof) shall have the exclusive
right to contest, resolve or defend against any
assessment, notice of deficiency, or other
proposed adjustment of Taxes with respect to any
liability for Tax for which Seller is liable
pursuant to subsection 6.1(b) hereof, including
the right to pay any such Tax to the relevant
taxing authority and thereafter to pursue
appropriate administrative or judicial action for
a refund. No party shall have the right to agree
to any assessment, deficiency, settlement, or
other adjustment of Taxes that would adversely
affect the interest of another party without such
other party's written consent, which consent
shall not be unreasonably withheld."
Section 6. Amendment to Conditions to Consummation
of the Stock Purchase.
A. Section 7.2 of the Stock Purchase Agreement is
amended as follows:
(i) Seller hereby waives the condition set forth
in Section 7.2(b), insofar as it relates to the
representation and warranty set forth in Section 4.3.
(ii) Seller hereby waives the condition set forth
in Section 7.2(d).
(iii) Seller hereby waives the condition set
forth in Section 7.2(e).
B. Section 7.3 of the Stock Purchase Agreement is
amended as follows:
(i) Buyer hereby waives the condition set forth
in Section 7.3(a).
(ii) Buyer hereby waives the condition set forth
in Section 7.3(b), except insofar as it relates to the
representations and warranties set forth in Sections
3.1, 3.2, 3.3, 3.15, 3.16, 3.17 and 3.19.
(iii) Section 7.3(d) is amended to be and read
as follows:
"Buyer shall have available to it for draw the
financing contemplated by the Commitment Letter, a
copy of which has previously been provided to
Seller, and all conditions to the obligations of
the lenders thereunder shall have been satisfied
or waived, substantially on the terms contemplated
thereby; provided, however, that Buyer shall not
be entitled to rely on this condition as grounds
for not consummating the Stock Purchase if Buyer
shall not have complied with Section 5.9(b) of the
Stock Purchase Agreement."
(iv) Section 7.3(e) is amended to be and read as
follows:
"Either (i) Seller shall have received the IRS
Ruling in a form reasonably satisfactory to Buyer,
to the effect that the Toys Transaction will not
give rise to the recognition by Seller or its
shareholders of a material amount of taxable
income (an "Acceptable Ruling"), and the
representations made by Seller and Toys in the
request for such private letter ruling (and any
supplements or amendments thereto) shall be true
and correct in all material respects or (ii) in
the event that the IRS Ruling has not been
received by the Closing Date, Seller shall have
covenanted pursuant to an agreement reasonably
satisfactory to Buyer that it will not consummate
the Toys Transaction or any other transaction
involving the direct or indirect disposition of
all or any portion of the Toys Shares (whether or
not intended to be a tax-free reorganization with
respect to Seller) within the taxable year of
Seller in which the Closing occurs except with the
consent of Buyer, or pursuant to an Acceptable
Ruling; and"
(v) Section 7.3(f) is amended to delete the text
following the semicolon therein and to insert a period
in place of such semicolon.
Section 7. Amendment to Termination and
Abandonment.
A. Section 8.1(b) of the Stock Purchase Agreement is
amended by deleting all text that follows "by Seller or Buyer at
any time after January 31, 1995" and nothing shall be added in
lieu thereof.
B. Section 8.1(c) of the Stock Purchase Agreement is
amended by deleting the entire text of Section 8.1(c) and nothing
shall be added in lieu thereof.
Section 8. Amendment to Entire Agreement;
Assignment; Alternate Structure.
Section 9.4 of the Stock Purchase Agreement is
amended by adding the following at the end thereof:
"Subject to the foregoing, as of the Closing,
Buyer and any Designees may assign all of their
respective rights and obligations under this
Agreement to a newly formed entity ("Holding
Company") owned by Buyer and other persons or
entities in such manner and proportions that
neither E.M. Warburg, Pincus & Co., Inc. nor any
of its affiliates shall be treated as a single
employer, within the meaning of Section 4001(b)(1)
of ERISA, with Holding Company. Thereafter, all
references in this Agreement to Buyer and the
Designees, other than such references in Section
5.11 or this Section 9.4 shall be deemed to refer
to Holding Company."
Section 9. Amendment to Expenses.
Section 9.10 of the Stock Purchase Agreement is amended
to be and read in its entirety as follows:
"Whether or not this Agreement and the
transactions contemplated hereby are consummated,
all costs and expenses (including legal fees and
expenses) incurred in connection with this
Agreement and the transactions contemplated hereby
shall be paid by the party incurring such
expenses. Notwithstanding the foregoing, if this
Agreement is terminated pursuant to Section 8.1
following the occurrence of one of the following:
(i) a material breach by Seller; (ii) the failure
to be satisfied of any of the conditions which are
set forth in Sections 7.3(b), (c) or (e)(ii); or
(iii) the failure to be satisfied of the condition
set forth in Section 7.2(f) by December 14, 1994,
then, so long as Buyer is not in material breach
of its obligations hereunder, Seller shall,
promptly following such termination, reimburse
Buyer for its reasonable, documented out-of-pocket
expenses, paid, incurred or assumed, by or on
behalf of Buyer or its affiliates (including,
without limitation, fees and expenses of its
advisors, financing sources, counsel and
accountants) in connection with or relating to the
transactions contemplated hereby, provided,
however, that Buyer has not been previously
reimbursed for such expenses and that the amount
payable under this Section 9.10 shall not exceed
$5.625 million.
Section 10. No Further Amendment. Except as
otherwise provided herein, the Stock Purchase Agreement shall
remain unchanged and in full force and effect.
Section 11. Effect of Amendment. From and after the
execution of this Amendment by the parties hereto, any references
to the Stock Purchase Agreement shall be deemed a reference to
the Stock Purchase Agreement as amended hereby.
Section 12. Governing Law. This Amendment shall be
governed by, enforced under and construed in accordance with the
laws of the State of New York, without giving effect to any
choice or conflict of law provision or rule
thereof.
Section 13. Counterparts. This Amendment may be
executed in any number of counterparts, each of which shall be
deemed an original, but all of which together shall constitute
one and the same instrument.
Section 14. Descriptive Headings. The descriptive
headings herein are inserted for convenience of reference only
and shall in no way be construed to define, limit, describe,
explain, modify, amplify, or add to the interpretation,
construction or meaning of any provision of, or scope or intent
of, this Amendment or the Stock Purchase Agreement nor in any way
affect this Amendment or the Stock Purchase Agreement.
In Witness Whereof, each of the undersigned has caused
this Amendment to be signed by its duly authorized officer as of
the date first above written.
Petrie Stores Corporation
By: /S/ Allan Laufgraben
Name: Allan Laufgraben
Title: CEO--President
WP Investors, Inc.
By: /s/ Errol M. Cook
Name: Errol M. Cook
Title: Vice President
As of November 3, 1994
CONFIRMATION
Reference is made to the Voting Agreement and
Proxy, dated as of August 23, 1994, between WP Investors,
Inc., a Delaware corporation (the "Buyer"), and Milton
Petrie, the record and beneficial owner of 28,111,274
shares of common stock of Petrie Stores Corporation, a
New York corporation (the "Seller"), as consented to and
agreed by Toys "R" Us, Inc. ("Toys") (the "Voting
Agreement") and to the Amendment to the Purchase
Agreement (as such term is defined in the Voting
Agreement) (the "Amendment") which the Buyer and the
Seller are entering into concurrently herewith.
In consideration of the premises and the
agreements set forth herein and for other good and
valuable consideration, receipt of which is hereby
acknowledged, the undersigned hereby agree as follows:
1) that the "Transaction" as defined in the Voting
Agreement shall include the transactions contemplated by
the Purchase Agreement, as amended by the Amendment, 2)
that all references to the Purchase Agreement in the
Voting Agreement shall hereafter be deemed references to
the Purchase Agreement as amended by the Amendment, and
3) that, except as otherwise provided herein, the Voting
Agreement shall remain unchanged and in full force and
effect.
IN WITNESS WHEREOF, the parties hereto have
executed this Agreement on the date first above written.
WP INVESTORS, INC.
By: /s/ Errol M. Cook
Name: Errol M. Cook
Title: Vice President
MILTON PETRIE
By: /s/ Bernard Petrie
Bernard Petrie, as Attorney-in-Fact
By: /s/ Joseph H. Flom
Joseph H. Flom, as Attorney-in-Fact
By: /s/ Jerome A. Manning
Jerome A. Manning, as Attorney-in-Fact
By: /s/ Albert Ratner
Albert Ratner, as Attorney-in-Fact
Consented and Agreed:
TOYS "R" US, INC.
By: /s/ Louis Lipschitz
Name: Louis Lipschitz
Title: Senior V.P. Finance and CFO
PETRIE STORES CORPORATION
70 ENTERPRISE AVENUE
SECAUCUS, NJ 07094
(201) 866-3600
FOR IMMEDIATE RELEASE
PETRIE STORES ANNUAL MEETING TO BE HELD DECEMBER 6, 1994;
SHAREHOLDERS TO VOTE ON SALE OF RETAIL OPERATIONS
Secaucus, New Jersey, November 3, 1994 -- Petrie
Stores Corporation (NYSE: PST) announced today that the
date of its Annual Meeting of Shareholders has been
changed from December 1, 1994 to December 6, 1994 and
that proxy materials relating to the meeting are being
sent to its shareholders. The record date, October 31,
1994, for determining shareholders entitled to notice of
and vote at the meeting, has not changed.
At the Annual Meeting to be held on December 6,
1994, Petrie Stores' shareholders will vote on the sale
of Petrie Stores' retail operations, the election of
directors, and the ratification of auditors. An investor
group led by E.M. Warburg, Pincus & Co., Inc. which is
purchasing Petrie Stores' retail operations has today
executed a bank commitment letter as described below.
Subject to the conditions of the bank commitment letter
being satisfied and other customary conditions, the
closing of the sale of Petrie Stores' retail operations
is expected to occur promptly following the December 6,
1994 Annual Meeting.
Petrie Stores and Toys "R" Us, Inc. (NYSE: TOY)
have agreed that Petrie Stores will adjourn the Annual
Meeting after these votes and before voting on the
proposed exchange with Toys "R" Us and the liquidation of
Petrie Stores so that Petrie Stores' shareholders can be
provided with the holiday season sales results of Toys
"R" Us. Toys "R" Us anticipates issuing its customary
holiday season press release on January 3, 1995, and
Petrie Stores expects that the Annual Meeting will be
reconvened, to on or about January 20, 1995, to vote on
the exchange and liquidation.
In April 1994, Petrie Stores announced that it
entered into a definitive agreement with Toys "R" Us to
exchange 39.9 million Toys "R" Us common shares and cash
for newly issued Toys "R" Us common shares. Toys "R" Us
will issue 36.6 million common shares plus common shares
having the value of the cash transferred by Petrie Stores
to Toys "R" Us. The transaction with Toys "R" Us is
conditioned on the disposition of Petrie Stores' retail
operations and on Petrie Stores receiving a ruling from
the Internal Revenue Service that the transaction will be
tax free to Petrie Stores, Toys "R" Us and Petrie Stores'
shareholders.
In August 1994, Petrie Stores announced that it
entered into a definitive agreement to sell its retail
operations to an investor group led by E.M. Warburg,
Pincus & Co., Inc. (which includes Verna Gibson, former
President of The Limited Stores, Inc., a division of the
Limited, Inc., and members of senior management) for $190
million in cash, to be financed on an all equity basis.
The agreement was amended today to provide, among other
things, for the waiver of certain conditions to the
respective obligations of each party to consummate the
sale of the retail operations. As a result, Petrie
Stores' obligations are no longer conditioned on the
closing of the share exchange transaction with Toys "R"
Us. The Warburg investor group has today executed a
commitment letter with Chemical Bank and The Chase
Manhattan Bank relating to a $250 million senior secured
revolving credit facility for the purpose of financing
the ongoing working capital needs of Petrie Stores'
retail operations.
This is neither an offer to sell, nor a solicitation
of offers to purchase, any securities. Toys "R" Us
common shares will be distributed only pursuant to an
effective registration statement.
Petrie Stores is one of the largest women's
specialty retailing chains in the country -- with
approximately 1700 stores throughout the United States,
Puerto Rico, and the U.S. Virgin Islands. The trade
names of its stores include Marianne, G&G, Rave, Jean
Nicole, Winkleman's, Stuarts, and M.J. Carroll.
# # #
Contact: Mary Ann Dunnell
(212) 484-6721
PETRIE STORES CORPORATION
NOTICE OF REDEMPTION
AND
EXPIRATION OF CONVERSION PRIVILEGE
8% CONVERTIBLE SUBORDINATED DEBENTURES DUE DECEMBER 15, 2010
(CUSIP NO. 716434 AC 9)
REDEMPTION DATE: DECEMBER 12, 1994
CONVERSION PRIVILEGE EXPIRES: DECEMBER 12, 1994
NOTICE IS HEREBY GIVEN that Petrie Stores Corporation (the
"Company") has elected to redeem and will redeem on December 12,
1994 (the "Redemption Date") all of its outstanding 8%
Convertible Subordinated Debentures Due December 15, 2010 (the
"Debentures") at a redemption price of $1,008 per $1,000
principal amount of Debentures, together with accrued and unpaid
interest thereon of $39.3333 per $1,000 principal amount of
Debentures from June 15, 1994 to, but not including, the
Redemption Date, for a total redemption price of $1,047.3333 for
each $1,000 principal amount of Debentures (the "Redemption
Price"). The Debentures are convertible into shares of common
stock, $1.00 par value, of the Company (the "Common Stock") at
the conversion price and in the manner described below until the
close of business (3:00 p.m. New York time) on the Redemption
Date. No payment will be made for interest accrued and unpaid on
Debentures surrendered for conversion on or prior to the
Redemption Date. From and after the close of business (3:00 p.m.
New York time) on the Redemption Date, Debentures shall no longer
be deemed outstanding, notwithstanding that any Debentures shall
not have been surrendered for cancellation, and all rights with
respect to such Debentures, including accrual of interest, shall
forthwith cease and terminate except the right of holders to
receive, upon surrender of their certificates, payment of the
Redemption Price.
ALTERNATIVES AVAILABLE TO HOLDERS OF DEBENTURES
1. Conversion of Debentures into Common Stock: The
Debentures are convertible until the close of business (3:00 p.m.
New York time) on the Redemption Date into shares of Common Stock
at the conversion price of $22.125 per share (equivalent to a
conversion rate of approximately 45.1977 shares of Common Stock
for each $1,000 principal amount of Debentures). No fractional
share or scrip representing any fractional share of Common Stock
will be issued upon conversion, but in lieu thereof, the Company
will pay in cash an amount equal to the applicable fraction of
the last reported sale price of the Common Stock, regular way, on
the New York Stock Exchange or, in case no such reported sale
takes place on such day, the average of the bid and asked prices,
regular way, on the last trading day immediately preceding the
day the Debentures are surrendered for conversion.
The Common Stock is traded on the New York Stock Exchange
under the symbol "PST." Holders of Debentures who are considering
exercising their right to convert are encouraged to obtain copies
of the available filings made by the Company under the Securities
Exchange Act of 1934, as amended, copies of which can be reviewed
at the offices of the Securities and Exchange Commission or the
New York Stock Exchange, or obtained from Chemical Bank,
successor by merger to Manufacturers Hanover Trust Company, as
trustee (the "Conversion Agent").
ON NOVEMBER 9, 1994, THE CLOSING PRICE OF THE COMMON STOCK ON
THE NEW YORK STOCK EXCHANGE COMPOSITE TAPE WAS $26.125 PER SHARE.
BASED UPON CURRENT MARKET PRICES, THE MARKET VALUE OF THE
COMPANY'S COMMON STOCK (AND CASH FOR ANY FRACTIONAL SHARE) INTO
WHICH THE DEBENTURES ARE CONVERTIBLE IS GREATER THAN THE
REDEMPTION PRICE OF THE DEBENTURES. SO LONG AS THE MARKET PRICE
OF THE COMPANY'S COMMON STOCK REMAINS ABOVE APPROXIMATELY $23.17
PER SHARE, HOLDERS OF DEBENTURES WHO ELECT TO CONVERT WILL
RECEIVE UPON CONVERSION COMMON STOCK (AND CASH FOR ANY FRACTIONAL
SHARE) HAVING A CURRENT MARKET VALUE GREATER THAN THE REDEMPTION
PRICE. HOLDERS OF DEBENTURES ARE URGED TO OBTAIN CURRENT MARKET
QUOTATIONS FOR THE COMMON STOCK. THE DEADLINE FOR CONVERSION OF
THE DEBENTURES IS THE CLOSE OF BUSINESS (3:00 P.M. NEW YORK TIME)
ON THE REDEMPTION DATE.
2. Redemption of the Debentures on December 12, 1994: Any
Debentures which have not been received by the Conversion Agent,
or which have been received by the Conversion Agent with
instructions to redeem such Debentures, by the close of business
(3:00 p.m. New York time) on the Redemption Date, will be
redeemed on the Redemption Date at the Redemption Price. From and
after the close of business (3:00 p.m. New York time) on the
Redemption Date, Debentures shall no longer be deemed
outstanding, notwithstanding that any certificate therefor shall
not have been surrendered for cancellation, and all rights with
respect to Debentures, including accrual of interest, shall
forthwith cease and terminate on the Redemption Date, except the
right of holders to receive, upon surrender of their Debentures,
payment of the Redemption Price. No payment will be made for
interest accrued and unpaid on Debentures surrendered for
conversion on or prior to the Redemption Date.
DELIVERY OF DEBENTURES
The Conversion Agent will act as paying and conversion agent
for the purpose of receiving Debentures tendered for redemption
or conversion. Delivery of Debentures to the Conversion Agent for
either such purpose may be made as follows:
If by Mail: Chemical Bank
Debt Operations Department
J.A.F. Building
P.O. Box 2862
New York, New York 10116-2862
If by Hand: Chemical Bank
Corporate Trust Securities Window
Room 234, North Building
55 Water Street
New York, New York
THE METHOD OF DELIVERY OF ALL DOCUMENTS, INCLUDING DEBENTURES,
IS AT THE ELECTION AND RISK OF THE HOLDER. IF DELIVERY IS BY
MAIL, IT IS RECOMMENDED THAT HOLDERS USE CERTIFIED OR REGISTERED
MAIL, INSURED, RETURN RECEIPT REQUESTED. IN THE CASE OF
CONVERSION OF DEBENTURES, SUFFICIENT TIME SHOULD BE ALLOWED TO
ASSURE TIMELY DELIVERY TO THE CONVERSION AGENT BY THE CLOSE OF
BUSINESS (3:00 P.M. NEW YORK TIME) ON THE REDEMPTION DATE. SINCE
IT IS THE TIME OF RECEIPT, NOT THE TIME OF MAILING, THAT
DETERMINES WHETHER THE DEBENTURES HAVE BEEN PROPERLY TENDERED FOR
CONVERSION, SUFFICIENT TIME SHOULD BE ALLOWED FOR DELIVERY.
MANNER OF CONVERSION:
TO CONVERT DEBENTURES INTO COMMON STOCK, THE HOLDER MUST
SURRENDER THE DEBENTURES PRIOR TO THE CLOSE OF BUSINESS (3:00
P.M. NEW YORK TIME) ON THE REDEMPTION DATE, WHETHER BY HAND OR
MAIL, TO THE CONVERSION AGENT AT ITS ADDRESS SET FORTH ABOVE. THE
DEBENTURES MUST BE ACCOMPANIED BY WRITTEN NOTICE OF ELECTION TO
CONVERT (WHICH MAY BE IN THE FORM OF THE LETTER OF TRANSMITTAL
PROVIDED TO ALL HOLDERS OF THE DEBENTURES). IF THE NOTICE OF
ELECTION IS SIGNED BY A PARTY OTHER THAN THE REGISTERED HOLDER OF
THE DEBENTURES, SUCH DEBENTURES MUST ALSO BE ACCOMPANIED BY A
WRITTEN INSTRUMENT OR INSTRUMENTS OF TRANSFER IN A FORM
SATISFACTORY TO THE COMPANY. THE CONVERSION PRIVILEGE EXPIRES AT
THE CLOSE OF BUSINESS (3:00 P.M. NEW YORK TIME) ON THE REDEMPTION
DATE.
THE DEBENTURES MAY BE CONVERTED INTO COMMON STOCK ONLY BY
DELIVERY OF THE DEBENTURES TO THE CONVERSION AGENT AT ITS ADDRESS
SET FORTH ABOVE PRIOR TO THE CLOSE OF BUSINESS (3:00 P.M. NEW
YORK TIME) ON THE REDEMPTION DATE. ANY DEBENTURES WHICH HAVE NOT
BEEN RECEIVED BY THE CONVERSION AGENT, OR WHICH HAVE BEEN
RECEIVED BY THE CONVERSION AGENT WITH INSTRUCTIONS TO REDEEM SUCH
DEBENTURES, BY THAT TIME WILL BE REDEEMED ON THE REDEMPTION DATE
AT THE REDEMPTION PRICE. SINCE IT IS THE TIME OF RECEIPT, NOT THE
TIME OF MAILING, THAT DETERMINES WHETHER THE DEBENTURES HAVE BEEN
PROPERLY TENDERED FOR CONVERSION, SUFFICIENT TIME SHOULD BE
ALLOWED FOR DELIVERY.
MANNER OF REDEMPTION
To receive the Redemption Price for any Debenture being
redeemed, the holder thereof must surrender the Debenture to the
Conversion Agent at its address set forth above. Debentures must
be accompanied by written notice of election to redeem such
Debentures (which may be in the form of the Letter of Transmittal
provided to all registered holders of the Debentures). If the
notice of election is signed by a party other than the registered
holder of the Debentures, such Debentures must also be
accompanied by a written instrument or instruments of transfer in
a form satisfactory to the Company.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The payment of the proceeds on redemption of the Debentures
may be subject to U.S. information reporting and backup
withholding at the rate of 31% unless such holder (a) comes
within certain exempt categories and, when required, demonstrates
that status or (b) provides a correct taxpayer identification
number, certifies as to no loss of exemption from backup
withholding and otherwise complies with applicable requirements
of the backup withholding rules. A holder of Debentures that does
not provide the Company with his correct taxpayer identification
number may be subject to penalties imposed by the Internal
Revenue Service. Any amount withheld under the backup withholding
rules will be creditable against the holder's Federal income tax
liability. Therefore, unless such an exemption exists and is
proved in a manner satisfactory to the Company, each stockholder
should complete and sign the Substitute Form W-9 included as part
of the Letter of Transmittal, so as to provide the information
and certification necessary to avoid backup withholding.
EACH HOLDER IS URGED TO CONSULT HIS OR HER OWN TAX ADVISOR AS
TO THE PARTICULAR TAX CONSEQUENCES OF CONVERSION OR REDEMPTION TO
SUCH HOLDER, INCLUDING THE APPLICABILITY AND EFFECT OF FEDERAL,
STATE, LOCAL AND OTHER TAX LAWS.
STOCK TRANSFER POWERS; TRANSFER TAXES
If a certificate evidencing shares of Common Stock or a check
is to be issued in a name other than that of the registered owner
of Debentures, the Debentures must be properly endorsed or be
accompanied by appropriate stock powers properly executed by the
registered holder(s) so that such endorsement or stock powers are
signed exactly as the name(s) of the registered holder(s)
appears(s) on the Debentures, and the signature(s) must be
properly guaranteed by a bank, trust company, broker, dealer,
credit union, savings association or other entity which is a
member in good standing of the Securities Transfer Agent's
Medallion Program. If certificates evidencing shares of Common
Stock issued upon conversion are to be registered in the name of
any person other than the registered holder, or if tendered
Debentures are registered in the name of any person other than
the person(s) signing the Letter of Transmittal, the amount of
any stock transfer taxes (whether imposed on the registered
holder or such person) payable on account of the transfer to such
person shall be borne by the registered holder or such person and
such amount shall be deducted from the Redemption Price (if
arising in connection with the redemption of Debentures), and
shares of Common Stock shall not be issued to such person (if
arising in connection with the conversion of Debentures), unless
in each case, satisfactory evidence of the payment of such taxes,
or exemption therefrom, is submitted.
GENERAL
A copy of this Notice of Redemption and Expiration of
Conversion Privilege and a form of Letter of Transmittal to
accompany Debentures surrendered for redemption or tendered for
conversion have been sent to all holders of record of the
Debentures. Additional copies of such documents may be obtained
from Chemical Bank at its addresses indicated at the top of the
Letter of Transmittal.
PETRIE STORES CORPORATION
Dated: November 10, 1994
PETRIE STORES CORPORATION
70 ENTERPRISE AVENUE
SECAUCUS, NJ 07094
(201) 866-3600
FOR IMMEDIATE RELEASE
PETRIE STORES REDEEMING $125 MILLION CONVERTIBLE DEBT
Secaucus, New Jersey, November 10, 1994 -- Petrie Stores
Corporation (NYSE:PST) announced today that it is calling
for redemption on December 12, 1994 all of its
outstanding 8% Convertible Subordinated Debentures due
December 15, 2010 (the "Debentures") at a redemption
price of $1,008 per $1,000 principal amount of
Debentures, together with accrued and unpaid interest
thereon of $39.333 per $1,000 principal amount of
Debentures, from June 15, 1994 to December 12, 1994.
The holders of the Debentures have the right to convert
the Debentures into approximately 45.1977 shares of
Petrie Stores Common Stock for each $1,000 principal
amount of Debentures and such right expires at 5:00 P.M.
New York time on December 12, 1994.
Holders of the Debentures must surrender the Debentures
to Chemical Bank, New York, for conversion or redemption.
Petrie Stores is one of the largest women's specialty of
chains in the country -- with approximately 1700 stores
throughout the United States, Puerto Rico, and the U.S.
Virgin Islands. The trade names of its stores include
Marianne, G&G, Rave, Jean Nicole, Winkelman's, Stuarts,
and M.J. Carroll.
# # #
Contact: Mary Ann Dunnell
(212) 484-6721
PETRIE STORES CORPORATION
70 ENTERPRISE AVENUE
SECAUCUS, NEW JERSEY 07094
(201) 866-3600
FOR IMMEDIATE RELEASE
PETRIE STORES AND TOYS "R" US RECEIVE
FAVORABLE INTERNAL REVENUE SERVICE RULING
Secaucus, New Jersey, November 17, 1994 -- Petrie
Stores Corporation (NYSE: PST) announced today that it
and Toys "R" Us, Inc. (NYSE: TOY) had received a
favorable ruling from the Internal Revenue Service
holding that the proposed exchange by Petrie of
approximately 39.9 million shares of Toys "R" Us Common
Stock and cash for shares of Toys "R" Us Common Stock and
the distribution by Petrie of such shares to Petrie
shareholders upon the liquidation of Petrie will qualify
as a tax-free reorganization under the Internal Revenue
Code.
The IRS ruling confirms that neither Petrie nor Toys
"R" Us will recognize any gain on the exchange and that
Petrie and its shareholders will not recognize a gain on
the distribution of its Toys "R" Us shares in the
subsequent liquidation of Petrie. In addition, Petrie
shareholders will not recognize any income with respect
to any shares of Toys "R" Us placed into a liquidating
trust to secure Petrie's contingent liabilities.
As previously announced, Petrie shareholders will
vote on the disposition of the company's retail
operations at the Annual Meeting of Shareholders to be
held on December 6, 1994. Thereafter, the annual meeting
will be adjourned, and Petrie shareholders will vote on
the exchange of shares with Toys "R" Us and the
liquidation of Petrie when the annual meeting is
reconvened on or about January 20, 1995.
This is neither an offer to sell, nor a solicitation
of offers to purchase, any securities. Toys "R" Us
common shares will be distributed only pursuant to an
effective registration statement.
Petrie Stores is one of the largest women's
specialty retailing chains in the country - - with
approximately 1700 stores throughout the United States,
Puerto Rico, and the U.S. Virgin Islands. The trade
names of its stores include Marianne, G&G, Rave, Jean
Nicole, Winkleman's, Stuarts, and M.J. Carroll.
