<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 30, 1997
REGISTRATION NO. 333-36213
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
------------------------
JONES APPAREL GROUP, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
PENNSYLVANIA 06-0935166
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
</TABLE>
250 RITTENHOUSE CIRCLE
KEYSTONE PARK
BRISTOL, PA 19007
(215) 785-4000
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
SIDNEY KIMMEL
250 RITTENHOUSE CIRCLE
KEYSTONE PARK
BRISTOL, PA 19007
(215) 785-4000
(Name, address, including zip code and telephone number,
including area code, of agent for service)
------------------------------
COPIES TO:
<TABLE>
<CAPTION>
<S> <C>
BRIAN BRODRICK, ESQ.
PHILLIPS NIZER BENJAMIN KRIM & IRA M. DANSKY, ESQ. WILLIAM J. GRANT, JR., ESQ.
BALLON LLP JONES APPAREL GROUP, INC. WILLKIE FARR & GALLAGHER
666 FIFTH AVENUE 1411 BROADWAY 153 EAST 53RD STREET
NEW YORK, NEW YORK 10103-0084 NEW YORK, NEW YORK 10018 NEW YORK, NEW YORK 10022
(212) 977-9700 (212) 536-9526 (212) 821-8000
</TABLE>
--------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: AS SOON AS
PRACTICABLE AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended (the "Securities Act"), other than securities offered only in
connection with dividend or interest reinvestment plans, check the following
box. / /
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
--------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON
SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY
DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED SEPTEMBER 30, 1997
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
<PAGE>
PROSPECTUS
4,500,000 SHARES
JONES APPAREL GROUP, INC.
COMMON STOCK
----------------
All of the 4,500,000 shares of Common Stock of the Company offered hereby
are being sold by a Selling Shareholder of the Company. The Company is not
selling shares of Common Stock in the Offerings and will not receive any of the
proceeds from the sale of shares of Common Stock offered hereby. Of the
4,500,000 shares of Common Stock being offered hereby, 3,600,000 shares are
being offered for sale initially in the United States and Canada by the U.S.
Underwriters and 900,000 shares are being offered for sale initially in a
concurrent offering outside the United States and Canada by the International
Managers. The initial public offering price and the aggregate underwriting
discount per share will be identical for both Offerings. See "Underwriting."
The Common Stock is listed on the New York Stock Exchange under the symbol
"JNY." On September 29, 1997, the last sale price of the Common Stock as
reported on the New York Stock Exchange was $53 1/16 per share. See "Price Range
of Common Stock."
SEE "RISK FACTORS," BEGINNING ON PAGE 8, FOR A DISCUSSION OF CERTAIN FACTORS
THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK OFFERED
HEREBY.
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<TABLE>
<CAPTION>
PROCEEDS TO
PRICE TO UNDERWRITING SELLING
PUBLIC DISCOUNT(1) SHAREHOLDER(2)
<S> <C> <C> <C>
Per Share................................................ $ $ $
Total(3)................................................. $ $ $
</TABLE>
(1) The Company and the Selling Shareholder have agreed to indemnify the several
Underwriters against certain liabilities, including certain liabilities
under the Securities Act of 1933, as amended. See "Underwriting."
(2) Before deducting expenses payable by the Selling Shareholder estimated at
$340,000.
(3) The Selling Shareholder has granted the U.S. Underwriters and the
International Managers options to purchase up to an additional 540,000
shares and 135,000 shares of Common Stock, respectively, in each case
exercisable within 30 days after the date hereof, solely to cover
over-allotments, if any. If such options are exercised in full, the total
Price to Public, Underwriting Discount and Proceeds to Selling Shareholder
will be $ , $ and $ , respectively. See
"Underwriting."
------------------------
The shares of Common Stock are offered by the several Underwriters, subject
to prior sale, when, as and if issued to and accepted by them, subject to
approval of certain legal matters by counsel for the Underwriters and certain
other conditions. The Underwriters reserve the right to withdraw, cancel or
modify such offer and to reject orders in whole or in part. It is expected that
delivery of the shares of Common Stock will be made in New York, New York on or
about , 1997.
------------------------
MERRILL LYNCH & CO.
BEAR, STEARNS & CO. INC.
GOLDMAN, SACHS & CO.
------------------------
The date of this Prospectus is , 1997.
<PAGE>
[PICTURES OF CERTAIN OF THE COMPANY'S APPAREL PRODUCTS]
Certain persons participating in the Offerings may engage in transactions
that stabilize, maintain or otherwise affect the price of the Common Stock. Such
transactions may include stabilizing, the purchase of Common Stock to cover
syndicate short positions and the imposition of penalty bids. For a description
of these activities, see "Underwriting."
2
<PAGE>
THE COMPANY
Jones Apparel Group, Inc. (the "Company") is a leading designer and marketer
of better priced women's sportswear, suits and dresses. The Company has pursued
a multi-brand strategy marketing its products under several nationally known
brands, including JONES NEW YORK, EVAN-PICONE and RENA ROWAN, and the LAUREN BY
RALPH LAUREN brand licensed from Polo Ralph Lauren Corporation. Each of the
Company's brands is positioned by style and price point to address a distinct
segment of the women's better priced market. In addition, the Company recently
announced the formation of a JONES NEW YORK men's sportswear division with
products to be shipped in the second half of 1998. The Company has leveraged the
strong consumer recognition of its brand names through 35 licenses for a range
of products including footwear, outerwear, men's suits and accessories under the
JONES NEW YORK brand name and 18 licenses under the EVAN-PICONE brand name with
select manufacturers of women's and men's apparel and accessories.
The Company has grown significantly over the last five years, with net sales
increasing from $436.6 million in 1992 to over $1.0 billion in 1996,
representing compound annual growth of 23.7%. During this period, the Company's
operating income increased from $67.6 million to $130.3 million, representing
compound annual growth of 17.8%, and net income increased from $41.3 million to
$80.9 million, representing compound annual growth of 18.3%. For the first half
of 1997, net sales and earnings per share increased to $581 million and $0.90,
representing a 28.1% and 42.9% increase, respectively, over the comparable
period of 1996.
In July 1996, the Company commenced shipping its first collection of women's
career and casual sportswear under the LAUREN BY RALPH LAUREN brand in the
United States under an exclusive licensing alliance. The Company's LAUREN BY
RALPH LAUREN lifestyle collection offers the classic styling, concepts and
elegance associated with internationally known designer Ralph Lauren to a new
group of consumers in the "better" market. This product line was initially
shipped to 275 department store concept shops and has expanded to 680 concept
shops as of August 1997. For Fall 1997, the Company added a petite collection
which is being offered in an additional 270 concept shops within petite
departments. The Company also recently expanded this lifestyle collection
through the addition of coats and suits.
In addition to its nationally-recognized brand names, the Company believes
it enjoys a number of competitive strengths. The Company believes that its
competitive advantages include its ability to design, merchandise, source and
distribute superior products at price points within the better market. Through
the combination of its worldwide network of quality contract manufacturers and
highly efficient information and distribution systems, the Company has developed
a reputation among retailers for customer service. The Company also believes it
has benefitted from a trend among its major retail accounts to concentrate their
apparel buying among a narrowing group of established brand name vendors. As one
of the primary apparel resources for many of its retail accounts, the Company is
able to influence the mix and timing of orders. As a result, the Company is able
to more effectively market complete lines of sportswear and minimize excess
inventory.
The Company seeks to capitalize on its competitive advantages through a
growth strategy that focuses on five principal areas: (i) continuing to expand
the LAUREN BY RALPH LAUREN lines by adding new store locations, increasing the
amount of retail space devoted to this label in existing store locations and
introducing additional product classifications; (ii) continuing to expand the
JONES NEW YORK brand by increasing the amount of retail space devoted to this
label in existing store locations and by leveraging its brand name recognition
to introduce new product lines such as the recently announced JONES NEW YORK
men's sportswear line; (iii) continuing to expand the RENA ROWAN and EVAN-PICONE
brands by adding new store locations and increasing the amount of retail space
devoted to these brands in existing store locations; (iv) seeking new
opportunities to license its brand names to increase the market presence and
enhance the consumer awareness of its brands, such as the recent licenses for
women's swimwear and men's and women's watches; and (v) selectively pursuing
acquisitions to provide new brands, products or channels of distribution.
3
<PAGE>
The Company distributes its products through approximately 1,550 customers,
including department stores, specialty retailer accounts and direct catalog
companies throughout the United States and Canada, representing 7,700 locations.
In addition, as of September 1, 1997, the Company operated a total of 215
factory outlet stores and five full price stores.
The Company was incorporated in Pennsylvania in 1975. The Company's
executive offices are located at 250 Rittenhouse Circle, Keystone Park, Bristol,
Pennsylvania 19007.
RECENT DEVELOPMENTS
On September 30, 1997 the Company announced that revenues for its third
quarter ended September 28, 1997 will be in the range of $440 million to $450
million. Earnings per share for the quarter should fall in a range of $.86 to
$.88, as compared to $.58 per share in the third quarter of 1996. In addition,
the Company's order backlog at September 28, 1997 is 49% ahead of the same point
in 1996. The Company's growth has been fueled by growth in its JONES NEW YORK
brand, as well as stronger than anticipated growth in the LAUREN BY RALPH LAUREN
brand. Based on the current order backlog, the Company now anticipates that
LAUREN BY RALPH LAUREN sales will exceed $250 million for 1997.
4
<PAGE>
THE OFFERINGS
The offering of 3,600,000 shares of Common Stock being offered in the United
States and Canada (the "U.S. Offering") and the offering of 900,000 shares of
Common Stock being offered outside the United States and Canada (the
"International Offering") are collectively referred to herein as the
"Offerings."
<TABLE>
<S> <C>
Common Stock to be offered by the Selling
Shareholder(1)............................. 4,500,000 shares
Common Stock outstanding before and after the
Offerings(2)............................... 52,050,906 shares
Use of Proceeds.............................. The Company will not receive any of the
proceeds from the Offerings.
New York Stock Exchange Symbol............... JNY
</TABLE>
- ------------------------
(1) Assumes the Underwriters' over-allotment options are not exercised.
(2) Excludes an aggregate of (i) 3,806,541 shares of Common Stock issuable upon
exercise of outstanding employee stock options as of June 29, 1997, and (ii)
2,692,734 shares of Common Stock reserved as of June 29, 1997 for issuance
upon exercise of stock options which may be granted under the Company's
stock option plans.
5
<PAGE>
SELECTED FINANCIAL INFORMATION
The following financial information is qualified by reference to, and should
be read in conjunction with, the Company's Consolidated Financial Statements and
the Notes thereto, and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" contained in the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1996 and the Company's
quarterly report on Form 10-Q for the fiscal quarter ended June 29, 1997
incorporated by reference in this Prospectus. The selected consolidated
financial information for each of the five years in the period ended December
31, 1996 is derived from the Company's audited Consolidated Financial Statements
for the five fiscal years ended December 31, 1996. The selected consolidated
financial information as of June 29, 1997 and June 30, 1996 and the periods
ended June 29, 1997 and June 30, 1996 is derived from financial statements that
are unaudited but which, in the opinion of management, include all adjustments,
consisting only of normal recurring accruals, necessary for a fair presentation
of financial condition and the results of operations. The results for interim
periods may not be indicative of results for the full fiscal year.
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, SIX MONTHS ENDED
----------------------------------------------------- --------------------
<S> <C> <C> <C> <C> <C> <C> <C>
JUNE 30, JUNE 29,
1992 1993 1994 1995 1996 1996 1997
--------- --------- --------- --------- --------- --------- ---------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
INCOME STATEMENT DATA
Net sales.................................... $ 436,572 $ 541,152 $ 633,257 $ 776,365 $1,021,042 $ 453,626 $ 580,978
Licensing income(1).......................... 1,564 4,907 8,487 10,314 13,036 5,235 6,766
--------- --------- --------- --------- --------- --------- ---------
Total revenues............................... 438,136 546,059 641,744 786,679 1,034,078 458,861 587,744
Cost of goods sold........................... 285,844 363,742 438,572 546,413 717,250 319,800 393,426
--------- --------- --------- --------- --------- --------- ---------
Gross profit(2).............................. 152,292 182,317 203,169 240,266 316,828 139,061 194,318
Selling, general and administrative
expenses................................... 84,740 103,392 115,307 139,135 186,572 84,874 115,729
--------- --------- --------- --------- --------- --------- ---------
Operating income............................. 67,552 78,925 87,862 101,131 130,256 54,187 78,589
Interest expense............................. 1,156 716 1,212 1,908 3,040 1,249 1,145
Interest income.............................. (221) (810) (695) (445) (547) (265) (516)
--------- --------- --------- --------- --------- --------- ---------
Income before provision for income taxes..... 66,617 79,019 87,345 99,668 127,763 53,203 77,960
Provision for income taxes................... 25,314 30,660 32,425 36,183 46,889 19,526 29,141
--------- --------- --------- --------- --------- --------- ---------
Income before cumulative effect of change
in accounting principle.................... 41,303 48,359 54,920 63,485 80,874 33,677 48,819
Cumulative effect on prior years of change
in accounting for income taxes(3).......... -- 1,376 -- -- -- -- --
--------- --------- --------- --------- --------- --------- ---------
Net income................................... $ 41,303 $ 49,735 $ 54,920 $ 63,485 $ 80,874 $ 33,677 $ 48,819
--------- --------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- --------- ---------
PER SHARE DATA(4)
Earnings per share--primary
Income before cumulative effect of change
in accounting principle.................. $0.79 $0.92 $1.04 $1.20 $1.51 $0.63 $0.90
Cumulative effect on prior years of change
in accounting for income taxes(3)........ -- $0.03 -- -- -- -- --
Net income................................. $0.79 $0.95 $1.04 $1.20 $1.51 $0.63 $0.90
Earnings per share--fully diluted
Income before cumulative effect of change
in accounting principle.................. $0.79 $0.92 $1.04 $1.19 $1.50 $0.63 $0.90
Cumulative effect on prior years of change
in accounting for income taxes(3)........ -- $0.03 -- -- -- -- --
Net income................................. $0.79 $0.95 $1.04 $1.19 $1.50 $0.63 $0.90
Weighted average number of common shares
and share equivalents outstanding
Primary.................................... 52,040 52,365 52,924 53,046 53,665 53,749 53,979
Fully diluted.............................. 52,379 52,413 52,925 53,458 54,077 53,844 54,250
</TABLE>
<TABLE>
<CAPTION>
AT DECEMBER 31,
----------------------------------------------------- AT JUNE 30, AT JUNE 29,
1992 1993 1994 1995 1996 1996 1997
--------- --------- --------- --------- --------- ----------- -----------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA
Working capital................................ $ 122,376 $ 159,175 $ 204,221 $ 260,853 $ 293,970 $ 285,444 $ 328,229
Total assets................................... 184,639 266,594 318,286 400,959 488,109 474,712 568,693
Short-term debt, including current portion
of capital lease obligations................. 1,131 1,722 1,859 2,327 3,067 2,890 3,655
Long-term debt, including capital lease
obligations.................................. 4,783 9,545 8,029 10,151 12,141 13,401 19,927
Stockholders' equity........................... 134,791 189,120 248,678 314,975 376,729 345,573 421,690
</TABLE>
FOOTNOTES ON FOLLOWING PAGE
6
<PAGE>
FOOTNOTES FROM PRIOR PAGE
(1) Represents license fees received by the Company (net of related expenses).
(2) Historically, the Company had included licensing income as a separate line
item in operating income. In accordance with current industry practice, the
Company has included this amount in total revenues and gross profit. All
periods presented reflect this reclassification of licensing income.
(3) For the year ended December 31, 1993, the Company recorded a cumulative
effect of a change in accounting principle for income taxes as a result of
the adoption of SFAS 109, which increased net income by $1,376,000.
(4) On July 30, 1996, the Company's Board of Directors approved a two-for-one
stock split of the Company's Common Stock in the form of a 100% stock
dividend for shareholders of record as of September 12, 1996. Concurrently,
the number of authorized shares of Common Stock was increased to
100,000,000. On October 2, 1996, a total of 26,744,580 shares of Common
Stock were issued in connection with the split. The stated par value of each
share remained at $0.01. All share and per share amounts have been restated
to retroactively reflect the stock split.
7
<PAGE>
RISK FACTORS
PROSPECTIVE PURCHASERS OF THE SHARES OF COMMON STOCK OFFERED HEREBY SHOULD
CAREFULLY CONSIDER ALL OF THE INFORMATION SET FORTH IN THIS PROSPECTUS AND THE
DOCUMENTS INCORPORATED HEREIN BY REFERENCE, AND, IN PARTICULAR, SHOULD EVALUATE
THE FOLLOWING RISKS IN CONNECTION WITH AN INVESTMENT IN THE COMMON STOCK OFFERED
HEREBY.
THIS PROSPECTUS AND THE DOCUMENTS INCORPORATED BY REFERENCE HEREIN INCLUDE
"FORWARD-LOOKING STATEMENTS" WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND SECTION 21E OF THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED (THE "EXCHANGE ACT") WHICH REPRESENT THE
COMPANY'S EXPECTATIONS OR BELIEFS CONCERNING FUTURE EVENTS THAT INVOLVE RISKS
AND UNCERTAINTIES, INCLUDING THOSE ASSOCIATED WITH THE EFFECT OF NATIONAL AND
REGIONAL ECONOMIC CONDITIONS, THE OVERALL LEVEL OF CONSUMER SPENDING, THE
PERFORMANCE OF THE COMPANY'S PRODUCTS WITHIN THE PREVAILING RETAIL ENVIRONMENT,
CUSTOMER ACCEPTANCE OF BOTH NEW DESIGNS AND NEWLY-INTRODUCED PRODUCT LINES, AND
FINANCIAL DIFFICULTIES ENCOUNTERED BY CUSTOMERS. ALL STATEMENTS OTHER THAN
STATEMENTS OF HISTORICAL FACTS INCLUDED IN THIS PROSPECTUS, AND THE DOCUMENTS
INCORPORATED BY REFERENCE HEREIN INCLUDING, WITHOUT LIMITATION, THE STATEMENTS
UNDER "THE COMPANY," AND ELSEWHERE HEREIN, ARE FORWARD-LOOKING STATEMENTS.
ALTHOUGH THE COMPANY BELIEVES THAT THE EXPECTATIONS REFLECTED IN SUCH FORWARD-
LOOKING STATEMENTS ARE REASONABLE, IT CAN GIVE NO ASSURANCE THAT SUCH
EXPECTATIONS WILL PROVE TO HAVE BEEN CORRECT. IMPORTANT FACTORS THAT COULD CAUSE
ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE COMPANY'S EXPECTATIONS ("CAUTIONARY
STATEMENTS") ARE DISCLOSED IN THIS PROSPECTUS AND THE DOCUMENTS INCORPORATED BY
REFERENCE HEREIN INCLUDING, WITHOUT LIMITATION, IN CONJUNCTION WITH THE
FORWARD-LOOKING STATEMENTS OR INCORPORATED BY REFERENCE INCLUDED IN THIS
PROSPECTUS AND UNDER "RISK FACTORS." ALL SUBSEQUENT WRITTEN AND ORAL
FORWARD-LOOKING STATEMENTS ATTRIBUTABLE TO THE COMPANY OR PERSONS ACTING ON ITS
BEHALF ARE EXPRESSLY QUALIFIED IN THEIR ENTIRETY BY THE CAUTIONARY STATEMENTS.
CYCLICALITY OF APPAREL INDUSTRY
The apparel industry is a cyclical industry heavily dependent upon the
overall level of consumer spending, with purchases of apparel and related goods
tending to decline during recessionary periods when disposable income is low. A
difficult retail environment could result in higher than normal levels of
promotional sales which could adversely impact the Company's gross profit
margins. Although the retail segment in which the Company operates improved
moderately in 1996 and 1997, there can be no assurance that the improved retail
environment will continue or that the retail environment will not deteriorate.
CONCENTRATION OF CUSTOMERS
Department stores account for approximately two-thirds of the Company's
sales, and its ten largest customers accounted for approximately 64% and 65% of
sales in 1996 and the first half of 1997, respectively. Although no single
customer accounted for more than 10% of net sales, certain of the Company's
customers are under common ownership. When considered together as a group under
common ownership, sales to the seven department store customers currently owned
by Federated Department Stores Inc. and sales to eight department store
customers currently owned by The May Department Store Company each accounted for
approximately 20% of 1996 sales, and 21% and 20% of sales for the first half of
1997, respectively. Although the Company believes that purchasing decisions are
generally made independently by each department store customer within a
commonly-controlled group, in some cases the trend may be toward more
centralized purchasing decisions. If such decisions become more centralized, the
risk to the Company of such concentration would become greater than is presently
the case. The loss of any of the Company's ten largest customers, or any such
customer's insolvency, bankruptcy or material financial difficulty, could have a
material adverse effect upon the Company.
8
<PAGE>
FASHION TRENDS
The Company believes that its success depends in substantial part on its
ability to anticipate, gauge and respond to changing consumer demands and
fashion trends in a timely manner. There can be no assurance, however, that the
Company will continue to be successful in this regard. If the Company misjudges
the market for a number of products or product groups, it may be faced with a
significant amount of unsold finished goods inventory, which could have an
adverse effect on the Company's operations.
LAUREN BY RALPH LAUREN LICENSE AGREEMENTS
The Company has an exclusive license to manufacture and market women's
career and casual sportswear under the LAUREN BY RALPH LAUREN trademark in the
United States pursuant to license and design service agreements with Polo Ralph
Lauren Corporation which expire on December 31, 2001. The license agreement
provides for the payment by the Company of a percentage of net sales against
guaranteed minimum royalty and design service payments, as set forth in the
agreements. Upon the expiration of the initial term, the Company has the right
to renew the license for an additional three year term provided that it meets
certain minimum sales level requirements. In the event that the license is
terminated or not renewed as a result of the Company's failure to comply with
the terms of these agreements, including the minimum sales level requirements,
such termination could have a material adverse effect upon the Company.
DEPENDENCE UPON KEY PERSONNEL
The success of the Company is dependent upon the personal efforts and
abilities of Sidney Kimmel (Chairman), Jackwyn Nemerov (President), and Irwin
Samelman (Executive Vice President, Marketing). The Company does not have
employment agreements with Mr. Kimmel, Ms. Nemerov, or Mr. Samelman. The Company
believes that the loss of the services of any of Mr. Kimmel, Ms. Nemerov, or Mr.
Samelman could have an adverse effect on the Company. See "Management."
FOREIGN OPERATIONS AND MANUFACTURING
During 1996 approximately 35% of the Company's products were manufactured in
the United States and Mexico and approximately 65% in Asia and, to a lesser
extent, other parts of the world. As a result, the Company's operations may be
adversely affected by political instability resulting in the disruption of trade
from foreign countries in which the Company's contractors and suppliers are
located, the imposition of additional regulations relating to imports or duties,
taxes and other charges on imports, any significant fluctuation of the value of
the dollar against foreign currencies and restrictions on the transfer of funds.
In addition, the Company's import operations are subject to constraints imposed
by bilateral textile agreements between the United States and a number of
foreign countries. These agreements impose quotas on the amount and type of
goods which can be imported into the United States from these countries.
Furthermore, because the Company's foreign manufacturers are located at greater
geographic distances from the Company than its domestic manufacturers, the
Company is generally required to allow greater lead time for foreign orders.
This reduces the Company's manufacturing flexibility, which increases the risk
that the Company will be required to mark down unsold inventory as a result of
misjudging the market for a foreign sourced product. Although the Company seeks
to actively monitor the compliance of its contractors with applicable labor and
wage standards, violations of these standards and the resulting publicity
relating to such violations could have an adverse effect on the Company.
9
<PAGE>
COMPETITION
There is intense competition in the sectors of the apparel industry in which
the Company participates. The Company competes with many other apparel
companies, some of which are larger and have greater resources than the Company.
The Company believes in order to be successful in its industry, it must be able
to evaluate and respond to changing consumer demand and taste and to remain
competitive in the areas of style, quality and price while operating within the
significant domestic and foreign production and delivery constraints of the
industry.
POSSIBLE VOLATILITY OF STOCK PRICE
The market price of the Company's Common Stock may be highly volatile.
Factors such as quarter-to-quarter variations in the Company's revenues and
earnings could cause the market price of the Company's Common Stock to fluctuate
significantly. In addition, in recent years the stock markets have experienced
significant volatility, which often may have been unrelated to the operating
performance of the affected companies. Such volatility may adversely affect the
market price of the Company's Common Stock. See "Common Stock Price Range."
SHARES ELIGIBLE FOR FUTURE SALE
The prevailing market price of Common Stock after this offering could be
adversely affected by future sales of substantial amounts of Common Stock by
existing shareholders. There will be 52,050,906 shares of Common Stock
outstanding immediately following the Offerings, 44,701,856 of which will be
tradeable without restriction and 7,349,050 of which may be sold subject to the
restrictions of Rule 144 under the Securities Act of 1933 (the "Securities
Act"). However, the Company, its executive officers and directors, including the
Selling Shareholder, have agreed, subject to certain exceptions, not to directly
or indirectly (i) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant for the sale of or otherwise dispose of or transfer any shares
of Common Stock or securities convertible into or exchangeable or exercisable
for Common Stock, whether now owned or thereafter acquired by the person
executing the agreement or with respect to which the person executing the
agreement thereafter acquires the power of disposition, or file a registration
statement under the Securities Act with respect to the foregoing or (ii) enter
into any swap or other agreement that transfers, in whole or in part, the
economic consequence of ownership of the Common Stock whether any such swap or
transaction is to be settled by delivery of Common Stock or other securities, in
cash or otherwise, without the prior written consent of Merrill Lynch on behalf
of the Underwriters for a period of 90 days after the date of this Prospectus,
in the case of the Selling Shareholder, or 30 days after the date of this
Prospectus, in the case of the other executive officers and directors of the
Company. See "Shares Eligible for Future Sale."
10
<PAGE>
CAPITALIZATION
The following table sets forth the capitalization of the Company at June 29,
1997. The sale of the shares of Common Stock offered hereby will not affect the
Company's capitalization.
<TABLE>
<CAPTION>
JUNE 29, 1997
--------------
<S> <C>
(IN THOUSANDS)
Short-term debt:
Current portion of long-term debt .............................................................. $ 10
Current portion of capital lease obligations.................................................... 3,645
--------------
Total short-term debt....................................................................... $ 3,655
--------------
--------------
Long-term debt:
Obligations under capital leases................................................................ $ 19,925
Long-term debt.................................................................................. 2
--------------
Total long-term debt........................................................................ 19,927
Stockholders' equity:
Common Stock, par value $0.01 per share: 100,000,000 shares authorized: 54,053,000 shares issued
and outstanding(1)............................................................................ 541
Additional paid-in capital...................................................................... 109,444
Retained earnings .............................................................................. 366,011
Cumulative foreign currency translation adjustment.............................................. (1,216)
Treasury stock (1,976,000 shares at cost) ...................................................... (53,090)
--------------
Total stockholders' equity.................................................................. 421,690
--------------
Total capitalization...................................................................... $ 441,617
--------------
--------------
</TABLE>
- ------------------------
(1) As of the date of this Prospectus, there were 52,050,906 shares of Common
Stock outstanding which excludes an aggregate of (i) 3,806,541 shares of
Common Stock issuable upon exercise of outstanding employee stock options as
of June 29, 1997, and (ii) 2,692,734 shares of Common Stock reserved as of
June 29, 1997 for issuance upon exercise of stock options which may be
granted under the Company's stock option plans.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the Offerings. All of
the expenses of the Offerings will be paid by the Selling Shareholder.
11
<PAGE>
PRICE RANGE OF COMMON STOCK
The Company's Common Stock is traded on the New York Stock Exchange under
the symbol "JNY." The following table sets forth, for the periods indicated, the
high and low sale prices per share of the Company's Common Stock as reported on
the New York Stock Exchange Composite Tape.
<TABLE>
<CAPTION>
HIGH LOW
------- -------
<S> <C> <C>
1995
First Quarter................................................................................... $13 15/16 $11 5/16
Second Quarter.................................................................................. 15 7/16 12 15/16
Third Quarter................................................................................... 18 3/8 14 7/8
Fourth Quarter.................................................................................. 19 3/4 15 3/16
1996
First Quarter................................................................................... 24 1/4 17 13/16
Second Quarter.................................................................................. 27 3/4 23 1/4
Third Quarter................................................................................... 37 3/8 22 9/16
Fourth Quarter.................................................................................. 37 3/8 29 5/8
1997
First Quarter................................................................................... 41 3/8 32 1/8
Second Quarter.................................................................................. 49 1/8 36 1/8
Third Quarter (through September 29, 1997) ..................................................... 57 3/16 46 5/8
</TABLE>
The last reported sale price per share of the Company's Common Stock as
reported on the New York Stock Exchange Composite Tape on September 29, 1997 was
$53 1/16.
DIVIDEND POLICY
The Company has not paid any cash dividends on shares of its Common Stock.
The Company presently anticipates that all of its future earnings will be
retained for development of its business and does not anticipate paying cash
dividends on its Common Stock in the foreseeable future. The payment of any
future dividends will be at the discretion of the Company's Board of Directors
and will depend upon, among other things, future earnings, operations, capital
requirements, the general financial condition of the Company and general
business conditions.
12
<PAGE>
MANAGEMENT
DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY
The directors and executive officers of the Company are as follows:
<TABLE>
<CAPTION>
NAME AGE OFFICE
- --------------------------------------------------- --- ---------------------------------------------------
<S> <C> <C>
Sidney Kimmel...................................... 69 Chairman and Director
Herbert J. Goodfriend.............................. 71 Vice Chairman and Director
Jackwyn Nemerov.................................... 46 President
Irwin Samelman..................................... 66 Executive Vice President, Marketing and Director
Wesley R. Card..................................... 49 Chief Financial Officer
Gary R. Klocek..................................... 47 Controller
Geraldine Stutz.................................... 69 Director
Howard Gittis...................................... 63 Director
</TABLE>
SIDNEY KIMMEL founded the Jones Apparel Division of W.R. Grace & Co. in
1970. Mr. Kimmel has served as Chairman since 1975. Prior to 1975, Mr. Kimmel
occupied various executive offices, including President of JONES NEW YORK and
Vice President of John Meyer of Norwich. Prior to founding the Company, Mr.
Kimmel was employed by W.R. Grace & Co. and was President of Villager, Inc., a
sportswear company.
HERBERT J. GOODFRIEND joined the Company in 1990 after serving as the
Company's legal counsel for the previous three years and has served as a
director since July 1991. Before joining the Company, Mr. Goodfriend served as a
director of Villager, Inc. and Venice Industries, Inc. In addition, Mr.
Goodfriend is engaged in the practice of law and is of counsel to the firm of
Phillips Nizer Benjamin Krim & Ballon LLP, which performs legal services for the
Company.
JACKWYN NEMEROV was appointed President of the Company in January 1997. She
joined the Company in 1985 and served as President of the Company's casual
sportswear divisions and LAUREN BY RALPH LAUREN division. Prior to joining the
Company, Ms. Nemerov was President of the Gloria Vanderbilt division of Murjani,
Inc. from 1980 through 1985.
IRWIN SAMELMAN has been Executive Vice President, Marketing of the Company
since 1991 and has served as a director since July 1991. In addition, from 1987
to 1991, Mr. Samelman provided marketing consulting services to the Company
through Samelman Associates, Inc., a private consulting company controlled by
him. Prior thereto, Mr. Samelman was Regional Marketing Manager of Russ Togs,
Inc. and a Vice President of Villager, Inc.
WESLEY R. CARD joined the Company in 1990 as Chief Financial Officer. Prior
to joining the Company, Mr. Card held the positions of Executive Vice President
and Chief Financial Officer of Carolyne Roehm, Inc., and Corporate Vice
President, Controller and Assistant Secretary of Warnaco, Inc.
GARY R. KLOCEK has been Controller of the Company since August 1987. Prior
to joining the Company, Mr. Klocek held various positions with Atlantic
Richfield Company ("ARCO") from 1979 through 1987, his last position being
Manager of Cost and Inventory Control for one of ARCO's subsidiaries.
GERALDINE STUTZ has been a director of the Company since July 1991. Since
1993, Ms. Stutz has been a principal partner of Panache Productions, a fashion
and marketing service. During the previous five years, she was Publisher of
Panache Press at Random House, a book publisher. From 1960 until 1986, Ms. Stutz
was President of Henri Bendel. Ms. Stutz serves on the Board of Directors of
Tiffany & Co., Hanover Direct, The Theatre Development Fund and The Actors'
Fund.
13
<PAGE>
HOWARD GITTIS has been a director of the Company since April 1992. During
the past five years, Mr. Gittis' principal occupation has been Director and Vice
Chairman of MacAndrews & Forbes Holdings Inc., a diversified holding company. In
addition, Mr. Gittis is a director of Andrews Group Incorporated, Consolidated
Cigar Corporation, First Nationwide Holdings Inc., First Nationwide Bank, a
Federal Savings Bank, Loral Corporation, Mafco Consolidated Group Inc., Mafco
Worldwide Corporation, NWCG Holdings Corporation, New World Communications Group
Incorporated, New World Television Incorporated, Power Control Technologies
Inc., Revlon, Inc., Revlon Consumer Products Corporation, and Revlon Worldwide
Corporation.
KEY EMPLOYEES
The following persons, although not executive officers of the Company, make
significant business contributions to the Company:
RENA ROWAN was the original creator of the JONES NEW YORK line and served as
the division's Chief Designer from 1970 to 1982. She is currently Vice
President, Design of the Company. From 1991 to 1993, Ms. Rowan was an executive
vice president of the Company. Prior to the inception of Jones New York, Ms.
Rowan was employed by Villager, Inc. and Rosenau, Inc.
ANITA BRITT, Director of Investor Relations and Financial Planning, joined
the Company in December 1993. Prior to joining the Company, Ms. Britt was
Director of Internal Audit of American Reliance Group, Inc.
HOWARD BUERKLE has been President of Retail Operations for the Company since
1989. From 1986 through 1989, Mr. Buerkle was President of the retail division
of Inwear/Matinique.
ELLEN DANIEL joined the Company in 1994 in the dual capacity of Senior Vice
President--Corporate Merchandising Manager and President of the EVAN-PICONE
division. From 1982 through 1994, Ms. Daniel was employed by Liz Claiborne, most
recently as Senior Vice President--Corporate Design Director.
IRA DANSKY joined the Company in 1996 as General Counsel. Prior to joining
the Company, Mr. Dansky was engaged in private law practice from 1987 though
1996, prior to which he served as Associate General Counsel of Xerox
Corporation.
RONALD HARRISON, Vice President of Manufacturing, joined the Company in
1981. Mr. Harrison had been Plant Manager for Chief Apparel, Inc. from 1965
through 1981.
JOSEPH HIESS was appointed President of the JONES NEW YORK Men's Sportswear
division in August 1997. Prior to his appointment, Mr. Hiess served as head of
Design and Marketing of JJ Farmer, a menswear company he founded in 1986 and
subsequently sold to Salant Corporation in 1993.
BARBARA KENNEDY has been President of the Jones New York Dress Division
since August 1991. From 1983 through August 1991, Ms. Kennedy was employed by
Bloomingdale's in various capacities, most recently as Vice President,
Merchandise Manager.
RICHARD SHAW, President of Jones Apparel Group Canada, Inc., joined the
Company in May, 1997. Prior to joining Jones, Mr. Shaw served as President of
Liz Claiborne Canada which he helped launch in 1987.
JEFFREY LEVY, President of RENA ROWAN, joined the Company in 1990. Prior to
joining the Company, Mr. Levy was Vice President of Sales and National Sales
Manager, of Russ Togs, Inc. from 1984 through 1990.
BENNY LIN joined the Company in December 1995 as Creative Director of the
LAUREN BY RALPH LAUREN division. Mr. Lin had been Fashion Director at Macy's
East prior to joining the Company.
14
<PAGE>
MARTIN MARLOWE joined the Company in 1992 as Vice President of Foreign
Manufacturing. Prior to joining the Company, Mr. Marlowe was President of Jodi
International, an apparel importer, from 1988 to 1992.
HELEN MERRIL, President of the EVAN-PICONE Dress Divisions, joined Jones
Apparel Group in October 1993. Prior to joining the Company, Ms. Merril held the
positions of President of Scassi Dress of De Peche Corporation and President of
Nipon Boutique of Albert Nipon Inc.
SUSAN METZGER, Vice President of Sales for the LAUREN BY RALPH LAUREN
division, joined the Company in May 1996. Prior to joining Jones Apparel Group,
Ms. Metzger held the positions of Vice President of Sales of Chaus, Inc and
Sales Manager of JH Collectibles.
DEANNA RANDALL, who joined the Company in 1981, has held various sales and
marketing positions with the Company, and is currently President of the JONES
NEW YORK career division.
JOHN SAMMARITANO, Vice President of Distribution, joined the Company in
1975. Mr. Sammaritano had been Vice President of Distribution for Villager, Inc.
from 1964 through 1975.
15
<PAGE>
SELLING SHAREHOLDER
The following tables sets forth certain information with respect to the
beneficial ownership of Common Stock as of September 22, 1997 by Sidney Kimmel
(the "Selling Shareholder") and as adjusted to reflect the sale of 4,500,000
shares by the Selling Shareholder in the Offerings. Mr. Kimmel has sole voting
and investment power with respect to all shares of Common Stock shown as
beneficially owned by him except as set forth in the footnotes below.
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP BENEFICIAL OWNERSHIP
PRIOR TO OFFERINGS SHARES AFTER OFFERINGS
------------------------- BEING ---------------------------
NAME SHARES PERCENT (1) OFFERED SHARES PERCENT (1)
- ------------------------------------------ ------------ ----------- -------------- -------------- -----------
<S> <C> <C> <C> <C> <C>
Sidney Kimmel(3).......................... 11,849,050 22.7% 4,500,000(2) 7,349,050(2) 14.1%
</TABLE>
- ------------------------
(1) Based upon 52,050,906 shares of Common Stock issued and outstanding as of
September 22, 1997.
(2) Assumes the Underwriters' over-allotment options are not exercised. If such
over-allotment options are exercised in full, an additional 675,000 shares
will be sold by the Selling Shareholder. See "Underwriting."
(3) Does not include 400,000 shares of Common Stock which are issuable upon
exercise of stock options, which do not become exercisable until July 1998.
SHARES ELIGIBLE FOR FUTURE SALE
The Selling Shareholder will beneficially own 7,349,050 shares of the
Company's Common Stock subsequent to the completion of the Offerings (6,674,050
shares if the Underwriters' over-allotment options are exercised in full). The
Selling Shareholder has agreed not to sell any such shares for a period of 90
days from the date of this Prospectus without the prior written consent of
Merrill Lynch on behalf of the Underwriters. Subsequently, such shares may be
eligible for sale pursuant to Rule 144 under the Securities Act of 1933 or
otherwise. In addition, the Company, its executive officers and directors,
including the Selling Shareholder, have agreed, subject to certain exceptions,
not to directly or indirectly (i) offer, pledge, sell, contract to sell, sell
any option or contract to purchase, purchase any option or contract to sell,
grant any option, right or warrant for the sale of or otherwise dispose of or
transfer any shares of Common Stock or securities convertible into or
exchangeable or exercisable for Common Stock, whether now owned or thereafter
acquired by the person executing the agreement or with respect to which the
person executing the agreement thereafter acquires the power of disposition, or
file a registration statement under the Securities Act with respect to the
foregoing or (ii) enter into any swap or other agreement that transfers, in
whole or in part, the economic consequence of ownership of the Common Stock
whether any such swap or transaction is to be settled by delivery of Common
Stock or other securities, in cash or otherwise, without the prior written
consent of Merrill Lynch on behalf of the Underwriters for a period of 90 days
after the date of this Prospectus, in the case of the Selling Shareholder, or 30
days after the date of this Prospectus, in the case of the other executive
officers and directors of the Company. See "Underwriting."
Pursuant to Rule 144, each shareholder who is deemed to be an "affiliate" of
the Company may sell, within any three-month period, a number of shares that
does not exceed the greater of (a) 1% of the shares of Common Stock then
outstanding or (b) the average weekly trading volume in the Common Stock during
the four calendar weeks preceding such sale.
No predictions can be made as of the effect, if any, that sales of shares
under Rule 144 or the availability of shares for sale will have on the market
price prevailing from time to time after the Offerings. Nevertheless, sales of
substantial amounts of Common Stock in the public market could adversely affect
the market price of the Common Stock.
16
<PAGE>
CERTAIN UNITED STATES FEDERAL TAX CONSEQUENCES
TO NON-U.S. HOLDERS OF COMMON STOCK
The following is a general discussion of certain United States federal
income and estate tax consequences of the ownership and disposition of Common
Stock by a holder who is not a United States person (a "Non-U.S. Holder") and
who acquires and owns such Common Stock as a capital asset within the meaning of
Section 1221 of the Internal Revenue Code of 1986, as amended (the "Code"). For
this purpose, the term "Non-U.S. Holder" generally is defined as any person
other than (i) a citizen or resident of the United States, (ii) a corporation,
partnership or other entity created or organized in the United States or under
the laws of the United States or of any state, or (iii) an estate whose income
is included in gross income for United States federal income tax purposes
regardless of its source, or (iv) a trust if, (a) a court within the United
States is able to exercise primary jurisdiction supervision over the
administration of the trust and (b) one or more United States fiduciaries have
the authority to control all substantial decisions of the trust.
This discussion does not consider specific facts and circumstances that may
be relevant to a particular Non-U.S. Holder's tax position, does not address all
aspects of United States federal income, gift and estate taxes and does not deal
with foreign and United States state and local consequences that may be relevant
to such Non-U.S. Holders in light of their personal circumstances. Further, it
does not discuss the rules applicable to Non-U.S. Holders subject to special tax
treatment under the federal tax laws (including, but not limited to, banks and
insurance companies, dealers in securities, and holders of securities held as
part of a "straddle," "hedge," or "conversion transaction"). Furthermore, this
discussion is based on current provisions of the Code, existing and proposed
regulations promulgated thereunder and administrative and judicial
interpretations thereof, all of which are subject to change, possibly on a
retroactive basis.
ACCORDINGLY, PROSPECTIVE INVESTORS ARE URGED TO CONSULT THEIR TAX ADVISORS
REGARDING THE UNITED STATES FEDERAL, STATE, LOCAL AND NON-UNITED STATES INCOME
AND OTHER TAX CONSEQUENCES OF OWNING AND DISPOSING OF SHARES OF COMMON STOCK.
An individual may, subject to certain exceptions, be deemed to be a resident
alien (as opposed to a nonresident alien) by virtue of being present in the
United States on at least thirty-one (31) days in the calendar year and for an
aggregate of at least one hundred eighty-three (183) days during a three-year
period ending in the current calendar year (counting for such purposes all of
the days present in the current year, one-third of the days present in the
immediately preceding year, and one-sixth of the days present in the second
preceding year). In addition to the "substantial presence test" described in the
immediately preceding sentence, an alien may be treated as a resident alien if
he (i) meets a lawful permanent residence test (a so-called "green card" test)
or (ii) elects to be treated as a U.S. resident and meets the "substantial
presence test" in the immediately following year. Resident aliens are subject to
United States federal income tax as if they were United States citizens.
DIVIDENDS
In general, dividends paid to a Non-U.S. Holder of Common Stock will be
subject to withholding of U.S. federal income tax at a thirty (30%) percent rate
(or such lower rate as may be specified by an applicable income tax treaty),
unless the dividends are (i) effectively connected with the conduct of a trade
or business of the Non-U.S. Holder within the United States ("United States
trade or business income") or (ii) if an applicable treaty so provides,
attibutable to a United States permanent establishment maintained by the
Non-U.S. Holder. If the dividend is United States trade or business income or
attributable to a United States permanent establishment, the dividend would be
subject to United States federal income tax on a net income basis at applicable
graduated individual or corporate rates and would be exempt from the thirty
(30%) percent withholding tax described above (if the Non-U.S. Holder files
certain forms, including United States Internal Revenue Service ("Service") Form
4224, with the payor of the dividend). Any such
17
<PAGE>
dividends that are United States trade or business income received by a foreign
corporation may, under certain circumstances, be subject to an additional
"branch profits tax" at a thirty (30%) percent rate (or such lower rate as may
be specified by an applicable income tax treaty).
Under current United States Treasury regulations, dividends paid to a
shareholder at an address in a foreign country are presumed to be paid to a
resident of such country for purposes of the withholding discussed above (unless
the payor has knowledge to the contrary) and, under the current interpretation
of United States Treasury regulations, for purposes of determining the
applicability of a tax treaty rate, unless an applicable tax treaty requires
some other method for determining a shareholder's residence. Under proposed
United States Treasury regulations not currently in effect, however, a Non-U.S.
Holder of Common Stock who wishes to claim the benefit of an applicable treaty
rate would be required to satisfy applicable certification and other
requirements, including the requirement generally to file Service Form W-8. The
proposed regulations, if adopted in their current form, generally would be
effective for payments made after December 31, 1997. Prospective investors
should consult their tax advisors concerning the potential adoption of the
proposed regulations and the effect that such regulations could have on an
investment in the Common Stock.
A Non-U.S. Holder of Common Stock eligible for a reduced rate of United
States withholding tax pursuant to a tax treaty or whose dividends have
otherwise been subjected to withholding in an amount which exceeds such Non-U.S.
Holder's United States federal income tax liability, may obtain a refund or
credit of any excess amounts withheld by filing an appropriate claim for refund
with the Service.
GAIN ON DISPOSITION OF COMMON STOCK
A Non-U.S. Holder generally will not be subject to United States federal
income tax with respect to gain recognized on a sale or other disposition of
Common Stock unless (i) the gain is effectively connected with a trade or
business of the Non-U.S. Holder in the United States or, if an applicable income
tax treaty so provides, attributable to a permanent establishment maintained by
the Non-U.S. Holder in the United States, (ii) in the case of a Non-U.S. Holder
who is a nonresident alien individual and holds the Common Stock as a capital
asset, such holder is present in the United States for 183 or more days in the
taxable year of the sale or other disposition and certain other conditions are
met, (iii) the Non-U.S. Holder is subject to tax pursuant to provisions of
United States tax law that apply to certain expatriates, or (iv) under certain
circumstances if the Company is or has been during certain time periods a "U.S.
real property holding corporation" for United States federal income tax purposes
and, if the Common Stock is "regularly traded on an established securities
market," the Non-U.S. Holder held, directly or indirectly, during certain time
periods more than 5% of the Common Stock. The Company believes that it has not
been, is not currently and is not likely to become, a "U.S. real property
holding corporation."
If an individual Non-U.S. Holder falls under clause (i) above, he will be
taxed on his net gain derived from the sale under regular graduated United
States federal income tax rates. If the individual falls under clause (ii)
above, he will be subject to a flat thirty (30%) percent tax on his United
States source capital gains for the taxable year which may be offset by United
States source capital losses for such year (notwithstanding the fact that he is
not considered a resident of the United States). Thus, Non-U.S. Holders who
spend 183 days or more in the United States in the taxable year in which they
contemplate the sale of the Common Stock are urged to consult their tax advisors
as to the tax consequences of such sale.
If the Non-U.S. Holder that is a foreign corporation falls under clause (i)
above, it will be taxed on its gain on a net income basis at applicable
graduated corporate rates and, in addition, may be subject to the branch profits
tax equal to thirty (30%) percent of its "effectively connected earnings and
profits" within the meaning of the Code for the taxable year, as adjusted for
certain items, unless it qualifies for a lower rate under an applicable income
tax treaty.
18
<PAGE>
FEDERAL ESTATE TAXES
Common Stock that is owned, or treated as owned, by an individual who is not
a citizen or resident (as specifically determined under residence rules for
United States federal estate tax purposes) of the United States at the time of
death or that has been the subject of certain lifetime transfers will be
included in such holder's gross estate for United States federal estate tax
purposes, unless an applicable estate tax treaty provides otherwise.
U.S. INFORMATION REPORTING REQUIREMENTS AND BACKUP WITHHOLDING
The Company must report annually to the Service and to each Non-U.S. Holder
the amount of dividends paid to such Non-U.S. Holder and any tax withheld with
respect to such dividends. These information reporting requirements apply
regardless of whether withholding is required. Copies of the information returns
reporting such dividends and withholding may also be made available under the
provisions of an applicable treaty or agreement, to the tax authorities in the
country in which the Non-U.S. Holder resides.
United States backup withholding tax (which generally is a withholding tax
imposed at the rate of thirty-one (31%) percent on certain payments to persons
that fail to furnish certain information under the United States information
reporting requirements) generally will not apply to dividends paid on Common
Stock to a Non-U.S. Holder at an address outside the United States. Dividends
paid to a Non-U.S. Holder at an address within the United States may be subject
to information reporting and backup withholding if the Non-U.S. Holder fails to
establish that it is entitled to an exemption or to provide a correct taxpayer
identification number and certain other information to the Company.
The payment of proceeds from the disposition of Common Stock to or through a
United States office of a broker will be subject to information reporting and
backup withholding unless the owner, under penalties of perjury, certifies,
among other things, its status as a Non-U.S. Holder or otherwise establishes an
exemption. The payment of proceeds from the disposition of Common Stock to or
through a non-U.S. office of a non-U.S. broker generally will not be subject to
backup withholding and information reporting except as noted below. In the case
of proceeds from the disposition of Common Stock paid to or through a non-U.S.
office of a broker that is (i) a United States person, (ii) a "controlled
foreign corporation" for United States federal income tax purposes or (iii) a
foreign person 50% or more of whose gross income (from all sources) from certain
periods is effectively connected with a United States trade or business,
information reporting (but not backup withholding) will apply unless the broker
has documentary evidence in its files that the owner is a Non-U.S. Holder (and
the broker has no actual knowledge to the contrary).
Backup withholding is not an additional tax. Any amounts withheld under the
backup withholding rules from a payment to a Non-U.S. Holder will be allowed as
a refund or as a credit against such Non-U.S. Holder's United States federal
income tax liability, provided that the required information is furnished to the
Service.
These rules are under review by the United States Treasury, and their
application to the Common Stock could be changed by future regulations.
THE FOREGOING DISCUSSION IS INCLUDED FOR GENERAL INFORMATION ONLY.
ACCORDINGLY, EACH PROSPECTIVE PURCHASER IS URGED TO CONSULT WITH HIS TAX ADVISOR
WITH RESPECT TO THE UNITED STATES FEDERAL INCOME TAX AND FEDERAL ESTATE TAX
CONSEQUENCES OF THE OWNERSHIP AND DISPOSITION OF COMMON STOCK, INCLUDING THE
APPLICATION AND EFFECT OF THE LAWS OF ANY STATE, LOCAL, FOREIGN, OR OTHER TAXING
JURISDICTION.
19
<PAGE>
UNDERWRITING
Merrill Lynch, Pierce, Fenner & Smith Incorporated ("Merrill Lynch"), Bear,
Stearns & Co. Inc. and Goldman, Sachs & Co. are acting as representatives (the
"U.S. Representatives") of each of the Underwriters named below (the "U.S.
Underwriters"). Subject to the terms and conditions set forth in a U.S. purchase
agreement (the "U.S. Purchase Agreement") among the Company, the Selling
Shareholder and the U.S. Underwriters, and concurrently with the sale of 900,000
shares of Common Stock to the International Managers (as defined below), the
Selling Shareholder has agreed to sell to the U.S. Underwriters, and each of the
U.S. Underwriters severally has agreed to purchase from the Selling Shareholder,
the number of shares of Common Stock set forth opposite its name below.
<TABLE>
<CAPTION>
NUMBER OF
U.S. UNDERWRITERS SHARES
-----------
<S> <C>
Merrill Lynch, Pierce, Fenner & Smith
Incorporated..........................................
Bear, Stearns & Co. Inc.........................................
Goldman, Sachs & Co.............................................
-----------
Total................................................. 3,600,000
-----------
-----------
</TABLE>
The Company and the Selling Shareholder have also entered into an
international purchase agreement (the "International Purchase Agreement") with
certain underwriters outside the United States and Canada (the "International
Managers" and, together with the U.S. Underwriters, the "Underwriters") for whom
Merrill Lynch International, Bear, Stearns International Limited and Goldman
Sachs International are acting as lead managers (the "Lead Managers"). Subject
to the terms and conditions set forth in the International Purchase Agreement,
and concurrently with the sale of 3,600,000 shares of Common Stock to the U.S.
Underwriters pursuant to the U.S. Purchase Agreement, the Selling Shareholder
has agreed to sell to the International Managers, and the International Managers
severally have agreed to purchase from the Selling Shareholder, an aggregate of
900,000 shares of Common Stock. The initial public offering price per share and
the total underwriting discount per share of Common Stock are identical under
the U.S. Purchase Agreement and the International Purchase Agreement.
In the U.S. Purchase Agreement and the International Purchase Agreement, the
several U.S. Underwriters and the several International Managers, respectively,
have agreed, subject to the terms and conditions set forth therein, to purchase
all of the shares of Common Stock being sold pursuant to each such agreement if
any of the shares of Common Stock being sold pursuant to such agreement are
purchased. Under certain circumstances, under the U.S. Purchase Agreement and
the International Purchase Agreement, the commitments of non-defaulting
Underwriters may be increased. The closings with respect to the sale of shares
of Common Stock to be purchased by the U.S. Underwriters and the International
Managers are conditioned upon one another.
The U.S. Representatives have advised the Company and the Selling
Shareholder that the U.S. Underwriters propose initially to offer the shares of
Common Stock to the public at the initial public offering price set forth on the
cover page of this Prospectus, and to certain dealers at such price less a
concession not in excess of $ per share of Common Stock. The U.S. Underwriters
may allow, and such dealers may reallow, a discount not in excess of $ per
share of Common Stock on sales to certain other dealers. After the initial
public offering, the public offering price, concession and discount may be
changed.
The Selling Shareholder has granted an option to the U.S. Underwriters,
exercisable for 30 days after the date of this Prospectus, to purchase up to an
aggregate of 540,000 additional shares of Common Stock at the initial public
offering price set forth on the cover page of this Prospectus, less the
underwriting
20
<PAGE>
discount. The U.S. Underwriters may exercise this option only to cover
over-allotments, if any, made on the sale of the Common Stock offered hereby. To
the extent that the U.S. Underwriters exercise these options, each U.S.
Underwriter will be obligated, subject to certain conditions, to purchase a
number of additional shares of Common Stock proportionate to such U.S.
Underwriter's initial amount reflected in the foregoing table. The Selling
Shareholder also has granted an option to the International Managers,
exercisable for 30 days after the date of this Prospectus, to purchase up to an
aggregate of 135,000 additional shares of Common Stock to cover over-allotments,
if any, on terms similar to those granted to the U.S. Underwriters.
The Company, its executive officers and directors, including the Selling
Shareholder, have agreed, subject to certain exceptions, not to directly or
indirectly (i) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant for the sale of or otherwise dispose of or transfer any shares
of Common Stock or securities convertible into or exchangeable or exercisable
for Common Stock, whether now owned or thereafter acquired by the person
executing the agreement or with respect to which the person executing the
agreement thereafter acquires the power of disposition, or file a registration
statement under the Securities Act with respect to the foregoing or (ii) enter
into any swap or other agreement that transfers, in whole or in part, the
economic consequence of ownership of the Common Stock whether any such swap or
transaction is to be settled by delivery of Common Stock or other securities, in
cash or otherwise, without the prior written consent of Merrill Lynch on behalf
of the Underwriters for a period of 90 days after the date of this Prospectus,
in the case of the Selling Shareholder, or 30 days after the date of this
Prospectus, in the case of the other executive officers and directors of the
Company. See "Shares Eligible for Future Sale."
The U.S. Underwriters and the International Managers have entered into an
intersyndicate agreement (the "Intersyndicate Agreement") that provides for the
coordination of their activities. Pursuant to the Intersyndicate Agreement, the
U.S. Underwriters and the International Managers are permitted to sell shares of
Common Stock to each other for purposes of resale at the initial public offering
price, less an amount not greater than the selling concession. Under the terms
of the Intersyndicate Agreement, the U.S. Underwriters and any dealer to whom
they sell shares of Common Stock will not offer to sell or sell shares of Common
Stock to persons who are non-U.S. or non-Canadian persons or to persons they
believe intend to resell to persons who are non-U.S. or non-Canadian persons,
and the International Managers and any dealer to whom they sell shares of Common
Stock will not offer to sell or sell shares of Common Stock to U.S. persons or
to Canadian persons or to persons they believe intend to resell to U.S. or
Canadian persons, except in the case of transactions pursuant to the
Intersyndicate Agreement.
The Company and the Selling Shareholder have agreed to indemnify the U.S.
Underwriters and the International Managers against certain liabilities,
including certain liabilities under the Securities Act, or to contribute to
payments the U.S. Underwriters and International Managers may be required to
make in respect thereof.
Until the distribution of the Common Stock is completed, rules of the
Securities and Exchange Commission may limit the ability of the Underwriters and
certain selling group members to bid for and purchase the Common Stock. As an
exception to these rules, the U.S. Representatives are permitted to engage in
certain transactions that stabilize the price of the Common Stock. Such
transactions consist of bids or purchases for the purpose of pegging, fixing or
maintaining the price of the Common Stock.
If the Underwriters create a short position in the Common Stock in
connection with the Offerings, i.e., if they sell more shares of Common Stock
than are set forth on the cover page of this Prospectus, the U.S.
Representatives may reduce that short position by purchasing Common Stock in the
open market. The U.S. Representatives may also elect to reduce any short
position by exercising all or part of the over-allotment option described above.
The U.S. Representatives may also impose a penalty bid on certain
Underwriters and selling group members. This means if the U.S. Representatives
purchase shares of Common Stock in the open market to
21
<PAGE>
reduce the Underwriters' short position or to stabilize the price of the Common
Stock, they may reclaim the amount of the selling concession from the
Underwriters and selling group members who sold those shares as part of the
Offerings.
In general, purchases of a security for the purpose of stabilization or to
reduce a short position could cause the price of the security to be higher than
it might be in the absence of such purchases. The imposition of a penalty bid
might also have an effect on the price of the Common Stock to the extent that it
were to discourage resales of the Common Stock.
Neither the Company, the Selling Shareholder nor any of the Underwriters
makes any representation or prediction as to the direction or magnitude of any
effect that the transactions described above may have on the price of the Common
Stock. In addition, neither the Company, the Selling Shareholder nor any of the
Underwriters makes any representation that the U.S. Representatives will engage
in such transactions
or that such transactions, once commenced, will not be discontinued without
notice.
Merrill Lynch has from time to time provided investment banking financial
advisory services to the Company, for which it has received customary
compensation, and may continue to do so in the future.
LEGAL MATTERS
Certain legal matters in connection with the Common Stock offered hereby
will be passed upon for the Company by Phillips Nizer Benjamin Krim & Ballon
LLP, 666 Fifth Avenue, New York, New York 10103. Phillips Nizer Benjamin Krim &
Ballon LLP will rely upon Mesirov Gelman Jaffe Cramer &
Jamieson, 1735 Market Street, Philadelphia, Pennsylvania, with respect to
certain matters concerning Pennsylvania law. Herbert J. Goodfriend, Vice
Chairman of the Company, is of counsel to Phillips Nizer Benjamin Krim & Ballon
LLP. Certain legal matters relating to the Offerings will be passed upon for the
Underwriters by Willkie Farr & Gallagher, 153 East 53rd Street, New York, New
York 10022.
EXPERTS
The financial statements and schedule of the Company incorporated by
reference in this Prospectus have been audited by BDO Seidman, LLP, independent
certified public accountants, to the extent and for the periods set forth in
their reports incorporated herein by reference, and are incorporated by
reference herein in reliance upon such reports given upon the authority of said
firm as experts in accounting and auditing.
22
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Exchange
Act, and in accordance therewith files reports and other information with the
Securities and Exchange Commission (the "Commission"). Reports, proxy statements
and other information concerning the Company can be inspected and copied at the
public reference room maintained by the Commission at 450 Fifth Street, N.W.,
Room 1024, Washington, D.C. 20549. In addition, upon request such reports, proxy
statements and other information will be made available for inspection and
copying at the Commission's public reference facilities at the Northwestern
Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661 and
at Seven World Trade Center, 13th Floor, New York, New York 10048. Copies of
such material can be obtained at prescribed rates upon request from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549. Such material may also be accessed electronically at the Commission's
site on the World Wide Web located at http:\\www.sec.gov. The Company's Common
Stock is listed on the New York Stock Exchange, and reports, proxy statements
and other information concerning the Company may be inspected and copied at the
offices of the New York Stock Exchange, 20 Broad Street, New York, New York
10005.
The Company has filed with the Securities and Exchange Commission,
Washington, D.C., a Registration Statement on Form S-3 under the Securities Act
with respect to the Common Stock offered hereby. For further information about
the Company and the securities offered hereby, reference is made to the
Registration Statement and to the financial statements, schedules and exhibits
filed as a part hereof. Statements contained in this Prospectus as to the
contents of any contract or any other document are not necessarily complete, and
in each instance, reference is made to the copy of such contract or document
filed as an exhibit to the Registration Statement, each such statement being
qualified in all respects by such reference. The Registration Statement,
including exhibits thereto, may be inspected without charge at the Commission's
principal office in Washington, D.C. and copies of all or any part thereof may
be obtained from such office after payment of the fees prescribed by the
Commission.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company hereby incorporates by reference in this Prospectus (i) the
Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1996
(the "1996 Form 10-K"), (ii) the Company's Quarterly Reports on form 10-Q for
the fiscal quarters ended March 30, 1997 (the First Quarter Form 10-Q") and June
29, 1997 (the "Second Quarter Form 10-Q" and, together with the First Quarter
Form 10-Q, the "1997 Form 10-Qs"); and (iii) the description of the Company's
Common Stock contained in the Company's Registration Statement on form 8-A,
dated April 5, 1991, including any amendments filed for the purpose of updated
such description. All documents filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus
and prior to the termination of this Offering shall be deemed incorporated by
reference into this Prospectus from the date of filing of such documents. Any
statement contained herein or in a document, all or a portion of which is
incorporated or deemed to be incorporated by reference herein, shall be deemed
to be modified or superseded for purposes of this Prospectus to the extent that
a statement contain herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Prospectus. The Company will provide without charge to each person, including
any beneficial owner, to whom this Prospectus is delivered, upon the request of
such person, a copy of the foregoing documents incorporated herein by reference,
other than exhibits to such documents (unless such exhibits are incorporated by
reference in such document). Requests shall be directed to Jones Apparel Group,
Inc., 250 Rittenhouse Circle, Keystone Park, Bristol, Pennsylvania 19007; Attn:
Wesley R. Card.
23
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
No dealer, salesperson or other individual has been authorized to give any
information or to make any representations not contained in this Prospectus in
connection with the offering covered by this Prospectus. If given or made, such
information or representations must not be relied upon as having been authorized
by the Company, the Selling Shareholder or the Underwriters. This Prospectus
does not constitute an offer to sell, or a solicitation of an offer to buy, the
Common Stock in any jurisdiction where, or to any person to whom, it is unlawful
to make such offer or solicitation. Neither the delivery of this Prospectus nor
any sale made hereunder shall, under any circumstances, create any implication
that there has not been any change in the facts set forth in this Prospectus or
in the affairs of the Company since the date hereof.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
---------
<S> <C>
The Company.................................... 3
The Offerings.................................. 5
Selected Financial Information................. 6
Risk Factors................................... 8
Capitalization................................. 11
Use of Proceeds................................ 11
Price Range of Common Stock.................... 12
Dividend Policy................................ 12
Management..................................... 13
Selling Shareholder............................ 16
Shares Eligible for Future Sale................ 16
Certain United States Federal Tax Consequences
to Non-U.S. Holders of Common Stock.......... 17
Underwriting................................... 20
Legal Matters.................................. 22
Experts........................................ 22
Available Information.......................... 23
Incorporation of Documents
by Reference................................. 23
</TABLE>
4,500,000 SHARES
JONES APPAREL
GROUP, INC.
COMMON STOCK
------------------------
PROSPECTUS
------------------------
MERRILL LYNCH & CO.
BEAR, STEARNS & CO. INC.
GOLDMAN, SACHS & CO.
, 1997
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
ALTERNATE PAGE TO INTERNATIONAL PROSPECTUS
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED SEPTEMBER 30, 1997
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
<PAGE>
PROSPECTUS
4,500,000 SHARES
JONES APPAREL GROUP, INC.
COMMON STOCK
-----------
All of the shares of Common Stock of the Company offered hereby are being
sold by a Selling Shareholder of the Company. The Company is not selling shares
of Common Stock in the Offerings and will not receive any of the proceeds from
the sale of shares of Common Stock offered hereby.Of the 4,500,000 shares of
Common Stock being offered, 900,000 shares are being offered for sale initially
outside the United States and Canada by the International Managers and 3,600,000
shares are being offered for sale initially in a concurrent offering in the
United States and Canada by the U.S. Underwriters. The initial public offering
price and the aggregate underwriting discount per share will be identical for
both Offerings. See "Underwriting."
The Common Stock is listed on the New York Stock Exchange under the symbol
"JNY." On September 29, 1997, the last sale price of the Common Stock as
reported on the New York Stock Exchange was $53 1/16 per share. See "Price Range
of Common Stock."
SEE "RISK FACTORS," BEGINNING ON PAGE 8, FOR A DISCUSSION OF CERTAIN FACTORS
THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK OFFERED
HEREBY.
---------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<TABLE>
<CAPTION>
PROCEEDS TO
PRICE TO UNDERWRITING SELLING
PUBLIC DISCOUNT(1) SHAREHOLDER(2)
<S> <C> <C> <C>
Per Share............................................... $ $ $
Total(3)................................................ $ $ $
</TABLE>
(1) The Company and the Selling Shareholder have agreed to indemnify the several
Underwriters against certain liabilities, including certain liabilities
under the Securities Act of 1933, as amended. See "Underwriting."
(2) Before deducting expenses payable by the Selling Shareholder estimated at
$340,000.
(3) The Selling Shareholder has granted the International Managers and the U.S.
Underwriters options to purchase up to an additional 135,000 shares and
540,000 shares of Common Stock, respectively, in each case exercisable
within 30 days after the date hereof, solely to cover over-allotments, if
any. If such options are exercised in full, the total Price to Public,
Underwriting Discount and Proceeds to Selling Shareholder will be $
, $ and $ , respectively. See "Underwriting."
----------------
The shares of Common Stock are offered by the several Underwriters, subject
to prior sale, when, as and if issued to and accepted by them, subject to
approval of certain legal matters by counsel for the Underwriters and certain
other conditions. The Underwriters reserve the right to withdraw, cancel or
modify such offer and to reject orders in whole or in part. It is expected that
delivery of the shares of Common Stock will be made in New York, New York on or
about , 1997.
----------------
MERRILL LYNCH INTERNATIONAL
BEAR, STEARNS INTERNATIONAL LIMITED
GOLDMAN SACHS INTERNATIONAL
----------------
The date of this Prospectus is , 1997.
<PAGE>
ALTERNATE PAGE TO INTERNATIONAL PROSPECTUS
UNDERWRITING
Merrill Lynch International, Bear, Stearns International Limited and Goldman
Sachs International are acting as lead managers (the "Lead Managers") for each
of the International Managers named below (the "International Managers").
Subject to the terms and conditions set forth in an international purchase
agreement (the "International Purchase Agreement") among the Company, the
Selling Shareholder and the International Managers, and concurrently with the
sale of 3,600,000 shares of Common Stock to the U.S. Underwriters (as defined
below), the Selling Shareholder has agreed to sell to the International
Managers, and each of the International Managers severally has agreed to
purchase from the Selling Shareholder the number of shares of Common Stock set
forth opposite its name below.
<TABLE>
<CAPTION>
NUMBER OF
INTERNATIONAL MANAGERS SHARES
-----------
<S> <C>
Merrill Lynch International.....................................
Bear, Stearns International Limited.............................
Goldman Sachs International.....................................
-----------
Total................................................. 900,000
-----------
-----------
</TABLE>
The Company and the Selling Shareholder have also entered into a U.S.
purchase agreement (the "U.S. Purchase Agreement") with certain underwriters in
the United States and Canada (the "U.S. Underwriters" and, together with the
International Managers, the "Underwriters") for whom Merrill Lynch, Pierce,
Fenner & Smith Incorporated ("Merrill Lynch"), Bear, Stearns & Co. Inc. and
Goldman, Sachs & Co. are acting as representatives (the "U.S. Representatives").
Subject to the terms and conditions set forth in the U.S. Purchase Agreement,
and concurrently with the sale of 900,000 shares of Common Stock to the
International Managers pursuant to the International Purchase Agreement, the
Selling Shareholder has agreed to sell to the U.S. Underwriters, and the U.S.
Underwriters severally have agreed to purchase from the Selling Shareholder, an
aggregate of 3,600,000 shares of Common Stock. The initial public offering price
per share and the total underwriting discount per share of Common Stock are
identical under the International Purchase Agreement and the U.S. Purchase
Agreement.
In the International Purchase Agreement and the U.S. Pursuant Agreement, the
several International Managers and the several U.S. Underwriters, respectively,
have agreed, subject to the terms and conditions set forth therein, to purchase
all of the shares of Common Stock being sold pursuant to each such agreement if
any of the shares of Common Stock being sold pursuant to such agreement are
purchased. Under certain circumstances, under the U.S. Purchase Agreement and
the International Purchase Agreement, the commitments of non-defaulting
Underwriters may be increased. The closings with respect to the sale of shares
of Common Stock to be purchased by the International Managers and the U.S.
Underwriters are conditioned upon one another.
The Lead Managers have advised the Company and the Selling Shareholder that
the International Managers propose initially to offer the shares of Common Stock
to the Public at the initial public offering price set forth on the cover page
of this Prospectus, and to certain dealers at such price less a concession not
in excess of $ per share of Common Stock. The International Managers may
allow, and such dealers may reallow, a discount not in excess of $ per share
of Common Stock on sales to certain other dealers. After the initial public
offering, the public offering price, concession and discount may be changed.
The Selling Shareholder has granted an option to the International Managers,
exercisable for 30 days after the date of this Prospectus, to purchase up to an
aggregate of 135,000 additional shares of Common Stock at the initial public
offering price set forth on the cover page of this Prospectus, less the
underwriting
X-2
<PAGE>
ALTERNATE PAGE TO INTERNATIONAL PROSPECTUS
discount. The International Managers may exercise this option solely to cover
over-allotments, if any, made on the sale of the Common Stock offered hereby. To
the extent that the International Managers exercise this option, each
International Manager will be obligated, subject to certain conditions, to
purchase a number of additional shares of Common Stock proportionate to such
International Manager's initial amount reflected in the foregoing table. The
Selling Shareholder has also granted an option to the U.S. Underwriters,
exercisable for 30 days after the date of this Prospectus, to purchase up to an
aggregate of 540,000 additional shares of Common Stock to cover over-allotments,
if any, on terms similar to those granted to the International Managers.
The Company, and its executive officers and directors, including the Selling
Shareholder, have agreed, subject to certain exceptions, not to directly or
indirectly (i) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant for the sale of or otherwise dispose of or transfer any shares
of Common Stock or securities convertible into or exchangeable or exercisable
for Common Stock, whether now owned or thereafter acquired by the person
executing the agreement or with respect to which the person executing the
agreement thereafter acquires the power of disposition, or file a registration
statement under the Securities Act with respect to the foregoing or (ii) enter
into any swap or other agreement that transfers, in whole or in part, the
economic consequence of ownership of the Common Stock whether any such swap or
transaction is to be settled by delivery of Common Stock or other securities, in
cash or otherwise, without the prior written consent of Merrill Lynch on behalf
of the Underwriters for a period of 90 days after the date of this Prospectus,
in the case of the Selling Shareholder, or 30 days after the date of this
Prospectus, in the case of the other executive officers and directors of the
Company. See "Shares Eligible for Future Sale."
The International Managers and the U.S. Underwriters have entered into an
intersyndicate agreement (the "Intersyndicate Agreement") that provides for the
coordination of their activities. Pursuant to the Intersyndicate Agreement, the
International Managers and the U.S. Underwriters are permitted to sell shares of
Common Stock to each other for purposes of resale at the initial public offering
price, less an amount not greater than the selling concession. Under the terms
of the Intersyndicate Agreement, the U.S. Underwriters and any dealer to whom
they sell shares of Common Stock will not offer to sell or sell shares of Common
Stock to persons who are non-U.S. or non-Canadian persons or to persons they
believe intend to resell to persons who are non-U.S. or non-Canadian persons,
and the International Managers and any dealer to whom they sell shares of Common
Stock will not offer to sell or sell shares Common Stock to U.S. persons or to
Canadian persons or to persons they believe intend to resell to U.S. or Canadian
persons, except in the case of transactions pursuant to the Intersyndicate
Agreement.
The Company and the Selling Shareholder have agreed to indemnify the
International Managers and the U.S. Underwriters against certain liabilities,
including certain liabilities under the Securities Act, or to contribute to
payments the U.S. Underwriters and International Managers may be required to
make in respect thereof.
Until the distribution of the Common Stock is completed, rules of the
Securities and Exchange Commission may limit the ability of the Underwriters and
certain selling group members to bid for and purchase the Common Stock. As an
exception to these rules, the U.S. Representatives are permitted to engage in
certain transactions that stabilize the price of the Common Stock. Such
transactions consist of bids of purchases for the purpose of pegging, fixing or
maintaining the price of the Common Stock.
If the Underwriters create a short position in the Common Stock in
connection with the Offerings, i.e., if they sell more shares of Common Stock
than are set forth on the cover page of this Prospectus, the U.S.
Representatives may reduce that short position by purchasing Common Stock in the
open market. The U.S. Representatives may also elect to reduce any short
position by exercising all or part of the over-allotment option described above.
X-3
<PAGE>
ALTERNATE PAGE TO INTERNATIONAL PROSPECTUS
The U.S. Representatives may also impose a penalty bid on certain
Underwriters and selling group members. This means that if the U.S.
Representatives purchase shares of Common Stock in the open market to reduce the
Underwriters' short position or to stabilize the price of the Common Stock, they
may reclaim the amount of the selling concession from the Underwriters and
selling group members who sold those shares as part of the Offerings.
In general, purchases of a security for the purpose of stabilization or to
reduce a short position could cause the price of the security to be higher than
it might be in the absence of such purchases. The imposition of a penalty bid
might also have an effect on the price of a the Common Stock to the extent that
it were to discourage resales of the Common Stock.
Neither the Company nor any of the Underwriters makes any representation or
prediction as to the direction or magnitude of any effect that the transactions
described above may have on the price of the Common Stock. In addition, neither
the Company nor any of the Underwriters makes any representation that the U.S.
Representatives will engage in such transactions or that such transactions, once
commenced, will not be discontinued without notice.
Merrill Lynch has from time to time provided investment banking financial
advisory services to the Company, for which it has received customary
compensation, and may continue to do so in the future.
Each International Managers has agreed that (i) it has not offered or sold
and, prior to the expiration of the period of six months from the Closing Date,
will not offer or sell any shares of Common Stock to persons in the United
Kingdom, except to persons whose ordinary activities involve them in acquiring,
holding, managing or disposing of investments (as principal or agent) for the
purposes of their businesses or otherwise in circumstances which do not
constitute an offer to the public in the United Kingdom within the meaning of
the Public Offers of Securities Regulations 1995; (ii) it has complied and will
comply with all applicable provisions of the Financial Services Act 1986 with
respect to anything done by it in relation to the Common Stock in, from or
otherwise involving the United Kingdom; and (iii) it has only issued or passed
on and will only issue or pass on in the United Kingdom any document received by
it in connection with the issuance of Common Stock to a person who is of a kind
described in Article 11(3) of the Financial Services Act 1986 (Investment
Advertisements) (Exemptions) Order 1996 or is a person to whom such document may
otherwise lawfully be issued or pass on.
No action has been or will be taken in any jurisdiction (except in the
United States) that would permit a public offering of the shares of Common
Stock, or the possession, circulation or distribution of this Prospectus or any
other material relating to the Company, the Selling Shareholder or shares of
Common Stock in any jurisdiction where action for that purpose is required.
Accordingly, the shares of Common Stock may not be offered or sold, directly or
indirectly, and neither this Prospectus nor any other offering material or
advertisements in connection with the shares of Common Stock may be distributed
or published, in or from any country or jurisdiction except in compliance with
any applicable rules and regulations of any such country or jurisdiction.
Purchasers of the shares offered hereby may be required to pay stamp taxes
and other charges in accordance with the laws and practices of the country of
purchase in addition to the offering price set forth on the cover page hereof.
X-4
<PAGE>
ALTERNATE PAGE TO INTERNATIONAL PROSPECTUS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
No dealer, salesperson or other individual has been authorized to give any
information or to make any representations not contained in this Prospectus in
connection with the offering covered by this Prospectus. If given or made, such
information or representations must not be relied upon as having been authorized
by the Company, the Selling Shareholder or the Underwriters. This Prospectus
does not constitute an offer to sell, or a solicitation of an offer to buy, the
Common Stock in any jurisdiction where, or to any person to whom, it is unlawful
to make such offer or solicitation. Neither the delivery of this Prospectus nor
any sale made hereunder shall, under any circumstances, create any implication
that there has not been any change in the facts set forth in this Prospectus or
in the affairs of the Company since the date hereof.
In the Prospectus, reference to "dollars" and "$" are to United States
dollars.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
---------
<S> <C>
The Company.................................... 3
The Offerings.................................. 5
Selected Financial Information................. 6
Risk Factors................................... 8
Capitalization................................. 11
Use of Proceeds................................ 11
Price Range of Common Stock.................... 12
Dividend Policy................................ 12
Management..................................... 13
Selling Shareholder............................ 16
Shares Eligible for Future Sale................ 16
Certain United States Federal Tax Consequences
to Non-U.S. Holders of Common Stock.......... 17
Underwriting................................... 20
Legal Matters.................................. 22
Experts........................................ 22
Available Information.......................... 23
Incorporation of Documents
by Reference................................. 23
</TABLE>
4,500,000 SHARES
JONES APPAREL
GROUP, INC.
COMMON STOCK
------------------------
PROSPECTUS
------------------------
MERRILL LYNCH INTERNATIONAL
BEAR, STEARNS INTERNATIONAL LIMITED
GOLDMAN SACHS INTERNATIONAL
, 1997
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
<S> <C>
Filing Fee-Securities Exchange Commission......................... $ 85,800
NASD Fee.......................................................... 28,817
Accounting Fees and Expenses...................................... 50,000
Legal Fees and Expenses........................................... 50,000
Blue Sky Fees and Expenses........................................ 10,000
Printing Fees and Expenses........................................ 100,000
Transfer Agent and Registrar's Fee................................ 2,500
Miscellaneous Expenses............................................ 12,883
---------
Total..................................................... $ 340,000
---------
---------
</TABLE>
All expenses other than the Securities and Exchange Commission and NASD
filing fees are estimated. All expenses will be borne by the Selling
Shareholder.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
As permitted by the Pennsylvania Business Corporation Law, Section 8.1 of
the Company's By-laws provides that a director of the Company shall not be
personally liable for monetary damages for any action taken or failed to be
taken, other than as expressly provided in the Pennsylvania Business Corporation
Law. Furthermore, Section 8.2 of the Company's By-laws provides that the Company
shall indemnify each officer and director to the full extent permitted by the
Pennsylvania Business Corporation Law, and shall pay and advance expenses for
any matters covered by such indemnification.
Section 1741 of the Pennsylvania Business Corporation Law provides that the
Company shall have the power to indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
proceeding, whether civil, criminal, administrative or investigative (other than
an action by or in the right of the corporation), by reason of the fact that he
is or was a representative of the corporation, or is or was serving at the
request of the corporation as a representative of another domestic or foreign
corporation for profit or not-for-profit, partnership, joint venture, trust or
other enterprise, against expenses (including attorney's fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by him in
connection with the action or proceeding if he acted in good faith and in a
manner he reasonably believed to be in, or not opposed to, the best interests of
the corporation and, with respect to any criminal proceeding, had no reasonable
cause to believe his conduct was unlawful. The termination of any action or
proceeding by judgment, order, settlement or conviction or upon a plea of nolo
contendere or its equivalent shall not of itself create a presumption that the
person did not act in good faith and in a manner that he reasonably believed to
be in, or not opposed to, the best interests of the corporation and, with
respect to any criminal proceeding, had reasonable cause to believe that his
conduct was unlawful.
Section 1742 of the Pennsylvania Business Corporation Law provides that the
Company shall have the power to indemnify any person who was or is a party, or
is threatened to be made a party, to any threatened, pending or completed action
by or in the right of the corporation to procure a judgment in its favor by
reason of the fact that he is or was a representative of the corporation or is
or was serving at the request of the corporation as a representative of another
domestic or foreign corporation for profit or not-for-profit, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection with the defense or
settlement of the action if he acted in good faith and in a manner he reasonably
believed to be in, or not opposed to, the best interests of
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<PAGE>
the corporation. Indemnification shall not be made under this section in respect
of any claim, issue or matter as to which the person has been adjudged to be
liable to the corporation unless and only to the extent that the court of common
pleas of the judicial district embracing the county in which the registered
office of the corporation is located or the court in which the action was
brought determined upon application that, despite the adjudication of liability
but in view of all the circumstances of the case, the person is fairly and
reasonably entitled to indemnity for the expenses that the court of common pleas
or other court deems proper.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULE.
(a) Exhibits
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ------------- -----------------------------------------------------------------------------------------------------
<C> <S>
1.1+ Form of U.S. Purchase Agreement
1.2+ Form of International Purchase Agreement
5+ Opinion of Mesirov Gelman Jaffe Cramer & Jamieson.
23.1* Consent of BDO Seidman, LLP.
23.2+ Consent of Mesirov Gelman Jaffe Cramer & Jamieson (included as part of Exhibit 5).
23.3+ Consent of Phillips Nizer Benjamin Krim & Ballon LLP.
24* Power of Attorney (included in Part II of this Registration Statement).
</TABLE>
- ------------------------
* Previously filed.
+ To be filed by amendment.
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the Act;
(ii) To reflect in the Prospectus any facts or events arising after the
effective date of this Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this
Registration Statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or any
material change to such information in this registration statement;
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) above do not apply if
the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the Registrant
pursuant to Section 13 or 15(d) of the Exchange Act by reference in this
Registration Statement.
(2) That, for the purpose of determining any liability under the Act, each
such post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial BONA FIDE offering thereof.
(3) To remove from registration by means of post-effective amendment any of
the securities being registered which remain unsold at the termination of the
offering.
(4) That, for purposes of determining any liability under the Act, each
filing of the Registrant's annual report pursuant to Section 13(a) or 15(d) of
the Exchange Act (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated
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<PAGE>
by reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial BONA
FIDE offering thereof.
(5) Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
(6) That, for purposes of determining any liability under the Securities Act
of 1933, each filing of the registrant's annual report pursuant to section 13(a)
or section 15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to section
15(d) of the Securities Exchange Act of 1934) that is incorporated by reference
in the registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial BONA FIDE offering thereof.
(7) (i) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective; and
(ii) For the purpose of determining any liability under the Securities
Act of 1933,each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial BONA FIDE offering thereof.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant certifies
that it has reasonable grounds to believe that it meets all of the requirements
for filing on Form S-3 and has duly caused this Amendment to the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of New York, State of New York on the 30th day of
September, 1997.
JONES APPAREL GROUP, INC.
By: *
------------------------------------------
Sidney Kimmel, Chairman
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<PAGE>
Pursuant to the requirements of the Securities Act, this Amendment to the
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------------------------------ --------------------------------- ----------------------
<C> <S> <C>
*
------------------------------------------- Chairman and Director (Chief September 30, 1997
(Sidney Kimmel) Executive Officer)
*
------------------------------------------- Chief Financial Officer September 30, 1997
(Wesley R. Card) (Principal Financial Officer)
*
------------------------------------------- Controller (Principal Accounting September 30, 1997
(Gary R. Klocek) Officer)
*
------------------------------------------- Vice Chairman and Director September 30, 1997
(Herbert J. Goodfriend)
*
------------------------------------------- Executive Vice President, September 30, 1997
(Irwin Samelman) Marketing, and Director
*
------------------------------------------- Director September 30, 1997
(Geraldine Stutz)
*
------------------------------------------- Director September 30, 1997
(Howard Gittis)
*By: /s/
--------------------------------------
Ira Dansky
Attorney-in-Fact
</TABLE>
- ------------------------
* Executed pursuant to a power of attorney contained in the Registration
Statement.
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