As filed with the Securities and Exchange Commission on December 9, 1998
Registration Statement No. 333-_____
- --------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------
FORM S-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------------------
JONES APPAREL GROUP, INC.
(Exact name of Registrant as specified in its charter)
---------------------------
Pennsylvania 2330 06-0935166
(State or other jurisdiction (Primary standard industrial (I.R.S. Employer
of incorporation or classification code number) Identification No.)
organization)
250 Rittenhouse Circle
Bristol, PA 19007
(215) 785-4000
(Address, including zip code, and
telephone number, including
area code, of Registrant's
principal executive offices
---------------------------
Ira M. Dansky, Esq.
Jones Apparel Group, Inc.
1411 Broadway
New York, NY 10018
(212) 536-9526
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
---------------------------
Copy to:
Philip J. Boeckman, Esq.
Cravath, Swaine & Moore
825 Eighth Avenue
New York, NY 10019
(212) 474-1000
---------------------------
Approximate date of commencement of proposed sale to public: As soon
as practicable after this Registration Statement becomes effective.
If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance
with General Instruction G, 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 of 1933, 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 of 1933, please check the following box and
list the Securities Act registration statement number of the earlier
effective registration statement for the same offering: / /
---------------------------
<TABLE>
CALCULATION OF REGISTRATION FEE
<CAPTION>
========================================================================================
Title of Each Class Proposed Maximum Proposed Maximum Amount of
of Securities to be Amount to be Offering Price Aggregate Offering Registration
Registered Registered Per Unit(1) Price(1) Fee(2)
- ----------------------------------------------------------------------------------------
<C> <S> <S> <S> <S>
6.25% Senior
Notes due 2001 $265,000,000 100% $265,000,000 $73,670
========================================================================================
</TABLE>
(1) Estimated solely for the purposes of computing the registration fee
pursuant to Rule 457(f)(2) under the Securities Act of 1933.
(2) Calculated by multiplying the aggregate offering amount by .000278.
---------------------------
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 that specifically states that
this Registration Statement shall thereafter become effective in accordance
with Section 8(a) of the Securities Act of 1933 or until the Registration
Statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
<PAGE>
The information in this Prospectus is not complete and may be changed. We
may not sell these securities until the registration statement filed with
the Securities and Exchange Commission relating to these securities is
effective. This Prospectus is not an offer to sell these securities and it
is not soliciting an offer to buy these securities in any state where the
offer or sale is not permitted.
---------------------------
Prospectus Subject to Completion
December 9, 1998
$265,000,000
Jones Apparel Group, Inc.
Offer to Exchange
6.25% Senior Notes due 2001
for any and all outstanding 6.25% Senior Notes due 2001
---------------------------
Summary of the Exchange Offer
This Prospectus (and accompanying Letter of Transmittal) relates to our
proposed offer to exchange up to $265,000,000 aggregate principal amount of
new 6.25% Senior Notes due 2001 (the "Exchange Notes"), which will be
freely transferable, for any and all outstanding 6.25% Senior Notes due
2001 issued in a private offering on October 2, 1998 (the "Restricted
Notes"), which have certain transfer restrictions.
o The Exchange Offer expires 5:00 p.m., New York City time, on [ ],
1999, unless extended.
o The terms of the Exchange Notes are substantially identical to
the terms of the Restricted Notes, except that the Exchange Notes
will be freely transferable and issued free of any covenants
regarding exchange and registration rights.
o All Restricted Notes that are validly tendered and not validly
withdrawn will be exchanged.
o Tenders of Restricted Notes may be withdrawn at any time prior to
expiration of the Exchange Offer.
o We will not receive any proceeds from the Exchange Offer.
o The exchange of Restricted Notes for Exchange Notes should not be
a taxable event for United States Federal income tax purposes.
o Holders of Restricted Notes do not have any appraisal or
dissenters' rights in connection with the Exchange Offer.
Restricted Notes not exchanged in the Exchange Offer will remain
outstanding and be entitled to the benefits of the Indenture, but
except under certain circumstances will have no further exchange
or registration rights under the Exchange and Registration Rights
Agreement.
o "Affiliates" of the Company (within the meaning of the Securities
Act) may not participate in the Exchange Offer.
o All broker-dealers must comply with the registration and
prospectus delivery requirements of the Securities Act. See "Plan
of Distribution" beginning on page 37.
o The Company does not intend to apply for listing of the Exchange
Notes on any securities exchange or to arrange for them to be
quoted on any quotation system.
---------------------------
Please see "Risk Factors" beginning on page 5 for a discussion of certain
factors you should consider in connection with the Exchange Offer .
---------------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of the Exchange Notes or determined
if this Prospectus is truthful or complete. Any representation to the
contrary is a criminal offense.
We may amend or supplement this Prospectus from time to time by filing
amendments or supplements as required. You should read this entire
Prospectus (and accompanying Letter of Transmittal and related documents)
and any amendments or supplements carefully before making your investment
decision.
---------------------------
Our principal executive offices are located at 250 Rittenhouse Circle,
Bristol, Pennsylvania 19007.
Our telephone number is (215) 785-4000.
The date of this Prospectus is [ ].
<PAGE>
TABLE OF CONTENTS
Page
Where You Can Find More Information...................... 2
The Company.............................................. 3
Forward-Looking Statements............................... 5
Risk Factors............................................. 5
Ratios of Earnings to Fixed Charges...................... 10
Exchange Offer........................................... 11
Description of Notes..................................... 22
Certain United States Federal Income Tax Considerations.. 33
Book-Entry; Delivery and Form............................ 34
Plan of Distribution..................................... 37
Legal Matters............................................ 38
Experts.................................................. 38
---------------------------
As used in this Prospectus, unless the context requires otherwise, (1)
"We" or "Jones" or the "Company" means Jones Apparel Group, Inc. and its
predecessors and consolidated subsidiaries, (2) "Sun" means Sun Apparel,
Inc. and its consolidated subsidiaries and (3) "Notes" means both the
Restricted Notes and the Exchange Notes. Italicized terms in this
Prospectus indicate trademarks or other protected intellectual property
which Jones and Sun own or license.
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
In connection with the Exchange Offer, we have filed with the
Securities and Exchange Commission ("SEC") a Registration Statement under
the Securities Act of 1933 (the "Securities Act"), relating to the Exchange
Notes to be issued in the Exchange Offer. As permitted by SEC rules, this
Prospectus omits certain information included in the Registration
Statement. For a more complete understanding of the Exchange Offer, you
should refer to the Registration Statement, including its exhibits.
We also file annual, quarterly and special reports, proxy
statements and other information with the SEC. You may read and copy the
Registration Statement and any other document we file at the SEC's public
reference room at 450 Fifth Street, N.W., Washington, D.C. 20549. These
documents are also available at the public reference rooms at the SEC's
regional offices in New York, New York and Chicago, Illinois. Please call
the SEC at 1-800-SEC-0330 for further information on the public reference
rooms. Our SEC filings are also available to the public at the SEC's web
site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" the information
we file with them, which means that we can disclose important information
to you by referring you to those documents. These incorporated documents
contain important business and financial information about us that is not
included in or delivered with this Prospectus. The information incorporated
by reference is considered to be part of this Prospectus, and later
information filed with the SEC will update and supersede this information.
We incorporate by reference the documents listed below and any future
filings made with the SEC under Section 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 (the "Exchange Act") prior to [ ], the date
the Exchange Offer expires.
o Annual Report on Form 10-K for the year ended December 31,
1997;
o Quarterly Reports on Form 10-Q for the quarters ended March
29, 1998, June 28, 1998 and September 27, 1998; and
o Current Reports on Form 8-K dated September 24, 1998 and
October 2, 1998.
These filings are available without charge to holders of
Restricted Notes. You may request a copy of these filings by writing or
telephoning us at the following address:
Chief Financial Officer
Jones Apparel Group, Inc.
250 Rittenhouse Circle
Bristol, Pennsylvania 19007
(215) 785-4000
To obtain timely delivery of any copies of filings requested from
us, please write or telephone us no later than [ ] , 1999 [five business
days prior to the expiration of the Exchange Offer].
<PAGE>
THE COMPANY
General
Jones is a leading designer, marketer, manufacturer and
distributor of career and casual sportswear, jeanswear and related apparel
for men, women and children. Jones markets its products under several
nationally known brands, including Jones New York, Evan-Picone and Rena
Rowan, and various licensed brands, the most prominent of which are Lauren
by Ralph Lauren and Polo Jeans Company. Through its Sun subsidiary, Jones
also manufactures and distributes certain product lines under various
private label brands.
Recent Transactions
The Acquisition. On October 2, 1998, Jones consummated its
acquisition (the "Acquisition") of Sun Apparel, Inc., pursuant to an
Agreement and Plan of Merger entered into on September 10, 1998 with Sun
and its shareholders. In the Acquisition, Jones indirectly purchased all
the shares of Sun for a total purchase price of $137.8 million in cash and
approximately 4.4 million shares of Jones' Common Stock, plus potential
future payments based on Sun's operating performance. Jones also assumed or
refinanced $228.5 million of Sun debt.
Offering of Restricted Notes. On October 2, 1998, Jones issued
$265.0 million aggregate principal amount of the Restricted Notes in a
private offering exempt from the registration requirements of the
Securities Act. The Restricted Notes were issued pursuant to an Indenture
dated October 2, 1998 between Jones and The Chase Manhattan Bank, as
trustee. The Restricted Notes are unsecured senior obligations of Jones,
ranking equally in right of payment with all existing and future unsecured
senior debt of Jones and senior in right of payment to all future
subordinated debt of Jones.
Jones received net proceeds of approximately $263.5 million from
the issuance of the Restricted Notes. Jones used the net proceeds from the
sale of the Restricted Notes, together with borrowings under the Senior
Credit Facilities (defined below), to finance the Acquisition, to refinance
existing indebtedness of Sun, to pay related expenses and for general
corporate purposes, including working capital and stock repurchases.
Senior Credit Facilities. Concurrently with the issuance of the
Restricted Notes, Jones entered into $550.0 million aggregate principal
amount of unsecured revolving and term loan credit facilities (the "Senior
Credit Facilities") with a syndicate of banks led by First Union National
Bank.
Proposed Reorganization
Prior to the commencement of the Exchange Offer, Jones may
consummate a corporate reorganization (the "Asset Drop-Down Transaction").
Under the Asset Drop-Down Transaction, Jones would transfer all operations
now directly conducted by Jones to a new wholly owned subsidiary to be
incorporated under the laws of Pennsylvania (the "Successor Operating
Company"). In addition, under the Asset Drop-Down Transaction, another new
wholly owned subsidiary ("Holdco"), would be incorporated under the laws of
Delaware. Holdco would serve as an intermediate holding company,
immediately above the Successor Operating Company and immediately below
Jones, and would hold the interests in all but two of Jones' existing
subsidiaries.
<PAGE>
As a result of the Asset Drop-Down Transaction:
o Jones would be the parent holding company and hold 100% of
the equity in Holdco;
o Holdco would be an intermediate holding company and the only
direct subsidiary of Jones;
o Holdco would hold 100% of the equity in the Successor
Operating Company; and
o Jones' existing subsidiaries would become subsidiaries of
Holdco (except for two subsidiaries incorporated under the
laws of Mexico, which would become subsidiaries of the
Successor Operating Company).
Upon consummation of the Asset Drop-Down Transaction and pursuant
to the terms of the Indenture, the Successor Operating Company would
succeed to the obligations of Jones with respect to the Indenture and the
Restricted Notes and, after the Exchange Offer, the Exchange Notes, and
each of Jones and Holdco would execute full and unconditional guarantees
(the "Guarantees") in respect of such obligations. The Successor Operating
Company would also succeed to the obligations of Jones under the Senior
Credit Facilities, and each of Jones and Holdco would execute full and
unconditional guarantees in respect of such obligations.
If Jones proceeds with the Asset Drop-Down Transaction, we will
file a pre-effective amendment to the Registration Statement that relates
to this Prospectus to record the succession of the Successor Operating
Company as the issuer of the Exchange Notes and the addition of Jones and
Holdco as guarantors thereof.
In the event that, at the time of the Asset Drop-Down
Transaction, the operations being transferred by Jones to the Successor
Operating Company represent less than substantially all of Jones' assets,
Jones would remain, and each of Holdco and the Successor Operating Company
would become, an obligor in respect of the Indenture and the Restricted
Notes and, after the Exchange Offer, the Exchange Notes, and Jones would
file a pre-effective amendment to the Registration Statement that relates
to this Prospectus to reflect such additional registrants. Under these
circumstances, a corresponding change would also be made to the Senior
Credit Facilities, with Jones remaining as an obligor, and Holdco and the
Successor Operating Company becoming additional obligors.
Jones currently anticipates that, if it proceeds with the Asset
Drop-Down Transaction, it would consummate such reorganization on or about
January 1, 1999. There can be no assurance that Jones will proceed with the
Asset Drop-Down Transaction.
<PAGE>
FORWARD-LOOKING STATEMENTS
This Prospectus includes and incorporates by reference
"forward-looking statements" within the meaning of the securities laws. All
statements regarding our expected financial position, business and
financing plans are forward-looking statements. Forward-looking statements
also include representations of our 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 our products
within the prevailing retail environment, customer acceptance of both new
designs and newly-introduced product lines, financial difficulties
encountered by customers and the integration of Sun's business with Jones'
existing operations. Although we believe that the expectations reflected in
such forward-looking statements are reasonable, such expectations may prove
to be incorrect. Important factors that could cause actual results to
differ materially from such expectations ("cautionary statements") are
disclosed in this Prospectus, in conjunction with the forward-looking
statements included in this Prospectus and under "Risk Factors." All
subsequent written and oral forward-looking statements attributable to us
or persons acting on our behalf are expressly qualified in their entirety
by the cautionary statements.
RISK FACTORS
You should consider carefully all the information included or
incorporated by reference in this Prospectus and, in particular, should
evaluate the following risks in connection with the Exchange Offer.
Competition; Changes in Fashion Trends
The apparel industry is highly competitive. Competition in this
industry takes many forms, including the following:
o establishing and maintaining favorable brand recognition; o
developing products sought by consumers;
o implementing appropriate pricing;
o providing strong marketing support; and
o obtaining access to retail outlets and sufficient floor
space.
There is intense competition in the sectors of the apparel
industry in which Jones and Sun participate. Jones and Sun each compete
with many other manufacturers, some of which are larger and have greater
resources. Any increased competition could result in reduced sales or
prices, or both, which could have a material adverse effect on Jones.
Additionally, customer tastes and fashion trends can change rapidly. Jones
may not be able to anticipate, gauge or respond to such changes in a timely
manner. If Jones misjudges the market for its products or product groups,
it may be faced with a significant amount of unsold finished goods
inventory, which could have a material adverse effect on Jones.
<PAGE>
Concentration of Customers
Jones' ten largest customers (typically department stores)
accounted for approximately 67% of sales in 1997 and 69% of its sales in
the first nine months of 1998. Sun's ten largest customers accounted for
48% of its sales in 1997 and 48% of its sales in the first nine months of
1998. While no single department or specialty store accounted for more than
10% of net sales for either Jones or Sun, certain of Jones' and Sun's
customers are under common ownership. Department stores owned by the
following entities accounted for the following percentages of Jones' sales:
Jones Customer 1997 First Nine Months of 1998
-------------- ---- -------------------------
Federated Department Stores Inc. 20% 18%
May Department Store Company 19% 17%
Remainder of ten largest customers 28% 34%
Department stores owned by the following entities accounted for
the following percentages of Sun's sales:
Sun Customer 1997 First Nine Months of 1998
------------ ---- -------------------------
Federated Department Stores, Inc. 13% 8%
Remainder of ten largest customers 35% 48%
We believe that purchasing decisions are generally made
independently by individual department stores within a commonly-controlled
group. There has been a trend, however, toward more centralized purchasing
decisions. As such decisions become more centralized, the risk to Jones of
such concentration increases. The loss of any of Jones' or Sun's largest
customers, or the bankruptcy or material financial difficulty of any
customer or any of the companies above, could have a material adverse
effect on Jones. Jones and Sun do not have long-term contracts with any of
their customers, and sales to customers generally occur on an
order-by-order basis. As a result, customers can terminate their
relationships with Jones or Sun at any time or under certain circumstances
cancel or delay orders.
Significant Dependence on License Agreements with Polo Ralph Lauren Corporation
The termination or non-renewal of Jones' and Sun's exclusive
licenses to manufacture and market clothing under the Lauren by Ralph
Lauren and Polo Jeans Company trademarks in the United States and elsewhere
would have a material adverse effect on Jones. Jones' Lauren by Ralph
Lauren line, and Sun's Polo Jeans business represent material portions of
each company's sales and profits. Jones and Sun sell products bearing those
trademarks under exclusive licenses from affiliates of Polo Ralph Lauren
Corporation. On a pro forma basis, net sales by Jones and Sun of products
bearing these trademarks would have been 27.1% of the consolidated entity's
total net sales for the year ended December 31, 1997 and 33.5% of the
consolidated entity's total net sales for the nine-month period ended
September 27, 1998. In addition, Jones has announced that it will introduce
for Fall 1999 a line of sportswear directed to younger women under the
trademark Ralph by Ralph Lauren, under an additional exclusive license from
Polo Ralph Lauren.
The Lauren by Ralph Lauren license expires on December 31, 2001,
subject to Jones' right to renew through December 31, 2006 if sales of that
product line for the year 2000 exceed a specified level. Although such
sales in 1997 and 1998 exceeded the renewal minimum, Jones' sales are made
season-to- season, with customers having no obligation to buy products
beyond what they have already ordered for a particular season.
The initial term of the Polo Jeans license expires on December
31, 2000 and may be renewed by Sun in five-year increments for up to 30
additional years, if certain minimum sales levels in certain years are met.
Although Sun's Polo Jeans sales in 1997 exceeded the renewal minimum which
would be required in 1999 to extend the term of the license through
December 31, 2005, Sun's sales are made season-to-season, with customers
having no obligation to buy products beyond what they have already
<PAGE>
ordered. In addition, renewal of the Polo Jeans license after 2010 requires
a one-time payment by Sun of $25 million or, at Sun's option, a transfer of
a 20% interest in its Polo Jeans business to Polo Ralph Lauren (with no
fees required for subsequent renewals). Polo Ralph Lauren also has an
option, exercisable on or before June 1, 2010, to purchase the Polo Jeans
business at the end of 2010 for 80% of the then fair value of the business
as a going concern, assuming the continuation of the Polo Jeans license
through December 31, 2030, payable in cash.
In addition to the provisions described above, both licenses (and
the Ralph by Ralph Lauren license) contain provisions common to trademark
licenses which could result in termination of a license, such as failure to
meet payment or advertising obligations.
Cyclicality of Apparel Industry; Seasonality
Negative economic trends over which Jones has no control that
depress the level of consumer spending could have a material adverse effect
on Jones. Purchases of apparel and related goods often decline during
recessionary periods when disposable income is low. In such an environment,
Jones and Sun may increase the number of promotional sales which could
further adversely impact Jones' gross profit margins. Additionally, Jones's
sales and profit levels fluctuate significantly by quarter, resulting
primarily from the timing of shipments for each season; Jones principally
ships spring merchandise in the first quarter and fall merchandise in the
third quarter. An increase in sales of jeans and casual apparel, which Sun
sells, generally occurs during the third and fourth quarter. Accordingly,
Jones' operating results will fluctuate from quarter to quarter.
Acquisition Risks
To realize the profit potential of the Acquisition, Jones will
need to successfully integrate Sun's business into its existing operations.
To do so, Jones may need to implement enhanced operational, distribution,
financial and information systems and may require additional employees and
management, operational and financial resources. The Acquisition is Jones'
first acquisition of another company. Jones may not be able to integrate
Sun's operations into its existing operations without significant expense
or interruption to its existing business. Jones also may not achieve
revenue growth or operational synergies in integrating jeanswear or other
product lines presently offered by Sun. Jones may also not be able to
retain important Sun employees. The acquisition of Sun, and any future
acquisition which Jones may pursue, involves certain special risks,
including:
o initial reductions in Jones' reported operating results;
o diversion of management's attention;
o unanticipated problems or legal liabilities; and
o possible reduction in reported earnings due to amortization
of acquired intangible assets.
Some or all the above items could have a material adverse effect
on Jones. Sun or any other acquired company may not achieve sales and
profitability in the future that justifies Jones' investment therein.
Foreign Operations and Manufacturing
In 1997, approximately 70% of Jones' products were manufactured
outside the United States, primarily in Asia, while the remainder were
manufactured in the United States and Mexico. Substantially all of Sun's
jeanswear assembly and most of its finishing occur in Mexico. Sun also
plans to shift cutting and portions of its other operations from the United
States to Mexico. The following may adversely affect foreign operations:
o political instability in countries where contractors and
suppliers are located;
o imposition of regulations and quotas relating to imports;
o imposition of duties, taxes and other charges on imports;
o significant fluctuation of the value of the dollar against
foreign currencies; and
o restrictions on the transfer of funds to or from foreign
countries.
<PAGE>
As a result of its substantial foreign operations, Jones'
domestic business (including the domestic business of Sun) is subject to
the following risks:
o quotas imposed by bilateral textile agreements between the
United States and certain foreign countries;
o reduced manufacturing flexibility because of geographic
distance between Jones and its foreign manufacturers,
increasing the risk that Jones may have to mark down unsold
inventory as a result of misjudging the market for a
foreign-made product; and
o violations by foreign contractors of labor and wage
standards and resulting adverse publicity.
Fluctuating Price and Availability of Raw Materials
Fluctuations in the price, availability and quality of the
fabrics or other raw materials used by Jones and Sun in their manufactured
apparel could have a material adverse effect on the Company's cost of sales
or its ability to meet its customers' demands. Jones and Sun mainly use
cotton twill, wool, denim and synthetic and blended fabrics. The prices for
such fabrics depend largely on the market prices for the raw materials used
to produced them, particularly cotton. The price and availability of such
raw materials and, in turn, the fabrics used in Jones' and Sun's apparel
may fluctuate significantly, depending on many factors, including crop
yields and weather patterns. Sun generally enters into denim purchase order
contracts at specified prices for three to six months at a time. Higher
cotton prices would directly affect Jones' and Sun's costs and earnings.
Jones may not be able to pass all or a portion of such higher prices on to
its customers.
Reliance on Independent Manufacturers
Jones relies upon independent third parties for the manufacture
of most of its products. Sun relies on independent third parties for the
manufacture of some of its products. A manufacturer's failure to ship
products in a timely manner or to meet the required quality standards could
cause Jones or Sun to miss the delivery date requirements of their
customers for those items. The failure to make timely deliveries may drive
customers to cancel orders, refuse to accept deliveries or demand reduced
prices, any of which could have a material adverse effect on Jones'
business. Jones and Sun do not have long-term written agreements with any
of their third party manufacturers. As a result, any of these manufacturers
may unilaterally terminate their relationships with Jones or Sun at any
time.
Dependence upon Key Personnel
The success of Jones depends upon the personal efforts and
abilities of Sidney Kimmel (Chairman), Jackwyn Nemerov (President), Irwin
Samelman (Executive Vice President, Marketing) and, with respect to Sun,
Eric Rothfeld (President of Sun) and Mindy Grossman (President and CEO of
Sun's Polo Jeans Company Division). Jones does not have employment
agreements with Mr. Kimmel, Ms. Nemerov and Mr. Samelman. If any of these
individuals become unable or unwilling to continue in their present
positions, Jones' business and financial results could be materially
adversely affected.
Increased Leverage
Following the Acquisition, Jones is substantially more leveraged
on a consolidated basis than it has historically been, as a result of
borrowings incurred to finance the Acquisition. On a pro forma basis, Jones
would have had $538.2 million of long-term debt (including the Notes)
outstanding as of September 27, 1998, compared to $48.2 million of
long-term debt on an historical basis. Historically, Jones has operated
with almost no leverage, and has not been subject to any type of materially
restrictive covenants. Certain covenants contained in the Indenture and in
the Senior Credit Facilities, as well as the increased leverage, may reduce
Jones' flexibility in responding to adverse changes in economic, business
or market conditions. The financial covenants and other restrictions
contained in the Senior Credit Facilities will require Jones to meet
certain financial tests and will restrict its ability to, among other
things, borrow additional funds, make certain investments, dispose of
assets and make material amendments to debt instruments, including the
Indenture. The additional leverage will also reduce funds available for
operations, capital expenditures, acquisitions and future business
opportunities.
<PAGE>
Risk of Year 2000 Non-Compliance
Certain functions in various types of technology used by Jones
and Sun are designed to use only two digits to identify a year. Therefore,
these programs may fail or create erroneous results on or before January 1,
2000 if not corrected. Jones and Sun have assessed and are updating their
own systems to insure that they are Year 2000 compliant. Jones and Sun
anticipate substantial completion of this process by early 1999. Jones and
Sun may not be able, however, to complete these plans in time.
Additionally, vendors, customers and other third parties with which Jones
and Sun do business may not make their systems Year 2000 compliant. Jones'
and Sun's business and results of operations could suffer if either of them
or such third parties fail to make necessary technological adjustments.
For a more complete discussion of Year 2000 issues, please refer
to "Management's Discussion and Analysis of Financial Condition and Results
of Operations" in the documents incorporated by reference in this
Prospectus.
Consequences of a Failure to Exchange Restricted Notes
The Company issued the Restricted Notes in a private offering
exempt from the registration requirements of the Securities Act. Therefore,
holders of Restricted Notes may not offer, sell or otherwise transfer their
Restricted Notes except in compliance with the registration requirements of
the Securities Act and applicable state securities laws or pursuant to
exceptions from, or in transactions not subject to, such registration
requirements. Holders of Restricted Notes who do not exchange their
Restricted Notes for Exchange Notes in the Exchange Offer will continue to
be subject to these transfer restrictions after the completion of the
Exchange Offer. See "The Exchange Offer--Consequences of a Failure to
Exchange Restricted Notes."
In addition, after completion of the Exchange Offer, holders of
Restricted Notes who do not tender their Restricted Notes in the Exchange
Offer will no longer be entitled to any exchange or registration rights
under the Exchange and Registration Rights Agreement, except under limited
circumstances.
To the extent that Restricted Notes are tendered and accepted in
the Exchange Offer, the liquidity of the trading market for untendered
Restricted Notes could be adversely affected.
Absence of a Public Market
Although holders of Exchange Notes (who are not "affiliates" of
the Company within the meaning of the Securities Act) may resell or
otherwise transfer their Exchange Notes without compliance with the
registration requirements of the Securities Act, there is no existing
market for the Exchange Notes, and there can be no assurance as to the
liquidity of any markets that may develop for the Exchange Notes, the
ability of holders of Exchange Notes to sell their Exchange Notes or the
prices at which holders would be able to sell their Exchange Notes. Future
trading prices of the Exchange Notes will depend on many factors,
including, among other things, prevailing interest rates, Jones' operating
results and the market for similar securities.
The initial purchasers in the private offering have advised Jones
that they intend to make a market in the Exchange Notes after the Exchange
Offer. However, they are not obligated to do so, and any market-making may
be discontinued at any time without notice. In addition, such market-making
activity may be limited during the Exchange Offer.
Jones does not intend to apply for listing of the Exchange Notes
on any securities exchange or to arrange for them to be quoted on any
quotation system.
Accordingly, an active trading market for the Exchange Notes may
not develop, either before, during or after the consummation of the
Exchange Offer. The absence of an active trading market may have an adverse
affect on the market price and liquidity of the Exchange Notes.
<PAGE>
Exchange Offer Procedures
Each holder of Restricted Notes wishing to accept the Exchange
Offer must deliver the Letter of Transmittal, together with the Restricted
Notes to be exchanged and any other required documentation, to the Exchange
Agent, or effect a tender of Restricted Notes by book-entry transfer into
the Exchange Agent's account, in each case in compliance with the
instructions provided in "The Exchange Offer" section of this Prospectus
and in the Letter of Transmittal.
The method of delivery of Restricted Notes and the Letter of
Transmittal and all other required documentation is at the election and
risk of the holders of Restricted Notes. Although the Company intends to
notify tendering holders of any defects or irregularities with respect to
their tenders of Restricted Notes, neither the Company, the Exchange Agent
nor any other person shall be under any duty to give notification of
defects or irregularities with respect to tenders of Restricted Notes, nor
shall any of them incur any liability for failure to give such
notification. Tenders of Restricted Notes will not be deemed to have been
made until such irregularities have been cured or waived.
RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth the unaudited consolidated ratios
of earnings to fixed charges for Jones on a historical basis:
Nine Months Ended Year Ended December 31,
September 27, 1998 1997 1996 1995 1994 1993
------------------ ---- ---- ---- ---- ----
Ratio of Earnings
to Fixed Charges.... 19.4x 18.1x 14.4x 14.8x 18.7x 22.6x
We computed these ratios by dividing fixed charges into the sum
of earnings (after certain adjustments) and fixed charges. Earnings used in
computing the ratio of earnings to fixed charges consist of income before
income taxes and fixed charges excluding capitalized interest. Fixed
charges consist of interest expensed and capitalized, amortization of debt
expense and that portion of rental expense representative of interest.
<PAGE>
EXCHANGE OFFER
Purpose of the Exchange Offer
Jones initially sold the Restricted Notes in a private offering
on October 2, 1998 to Chase Securities Inc., Merrill Lynch, Pierce Fenner &
Smith Incorporated and Bear, Stearns & Co. Inc. (collectively, the "Initial
Purchasers") pursuant to a Purchase Agreement dated September 29, 1998
between Jones and the Initial Purchasers. The Initial Purchasers
subsequently resold the Restricted Notes to qualified institutional buyers
in reliance on, and subject to the restrictions imposed under, Rule 144A
under the Securities Act and outside the United States in accordance with
the provisions of Regulation S under the Securities Act.
In connection with the private offering of the Restricted Notes,
Jones and the Initial Purchasers entered into an Exchange and Registration
Rights Agreement dated October 2, 1998, in which Jones agreed, among other
things:
o to file with the SEC on or before December 31, 1998, a
registration statement relating to an exchange offer for the
Restricted Notes (the "Exchange Offer Registration
Statement");
o to use its reasonable best efforts to cause the Exchange
Offer Registration Statement to be declared effective under
the Securities Act on or before March 31, 1999;
o upon the effectiveness of the Exchange Offer Registration
Statement, to offer the holders of the Restricted Notes the
opportunity to exchange their Restricted Notes in the
Exchange Offer for a like principal amount of Exchange
Notes;
o to keep the Exchange Offer open for not less than 30 days
(or longer, if required by applicable law) after notice of
the Exchange Offer is mailed to holders of Restricted Notes;
and
o to use its reasonable best efforts to consummate the
Exchange Offer on or before April 30, 1999.
Jones also agreed, under certain circumstances:
o to use its reasonable best efforts to file a shelf
registration statement relating to the offer and sale of the
Restricted Notes by the holders of the Restricted Notes (a
"Shelf Registration Statement");
o to use its reasonable best efforts to cause such Shelf
Registration Statement to be declared effective; and
o to use its reasonable best efforts to keep such Shelf
Registration Statement effective until October 2, 2000 or
until the Restricted Notes covered by the Shelf Registration
Statement have been sold or until such Restricted Notes
become eligible for resale without volume restrictions
pursuant to Rule 144 under the Securities Act.
The Exchange Offer being made by this Prospectus is intended to
satisfy your exchange and registration rights under the Exchange and
Registration Rights Agreement. If the Company fails to fulfill such
registration and exchange obligations, you, as a holder of outstanding
Restricted Notes, are entitled to receive additional interest, at a rate of
0.25% per annum, determined daily, as liquidated damages for such default.
For a more complete understanding of your exchange and
registration rights, you should refer to the Exchange and Registration
Rights Agreement, which is included as Exhibit 4.1 to the Registration
Statement that relates to this Prospectus.
<PAGE>
Effect of the Exchange Offer
Based on certain no-action letters issued by the staff of the SEC
to third parties in unrelated transactions, the Company believes that you
may offer for resale, resell or otherwise transfer any Exchange Notes
issued to you in the Exchange Offer in exchange for Restricted Notes
without compliance with the registration and prospectus delivery
requirements of the Securities Act, if
o you are acquiring the Exchange Notes issued in the Exchange
Offer in the ordinary course of your business;
o you are not participating, do not intend to participate and
have no arrangement or understanding with any person to
participate, in a distribution of the Exchange Notes;
o you are not an "affiliate" of the Company (as defined in
Rule 405 under the Securities Act); and
o you are not an Initial Purchaser who acquired Restricted
Notes directly from the Company in the initial offering to
resell pursuant to Rule 144A, Regulation S or any other
available exemption under the Securities Act.
If you are an "affiliate" of the Company or an Initial Purchaser
or if you have any arrangement or understanding with any person to
participate in a distribution of the Exchange Notes :
o you will not be able to rely on the interpretations of the
staff of the SEC, in connection with any offer for resale,
resale or other transfer of Exchange Notes; and
o you must comply with the registration and prospectus
delivery requirements of the Securities Act, or have an
exemption available to you, in connection with any offer for
resale, resale or other transfer of the Exchange Notes.
In addition, we are not making this Exchange Offer to, nor will
we accept surrenders of Restricted Notes from holders of Restricted Notes
in any state in which this Exchange Offer would not comply with the
applicable securities laws or "blue sky" laws of such state.
Each broker-dealer that receives Exchange Notes for its own
account in exchange for Restricted Notes, where such Restricted Notes were
acquired by such broker-dealer as a result of market-making activities or
other trading activities, must acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Notes. See "Plan
of Distribution".
Use of Proceeds
The Company will not receive any cash proceeds from the issuance
of the Exchange Notes. As consideration for the Exchange Notes, the Company
will receive in exchange an equivalent principal amount of outstanding
Restricted Notes, the terms of which are substantially identical to the
terms of the Exchange Notes, except that the Exchange Notes will be freely
transferable and issued free of any covenants regarding exchange and
registration rights.
The Company will retire and cancel the Restricted Notes
surrendered in exchange for the Exchange Notes. Accordingly, the issuance
of the Exchange Notes under the Exchange Offer will not result in any
change in the outstanding aggregate indebtedness of the Company.
Terms of the Exchange Offer
Upon the terms and subject to the conditions set forth in this
Prospectus and in the accompanying Letter of Transmittal, the Company will
accept all Restricted Notes validly tendered and not withdrawn prior to
5:00 p.m. New York City time, on the Expiration Date (defined below in
"--Expiration Date; Extensions; Amendments"). After authentication of the
Exchange Notes by the Trustee or an authenticating agent, the Company will
issue and deliver $1,000 principal amount of Exchange Notes in exchange for
each $1,000
<PAGE>
principal amount of outstanding Restricted Notes accepted in the Exchange
Offer. Holders may tender some or all of their Restricted Notes pursuant to
the Exchange Offer in denominations of $1,000 and integral multiples
thereof.
By tendering Restricted Notes in exchange for Exchange Notes and
by executing the Letter of Transmittal, each holder of Restricted Notes
will be required to represent that, among other things:
o any Exchange Notes to be received by it will be acquired in
the ordinary course of its business;
o it has no arrangement or understanding with any person to
participate in the distribution of the Exchange Notes; and
o it is not an "affiliate" (as defined in Rule 405 under the
Securities Act) of the Company, or, if it is an affiliate,
that it will comply with the registration and prospectus
delivery requirements of the Securities Act to the extent
applicable.
Each broker-dealer that receives Exchange Notes for its own
account in exchange for Restricted Notes, where such Restricted Notes were
acquired by such broker-dealer as a result of market-making activities or
other trading activities, must acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Notes. See "Plan
of Distribution."
The form and terms of the Exchange Notes are identical in all
material respects to the form and terms of the outstanding Restricted
Notes, except that
o the offering of the Exchange Notes has been registered under
the Securities Act;
o the Exchange Notes will not be subject to transfer
restrictions; and
o the Exchange Notes will be issued free of any covenants
regarding exchange and registration rights.
The Exchange Notes will be issued under and entitled to the
benefits of the Indenture that governs the Restricted Notes.
As of the date of this Prospectus, $265.0 million aggregate
principal amount of the Restricted Notes is outstanding. In connection with
the issuance of the Restricted Notes, the Company arranged for the
Restricted Notes to be issued and transferable in book-entry form through
the facilities of The Depository Trust Company ("DTC"), acting as a
depositary. The Exchange Notes will also be issuable and transferable in
book-entry form through DTC.
This Prospectus, together with the accompanying Letter of
Transmittal, is initially being sent to all registered holders of
Restricted Notes as of the close of business on [ ], 1999. The Exchange
Offer is not conditioned upon any minimum aggregate principal amount of
Restricted Notes being tendered. However, the Exchange Offer is subject to
certain customary conditions which may be waived by the Company, and to the
terms and provisions of the Exchange and Registration Rights Agreement. See
"--Conditions to the Exchange Offer."
The Company shall be deemed to have accepted validly tendered
Restricted Notes when, as and if the Company has given oral or written
notice thereof to the Exchange Agent. See "--Exchange Agent." The Exchange
Agent will act as agent for the tendering holders of Restricted Notes for
the purpose of receiving Exchange Notes from the Company and delivering
Exchange Notes to such holders.
If any tendered Restricted Notes are not accepted for exchange
because of an invalid tender or the occurrence of certain other events set
forth herein, certificates for any such unaccepted Restricted Notes will be
returned, at the Company's cost, to the tendering holder thereof as
promptly as practicable after the Expiration Date.
<PAGE>
Holders who tender Restricted Notes in the Exchange Offer will
not be required to pay brokerage commissions or fees or, subject to the
instructions in the Letter of Transmittal, transfer taxes with respect to
the exchange of Restricted Notes pursuant to the Exchange Offer. The
Company will pay all charges and expenses, other than certain applicable
taxes, in connection with the Exchange Offer. See "--Solicitation of
Tenders, Fees and Expenses."
Expiration Date; Extensions; Amendments
The term "Expiration Date" shall mean 5:00 p.m., New York City
time, on [ ], 1999, unless the Company, in its sole discretion, extends the
Exchange Offer, in which case the term "Expiration Date" shall mean the
latest date to which the Exchange Offer is extended. The Company may extend
the Exchange Offer at any time and from time to time by giving oral or
written notice to the Exchange Agent and by timely public announcement.
The Company expressly reserves the right, in its sole discretion,
to amend the terms of the Exchange Offer in any manner. Without limiting
the generality of the foregoing, if any of the conditions set forth herein
under "--Termination" shall have occurred and shall not have been waived by
the Company (if permitted to be waived by the Company), the Company
expressly reserves the right, in its sole discretion, by giving oral or
written notice to the Exchange Agent, to:
o delay acceptance of, or refuse to accept, any Restricted
Notes not previously accepted;
o extend the Exchange Offer; or
o terminate the Exchange Offer.
Any such delay in acceptance, extension, termination or amendment will be
followed as promptly as practicable by oral or written notice thereof by
the Company to the registered holders of the Restricted Notes. If the
Exchange Offer is amended in a manner determined by the Company to
constitute a material change, the Company will promptly disclose such
amendment in a manner reasonably calculated to inform the holders of such
amendment and the Company will extend the Exchange Offer to the extent
required by law.
Without limiting the manner in which the Company may choose to
make public announcements of any delay in acceptance, extension,
termination or amendment of the Exchange Offer, the Company shall have no
obligation to publish, advise, or otherwise communicate any such public
announcement, other than by making a timely press release thereof.
Interest on the Exchange Notes
Interest on the Exchange Notes will accrue from the last interest
payment date on which interest was paid on the Restricted Notes surrendered
in exchange therefor or, if no interest has been paid on the Restricted
Notes, from October 2, 1998. The Exchange Notes will bear interest at a
rate of 6.25% per annum. Interest on the Exchange Notes will be payable
semi-annually on April 1 and October 1 of each year, beginning on April 1,
1999.
Procedures for Tendering
Each holder of Restricted Notes wishing to accept the Exchange
Offer must complete, sign and date the Letter of Transmittal, or a
facsimile thereof, in accordance with the instructions contained herein and
in the Letter of Transmittal, and mail or otherwise deliver such Letter of
Transmittal, or such facsimile, together with the Restricted Notes to be
exchanged and any other required documentation, to The Chase Manhattan
Bank, as Exchange Agent, at the address set forth herein and in the Letter
of Transmittal or effect a tender of Restricted Notes pursuant to the
procedures for book-entry transfer as provided for herein and in the Letter
of Transmittal.
By tendering Restricted Notes in exchange for Exchange Notes and
by executing the Letter of Transmittal, each holder of Restricted Notes
will represent to the Company that, among other things:
<PAGE>
o any Exchange Notes to be received by it will be acquired in
the ordinary course of its business;
o it has no arrangement or understanding with any person to
participate in the distribution of the Exchange Notes; and
o it is not an "affiliate" (as defined in Rule 405 under the
Securities Act) of the Company, or, if it is an affiliate,
that it will comply with the registration and prospectus
delivery requirements of the Securities Act to the extent
applicable.
Any financial institution that is a participant in DTC's system
may make book-entry delivery of the Restricted Notes by causing DTC to
transfer such Restricted Notes into the Exchange Agent's account in
accordance with DTC's procedure for such transfer. Although delivery of
Restricted Notes may be effected through book-entry transfer into the
Exchange Agent's account at DTC, the Letter of Transmittal (or facsimile
thereof), with any required signature guarantees and any other required
documents, must, in any case, be transmitted to and received by the
Exchange Agent at its address set forth herein under "--Exchange Agent"
prior to 5:00 p.m., New York City time, on the Expiration Date.
Delivery of documents to DTC in accordance with DTC's procedures
does NOT constitute delivery to the Exchange Agent.
Only a holder of Restricted Notes may tender its Restricted Notes
in the Exchange Offer. To tender in the Exchange Offer, a holder must
complete, sign and date the Letter of Transmittal or a facsimile thereof,
have the signatures thereon guaranteed if required by the Letter of
Transmittal, and mail or otherwise deliver such Letter of Transmittal or
such facsimile, together with the Restricted Notes (unless such tender is
being effected pursuant to the procedure for book-entry transfer) and other
required documents, to the Exchange Agent, prior to 5:00 p.m., New York
City time, on the Expiration Date.
The tender by a holder of Restricted Notes will constitute an
agreement between such holder, the Company and the Exchange Agent in
accordance with the terms and subject to the conditions set forth herein
and in the Letter of Transmittal. If less than all the Restricted Notes
held by a holder of Restricted Notes are tendered, a tendering holder
should fill in the amount of Restricted Notes being tendered in the
appropriate box on the Letter of Transmittal. The entire amount of
Restricted Notes delivered to the Exchange Agent will be deemed to have
been tendered unless otherwise indicated.
The Letter of Transmittal will include representations to the
Company that, among other things:
o any Exchange Notes to be received by it will be acquired in
the ordinary course of its business;
o it has no arrangement or understanding with any person to
participate in the distribution of the Exchange Notes; and
o it is not an "affiliate" (as defined in Rule 405 under the
Securities Act) of the Company, or, if it is an affiliate,
that it will comply with the registration and prospectus
delivery requirements of the Securities Act to the extent
applicable.
In the case of a broker-dealer that receives Exchange Notes for
its own account in exchange for Restricted Notes that were acquired by it
as a result of market-making or other trading activities, the Letter of
Transmittal will also include an acknowledgment that the broker-dealer will
deliver a copy of this Prospectus in connection with the resale by it of
Exchange Notes received pursuant to the Exchange Offer; however, by so
acknowledging and by delivering a Prospectus, such broker-dealer will not
be deemed to admit that it is an "underwriter" (within the meaning of the
Securities Act). See "Plan of Distribution."
The method of delivery of Restricted Notes and the Letter of
Transmittal and all other required documents to the Exchange Agent is at
the election and risk of the holders of Restricted Notes. Instead of
delivery by mail, it is recommended that holders of Restricted Notes use an
overnight or hand delivery
<PAGE>
service. In all cases, sufficient time should be allowed to ensure delivery
to the Exchange Agent prior to the Expiration Date. No Letter of
Transmittal or Restricted Notes should be sent to the Company.
Any beneficial owner whose Restricted Notes are registered in the
name of a broker, dealer, commercial bank, trust company or other nominee
and who wishes to tender Restricted Notes in the Exchange Offer should
contact such registered holder promptly and instruct such registered holder
to tender on such beneficial owner's behalf. If such beneficial owner
wishes to tender on its own behalf, such beneficial owner must, prior to
completing and executing the Letter of Transmittal and delivering its
Restricted Notes, either make appropriate arrangements to register
ownership of the Restricted Notes in such beneficial owner's own name or
obtain a properly completed bond power from the registered holder of such
Restricted Notes. This transfer of record ownership may take considerable
time.
Signatures on a Letter of Transmittal or a notice of withdrawal,
as the case may be, must be guaranteed by a member firm of a registered
national securities exchange or of the National Association of Securities
Dealers, Inc., a commercial bank or trust company having an office or
correspondent in the United States or an "eligible guarantor institution"
within the meaning of Rule 17Ad-15 under the Exchange Act (each, an
"Eligible Institution"), unless the Restricted Notes tendered pursuant
thereto are tendered
o by a registered holder who has not completed the box
entitled "Special Registration Instructions" or the box
entitled "Special Delivery Instructions" on the Letter of
Transmittal; or
o for the account of an Eligible Institution.
If the Letter of Transmittal is signed by a person other than the
registered holder listed therein, such Restricted Notes must be endorsed or
accompanied by appropriate bond powers which authorize such person to
tender the Restricted Notes on behalf of the registered holder thereof, in
either case signed as the name of the registered holder or holders appears
on the Restricted Notes. If the Letter of Transmittal or any Restricted
Notes or bond powers are signed or endorsed by trustees, executors,
administrators, guardians, attorneys-in-fact, officers or corporations or
others acting in a fiduciary or representative capacity, such persons
should so indicate when signing, and unless waived by the Company, submit
evidence satisfactory to the Company of their authority to so act with such
Letter of Transmittal.
All questions as to the validity, form, eligibility (including
time of receipt), acceptance and withdrawal of the tendered Restricted
Notes will be determined by the Company in its sole discretion, which
determination will be final and binding. The Company reserves the absolute
right to reject any and all Restricted Notes not properly tendered or any
Restricted Notes the Company's acceptance of which would, in the opinion of
counsel for the Company, be unlawful. The Company also reserves the
absolute right to waive any irregularities or conditions of tender as to
particular Restricted Notes. The Company's interpretation of the terms and
conditions of the Exchange Offer (including the instructions in the Letter
of Transmittal) will be final and binding on all parties. Unless waived,
any defects or irregularities in connection with tenders of Restricted
Notes must be cured within such time as the Company shall determine.
Although the Company intends to notify tendering holders of defects or
irregularities with respect to tenders of Restricted Notes, neither the
Company, the Exchange Agent nor any other person shall be under any duty to
give notification of defects or irregularities with respect to tenders of
Restricted Notes, nor shall any of them incur any liability for failure to
give such notification. Tenders of Restricted Notes will not be deemed to
have been made until such irregularities have been cured or waived. Any
Restricted Notes received by the Exchange Agent that the Company determines
are not properly tendered or the tender of which is otherwise rejected by
the Company and as to which the defects or irregularities have not been
cured or waived by the Company will be returned by the Exchange Agent to
the tendering holder unless otherwise provided in the Letter of
Transmittal, as soon as practicable following the Expiration Date.
<PAGE>
In addition, the Company reserves the right in its sole
discretion:
o to purchase or make offers for any Restricted Notes that
remain outstanding subsequent to the Expiration Date;
o to terminate the Exchange Offer, as set forth in
"--Termination"; and
o to the extent permitted by applicable law, to purchase
Restricted Notes in the open market, in privately negotiated
transactions or otherwise.
The terms of any such purchases or offers may differ from the terms of the
Exchange Offer.
Book-Entry Transfer
The Company understands that the Exchange Agent will make a
request promptly after the date of this Prospectus to establish accounts
with respect to the Restricted Notes at DTC for the purpose of facilitating
the Exchange Offer, and subject to the establishment of such accounts, any
financial institution that is a participant in DTC's system may make
book-entry delivery of Restricted Notes by causing DTC to transfer such
Restricted Notes into the Exchange Agent's account with respect to the
Restricted Notes in accordance with DTC's Automated Tender Offer Program
procedures for such transfer. However, the exchange for the Restricted
Notes so tendered will only be made after a timely confirmation of a
book-entry transfer of such Restricted Notes into the Exchange Agent's
account, and timely receipt by the Exchange Agent of an Agent's Message and
any other documents required by the Letter of Transmittal.
The term "Agent's Message" means a message, transmitted by DTC
and received by the Exchange Agent and forming part of the confirmation of
a book-entry transfer, which states that DTC has received an express
acknowledgment from a participant tendering Restricted Notes and that such
participant has received the Letter of Transmittal and agrees to be bound
by the terms of the Letter of Transmittal, and the Company may enforce such
agreement against the participant.
Although delivery of Restricted Notes may be effected through DTC
into the Exchange Agent's account at DTC, an appropriate Letter of
Transmittal properly completed and duly executed with any required
signature guarantee and all other required documents must in each case be
transmitted to and received or confirmed by the Exchange Agent at its
address set forth herein or in the Letter of Transmittal on or prior to the
Expiration Date, or, if the guaranteed delivery procedures described below
are complied with, within the time period provided under such procedures.
Delivery of documents to DTC without such confirmation or compliance does
not constitute delivery to the Exchange Agent.
Guaranteed Delivery Procedures
Holders who wish to tender their Restricted Notes and (1) whose
Restricted Notes are not immediately available, or (2) who cannot deliver
their Restricted Notes, the Letter of Transmittal or any other required
documents to the Exchange Agent prior to the Expiration Date, or (3) who
cannot complete the procedure for book-entry transfer on a timely basis,
may effect a tender if:
o the tender is made through an Eligible Institution;
o prior to the Expiration Date, the Exchange Agent receives
from such Eligible Institution a properly completed and duly
executed Notice of Guaranteed Delivery (by facsimile
transmittal, mail or hand delivery) setting forth the name
and address of the holder, the certificate number or numbers
of such holder's Restricted Notes and the principal amount
of such Restricted Notes tendered, stating that the tender
is being made thereby, and guaranteeing that, within three
business days after the Expiration Date, the Letter of
Transmittal (or facsimile thereof), together with the
certificate(s) representing the Restricted Notes to be
tendered in proper form for transfer (or confirmation of a
book-entry transfer into the Exchange Agent's account at DTC
of Restricted Notes delivered electronically) and any other
documents required by the Letter of Transmittal, will be
deposited by the Eligible Institution with the Exchange
Agent; and
<PAGE>
o such properly completed and executed Letter of Transmittal
(or facsimile thereof), together with the certificate(s)
representing all tendered Restricted Notes in proper form
for transfer (or confirmation of a book-entry transfer into
the Exchange Agent's account at DTC of Restricted Notes
delivered electronically) and all other documents required
by the Letter of Transmittal are received by the Exchange
Agent within three business days after the Expiration Date.
Upon request to the Exchange Agent, a Notice of Guaranteed
Delivery will be sent to holders who wish to tender their Restricted Notes
according to the guaranteed delivery procedures set forth above.
Withdrawal of Tenders
Except as otherwise provided herein, tenders of Restricted Notes
may be withdrawn at any time prior to 5:00 p.m. New York City time, on the
Expiration Date.
For a withdrawal to be effective, a written or facsimile
transmission notice of withdrawal must be received by the Exchange Agent at
its address set forth herein prior to 5:00 p.m., New York City time, on the
Expiration Date.
Any such notice of withdrawal must
o specify the name of the person having deposited the
Restricted Notes to be withdrawn (the "Depositor");
o identify the Restricted Notes to be withdrawn (including the
certificate number or number and principal amount of such
Restricted Notes or, in the case of Restricted Notes
transferred by book-entry transfer, the name and number of
the account at DTC to be credited);
o be signed by the Depositor in the same manner as the
original signature on the Letter of Transmittal by which
such Restricted Notes were tendered (including any required
signature guarantee) or be accompanied by documents of
transfer sufficient to permit the registrar to register the
transfer of such Restricted Notes into the name of the
Depositor withdrawing the tender; and
o specify the name in which any such Restricted Notes are to
be registered, if different from that of the Depositor.
All questions as to the validity, form and eligibility (including
time of receipt) of such withdrawal notices will be determined by the
Company, whose determination shall be final and binding on all parties. Any
Restricted Notes so withdrawn will be deemed not to have been validly
tendered for purposes of the Exchange Offer, and no Exchange Notes will be
issued with respect thereto unless the Restricted Notes so withdrawn are
validly retendered. Any Restricted Notes that have been tendered but are
not accepted for exchange will be returned to the holder thereof without
cost to such holder as soon as practicable after withdrawal, rejection of
tender or termination of the Exchange Offer. Properly withdrawn Restricted
Notes may be retendered by following one of the procedures described above
under "--Procedures for Tendering" at any time prior to the Expiration
Date.
Conditions to the Exchange Offer
Notwithstanding any other term of the Exchange Offer, the Company
will not be required to accept for exchange, or to exchange Exchange Notes
for, any Restricted Notes, and may terminate or amend the Exchange Offer
before the acceptance of such Restricted Notes if, in the Company's
judgment, any of the following conditions has occurred or exists or has not
been satisfied:
o the Exchange Offer, or the making of any exchange by a
holder of Restricted Notes, violates applicable
interpretations of the SEC staff;
<PAGE>
o any action or proceeding shall have been instituted or
threatened in any court or by or before any governmental
agency or body with respect to the Exchange Offer; or
o there has been adopted or enacted any law, statute, rule or
regulation that can reasonably be expected to impair the
ability of the Company to proceed with the Exchange Offer.
If the Company determines that it may terminate the Exchange
Offer for any of the reasons set forth above, the Company may (1) refuse to
accept any Restricted Notes and return any Restricted Notes that have been
tendered to the tendering holders, (2) extend the Exchange Offer and retain
all Restricted Notes tendered prior to the Expiration Date of the Exchange
Offer, subject to the rights of the holders of the tendered Restricted
Notes to withdraw such Restricted Notes, or (3) waive such termination
event with respect to the Exchange Offer and accept the properly tendered
Restricted Notes that have not been withdrawn. If the Company determines
that such waiver constitutes a material change in the Exchange Offer, the
Company will promptly disclose such change in a manner reasonably
calculated to inform the holders of such change and the Company will extend
the Exchange Offer to the extent required by law.
The foregoing conditions are for the sole benefit of the Company
and may be asserted by the Company regardless of the circumstances giving
rise to any such condition or may be waived by the Company in whole or in
part at any time and from time to time in its sole discretion. The failure
by the Company at any time to exercise any of the foregoing rights will not
be deemed a waiver of any such right and each such right will be deemed an
ongoing right which may be asserted at any time and from time to time.
Exchange Agent
The Chase Manhattan Bank, the Trustee under the Indenture, has
been appointed as Exchange Agent for the Exchange Offer. In such capacity,
the Exchange Agent has no fiduciary duties and will be acting solely on the
basis of directions of the Company. Requests for assistance and requests
for additional copies of this Prospectus or of the Letter of Transmittal
should be directed to the Exchange Agent addressed as follows:
By Mail, Overnight Delivery
or Hand Delivery: The Chase Manhattan Bank
450 West 33rd Street, 15th Floor
New York, New York 10001-2967
Attention: Sheik Wiltshire
Global Trust Services
Facsimile Transmission: (212) 946-8161
Attention: Sheik Wiltshire
Information or Confirmation by
Telephone: (212) 946-3082
Delivery to an address or facsimile number other than those
listed above will not constitute a valid delivery.
Solicitation of Tenders; Fees and Expenses
The Company will bear all expenses of soliciting tenders pursuant
to the Exchange Offer. The principal solicitation pursuant to the Exchange
Offer is being made by mail. Additional solicitations may be made by
officers and regular employees of the Company and its affiliates in person,
by telegraph, telephone or facsimile transmission.
The Company has not retained any dealer-manager in connection with
the Exchange Offer and will not make any payments to brokers, dealers or
other persons soliciting acceptances of the Exchange Offer. The Company
will, however, pay the Exchange Agent reasonable and customary fees for its
services and
<PAGE>
will reimburse the Exchange Agent for its reasonable out-of-pocket costs
and expenses in connection therewith and will indemnify the Exchange Agent
for all losses and claims incurred by it as a result of the Exchange Offer.
The Company may also pay brokerage houses and other custodians, nominees
and fiduciaries the reasonable out-of-pocket expenses incurred by them in
forwarding copies of this Prospectus, Letters of Transmittal and related
documents to the beneficial owners of the Restricted Notes and in handling
or forwarding tenders for exchange.
The Company will pay all expenses incurred in connection with the
Exchange Offer, including fees and expenses of the Exchange Agent and
Trustee, accounting and legal fees (including the expense of one counsel to
the holders of the Notes) and printing costs.
The Company will pay any transfer taxes applicable to the
exchange of Restricted Notes pursuant to the Exchange Offer. If, however, a
transfer tax is imposed for any reason other than the exchange of
Restricted Notes pursuant to the Exchange Offer, then the amount of any
such transfer taxes (whether imposed on the registered holder thereof or
any other person) will be payable by the tendering holder. For example, the
tendering holder will pay transfer taxes, if:
o certificates representing Exchange Notes for principal
amounts not tendered or accepted for exchange are to be
delivered to, or are to be registered or issued in the name
of, any person other than the registered holder of the
Restricted Notes tendered; or
o tendered Restricted Notes are registered in the name of any
person other than the person signing the Letter of
Transmittal.
If satisfactory evidence of payment of such taxes or exemption therefrom is
not submitted with the Letter of Transmittal, the amount of such transfer
taxes will be billed by the Company directly to such tendering holder.
Accounting Treatment
The Exchange Notes will be recorded at the same carrying value as
the Restricted Notes, as reflected in the Company's accounting records on
the date of the exchange. Accordingly, no gain or loss for accounting
purposes will be recognized by the Company as a result of the consummation
of the Exchange Offer. The expense of the Exchange Offer will be amortized
by the Company over the term of the Exchange Notes.
Consequences of a Failure to Exchange Restricted Notes
As a result of the making of, and upon acceptance for exchange of
all validly tendered Restricted Notes pursuant to the terms of, this
Exchange Offer, the Company will have fulfilled certain covenants contained
in the Exchange and Registration Rights Agreement. Holders of Restricted
Notes who do not tender their Restricted Notes in the Exchange Offer will
continue to hold such Restricted Notes and will be entitled to all the
rights, and subject to the limitations applicable thereto, under the
Indenture and the Exchange and Registration Rights Agreement, except for
any such rights under the Exchange and Registration Rights Agreement that
by their terms terminate or cease to have further effect as a result of the
consummation of this Exchange Offer.
All untendered Restricted Notes will continue to be subject to
the restrictions on transfer set forth in the Indenture. Accordingly, after
the completion of the Exchange Offer, you will only be able to offer for
sale, sell or otherwise transfer untendered Restricted Notes as follows:
o to the Company;
o pursuant to a registration statement that has been declared
effective under the Securities Act;
o for so long as the Restricted Notes are eligible for resale
pursuant to Rule 144A under the Securities Act, to a person
you reasonably believe is a qualified institutional buyer
("QIB")
<PAGE>
within the meaning of Rule 144A, that purchases for its own
account or for the account of a QIB to whom notice is given
that the transfer is being made in reliance on the exemption
from the registration requirements of the Securities Act
provided by Rule 144A;
o pursuant to offers and sales that occur outside the United
States to foreign persons in transactions complying with the
provisions of Regulation S under the Securities Act;
o to an "accredited investor" within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act that is
an institutional investor (an "Institutional Accredited
Investor") purchasing for its own account or for the account
of such an Institutional Accredited Investor, in each case
in a minimum principal amount of the Restricted Notes of
$250,000; or
o pursuant to any other available exemption from the
registration requirements of the Securities Act.
To the extent that Restricted Notes are tendered and accepted in
the Exchange Offer, the liquidity of the trading market for untendered
Restricted Notes could be adversely affected.
<PAGE>
DESCRIPTION OF NOTES
General
The Restricted Notes were issued and the Exchange Notes will be
issued under an indenture, dated as of October 2, 1998 (the "Indenture"),
between Jones and The Chase Manhattan Bank, as trustee (the "Trustee"). The
term "Notes" as used in this "Description of Notes" refers to all notes
issued or to be issued under the Indenture and includes the Restricted
Notes and the Exchange Notes. Capitalized terms used and not otherwise
defined have the meanings set forth under "--Certain Definitions".
The following summary of certain provisions of the Indenture and
the Notes does not purport to be complete and is subject to, and is
qualified in its entirety by reference to, all the provisions of the
Indenture, including the definitions of certain terms therein and those
terms made a part thereof by the TIA. For a more complete understanding of
the terms of the Notes, you should refer to the Indenture, which is
included as Exhibit 4.2 to the Registration Statement that relates to this
Prospectus.
The Notes will be unsecured senior obligations of Jones, ranking
equally in right of payment with all existing and future unsecured senior
debt of Jones and senior in right of payment to all future subordinated
debt of Jones.
Principal of, premium, if any, and interest on the Notes will be
payable, and the Notes may be exchanged or transferred, at the office or
agency of Jones in the Borough of Manhattan, The City of New York (which
initially shall be the corporate trust office of the Trustee, at 450 West
33rd Street, 15th Floor, New York, New York 10001-2697), except that, at
the option of Jones, payment of interest may be made by check mailed to the
registered holders of the Notes at their registered addresses.
The Notes will be issued only in fully registered form, without
coupons, in denominations of $1,000 and any integral multiple of $1,000.
The registered holder of a Note will be treated as the owner of such Note
for all purposes. No service charge will be made for any registration of
transfer or exchange of Notes, but Jones may require payment of a sum
sufficient to cover any transfer tax or other similar governmental charge
payable in connection therewith. See "Exchange Offer --Solicitation of
Tenders; Fees and Expenses".
Terms of the Notes
The Notes will be unsecured senior obligations of Jones, limited
to $265.0 million aggregate principal amount, and will mature on October 1,
2001. Each Note will bear interest at a rate per annum of 6.25% from
October 2, 1998, or from the most recent date to which interest has been
paid or provided for. Interest will be payable semiannually to holders of
record at the close of business on the March 15 or September 15 immediately
preceding the interest payment date on April 1 and October 1 of each year,
commencing April 1, 1999. Interest will be computed on the basis of a
360-day year consisting of twelve 30-day months.
Exchange and Registration Rights
The terms of the Exchange Notes are substantially identical to
the terms of the Restricted Notes, except that the Exchange Notes will be
freely transferable and issued free of any covenants regarding exchange and
registration rights. Restricted Notes not exchanged in the Exchange Offer
will remain outstanding and be entitled to the benefits of the Indenture,
but, except under certain circumstances, will have no further exchange or
registration rights under the Exchange and Registration Rights Agreement.
Optional Redemption
The Notes will be redeemable as a whole or in part, at the option
of Jones at any time or from time to time, at a redemption price equal to
the greater of (1) 100% of their principal amount or (2) the sum of the
present values of the remaining scheduled payments of principal and
interest thereon discounted to the date of redemption on a semi-annual
basis (assuming a 360-day year consisting of twelve 30-day months)
<PAGE>
at the Treasury Rate plus 15 basis points, plus in the case of each of
clause (1) and (2) accrued interest to the date of redemption.
Holders of Notes to be redeemed will receive notice thereof by
first-class mail at least 30 and not more than 60 days prior to the date
fixed for redemption. In the case of any partial redemption, selection of
Notes for redemption will be made by the Trustee on a pro rata basis, by
lot or by such other method as the Trustee in its sole discretion shall
deem to be fair and appropriate, although no Note of $1,000 in original
principal amount or less will be redeemed in part. If any Note is to be
redeemed in part only, the notice of redemption relating to such Note shall
state the portion of the principal amount thereof to be redeemed. A new
Note in principal amount equal to the unredeemed portion thereof will be
issued in the name of the holder thereof upon cancelation of the original
Note. On and after the redemption date, interest will cease to accrue on
Notes or portions thereof called for redemption so long as Jones has
deposited with the Paying Agent funds sufficient to pay the principal of,
plus accrued and unpaid interest and liquidated damages (if any) on, the
Notes to be redeemed.
Certain Covenants
The Indenture contains covenants including, among others, the
following:
Restrictions on Liens. Except as provided below under "--Exempted
Debt," the Credit Parties will not, and will not permit any Restricted
Subsidiary to, create or suffer to exist any mortgage, lien, pledge,
charge, security interest or encumbrance (a "Lien" or "Liens") to secure
any Indebtedness of any Credit Party or Restricted Subsidiary on any
Principal Property of any Credit Party or Restricted Subsidiary, without
making, or causing such Restricted Subsidiary to make, effective provision
to secure all the Notes then outstanding by such Lien, equally and ratably
with any and all other such Indebtedness thereby secured, so long as such
other Indebtedness is so secured, except that the foregoing restrictions
shall not apply to: (a) Liens on property of a Person existing at the time
such Person is merged into or consolidated with any Credit Party or
Restricted Subsidiary or at the time of sale, lease or other disposition of
the properties of such Person (or a division thereof) as an entirety or
substantially as an entirety to any Credit Party or Restricted Subsidiary;
(b) Liens on property of a Person existing at the time such Person becomes
a Restricted Subsidiary or existing on property prior to the acquisition
thereof by any Credit Party or Restricted Subsidiary; (c) Liens securing
Indebtedness between a Restricted Subsidiary and a Credit Party or between
Restricted Subsidiaries or Credit Parties; (d) Liens on any property
created, assumed or otherwise brought into existence in contemplation of
the sale or other disposition of the underlying property, whether directly
or indirectly, by way of share disposition or otherwise, provided that the
applicable Credit Party or Restricted Subsidiary must have disposed of such
property within 180 days after the creation of such Liens and that any
Indebtedness secured by such Liens shall be without recourse to any Credit
Party or Restricted Subsidiary; (e) Liens in favor of the United States of
America or any State thereof, or any department, agency or instrumentality
or political subdivision of the United States of America or any State
thereof, or in favor of any country, or any political subdivision thereof,
to secure partial, progress, advance or other payments, or performance of
any other similar obligations, including, without limitation, Liens to
secure pollution control bonds or industrial revenue or other types of
bonds; (f) Liens imposed by law, such as carriers', warehousemen's and
mechanics' Liens and other similar Liens arising in the ordinary course of
business which secure obligations not more than 60 days past due or are
being contested in good faith and by appropriate proceedings; (g) Liens
incurred in the ordinary course of business to secure performance of
obligations with respect to statutory or regulatory requirements,
performance or return-of-money bonds, surety bonds or other obligations of
a like nature, in each case which are not incurred in connection with the
borrowing of money, the obtaining of advances or credit or the payment of
the deferred purchase price of property and which do not in the aggregate
impair in any material respect the use of property in the operation of the
business of the Credit Parties and their respective Subsidiaries taken as a
whole; (h) Liens incurred to secure appeal bonds and judgment and
attachment Liens, in each case in connection with litigation or legal
proceedings which are being contested in good faith by appropriate
proceedings so long as reserves have been established to the extent
required by generally accepted accounting principles as in effect at such
time; (i) pledges or deposit under workmen's compensation laws,
unemployment insurance laws or similar legislation, or good faith deposits
in connection with bids, tenders, contracts (other than for the payment of
Indebtedness) or leases to which any Credit Party or Restricted Subsidiary
is a party, or deposits to secure public or statutory obligations of any
Credit Party or Restricted
<PAGE>
Subsidiary or deposits for the payment of rent, in each case incurred in
the ordinary course of business; (j) utility easements, building
restrictions and such other encumbrances or charges against real property
as are of a nature generally existing with respect to properties of a
similar character; (k) Liens granted to any bank or other institution by a
Credit Party or Subsidiary of a Credit Party on the payments to be made by
such institution to the Company or a Subsidiary of the Company pursuant to
any interest rate swap or similar agreement or foreign currency hedge,
exchange or similar agreement designed to provide protection against
fluctuations in interest rates and currency exchange rates, respectively,
provided that such agreements are entered into in, or are incidental to,
the ordinary course of business; (l) Liens arising solely by virtue of any
statutory or common law provision relating to banker's liens, rights of
setoff or similar rights and remedies, in each case as to deposit accounts
or other funds maintained with a creditor depository institution, provided
that (1) such deposit account is not a dedicated cash collateral account
and is not subject to restrictions against access by the applicable Credit
Party or Restricted Subsidiary in excess of those set forth by regulations
promulgated by the Federal Reserve Board, and (2) such deposit account is
not intended by such Credit Party or Restricted Subsidiary to provide
collateral to the depository institution; (m) Liens arising from Uniform
Commercial Code financing statements regarding leases; (n) the giving,
simultaneously with or within 180 days after the latest of the date of the
Indenture, or the acquisition, construction, improvement, development or
expansion of such property, of a purchase money Lien on property acquired,
constructed, improved, developed or expanded after the date of the
Indenture, or the acquisition, construction, improvement, development or
expansion after the date of the Indenture, of property subject to any Lien
which is limited to such property; (o) the giving of a Lien on real
property which is the sole security for Indebtedness incurred within two
years after the latest of the date of the Indenture, the acquisition,
construction, improvement, development or expansion of the property,
provided that the holder of such Indebtedness is entitled to enforce its
payment only by resorting to such security; (p) Liens arising by the terms
of letters of credit entered into in the ordinary course of business to
secure reimbursement obligations thereunder; (q) Liens existing on the date
of the Indenture; (r) Liens for taxes, assessments and other governmental
changes or levies not yet due or as to which the period of grace, if any,
related thereto has not expired or which are being contested in good faith
and by appropriate proceedings if adequate reserves are maintained to the
extent required by generally accepted accounting principles; and (s)
extension, renewal, replacement or refunding of any Lien existing on the
date of the Indenture or referred to in clauses (a) to (k) and (n), (o) and
(q), provided that the principal amount of Indebtedness secured thereby and
not otherwise authorized by clauses (a) to (k) and (n), (o) and (q) shall
not exceed the principal amount of Indebtedness, plus any premium or fee
payable in connection with any such extension, renewal, replacement or
refunding, so secured at the time of such extension, renewal, replacement
or refunding.
Restrictions on Sale and Leaseback Transactions. Except as
provided below under "--Exempted Debt," the Credit Parties will not, and
will not permit any Restricted Subsidiary to, after the date of the
Indenture, enter into any arrangement with any Person providing for the
leasing by any such Credit Party or Restricted Subsidiary of any Principal
Property now owned or hereafter acquired which has been or is to be sold or
transferred by such Credit Party or Restricted Subsidiary to such Person
with the intention of taking back a lease of such Principal Property (a
"Sale and Leaseback Transaction"), unless the net proceeds of such sale or
transfer have been determined by the Board of Directors to be at least
equal to the fair market value of such Principal Property or asset at the
time of such sale and transfer and either (i) such Credit Party or
Restricted Subsidiary applies or causes to be applied an amount equal to
the net proceeds of such sale or transfer, within 180 days of receipt
thereof, to the retirement or prepayment (other than any mandatory
retirement or prepayment, except mandatory retirements or prepayments
required as a result of such Sale and Leaseback Transaction) of Funded Debt
of any Credit Party or Restricted Subsidiary or to the purchase,
construction or development of property or assets to be used in the
ordinary course of business, or (ii) such Credit Party or Restricted
Subsidiary would, on the effective date of such sale or transfer, be
entitled, pursuant to the Indenture, to issue, assume or guarantee
Indebtedness secured by a Lien upon such Principal Property at least equal
in amount to the Attributable Debt in respect of such Sale and Leaseback
Transaction without equally and ratably securing the Notes then
outstanding. The foregoing restriction will not apply to any Sale and
Leaseback Transaction (i) between a Credit Party and a Restricted
Subsidiary or between Restricted Subsidiaries or Credit Parties, provided
that the lessor shall be a Credit Party or Wholly Owned Restricted
Subsidiary, (ii) which has a lease of less than three years in length,
(iii) entered into within 180 days after the later of the purchase,
construction or
<PAGE>
development of such Principal Property or asset or the commencement of
operation of such Principal Property, or (iv) involving Jones' distribution
warehouse at South Hill, Virginia.
Exempted Debt. Notwithstanding the restrictions in the Indenture
on (i) Liens and (ii) Sale and Leaseback Transactions, any Credit Party or
Restricted Subsidiary may, in addition to amounts permitted under such
restrictions, create Indebtedness secured by Liens, or enter into Sale and
Leaseback Transactions, provided that, at the time of such transactions and
after giving effect thereto, the aggregate outstanding amount of all such
Indebtedness secured by Liens plus Attributable Debt resulting from such
Sale and Leaseback Transactions does not exceed 20% of Consolidated
Stockholders' Equity.
Corporate Existence. Each Credit Party will do or cause to be
done all things necessary to preserve and keep in full force and effect its
corporate existence, material rights (charter and statutory) and material
franchises; provided, however, that such Credit Party shall not be required
to preserve any such right or franchise if the Board of Directors shall
determine that the preservation of such rights and franchises is no longer
desirable in the conduct of the business of the Credit Parties and
Restricted Subsidiaries considered as a whole.
No Special Protection in the Event of a Highly Leveraged
Transaction. The terms of the Notes will not afford the holders special
protection in the event of a highly leveraged transaction.
Merger and Consolidation
The Indenture provides that none of the Credit Parties will
consolidate with or merge with or into, or convey, transfer or lease all or
substantially all its assets to, any Person (other than a merger of a
Wholly Owned Restricted Subsidiary into a Credit Party or another Wholly
Owned Restricted Subsidiary or a merger of one Credit Party into another),
unless: (i) the resulting, surviving or transferee Person (the "Successor
Company") will be a corporation organized and existing under the laws of
the United States of America, any State thereof or the District of Columbia
and the Successor Company (if not such Credit Party) will expressly assume,
by a supplemental Indenture, executed and delivered to the Trustee, in form
satisfactory to the Trustee, all the obligations of such Credit Party under
the Notes and the Indenture; (ii) immediately after giving effect to such
transaction (and treating any indebtedness which becomes an obligation of
the Successor Company, any other Credit Party or any Restricted Subsidiary
as a result of such transaction as having been incurred by the Successor
Company or such Credit Party or Restricted Subsidiary at the time of such
transaction), no Event of Default shall have occurred and be continuing;
(iii) such Credit Party shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental indenture (if any)
comply with the Indenture; and (iv) if, as a result of any such
consolidation, merger or transfer, Principal Property of such Credit Party
would become subject to a Lien which would not be permitted by the
Indenture, such Credit Party or the Successor Company, as the case may be,
shall take such steps as shall be necessary effectively to secure the Notes
then outstanding equally and ratably with (or prior to) all Indebtedness
secured thereby. Notwithstanding the foregoing, the transfer of assets in
connection with the Asset Drop-Down Transaction (as defined below) shall
be governed by the provisions described in the third paragraph in this "--
Merger and Consolidation" section and not the provisions of this paragraph
or the immediately following paragraph.
The Indenture provides that the Successor Company will succeed
to, and be substituted for, and may exercise every right and power of, the
applicable Credit Party under the Indenture, but the predecessor Credit
Party in the case of a lease of all or substantially all its assets will
not be released from the obligation to pay the principal of and interest on
the Notes.
Jones is considering a corporate reorganization which it believes
would have certain tax benefits and which would result in the transfer of
all its operations to a newly created, indirect wholly owned subsidiary.
See "The Company -- Proposed Reorganization." Jones may convey or transfer
in one transaction or series of related transactions (including by way of
merger or consolidation), all or a majority of its assets other than the
Capital Stock of its Subsidiaries (the "Asset Drop-Down Transaction") to an
indirect Wholly-Owned Restricted Subsidiary (the "Successor Operating
Company") (x) upon compliance with clauses (i), (iii) and (iv) of the first
paragraph of this "-- Merger and Consolidation" section and
<PAGE>
(y) upon the execution and delivery by Jones and the intermediate holding
company ("Holdco") that will own all the Capital Stock of the Successor
Operating Company of a supplemental indenture, in form and substance
satisfactory to the Trustee, providing (1 ) for the full and unconditional
guarantee of all the Successor Operating Company's obligations under the
Notes and the Indenture or (2) if less than substantially all of Jones'
assets are being conveyed or transferred to the Successor Operating
Company, that Jones shall remain, and Holdco shall be added as, a
co-obligor under the Notes and the Indenture (Jones and Holdco are referred
to as the "Additional Obligors" ). Neither the Additional Obligors nor the
Successor Operating Company shall be required to make a notation on the
Notes to reflect such guarantee or co-obligation or the Successor Operating
Company as a new obligor under the Notes and the Indenture. Upon compliance
with clauses (x) and (y) above, the Successor Operating Company will
succeed to, and be substituted for, and may exercise every right and power
of, Jones under the Indenture. The Additional Obligors will agree not to
engage in any activity other than (a) continuing to own all the Capital
Stock of, in the case of Jones, Holdco, and, in the case of Holdco, the
Successor Operating Company and former subsidiaries of the Successor
Operating Company and (b) certain related or other activities incidental
thereto. There can be no assurance that the Asset Drop-Down Transaction
will occur. However, Jones currently anticipates that, if it proceeds with
the Asset Drop-Down Transaction, it would consummate such transaction on or
about January 1, 1999, prior to the commencement of the Exchange Offer.
Defaults
An Event of Default is defined in the Indenture as (i) a default
in any payment of interest on any Note when due and payable, continued for
30 days, (ii) a default in the payment of principal of any Note when due
and payable at maturity, upon declaration or otherwise, (iii) the failure
by any Credit Party to comply with its obligations under the covenant
described under "-- Merger and Consolidation" above, (iv) the failure by
any Credit Party to comply for 30 days after notice with any of its
obligations under the covenants described under "-- Certain Covenants"
above, (v) the failure by any Credit Party to comply for 60 days after
notice with its other covenants or agreements contained in the Notes or the
Indenture, (vi) a default under any Indebtedness by any Credit Party or
Restricted Subsidiary (other than the Notes), whether such Indebtedness now
exists or shall hereafter be created, which default shall have resulted in
Indebtedness in excess of $25.0 million or its foreign currency equivalent
becoming due and payable prior to the date on which it would otherwise have
become due and payable, without such Indebtedness having been discharged or
such acceleration having been rescinded or annulled within 30 days after
notice (the "cross acceleration provision" ), (vii) the rendering of any
judgment or decree for the payment of money in excess of $25.0 million or
its foreign currency equivalent against a Credit Party or Restricted
Subsidiary if (A) an enforcement proceeding thereon is commenced by any
creditor or (B) such judgment or decree remains outstanding for a period of
60 days following such judgment and is not discharged, waived or stayed
(the "judgment default provision"), (viii) the guarantee or co-obligation
of any Additional Obligor shall cease to be in full force and effect
(except as contemplated by the terms thereof) or any Additional Obligor or
Person acting by or on behalf of such Additional Obligor shall deny or
disaffirm its obligations under the Indenture or any such guarantee or
co-obligation, or (ix) certain events of bankruptcy, insolvency or
reorganization of a Credit Party or Restricted Subsidiary (the "bankruptcy
provisions").
The foregoing will constitute Events of Default whatever the
reason for any such Event of Default and whether it is voluntary or
involuntary or is effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body.
However, a default under clause (iv), (v) or (vi) will not
constitute an Event of Default until the Trustee or the holders of at least
25% in principal amount of the outstanding Notes notify Jones of the
default and Jones does not cure such default within the time specified in
clause (iv), (v) or (vi) hereof after receipt of such notice.
If an Event of Default (other than an Event of Default relating
to certain events of bankruptcy, insolvency or reorganization of a Credit
Party) occurs and is continuing, the Trustee or the holders of at least 25%
in principal amount of the outstanding Notes by notice to Jones may declare
the principal of and accrued but unpaid interest on all the Notes to be due
and payable. Upon such a declaration, such principal and interest will be
due and payable immediately. If an Event of Default relating to certain
events of bankruptcy, insolvency or reorganization of a Credit Party
occurs, the principal of and interest on all the
<PAGE>
Notes will become immediately due and payable without any declaration or
other act on the part of the Trustee or any holders. Under certain
circumstances, the holders of a majority in principal amount of the
outstanding Notes may rescind any such acceleration with respect to the
Notes and its consequences.
Subject to the provisions of the Indenture relating to the duties
of the Trustee, in case an Event of Default occurs and is continuing, the
Trustee will be under no obligation to exercise any of the rights or powers
under the Indenture at the request or direction of any of the holders
unless such holders have offered to the Trustee indemnity or security
satisfactory to it against any loss, liability or expense. Except to
enforce the right to receive payment of principal, premium (if any) or
interest when due, no holder may pursue any remedy with respect to the
Indenture or the Notes unless (i) such holder has previously given the
Trustee notice that an Event of Default is continuing, (ii) holders of at
least 25% in principal amount of the outstanding Notes have requested the
Trustee in writing to pursue the remedy, (iii) such holders have offered
the Trustee reasonable security or indemnity against any loss, liability or
expense, (iv) the Trustee has not complied with such request within 60 days
after the receipt of the request and the offer of security or indemnity and
(v) the holders of a majority in principal amount of the outstanding Notes
have not given the Trustee a direction inconsistent with such request
within such 60-day period. Subject to certain restrictions, the holders of
a majority in principal amount of the outstanding Notes will be given the
right to direct the time, method and place of conducting any proceeding for
any remedy available to the Trustee or of exercising any trust or power
conferred on the Trustee. The Trustee, however, may refuse to follow any
direction that conflicts with law or the Indenture or that the Trustee
determines is unduly prejudicial to the rights of any other holder or that
would involve the Trustee in personal liability. Prior to taking any action
under the Indenture, the Trustee will be entitled to indemnification
satisfactory to it in its sole discretion against all losses and expenses
caused by taking or not taking such action.
The Indenture provides that if a Default occurs and is continuing
and is known to the Trustee, the Trustee must mail to each holder notice of
the Default within 90 days after it occurs. Except in the case of a Default
in the payment of principal of, premium (if any) or interest on any Note
(including payments pursuant to the redemption provisions of such Note),
the Trustee may withhold notice if and so long as a committee of its Trust
Officers in good faith determines that withholding notice is in the
interests of the holders. In addition, Jones will be required to deliver to
the Trustee, within 120 days after the end of each fiscal year, a
certificate indicating whether the signers thereof know of any Default that
occurred during the previous year.
Amendments and Waivers
Subject to certain exceptions, the Indenture or the Notes may be
amended with the written consent of the holders of a majority in principal
amount of the Notes then outstanding and any past default or compliance
with any provisions may be waived with the consent of the holders of a
majority in principal amount of the Notes then outstanding. However,
without the consent of each holder of an outstanding Note affected, no
amendment may, among other things, (i) reduce the amount of Notes whose
holders must consent to an amendment, (ii) reduce the rate of or extend the
time for payment of interest or any liquidated damages on any Note, (iii)
reduce the principal of or extend the stated maturity of any Note, (iv)
reduce the premium payable upon the redemption of any Note or change the
time at which any Note may be redeemed as described under "-- Optional
Redemption" above, (v) make any Note payable in money other than that
stated in the Note, (vi) impair the right of any holder to receive payment
of principal of, and interest or any liquidated damages on, such holder's
Notes on or after the due dates therefor or to institute suit for the
enforcement of any payment on or with respect to such holder's Notes, or
(vii) make any change in the amendment provisions which require each
holder's consent or in the waiver provisions, or (viii) make any change in
any guarantee or co-obligation of any Additional Obligor that would
adversely affect the holders.
Without the consent of any holder, Jones and the Trustee may
amend the Indenture to cure any ambiguity, omission, defect or
inconsistency, to provide for the assumption by a successor corporation of
the obligations of Jones under the Indenture, to provide for uncertificated
Notes in addition to or in place of certificated Notes (provided that the
uncertificated Notes are issued in registered form for purposes of Section
163(f) of the Code, or in a manner such that the uncertificated Notes are
described in Section 163(f)(2)(B) of the Code), to provide for the
assumption by the Successor Operating Company of
<PAGE>
the obligations of Jones and the issuance of the guarantees of such
obligations by the Additional Obligors or the retention and addition, as
applicable, of the Additional Obligors as co-obligors, in connection with
the Asset Drop-Down Transaction (as contemplated under "-- Merger and
Consolidation"), to secure the Notes, to add guarantees or co-obligors with
respect to the Notes, to add to the covenants of Jones for the benefit of
the holders or to surrender any right or power conferred upon Jones, to
make any change that does not adversely affect the rights of any holder,
subject to the provisions of the Indenture, to provide for the issuance of
the Exchange Notes or to comply with any requirement of the SEC in
connection with the qualification of the Indenture under the TIA.
The Senior Credit Facilities contain a covenant which, following
a default or event of default under the Senior Credit Facilities, prohibits
Jones from making material amendments to debt instruments, including the
Indenture, without the consent of a majority of the lenders under the
Senior Credit Facilities.
The consent of the holders will not be necessary under the
Indenture to approve the particular form of any proposed amendment. It will
be sufficient if such consent approves the substance of the proposed
amendment.
After an amendment under the Indenture becomes effective, Jones
will be required to mail to holders a notice briefly describing such
amendment. However, the failure to give such notice to all holders, or any
defect therein, will not impair or affect the validity of the amendment.
Transfer and Exchange
A holder will be able to transfer or exchange Notes in accordance
with the Indenture. Upon any transfer or exchange, the registrar and the
Trustee may require a holder, among other things, to furnish appropriate
endorsements and transfer documents and Jones may require a holder to pay
any taxes required by law or permitted by the Indenture. Jones will not be
required to transfer or exchange any Note selected for redemption or to
transfer or exchange any Note for a period of 15 days prior to a selection
of Notes to be redeemed. The Notes will be issued in registered form and
the registered holder of a Note will be treated as the owner of such Note
for all purposes.
Defeasance
The Indenture provides that Jones at any time may terminate all
its obligations under the Notes and the Indenture ("legal defeasance"),
except for certain obligations, including those respecting the defeasance
trust and obligations to register the transfer or exchange of the Notes, to
replace mutilated, destroyed, lost or stolen Notes and to maintain a
registrar and paying agent in respect of the Notes. In addition, the
Indenture will provide that Jones at any time may terminate its obligations
under the covenants described under "--Certain Covenants," the cross
acceleration provision, the bankruptcy provisions with respect to
Restricted Subsidiaries and the judgment default provision described under
"-- Defaults" above and the limitations contained in clauses (iii) and (iv)
under "-- Merger and Consolidation" above ("covenant defeasance").
Jones may exercise its legal defeasance option notwithstanding
its prior exercise of its covenant defeasance option. If Jones exercises
its legal defeasance option, payment of the Notes may not be accelerated
because of an Event of Default with respect thereto. If Jones exercises its
covenant defeasance option, payment of the Notes may not be accelerated
because of an Event of Default specified in clause (iv), (vi) or (vii) or
clause (viii) (with respect only to Restricted Subsidiaries) under "--
Defaults" above or because of the failure of Jones to comply with clause
(iii) or (iv) under "-- Merger and Consolidation" above.
In order to exercise either defeasance option, Jones must
irrevocably deposit in trust (the "defeasance trust") with the Trustee
money or U.S. Government Obligations for the payment of principal, premium
(if any) and interest on the outstanding Notes to redemption or maturity,
as the case may be, and must comply with certain other conditions,
including delivery to the Trustee of an Opinion of Counsel to the effect
that holders of the Notes will not recognize income, gain or loss for
Federal income tax purposes as a result of such deposit and defeasance and
will be subject to Federal income tax on the same amounts
<PAGE>
and in the same manner and at the same times as would have been the case if
such deposit and defeasance had not occurred (and, in the case of legal
defeasance only, such Opinion of Counsel must be based on a ruling of the
Internal Revenue Service or other change in applicable Federal income tax
law).
Concerning the Trustee
The Chase Manhattan Bank is the Trustee under the Indenture and
has been appointed by Jones as Registrar, Paying Agent and Exchange Agent
with regard to the Notes. The Trustee is an affiliate of Chase Securities
Inc., one of the Initial Purchasers.
Governing Law
The Indenture provides that it and the Notes will be governed by,
and construed in accordance with, the laws of the State of New York without
giving effect to applicable principles of conflicts of law to the extent
that the application of the law of another jurisdiction would be required
thereby.
Certain Definitions
"Asset Drop-Down Transaction" shall have the meaning assigned to
such term in the third paragraph of the "-- Merger and Consolidation"
section.
"Attributable Debt" in respect of a Sale and Leaseback
Transaction means, at the time of determination, the present value
(discounted at the actual rate of interest of such transaction) of the
obligation of the lessee for net rental payments during the remaining term
of the lease included in such Sale and Leaseback Transaction (including any
period for which such lease has been extended or may, at the option of the
lessor, be extended). The term "net rental payments" under any lease for
any period shall mean the sum of the rental and other payments required to
be paid in such period by the lessee thereunder, not including, however,
any amounts required to be paid by such lessee (whether or not designated
as rental or additional rental) on account of maintenance and repairs,
insurance, taxes, assessments, water rates or similar charges required to
be paid by such lessee thereunder or any amounts required to be paid by
such lessee thereunder contingent upon the amount of sales, maintenance and
repairs, insurance, taxes, assessments, water rates or similar charges. In
the case of any lease which is terminable by the lessee upon the payment of
a penalty, such net amount shall also include the amount of such penalty,
but no rent shall be considered as required to be paid under such lease
subsequent to the first date upon which it may be so terminated.
"Board of Directors" means the Board of Directors of the
applicable Credit Party or any committee thereof duly authorized to act on
behalf of the Board of Directors of such Credit Party.
"Business Day" means each day which is not a Legal Holiday.
"Capital Stock" of any Person means any and all shares,
interests, rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) equity of such Person,
including any preferred stock, but excluding any debt securities
convertible into such equity.
"Code" means the Internal Revenue Code of 1986, as amended.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term ("Remaining Life") of the Notes that would
be utilized, at the time of selection and in accordance with customary
financing practice, in pricing new issues of corporate debt securities of
comparable maturity to the remaining term of the Notes.
"Comparable Treasury Price" means (1) the average of five
Reference Treasury Dealer Quotations for such redemption date, after
excluding the highest and lowest Reference Treasury Dealer Quotations, or
(2) if the Independent Investment Banker obtains fewer than five such
Reference Treasury Dealer Quotations, the average of all such quotations.
<PAGE>
"Consolidated Net Tangible Assets" means, as of any date of
determination, the total amount of assets (less applicable reserves and
other properly deductible items) after deducting (1) all current
liabilities (excluding the amount of those which are by their terms
extendable or renewable at the option of the obligor to a date more than 12
months after the date as of which the amount is being determined and
excluding all intercompany items between a Credit Party and any of its
Subsidiaries or between Credit Parties or Subsidiaries of Credit Parties)
and (2) all goodwill, trade names, trademarks, patents, unamortized debt
discount and expense and other like intangible assets, all as determined on
a consolidated basis in accordance with generally acceptable accounting
principles.
"Consolidated Stockholders' Equity" means consolidated
stockholders' equity of the Credit Parties and their respective
Subsidiaries as determined in accordance with generally accepted accounting
principles and reflected on the most recent balance sheet delivered to the
Trustee pursuant to the Indenture.
"Credit Parties" means Jones or, following consummation of the
Asset Drop-Down Transaction, each of the Additional Obligors and the
Successor Operating Company.
"Funded Debt" means Indebtedness, whether incurred, assumed or
guaranteed, maturing by its terms more than one year from the date of
creation thereof or which is extendable or renewable at the sole option of
the obligor in such manner that it may become payable more than one year
from the date of creation thereof; provided, however, that Funded Debt
shall not include obligations created pursuant to leases, or any
Indebtedness or portion thereof maturing by its terms within one year from
the time of any computation of the amount of outstanding Funded Debt unless
such Indebtedness shall be extendable or renewable at the sole option of
the obligor in such manner that it may become payable more than one year
from such time, or any Indebtedness for the payment or redemption of which
money in the necessary amount shall have been deposited in trust either at
or before the maturity or redemption date thereof.
"Indebtedness" of a Person means indebtedness for borrowed money
and all indebtedness under purchase money mortgages or other purchase money
liens or conditional sales or similar title retention agreements (but
excluding trade accounts payable in the ordinary course of business) in
each case where such indebtedness has been created, incurred, assumed or
guaranteed by such Person or where such Person is otherwise liable therefor
and indebtedness for borrowed money secured by any Lien upon property owned
by such Person even though such Person has not assumed or become liable for
the payment of such indebtedness; provided that if the obligation so
secured has not been assumed in full by such Person or is otherwise not
such Person's legal liability in full, the amount of such obligation for
the purposes of this definition shall be limited to the lesser of the
amount of such obligation secured by such Lien or the fair market value of
the property securing such Lien.
"Independent Investment Banker" means Chase Securities Inc. or,
if such firm is unwilling or unable to select the Comparable Treasury
Issue, an independent investment banking institution of national standing
appointed by the Trustee.
"Legal Holiday" means a Saturday, Sunday or other day on which
banking institutions in New York State are authorized or required by law to
close.
"Officer" means the Chairman of the Board, the Chief Executive
Officer, the Chief Financial Officer, the President, any Vice President,
the Treasurer or the Secretary of the applicable Credit Party.
"Officers' Certificate" means a certificate signed by two
Officers.
"Opinion of Counsel" means a written opinion from legal counsel.
The counsel may be an employee of or counsel to the applicable Credit Party
or the Trustee.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political
subdivision thereof or any other entity.
<PAGE>
"principal" of a Note means the principal of the Note plus the
premium, if any, payable on the Note which is due or overdue or is to
become due at the relevant time.
"Principal Property" means any property owned or leased by any
Credit Party or Restricted Subsidiary, the net book value of which exceeds
one percent of Consolidated Net Tangible Assets of the Credit Parties and
their respective Subsidiaries.
"Reference Treasury Dealer" means (1) Chase Securities Inc.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated and Bear, Stearns & Co.
Inc. and their respective successors, provided, however, that if any of the
foregoing shall cease to be a primary U.S. Government securities dealer in
New York City (a "Primary Treasury Dealer"), Jones shall substitute
therefor another Primary Treasury Dealer and (2) any other Primary Treasury
Dealer selected by the Independent Investment Banker after consultation
with Jones.
"Reference Treasury Dealer Quotations" means, with respect to
each Reference Treasury Dealer and any redemption date, the average, as
determined by the Independent Investment Banker, of the bid and asked
prices for the Comparable Treasury Issue (expressed in each case as a
percentage of its principal amount) quoted in writing to the Independent
Investment Banker at 5:00 p.m., New York City time, on the third Business
Day preceding such redemption date.
"Restricted Subsidiary" means, at any time, any Subsidiary of a
Credit Party which would be a "Significant Subsidiary" at such time, as
such term is defined in Regulation S-X promulgated by the SEC, as in effect
on the date of the Indenture.
"SEC" means the Securities and Exchange Commission.
"Subsidiary" of any Person means any corporation, association,
partnership or other business entity of which more than 50% of the total
voting power of shares of Capital Stock or other interests (including
partnership interests) entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by (i)
such Person, (ii) such Person and one or more Subsidiaries of such Person
or (iii) one or more Subsidiaries of such Person.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss.
77aaa-77bbbb) as in effect on the date of the Indenture.
"Treasury Rate" means, with respect to any redemption date, (1)
the yield, under the heading which represents the average for the
immediately preceding week, appearing in the most recently published
statistical release designated "H.15(519)" or any successor publication
which is published weekly by the Federal Reserve and which establishes
yields on actively traded United States Treasury securities adjusted to
constant maturity under the caption "Treasury Constant Maturities," for the
maturity corresponding to the Comparable Treasury Issue (if no maturity is
within three months before or after the Remaining Life, yields for the two
published maturities most closely corresponding to the Comparable Treasury
Issue shall be determined and the Treasury Rate shall be interpolated or
extrapolated from such yields on a straight line basis, rounding to the
nearest month) or (2) if such release (or any successor release) is not
published during the week preceding the calculation date or does not
contain such yields, the rate per annum equal to the semiannual equivalent
yield to maturity of the Comparable Treasury Issue, calculated using a
price for the Comparable Treasury Issue (expressed as a percentage of its
principal amount) equal to the Comparable Treasury Price for such
redemption date. The Treasury Rate shall be calculated on the third
Business Day preceding the redemption date.
"Trust Officer" means the Chairman of the Board, the President or
any other officer or assistant officer of the Trustee assigned by the
Trustee to administer its corporate trust matters.
"U.S. Government Obligations" means direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States of America (including any agency or instrumentality
<PAGE>
thereof) for the payment of which the full faith and credit of the United
States of America is pledged and which are not callable or redeemable at
the issuer's option.
"Wholly Owned Restricted Subsidiary" means a Restricted
Subsidiary, 100% of the outstanding Capital Stock of which (other than
Capital Stock constituting directors' qualifying shares or interests held
by directors or shares or interests required to be held by foreign
nationals, in each case to the extent mandated by applicable law) is
directly or indirectly owned by a Credit Party or by one or more Wholly
Owned Restricted Subsidiaries.
<PAGE>
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
The following discussion is a summary of certain United States
Federal income tax considerations relevant to the Exchange Offer to holders
of Restricted Notes, but does not purport to be a complete analysis of all
potential tax effects. The discussion set forth below is based upon
currently existing provisions of the Internal Revenue Code of 1986, as
amended (the "Code"), existing and proposed Treasury regulations
promulgated thereunder and current administrative rulings and judicial
decisions, all of which are subject to change, possibly on a retroactive
basis. This summary does not discuss all aspects of United States Federal
income taxation that may be relevant to certain types of holders subject to
special treatment under the United States Federal income tax laws such as
tax-exempt organizations, dealers in securities, financial institutions and
life insurance companies. This summary applies only to a holder that
acquired Restricted Notes at original issue for cash and holds Restricted
Notes as a capital asset as defined in section 1221 of the Code. This
summary also does not discuss any aspect of state, local or foreign
taxation. Holders of Restricted Notes considering the Exchange Offer should
consult their own tax advisors concerning the United States Federal income
tax consequences in light of their particular situations as well as any
consequences arising under the laws of any other taxing jurisdiction.
An exchange of Restricted Notes for Exchange Notes pursuant to
the Exchange Offer should not be treated as an exchange or other taxable
event for United States Federal income tax purposes. Accordingly, there
should be no United States Federal income tax consequences to holders of
Restricted Notes who exchange Restricted Notes for Exchange Notes pursuant
to the Exchange Offer and any such holder should have the same adjusted tax
basis and holding period in the Exchange Notes as it had in the Restricted
Notes immediately before the exchange.
THE FOREGOING DISCUSSION OF CERTAIN UNITED STATES FEDERAL INCOME
TAX CONSIDERATIONS DOES NOT CONSIDER THE FACTS AND CIRCUMSTANCES OF ANY
PARTICULAR HOLDER'S SITUATION OR STATUS. ACCORDINGLY, EACH HOLDER OF
RESTRICTED NOTES SHOULD CONSULT ITS OWN TAX ADVISOR WITH RESPECT TO THE TAX
CONSEQUENCES OF THE EXCHANGE OFFER TO IT, INCLUDING THOSE UNDER THE STATE,
FOREIGN AND OTHER TAX LAWS.
<PAGE>
BOOK-ENTRY; DELIVERY AND FORM
The Global Notes
The certificates representing the Restricted Notes were issued,
and the certificates representing the Exchange Notes will be issued, in
fully registered form, without coupons. The Restricted Notes are
represented by one or more permanent global certificates in definitive,
fully registered form without interest coupons in the aggregate amount of
$265.0 million (collectively, the "Initial Global Note"). Except as
described under "Certificated Exchange Notes", the Exchange Notes initially
will be represented by one or more permanent global certificates in
definitive, fully registered form (collectively, the "Global Notes") and
(i) will be deposited with, or on behalf of, DTC, and registered in the
name of Cede & Co., as DTC's nominee or (ii) will remain in the custody of
the Trustee pursuant to a FAST Balance Certificate Agreement between DTC
and the Trustee or (iii) will be deposited with, or on behalf of, a
custodian of DTC for credit to the respective accounts of the purchasers
(or to such accounts as they may direct) at Morgan Guaranty Trust Company
of New York, Brussels office, as operator of the Euroclear System
("Euroclear"), or Cedel Bank, societe anonyme ("Cedel"). If any holder of
Restricted Notes whose interest in such Restricted Notes is represented by
the Initial Global Note fails to tender in the Exchange Offer, the Company
may issue and deliver to such holder a separate certificate representing
such holder's Restricted Notes in registered from without interest coupons.
Certain Book-Entry Procedures for the Global Notes
The descriptions of the operations and procedures of DTC,
Euroclear and Cedel set forth below are provided solely as a matter of
convenience. These operations and procedures are solely within the control
of the respective settlement systems and are subject to change by them from
time to time. The Company takes no responsibility for these operations or
procedures, and investors are urged to contact the relevant system or its
participants directly to discuss these matters.
DTC has advised the Company that it is (i) a limited purpose
trust company organized under the laws of the State of New York, (ii) a
"banking organization" within the meaning of the New York Banking Law,
(iii) a member of the Federal Reserve System, (iv) a "clearing corporation"
within the meaning of the Uniform Commercial Code, as amended, and (v) a
"clearing agency" registered pursuant to Section 17A of the Exchange Act.
DTC was created to hold securities for its participants (collectively, the
"Participants") and facilitates the clearance and settlement of securities
transactions between Participants through electronic book-entry changes to
the accounts of its Participants, thereby eliminating the need for physical
transfer and delivery of certificates. DTC's Participants include
securities brokers and dealers (which may include the Initial Purchasers),
banks and trust companies, clearing corporations and certain other
organizations. Indirect access to DTC's system is also available to other
entities such as banks, brokers, dealers and trust companies (collectively,
the "Indirect Participants") that clear through or maintain a custodial
relationship with a Participant, either directly or indirectly. Investors
who are not Participants may beneficially own securities held by or on
behalf of DTC only through Participants or Indirect Participants.
The Company expects that pursuant to procedures established by
DTC (i) upon the deposit of the Global Note, DTC will credit the accounts
of Participants with an interest in the Global Note and (ii) ownership of
the Exchange Notes will be shown on, and the transfer of ownership thereof
will be effected only through, records maintained by DTC (with respect to
the interests of Participants) and the records of Participants and the
Indirect Participants (with respect to the interests of persons other than
Participants).
The laws of some jurisdictions may require that certain
purchasers of securities take physical delivery of such securities in
definitive form. Accordingly, the ability to transfer interests in the
Exchange Notes represented by a Global Note to such persons may be limited.
In addition, because DTC can act only on behalf of its Participants, who in
turn act on behalf of persons who hold interests through Participants, the
ability of a person having an interest in Exchange Notes represented by a
Global Note to pledge or transfer such interest to persons or entities that
do not participate in DTC's system, or to otherwise take actions in respect
of such interest, may be affected by the lack of a physical definitive
security in respect of such interest.
<PAGE>
So long as DTC or its nominee is the registered owner of a Global
Note, DTC or such nominee, as the case may be, will be considered the sole
owner or holder of the Exchange Notes represented by the Global Note for
all purposes under the Indenture. Except as provided below, owners of
beneficial interests in a Global Note will not be entitled to have Exchange
Notes represented by such Global Note registered in their names, will not
receive or be entitled to receive physical delivery of Certificated
Exchange Notes, and will not be considered the owners or holders thereof
under the Indenture for any purpose, including with respect to the giving
of any direction, instruction or approval to the Trustee thereunder.
Accordingly, each holder owning a beneficial interest in a Global Note must
rely on the procedures of DTC and, if such holder is not a Participant or
an Indirect Participant, on the procedures of the Participant through which
such holder owns its interest, to exercise any rights of a holder of
Exchange Notes under the Indenture or such Global Note. The Company
understands that under existing industry practice, in the event that the
Company requests any action of holders of Exchange Notes, or a holder that
is an owner of a beneficial interest in a Global Note desires to take any
action that DTC, as the holder of such Global Note, is entitled to take,
DTC would authorize the Participants to take such action and the
Participants would authorize holders owning through such Participants to
take such action or would otherwise act upon the instruction of such
holders. Neither the Company nor the Trustee will have any responsibility
or liability for any aspect of the records relating to or payments made on
account of Exchange Notes by DTC, or for maintaining, supervising or
reviewing any records of DTC relating to such Exchange Notes.
Payments with respect to the principal of, and premium, if any,
and interest on, any Exchange Notes represented by a Global Note registered
in the name of DTC or its nominee on the applicable record date will be
payable by the Trustee to or at the direction of DTC or its nominee in its
capacity as the registered holder of the Global Note representing such
Exchange Notes under the Indenture. Under the terms of the Indenture, the
Company and the Trustee may treat the persons in whose names the Exchange
Notes, including the Global Notes, are registered as the owners thereof for
the purpose of receiving payment thereon and for any and all other purposes
whatsoever. Accordingly, neither the Company nor the Trustee has or will
have any responsibility or liability for the payment of such amounts to
owners of beneficial interests in a Global Note (including principal,
premium, if any, and interest). Payments by the Participants and the
Indirect Participants to the owners of beneficial interests in a Global
Note will be governed by standing instructions and customary industry
practice and will be the responsibility of the Participants or the Indirect
Participants and DTC.
Transfers between Participants in DTC will be effected in
accordance with DTC's procedures, and will be settled in same-day funds.
Transfers between participants in Euroclear or Cedel will be effected in
the ordinary way in accordance with their respective rules and operating
procedures.
Cross-market transfers of Exchange Notes between the Participants
in DTC, on the one hand, and Euroclear or Cedel participants, on the other
hand, will be effected through DTC in accordance with DTC's rules on behalf
of Euroclear or Cedel, as the case may be, by its respective depositary.
However, such cross-market transactions will require delivery of
instructions to Euroclear or Cedel, as the case may be, by the counterparty
in such system in accordance with the rules and procedures and within the
established deadlines (Brussels time) of such system. Euroclear or Cedel,
as the case may be, will, if the transaction meets its settlement
requirements, deliver instructions to its respective depositary to take
action to effect final settlement on its behalf by delivering or receiving
interests in the relevant Global Notes in DTC, and making or receiving
payment in accordance with normal procedures for same-day funds settlement
applicable to DTC. Euroclear participants and Cedel participants may not
deliver instructions directly to the depositaries for Euroclear or Cedel.
Because of time zone differences, the securities account of a
Euroclear or Cedel participant purchasing an interest in a Global Note from
a Participant in DTC will be credited, and any such crediting will be
reported to the relevant Euroclear or Cedel participant, during the
securities settlement processing day (which must be a business day for
Euroclear and Cedel) immediately following the settlement date of DTC. Cash
received in Euroclear or Cedel as a result of sales of interest in a Global
Note by or through a Euroclear or Cedel participant to a Participant in DTC
will be received with value on the settlement date of DTC but will be
available in the relevant Euroclear or Cedel cash account only as of the
business day for Euroclear or Cedel following DTC's settlement date.
<PAGE>
Although DTC, Euroclear and Cedel have agreed to the foregoing
procedures to facilitate transfers of interests in the Global Notes among
participants in DTC, Euroclear and Cedel, they are under no obligation to
perform or to continue to perform such procedures, and such procedures may
be discontinued at any time. Neither the Company nor the Trustee will have
any responsibility for the performance by DTC, Euroclear or Cedel or their
respective participants or indirect participants of their respective
obligations under the rules and procedures governing their operations.
Certificated Exchange Notes
If (i) the Company notifies the Trustee in writing that DTC is no
longer willing or able to act as a depositary or DTC ceases to be
registered as a clearing agency under the Exchange Act and a successor
depositary is not appointed within 90 days of such notice or cessation,
(ii) the Company, at its option, notifies the Trustee in writing that it
elects to cause the issuance of Exchange Notes in definitive form under the
Indenture or (iii) upon the occurrence of certain other events as provided
in the Indenture, then, upon surrender by DTC of the Global Notes,
Certificated Exchange Notes will be issued to each person that DTC
identifies as the beneficial owner of the Exchange Notes represented by the
Global Notes. Upon any such issuance, the Trustee is required to register
such Certificated Exchange Notes in the name of such person or persons (or
the nominee of any thereof) and cause the same to be delivered thereto.
Neither the Company nor the Trustee shall be liable for any delay
by DTC or any Participant or Indirect Participant in identifying the
beneficial owners of the related Exchange Notes and each such person may
conclusively rely on, and shall be protected in relying on, instructions
from DTC for all purposes (including with respect to the registration and
delivery, and the respective principal amounts, of the Exchange Notes to be
issued).
<PAGE>
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange Notes for its own
account pursuant to the Exchange Offer must acknowledge that it will
deliver a prospectus in connection with any resale of such Exchange Notes.
This Prospectus, as it may be amended or supplemented from time to time,
may be used by a broker-dealer in connection with resales of Exchange Notes
received in exchange for Notes where such Notes were acquired as a result
of market-making activities or other trading activities. The Company has
agreed that, starting on the date of this Prospectus and ending on the
close of business on the earlier to occur of (i) the date on which all
Exchange Notes held by broker-dealers eligible to use the Prospectus to
satisfy their prospectus delivery obligations under the Securities Act have
been sold and (ii) the date 180 days after the consummation of the Exchange
Offer, it will make this Prospectus, as amended or supplemented, available
to any broker-dealer that requests such documents in the Letter of
Transmittal for use in connection with any such resale. In addition, until
[ ], 1999 [90 days after the date of this Prospectus], all
dealers effecting transactions in the Exchange Notes may be required to
deliver a prospectus.
The Company will not receive any proceeds from any sale of
Exchange Notes by broker-dealers. Exchange Notes received by broker-dealers
for their own account pursuant to the Exchange Offer may be sold from time
to time in one or more transactions in the over-the-counter market, in
negotiated transactions, through the writing of options on the Exchange
Notes or a combination of such methods of resale, at market prices
prevailing at the time of resale, at prices related to such prevailing
market prices or at negotiated prices. Any such resale may be made directly
to purchasers or to or through brokers or dealers who may receive
compensation in the form of commissions or concessions from any such
broker-dealer or the purchasers of any such Exchange Notes. Any
broker-dealer that resells Exchange Notes that were received by it for its
own account pursuant to the Exchange Offer and any broker or dealer that
participates in a distribution of such Exchange Notes may be deemed to be
an "underwriter" within the meaning of the Securities Act and any profit on
any such resale of Exchange Notes and any commission or concessions
received by any such persons may be deemed to be underwriting compensation
under the Securities Act. The Letter of Transmittal states that, by
acknowledging that it will deliver and by delivering a Prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter"
within the meaning of the Securities Act.
For a period starting on the date of this Prospectus and ending
on the close of business on the earlier to occur of (i) the date on which
all Exchange Notes held by broker-dealers eligible to use the Prospectus to
satisfy their prospectus delivery obligations under the Securities Act have
been sold and (ii) the date 180 days after the consummation of the Exchange
Offer, the Company will promptly send additional copies of this Prospectus
and any amendment or supplement to this Prospectus to any broker-dealer
that requests such documents in the Letter of Transmittal. The Company has
agreed to pay all expenses incident to the Exchange Offer (including the
expense of one counsel for the holders of the Restricted Notes) other than
commissions or concessions of any broker-dealers and will indemnify the
holders of the Restricted Notes (including any broker-dealers) against
certain liabilities, including liabilities under the Securities Act.
<PAGE>
LEGAL MATTERS
Ira M. Dansky, Esq., our General Counsel, has passed upon the
validity of the Exchange Notes offered by this Prospectus. With respect to
certain matters concerning Pennsylvania law, he will rely on Mesirov Gelman
Jaffe Cramer & Jamieson, LLP, Philadelphia, Pennsylvania.
EXPERTS
The consolidated financial statements and schedule of Jones
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 herein in reliance upon such reports given
upon the authority of said firm as experts in accounting and auditing.
The consolidated financial statements of Sun appearing in the
Jones' Current Report on Form 8-K dated September 24, 1998, have been
audited by Ernst & Young LLP, independent auditors, as set forth in their
report thereon included therein and incorporated herein by reference. Such
consolidated financial statements are incorporated herein by reference in
reliance upon such report given upon the authority of said firm as experts
in accounting and auditing.
<PAGE>
=================================== =============================
We have not authorized any
dealer, salesperson or other person
to give any information or to make
any representations not contained
in this Prospectus in connection $265,000,000
with the Exchange Offer made by
this Prospectus and you must not
rely on any such information or
representations as having been Jones Apparel Group, Inc.
authorized by the Company. Neither
the delivery of this Prospectus nor
any sale made hereunder will, under
any circumstances, create any
implication that there has been no
change in the affairs of the
Company since the date as of which
information is given in this
Prospectus. This Prospectus does
not constitute an offer or
solicitation by anyone in any [LOGO]
jurisdiction in which such offer or
solicitation is not authorized or
in which the person making such
offer or solicitation is not
qualified to do so or to any person
to whom it is unlawful to make such Offer to Exchange
solicitation. 6.25% Senior Notes due 2001
------------------
------------------
PROSPECTUS
------------------
Dealer Prospectus
Delivery Obligation
Until , 1999 [90 days
after the date of this Prospectus],
all broker dealers that effect
transactions in the Exchange Notes,
whether or not participating in the
Exchange Offer, may be required to
deliver a Prospectus. This is in
addition to the broker-dealers'
obligation to deliver a Prospectus
when acting as underwriters and
with respect to any unsold [DATE]
allotments or subscriptions.
=================================== =============================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
As permitted by the Pennsylvania Business Corporation Law of 1988
(the "Pennsylvania Business Corporation Law"), Section 8.1 of our By-laws
provides that a director 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 our 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 we 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 or she 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), judgments, fines and amounts
paid in settlement actually and reasonably incurred by him or her in
connection with the action or proceeding if he or she acted in good faith
and in a manner he or she 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 or her 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 or she 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 or her conduct was unlawful.
Section 1742 of the Pennsylvania Business Corporation Law
provides that we 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 or she 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 or her in connection with the defense or
settlement of the action if he or she acted in good faith and in a manner
he or she reasonably believed to be in, or not opposed to, the best
interest of the corporation. Indemnification shall not be made under
Section 1742 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 determines 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.
<PAGE>
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
EXHIBIT NO. DESCRIPTION
4.1 Exchange and Registration Rights Agreement dated October 2,
1998, by and among the Company and Chase Securities Inc.,
Merrill Lynch, Pierce Fenner & Smith Incorporated and Bear,
Stearns & Co. Inc.
4.2 Indenture dated as of October 2, 1998, by and between the
Company and The Chase Manhattan Bank, as trustee,
incorporated by reference to our Shelf Registration
Statement on Form S-3, filed on October 28, 1998
(Registration No. 333-66223)
5.1 Form of opinion of Ira M. Dansky, Esq.
5.2 Form of opinion of Mesirov Gelman Jaffe Cramer & Jamieson,
LLP
12.1 Computation of Ratios of Earnings to Fixed Charges
23.1 Consent of BDO Seidman, LLP
23.2 Consent of Ernst & Young LLP
23.3 Consent of Ira M. Dansky, Esq. (included in opinion filed as
Exhibit 5.1)
23.4 Consent of Mesirov Gelman Jaffe Cramer & Jamieson, LLP
(included in opinion filed as Exhibit 5.2)
24.1 Power of Attorney (included in signature page)
25.1 Form T-1 Statement of Eligibility of Trustee
99.1 Form of Letter of Transmittal
99.2 Form of Notice of Guaranteed Delivery
ITEM 22. UNDERTAKINGS.
(a) 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 Securities Act of 1933 (the "Securities 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.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the maximum aggregate offering price may be
reflected in the form of prospectus filed with the SEC pursuant
to Rule 424(b) under the Securities Act, if in the aggregate, the
changes in volume and price represent no more than a 20% change
in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
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 (a)(1)(i) and (a)(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 of
1934 the (the "Exchange Act") and incorporated by reference in
this Registration Statement.
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities 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 a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities 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 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.
(c) Insofar as indemnification for liabilities arising under the
Securities 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 SEC
such indemnification is against public policy as expressed in the
Securities Act and is, therefor, 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 Securities Act and will be governed by
the final adjudication of such issue.
(d) The undersigned Registrant hereby undertakes to respond to
requests for information that is incorporated by reference into the
prospectus pursuant to Items 4, 10(b), 11 or 13 of this Form, within one
business day of receipt of such request, and to send the incorporated
documents by first class mail or other equally prompt means. This includes
information contained in documents filed subsequent to the effective date
of the Registration Statement through the date of responding to the
request.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned thereunto duly authorized.
JONES APPAREL GROUP, INC., Registrant
by /s/ Wesley R. Card
-------------------
Wesley R. Card
Chief Financial Officer
December 9, 1998
<PAGE>
POWER OF ATTORNEY
Each person whose signature appears below constitutes and
appoints Ira M. Dansky, Wesley R. Card and Patrick M. Farrell and each of
them, his or her true and lawful attorney-in-fact and agent, with full
power of substitution and resubstitution, for him or her and in his or her
name, place and stead, in any and all capacities, to sign any and all
amendments to this Registration Statement, any Registration Statement filed
pursuant to Rule 462(b) under the Securities Act, and to file the same,
with all exhibits thereto, and other documents in connection therewith,
with the Securities and Exchange Commission, granting unto said
attorney-in-fact and agent full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorney-in-fact,
agent, or his substitute may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
SIGNATURE TITLE DATE
/s/ Sidney Kimmel
- -------------------- Chairman and Director December 9, 1998
(Sidney Kimmel) (Chief Executive Officer)
/s/ Jackwyn Nemerov
- -------------------- President and Director December 9, 1998
(Jackwyn Nemerov)
/s/ Wesley R. Card
- -------------------- Chief Financial Officer December 9, 1998
(Wesley R. Card) (Principal Financial Officer)
/s/ Patrick M. Farrell
- ---------------------- Vice President and Corporate December 9, 1998
(Patrick M. Farrell) Controller
(Principal Accounting Officer)
/s/ Irwin Samelman
- -------------------- Executive Vice President, December 9, 1998
(Irwin Samelman) Marketing, and Director
/s/ Geraldine Stutz
- -------------------- Director December 9, 1998
(Geraldine Stutz)
/s/ Howard Gittis
- -------------------- Director December 9, 1998
(Howard Gittis)
/s/ Eric A. Rothfeld
- -------------------- Director December 9, 1998
(Eric A. Rothfeld)
/s/ Mark Schwartz
- -------------------- Director December 9, 1998
(Mark Schwartz)
<PAGE>
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
4.1 Exchange and Registration Rights Agreement dated October 2,
1998, by and among the Company and Chase Securities Inc.,
Merrill Lynch, Pierce Fenner & Smith Incorporated and Bear,
Stearns & Co. Inc.
4.2 Indenture dated as of October 2, 1998, by and between the
Company and The Chase Manhattan Bank, as trustee,
incorporated by reference to our Shelf Registration
Statement on Form S-3, filed on October 28, 1998
(Registration No. 333-66223)
5.1 Form of opinion of Ira M. Dansky, Esq.
5.2 Form of opinion of Mesirov Gelman Jaffe Cramer & Jamieson,
LLP
12.1 Computation of Ratios of Earnings to Fixed Charges
23.1 Consent of BDO Seidman, LLP
23.2 Consent of Ernst & Young LLP
23.3 Consent of Ira M. Dansky, Esq. (included in opinion filed as
Exhibit 5.1)
23.4 Consent of Mesirov Gelman Jaffe Cramer & Jamieson, LLP
(included in opinion filed as Exhibit 5.2)
24.1 Power of Attorney (included in signature page)
25.1 Form T-1 Statement of Eligibility of Trustee
99.1 Form of Letter of Transmittal
99.2 Form of Notice of Guaranteed Delivery
EXHIBIT 4.1
Jones Apparel Group, Inc.
$265,000,000
6.25 % Senior Notes due 2001
EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
October 2, 1998
CHASE SECURITIES INC.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
BEAR, STEARNS & CO. INC.
c/o Chase Securities Inc.
270 Park Avenue, 8th floor
New York, New York 10017
Ladies and Gentlemen:
Jones Apparel Group, Inc., a Pennsylvania corporation (the
"Company"), proposes to issue and sell to Chase Securities Inc. ("CSI"),
Merrill Lynch, Pierce, Fenner & Smith Incorporated, and Bear, Stearns & Co.
Inc. (collectively, the "Initial Purchasers") upon the terms and subject to
the conditions set forth in a purchase agreement dated September 29, 1998
(the "Purchase Agreement"), $265,000,000 aggregate principal amount of its
6.25% Senior Notes due 2001 (the "Securities"). Capitalized terms used but
not defined herein shall have the meanings given to such terms in the
Purchase Agreement.
As an inducement to the Initial Purchasers to enter into the
Purchase Agreement and in satisfaction of a condition to the obligations of
the Initial Purchasers thereunder, the Company agrees with the Initial
Purchasers, for the benefit of the holders (including the Initial
Purchasers) of the Securities, the Exchange Securities (as defined herein)
and the Private Exchange Securities (as defined herein) (collectively, the
"Holders"), as follows:
1. Registered Exchange Offer. The Company shall (i) prepare
and, not later than 90 days following the date of original issuance of the
Securities (the "Issue Date"), file with the Commission a registration
statement (the "Exchange Offer Registration Statement") on an appropriate
form under the Securities Act with respect to a proposed offer to the
Holders of the Securities (the "Registered Exchange Offer") to issue and
deliver to such Holders, in exchange for the Securities, a like aggregate
principal amount of debt securities of the Company (the "Exchange
Securities") that are identical in all material respects to the Securities,
except that the liquidated damages provisions and the transfer restrictions
relating to the Securities will be eliminated, (ii) use its reasonable best
efforts to cause the Exchange Offer Registration Statement to become
effective under the Securities Act no later than 180 days after the Issue
Date and the Registered Exchange Offer to be consummated no later than 210
days after the Issue Date and (iii) keep the Exchange Offer Registration
Statement effective for not less than 30 days (or longer, if required by
applicable law) after the date on which notice of the Registered Exchange
Offer is mailed to the Holders (such period being called the "Exchange
Offer Registration Period"). The Exchange Securities will be issued under
the Indenture or an indenture (the "Exchange Securities Indenture") between
the Company and the Trustee or such other bank or trust company that is
reasonably satisfactory to the Initial Purchasers, as trustee (the
"Exchange Securities Trustee"), such indenture to be identical in all
material respects to the Indenture, except for the liquidated damages
provisions and the transfer restrictions relating to the Securities (as
described above).
Upon the effectiveness of the Exchange Offer Registration
Statement, the Company shall promptly commence the Registered Exchange
Offer, it being the objective of such Registered Exchange Offer to enable
each Holder electing to exchange Securities for Exchange Securities
(assuming that such Holder (a) is not an affiliate of the Company (within
the meaning of the Securities Act) or an Exchanging Dealer (as defined
herein) not complying with the requirements of the next sentence, (b) is
not an Initial Purchaser holding Securities that have, or that are
reasonably likely to have, the status of an unsold allotment in an initial
distribution, (c) acquires the Exchange Securities in the ordinary course
of such
<PAGE>
Holder's business and (d) has no arrangements or understandings with any
person to participate in the distribution of the Exchange Securities) and
to trade such Exchange Securities from and after their receipt without any
limitations or restrictions under the Securities Act and without material
restrictions under the securities laws of the several states of the United
States. The Company, the Initial Purchasers and each Exchanging Dealer (as
defined below) acknowledge that, pursuant to current interpretations by the
Commission's staff of Section 5 of the Securities Act, and in the absence
of an applicable exemption therefrom, each Holder (which may include the
Initial Purchasers) that is a broker-dealer electing to exchange
Securities, acquired for its own account as a result of market-making
activities or other trading activities, for Exchange Securities (an
"Exchanging Dealer"), may be deemed to be an "underwriter" within the
meaning of the Securities Act and must therefore, deliver a prospectus
containing substantially the information set forth in Annex A hereto on the
cover, in Annex B hereto in the "Exchange Offer Procedures" section and the
"Purpose of the Exchange Offer" section and in Annex C hereto in the "Plan
of Distribution" section of such prospectus in connection with a sale of
any such Exchange Securities received by such Exchanging Dealer pursuant to
the Registered Exchange Offer.
If, prior to the consummation of the Registered Exchange Offer,
any Holder holds any Securities acquired by it that have, or that are
reasonably likely to be determined to have, the status of an unsold
allotment in an initial distribution, or any Holder is not entitled to
participate in the Registered Exchange Offer, the Company shall, upon the
request of any such Holder, simultaneously with the delivery of the
Exchange Securities in the Registered Exchange Offer, issue and deliver to
any such Holder, in exchange for the Securities held by such Holder (the
"Private Exchange"), a like aggregate principal amount of debt securities
of the Company (the "Private Exchange Securities") that are identical in
all material respects to the Exchange Securities, except for the transfer
restrictions relating to such Private Exchange Securities. The Private
Exchange Securities will be issued under the same indenture as the Exchange
Securities, and the Company shall use its reasonable best efforts to cause
the Private Exchange Securities to bear the same CUSIP number as the
Exchange Securities.
In connection with the Registered Exchange Offer, the Company
shall:
(a) mail to each Holder a copy of the prospectus forming part of
the Exchange Offer Registration Statement, together with an
appropriate letter of transmittal and related documents;
(b) keep the Registered Exchange Offer open for not less than 30
days (or longer, if required by applicable law) after the date on
which notice of the Registered Exchange Offer is mailed to the
Holders;
(c) utilize the services of a depositary for the Registered
Exchange Offer with an address in the Borough of Manhattan, The City
of New York;
(d) permit Holders to withdraw tendered Securities at any time
prior to the close of business, New York City time, on the last
business day on which the Registered Exchange Offer shall remain open;
and
(e) otherwise comply in all respects with all laws that are
applicable to the Registered Exchange Offer.
As soon as practicable after the close of the Registered Exchange
Offer and any Private Exchange, as the case may be, the Company shall:
(a) accept for exchange all Securities validly tendered and not
validly withdrawn pursuant to the Registered Exchange Offer and the
Private Exchange (it being understood that all questions as to
validity, form, eligibility (including time of receipt) and acceptance
of Securities tendered for exchange shall be determined by the Company
in its sole discretion, which determination shall be final and
binding);
(b) deliver to the Trustee for cancelation all Securities so
accepted for exchange; and
(c) cause the Trustee or the Exchange Securities Trustee, as the
case may be, promptly to authenticate and deliver to each Holder,
Exchange Securities or Private Exchange Securities, as the case may
be, equal in principal amount to the Securities of such Holder so
accepted for exchange.
<PAGE>
The Company shall use its reasonable best efforts to keep the
Exchange Offer Registration Statement effective and to amend and supplement
the prospectus contained therein in order to permit such prospectus to be
used by all persons subject to the prospectus delivery requirements of the
Securities Act for such period of time as such persons must comply with
such requirements in order to resell the Exchange Securities; provided that
(i) in the case where such prospectus and any amendment or supplement
thereto must be delivered by an Exchanging Dealer, such period shall be the
lesser of 180 days and the date on which all Exchanging Dealers have sold
all Exchange Securities held by them and (ii) the Company shall make such
prospectus and any amendment or supplement thereto available to any
broker-dealer for use in connection with any resale of any Exchange
Securities for a period of not less than 90 days after the consummation of
the Registered Exchange Offer.
The Indenture or the Exchange Securities Indenture, as the case
may be, shall provide that the Securities, the Exchange Securities and the
Private Exchange Securities shall vote and consent together on all matters
as one class and that none of the Securities, the Exchange Securities or
the Private Exchange Securities will have the right to vote or consent as a
separate class on any matter.
Interest on each Exchange Security and Private Exchange Security
issued pursuant to the Registered Exchange Offer and in the Private
Exchange will accrue from the last interest payment date on which interest
was paid on the Securities surrendered in exchange therefor or, if no
interest has been paid on the Securities, from the Issue Date.
Each Holder participating in the Registered Exchange Offer shall
be required to represent to the Company that at the time of the
consummation of the Registered Exchange Offer (i) any Exchange Securities
received by such Holder will be acquired in the ordinary course of
business, (ii) such Holder will have no arrangements or understanding with
any person to participate in the distribution of the Securities or the
Exchange Securities within the meaning of the Securities Act and (iii) such
Holder is not an affiliate of the Company or, if it is such an affiliate,
such Holder will comply with the registration and prospectus delivery
requirements of the Securities Act to the extent applicable.
Notwithstanding any other provisions hereof, the Company will
ensure that (i) any Exchange Offer Registration Statement and any amendment
thereto and any prospectus forming part thereof and any supplement thereto
complies in all material respects with the Securities Act and the rules and
regulations of the Commission thereunder, (ii) any Exchange Offer
Registration Statement and any amendment thereto does not, when it becomes
effective, contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading and (iii) any prospectus forming part of
any Exchange Offer Registration Statement, and any supplement to such
prospectus, does not, as of the consummation of the Registered Exchange
Offer, include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
2. Shelf Registration. If (i) because of any change in law or
applicable interpretations thereof by the Commission's staff the Company is
not permitted to effect the Registered Exchange Offer as contemplated by
Section 1 hereof, or (ii) any Securities validly tendered pursuant to the
Registered Exchange Offer are not exchanged for Exchange Securities within
210 days after the Issue Date, or (iii) any Initial Purchaser so requests
with respect to Securities or Private Exchange Securities not eligible to
be exchanged for Exchange Securities in the Registered Exchange Offer and
held by it following the consummation of the Registered Exchange Offer, or
(iv) any applicable law or interpretations do not permit any Holder to
participate in the Registered Exchange Offer, or (v) any Holder that
participates in the Registered Exchange Offer does not receive freely
transferable Exchange Securities in exchange for tendered Securities, other
than by reason of such Holder being an Affiliate of the Company (it being
understood that, for purposes of this Section 2, the requirement that an
Exchanging Dealer deliver a prospectus in connection with sales of Exchange
Securities acquired in the Registered Exchange Offer in exchange for
Securities acquired as a result of marketmaking activities or other trading
activities shall not result in such Exchange Securities being not "freely
tradeable"), or (vi) the Company so elects, then the following provisions
shall apply:
(a) The Company shall use its reasonable best efforts to file as
promptly as practicable (but in no event more than 90 days after so
required or requested pursuant to this Section 2) with the Commission,
and thereafter shall use its reasonable best efforts to cause to be
declared effective, a shelf registration statement on an appropriate
form under the Securities Act relating to the offer and sale of the
Transfer Restricted Securities (as defined below) by the Holders
thereof from time to time in accordance with the methods of
distribution set forth in such
<PAGE>
registration statement (hereafter, a "Shelf Registration Statement"
and, together with any Exchange Offer Registration Statement, a
"Registration Statement"); provided, however, that, with respect to
Exchange Securities or Private Exchange Securities received by an
Initial Purchaser in exchange for Securities constituting any portion
of an unsold allotment, the Company may, if permitted by current
interpretations by the Commission's staff, file a posteffective
amendment to the Exchange Offer Registration Statement containing the
information required by Regulation SK Items 507 and/or 508, as
applicable, in satisfaction of its obligations under this paragraph
(a) with respect thereto, and any such Exchange Offer Registration
Statement, as so amended, shall be referred to herein as, and governed
by the provisions herein applicable to, a Shelf Registration
Statement.
(b) The Company shall use its reasonable best efforts to keep the
Shelf Registration Statement continuously effective in order to permit
the prospectus forming part thereof to be used by Holders of Transfer
Restricted Securities for a period ending on the earlier of (i) two
years from the Issue Date or such shorter period that will terminate
when all the Transfer Restricted Securities covered by the Shelf
Registration Statement have been sold pursuant thereto and (ii) the
date on which the Securities become eligible for resale without volume
restrictions pursuant to Rule 144 under the Securities Act (in any
such case, such period being called the "Shelf Registration Period").
The Company shall be deemed not to have used its reasonable best
efforts to keep the Shelf Registration Statement effective during the
requisite period if it voluntarily takes any action that would result
in Holders of Transfer Restricted Securities covered thereby not being
able to offer and sell such Transfer Restricted Securities during that
period, unless (i) such action is required by applicable law or (ii)
such action is taken by the Company in good faith and for valid
business reasons (not including avoidance of the Company's obligation
hereunder), including the acquisition or divestiture of assets and
other material transactions involving the Company, so long as the
Company promptly thereafter complies with the requirements of Section
4(j) hereof, if applicable.
(c) Notwithstanding any other provisions hereof, the Company will
ensure that (i) any Shelf Registration Statement and any amendment
thereto and any prospectus forming part thereof and any supplement
thereto complies in all material respects with the Securities Act and
the rules and regulations of the Commission thereunder, (ii) any Shelf
Registration Statement and any amendment thereto (in either case,
other than with respect to information included therein in reliance
upon or in conformity with written information furnished to the
Company by or on behalf of any Holder specifically for use therein
(the "Holders' Information")) does not contain an untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading and
(iii) any prospectus forming part of any Shelf Registration Statement,
and any supplement to such prospectus (in either case, other than with
respect to Holders' Information), does not include an untrue statement
of a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
3. Liquidated Damages. (a) The parties hereto agree that the
Holders of Transfer Restricted Securities will suffer damages if the
Company fails to fulfill its obligations under Section 1 or Section 2, as
applicable, and that it would not be feasible to ascertain the extent of
such damages. Accordingly, if (i) the applicable Registration Statement is
not filed with the Commission on or prior to 90 days after the Issue Date,
(ii) the Exchange Offer Registration Statement or the Shelf Registration
Statement, as the case may be, is not declared effective within 180 days
after the Issue Date (or in the case of a Shelf Registration Statement
required to be filed in response to a change in law or the applicable
interpretations of Commission's staff, if later, within 90 days after
publication of the change in law or interpretation), (iii) the Registered
Exchange Offer is not consummated on or prior to 210 days after the Issue
Date, or (iv) the Shelf Registration Statement is filed and declared
effective within 180 days after the Issue Date (or in the case of a Shelf
Registration Statement required to be filed in response to a change in law
or the applicable interpretations of Commission's staff, if later, within
90 days after publication of the change in law or interpretation) but shall
thereafter cease to be effective (at any time that the Company is obligated
to maintain the effectiveness thereof) without being succeeded within 90
days by an additional Registration Statement filed and declared effective
(each such event referred to in clauses (i) through (iv), a "Registration
Default"), the Company will be obligated to pay liquidated damages to each
Holder of Transfer Restricted Securities, during the period of one or more
such Registration Defaults, at a rate of 0.25% per annum, determined daily,
on the principal amount of the Securities constituting Transfer Restricted
Securities held by such holder until (i) the applicable Registration
Statement is filed, (ii) the Exchange Offer Registration Statement is
declared effective and the Registered Exchange Offer is consummated, (iii)
the Shelf Registration Statement is declared effective or (iv) the Shelf
Registration
<PAGE>
Statement again becomes effective, as the case may be. Following the cure
of all Registration Defaults, the accrual of liquidated damages will cease.
As used herein, the term "Transfer Restricted Securities" means (i) each
Security until the date on which such Security has been exchanged for a
freely transferable Exchange Security in the Registered Exchange Offer,
(ii) each Security or Private Exchange Security until the date on which it
has been effectively registered under the Securities Act and disposed of in
accordance with the Shelf Registration Statement or (iii) each Security or
Private Exchange Security until the date on which it is distributed to the
public pursuant to Rule 144 under the Securities Act or is saleable
pursuant to Rule 144(k) under the Securities Act. Notwithstanding anything
to the contrary in this Section 3(a), the Company shall not be required to
pay liquidated damages to a Holder of Transfer Restricted Securities if
such Holder failed to comply with its obligations to make the
representations set forth in the second to last paragraph of Section 1 or
failed to provide the information required to be provided by it, if any,
pursuant to Section 4(n).
(b) The Company shall notify the Trustee and the Paying Agent
under the Indenture promptly upon the happening of each and every
Registration Default. The Company shall pay the liquidated damages due on
the Transfer Restricted Securities by depositing with the Paying Agent
(which may not be the Company for these purposes), in trust, for the
benefit of the Holders thereof, prior to 10:00 a.m., New York City time, on
the next interest payment date specified by the Indenture and the
Securities, sums sufficient to pay the liquidated damages then due. The
liquidated damages due shall be payable on each interest payment date
specified by the Indenture and the Securities to the record holder entitled
to receive the interest payment to be made on such date. Each obligation to
pay liquidated damages shall be deemed to accrue from and including the
date of the applicable Registration Default.
(c) The parties hereto agree that the liquidated damages provided
for in this Section 3 constitute a reasonable estimate of and are intended
to constitute the sole and exclusive remedy for damages that will be
suffered by Holders of Transfer Restricted Securities by reason of the
failure of (i) the Shelf Registration Statement or the Exchange Offer
Registration Statement to be filed, (ii) the Shelf Registration Statement
to remain effective or (iii) the Exchange Offer Registration Statement to
be declared effective and the Registered Exchange Offer to be consummated,
in each case to the extent required by this Agreement.
4. Registration Procedures. In connection with any Registration
Statement, the following provisions shall apply:
(a) The Company shall (i) furnish to each Initial Purchaser,
prior to the filing thereof with the Commission, a copy of the
Registration Statement and each amendment thereof and each supplement,
if any, to the prospectus included therein and shall use its
reasonable best efforts to reflect in each such document, when so
filed with the Commission, such comments as any Initial Purchaser may
reasonably propose; (ii) include the information set forth in Annex A
hereto on the cover, in Annex B hereto in the "Exchange Offer
Procedures" section and the "Purpose of the Exchange Offer" section
and in Annex C hereto in the "Plan of Distribution" section of the
prospectus forming a part of the Exchange Offer Registration
Statement, and include the information set forth in Annex D hereto in
the Letter of Transmittal delivered pursuant to the Registered
Exchange Offer; and (iii) if requested by any Initial Purchaser,
include the information required by Item 507 or 508 of Regulation S-K,
as applicable, in the prospectus forming a part of the Exchange Offer
Registration Statement.
(b) The Company shall advise each Initial Purchaser, each
Exchanging Dealer which has provided in writing to the Company a
telephone or facsimile number and address for notice (in the case of
clauses (iii), (iv) and (v) only) and, in the case of a Shelf
Registration Statement, the Holders of the securities covered thereby
and, if requested by any such person, confirm such advice in writing
(which advice pursuant to clauses (iii)-(v) hereof shall be
accompanied by an instruction to suspend the use of the prospectus
until the requisite changes have been made):
(i) when any Registration Statement and any amendment
thereto has been filed with the Commission and when such
Registration Statement or any post-effective amendment thereto
has become effective;
(ii) of any request by the Commission for amendments or
supplements to any Registration Statement or the prospectus
included therein or for additional information;
<PAGE>
(iii) of the issuance by the Commission of any stop order
suspending the effectiveness of any Registration Statement or the
initiation of any proceedings for that purpose;
(iv) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Securities,
the Exchange Securities or the Private Exchange Securities for
sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose; and
(v) of the happening of any event that requires the making
of any changes in any Registration Statement or the prospectus
included therein in order that such document does not contain an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein (in the case of the prospectus included
therein, in the light of the circumstances under which they were
made) not misleading.
(c) The Company will make every reasonable effort to obtain the
withdrawal at the earliest possible time of any order suspending the
effectiveness of any Registration Statement.
(d) The Company will furnish to each Holder of Transfer
Restricted Securities included within the coverage of any Shelf
Registration Statement, without charge, at least one conformed copy of
such Shelf Registration Statement and any post-effective amendment
thereto, including financial statements and schedules and, if any such
Holder so requests in writing, all exhibits thereto (including those,
if any, incorporated by reference).
(e) The Company will, during the Shelf Registration Period,
promptly deliver to each Holder of Transfer Restricted Securities
included within the coverage of any Shelf Registration Statement,
without charge, as many copies of the prospectus (including each
preliminary prospectus) included in such Shelf Registration Statement
and any amendment or supplement thereto as such Holder may reasonably
request; and the Company consents to the use of such prospectus or any
amendment or supplement thereto by each of the selling Holders of
Transfer Restricted Securities in connection with the offer and sale
of the Transfer Restricted Securities covered by such prospectus or
any amendment or supplement thereto.
(f) The Company will furnish to each Initial Purchaser and each
Exchanging Dealer and to any other Holder who so requests in writing,
without charge, at least one conformed copy of the Exchange Offer
Registration Statement and any post-effective amendment thereto,
including financial statements and schedules and, if any Initial
Purchaser or Exchanging Dealer or any such Holder so requests in
writing, all exhibits thereto (including those, if any, incorporated
by reference).
(g) The Company will, during the Exchange Offer Registration
Period or the Shelf Registration Period, as applicable, promptly
deliver to each Initial Purchaser, each Exchanging Dealer and such
other persons that are required to deliver a prospectus following the
Registered Exchange Offer, without charge, as many copies of the final
prospectus included in the Exchange Offer Registration Statement or
the Shelf Registration Statement and any amendment or supplement
thereto as such Initial Purchaser, Exchanging Dealer or other persons
may reasonably request; and the Company consents to the use of such
prospectus or any amendment or supplement thereto by any such Initial
Purchaser, Exchanging Dealer or other persons, as applicable, as
aforesaid.
(h) Prior to the effective date of any Registration Statement,
the Company will use its reasonable best efforts to register or
qualify, or cooperate with the Holders of Securities, Exchange
Securities or Private Exchange Securities included therein and their
respective counsel in connection with the registration or
qualification of, such Securities, Exchange Securities or Private
Exchange Securities for offer and sale under the securities or blue
sky laws of such jurisdictions as any such Holder reasonably requests
in writing and do any and all other acts or things necessary or
advisable to enable the offer and sale in such jurisdictions of the
Securities, Exchange Securities or Private Exchange Securities covered
by such Registration Statement; provided that the Company will not be
required to qualify generally to do business in any jurisdiction where
it is not then so qualified or to take any action which would subject
it to general service of process or to taxation in any such
jurisdiction where it is not then so subject.
<PAGE>
(i) Subject to the provisions of the Indenture or the Exchange
Securities Indenture, as the case may be, and applicable law, the
Company will cooperate with the Holders of Securities, Exchange
Securities or Private Exchange Securities to facilitate the timely
preparation and delivery of certificates representing Securities,
Exchange Securities or Private Exchange Securities to be sold pursuant
to any Registration Statement free of any restrictive legends and in
such denominations and registered in such names as the Holders thereof
may request in writing prior to sales of Securities, Exchange
Securities or Private Exchange Securities pursuant to such
Registration Statement.
(j) If any event contemplated by Section 4(b)(iii) through (v)
occurs during the period for which the Company is required to maintain
an effective Registration Statement, the Company will promptly prepare
and file with the Commission a post-effective amendment to the
Registration Statement or a supplement to the related prospectus or
file any other required document so that, as thereafter delivered to
purchasers of the Securities, Exchange Securities or Private Exchange
Securities from a Holder, the prospectus will not include an untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(k) Not later than the effective date of the applicable
Registration Statement, the Company will provide a CUSIP number for
the Securities, the Exchange Securities and the Private Exchange
Securities, as the case may be, and provide the applicable trustee
with printed certificates for the Securities, the Exchange Securities
or the Private Exchange Securities, as the case may be, in a form
eligible for deposit with The Depository Trust Company.
(l) The Company shall use its reasonable best efforts to comply
with all applicable rules and regulations of the Commission to the
extent and so long as they are applicable to the applicable
Registration Statement, Registered Exchange Offer or the shelf
registration described in the Shelf Registration Statement and will
make generally available to its security holders as soon as
practicable after the effective date of the applicable Registration
Statement an earning statement satisfying the provisions of Section
11(a) of the Securities Act; provided that in no event shall such
earning statement be delivered later than 45 days after the end of a
12-month period (or 90 days, if such period is a fiscal year)
beginning with the first month of the Company's first fiscal quarter
commencing after the effective date of the applicable Registration
Statement, which statement shall cover such 12-month period.
(m) The Company will cause the Indenture or the Exchange
Securities Indenture, as the case may be, to be qualified under the
Trust Indenture Act as required by applicable law in a timely manner.
(n) The Company may require each Holder of Transfer Restricted
Securities to be registered pursuant to any Shelf Registration
Statement to furnish to the Company such information concerning the
Holder and the distribution of such Transfer Restricted Securities as
the Company may from time to time reasonably require for inclusion in
such Shelf Registration Statement, and the Company may exclude from
such registration the Transfer Restricted Securities of any Holder
that fails to furnish such information within a reasonable time after
receiving such request.
(o) In the case of a Shelf Registration Statement, each Holder of
Transfer Restricted Securities to be registered pursuant thereto
agrees by acquisition of such Transfer Restricted Securities that,
upon receipt of any notice from the Company pursuant to Section
4(b)(iii) through (v), such Holder will discontinue disposition of
such Transfer Restricted Securities until such Holder's receipt of
copies of the supplemental or amended prospectus contemplated by
Section 4(j) or until advised in writing (the "Advice") by the Company
that the use of the applicable prospectus may be resumed. If the
Company shall give any notice under Section 4(b)(iii) through (v)
during the period that the Company is required to maintain an
effective Registration Statement (the "Effectiveness Period"), such
Effectiveness Period shall be extended by the number of days during
such period from and including the date of the giving of such notice
to and including the date when each seller of Transfer Restricted
Securities covered by such Registration Statement shall have received
(x) the copies of the supplemental or amended prospectus contemplated
by Section 4(j) (if an amended or supplemental prospectus is required)
or (y) the Advice (if no amended or supplemental prospectus is
required).
<PAGE>
(p) In the case of a Shelf Registration Statement, the Company
shall enter into such customary agreements (including, if requested,
an underwriting agreement in customary form) and take all such other
action, if any, as Holders of a majority in aggregate principal amount
of the Securities, Exchange Securities and Private Exchange Securities
being sold or the managing underwriters (if any) shall reasonably
request in order to facilitate any disposition of Securities, Exchange
Securities or Private Exchange Securities pursuant to such Shelf
Registration Statement.
(q) In the case of a Shelf Registration Statement, the Company
shall as may reasonably be requested by any Holder (i) make reasonably
available for inspection by a representative of, and Special Counsel
(as defined below) acting for, Holders of a majority in aggregate
principal amount of the Securities, Exchange Securities and Private
Exchange Securities being sold and any underwriter participating in
any disposition of Securities, Exchange Securities or Private Exchange
Securities pursuant to such Shelf Registration Statement, all relevant
financial and other records, pertinent corporate documents and
properties of the Company and its subsidiaries and (ii) use its
reasonable best efforts to have its officers, directors, employees,
accountants and counsel supply all relevant information reasonably
requested by such representative, Special Counsel or any such
underwriter (an "Inspector") in connection with such Shelf
Registration Statement; provided, however, that each such person shall
first agree in writing if requested by the Company that any
information that is designated in writing by the Company, in good
faith, as confidential at the time of delivery of such information
shall be kept confidential by the Holders or any Inspector, unless
such disclosure is required by law or by court or administrative
order, or to assert any defenses available under the state and federal
securities laws, including without limitation, "due diligence"
defenses, or such information becomes available to the public
generally other than as a result of a disclosure or failure to
safeguard such information by such Holder or Inspector or to such
person from a source other than the Company and such source is not
known, after due inquiry, by such person to be bound by any obligation
of confidentiality.
(r) In the case of a Shelf Registration Statement, the Company
shall, if requested by Holders of a majority in aggregate principal
amount of the Securities, Exchange Securities and Private Exchange
Securities being sold, their Special Counsel or the managing
underwriters (if any) in connection with such Shelf Registration
Statement, use its reasonable best efforts to cause (i) its counsel to
deliver an opinion relating to the Shelf Registration Statement and
the Securities, Exchange Securities or Private Exchange Securities, as
applicable, in customary form, (ii) its officers to execute and
deliver all customary documents and certificates requested by Holders
of a majority in aggregate principal amount of the Securities,
Exchange Securities and Private Exchange Securities being sold, their
Special Counsel or the managing underwriters (if any) and (iii) its
independent public accountants to provide a comfort letter or letters
in customary form, subject to receipt of appropriate documentation as
contemplated, and only if permitted, by Statement of Auditing
Standards No. 72.
5. Registration Expenses. The Company will bear all expenses
incurred in connection with the performance of its obligations under
Sections 1, 2, 3 and 4 and the Company will reimburse the Initial
Purchasers and the Holders for the reasonable fees and disbursements of one
firm of attorneys (in addition to any local counsel) chosen by the Holders
of a majority in aggregate principal amount of the Securities, the Exchange
Securities and the Private Exchange Securities to be sold pursuant to each
Registration Statement (the "Special Counsel") acting for the Initial
Purchasers or Holders in connection therewith.
6. Indemnification. (a) In the event of a Shelf Registration
Statement or in connection with any prospectus delivery pursuant to an
Exchange Offer Registration Statement by an Initial Purchaser or Exchanging
Dealer, as applicable, the Company shall indemnify and hold harmless each
Holder (including any such Initial Purchaser or Exchanging Dealer), its
affiliates, their respective officers, directors, employees and agents, and
each person, if any, who controls such Holder within the meaning of the
Securities Act or the Exchange Act (collectively referred to for purposes
of this Section 6 and Section 7 as a Holder) from and against any loss,
claim, damage or liability, joint or several, or any action in respect
thereof (including, without limitation, any loss, claim, damage, liability
or action relating to purchases and sales of Securities, Exchange
Securities or Private Exchange Securities), to which that Holder may become
subject, whether commenced or threatened, under the Securities Act, the
Exchange Act, any other federal or state statutory law or regulation, at
common law or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained in any such Registration
Statement or any prospectus forming part thereof or in any
<PAGE>
amendment or supplement thereto or (ii) the omission or alleged omission to
state therein a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading, and shall reimburse each Holder
promptly upon demand for any legal or other expenses reasonably incurred by
that Holder in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred; provided, however, that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, an untrue statement or
alleged untrue statement in or omission or alleged omission from any of
such documents in reliance upon and in conformity with any Holders'
Information; and provided, further, that with respect to any such untrue
statement in or omission from any related preliminary prospectus, the
indemnity agreement contained in this Section 6(a) shall not inure to the
benefit of any Holder from whom the person asserting any such loss, claim,
damage, liability or action received Securities, Exchange Securities or
Private Exchange Securities to the extent that such loss, claim, damage,
liability or action of or with respect to such Holder results from the fact
that both (A) a copy of the final prospectus was not sent or given to such
person at or prior to the written confirmation of the sale of such
Securities, Exchange Securities or Private Exchange Securities to such
person and (B) the untrue statement in or omission from the related
preliminary prospectus was corrected in the final prospectus unless, in
either case, such failure to deliver the final prospectus was a result of
non-compliance by the Company with Section 4(d), 4(e), 4(f) or 4(g). This
indemnity agreement will be in addition to any liability which the Company
may otherwise have.
(b) In the event of a Shelf Registration Statement, each Holder
(including any Initial Purchaser or Exchanging Dealer) shall indemnify and
hold harmless the Company, its affiliates, their respective officers,
directors, employees, representatives and agents, and each person, if any,
who controls the Company within the meaning of the Securities Act or the
Exchange Act (collectively referred to for purposes of this Section 6(b)
and Section 7 as the Company), from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to which the
Company may become subject, whether commenced or threatened, under the
Securities Act, the Exchange Act, any other federal or state statutory law
or regulation, at common law or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained in any
such Registration Statement or any prospectus forming part thereof or in
any amendment or supplement thereto or (ii) the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, but in each case
only to the extent that the untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in conformity
with any Holders' Information furnished to the Company by such Holder, and
shall reimburse the Company promptly upon demand for any legal or other
expenses reasonably incurred by the Company in connection with
investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are incurred; provided,
however, that no such Holder shall be liable for any indemnity claims
hereunder in excess of the amount of net proceeds received by such Holder
from the sale of Securities, Exchange Securities or Private Exchange
Securities pursuant to such Shelf Registration Statement. This indemnity
agreement will be in addition to any liability which any such Holder may
otherwise have.
(c) Promptly after receipt by an indemnified party under this
Section 6 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party pursuant to Section 6(a) or 6(b), notify the
indemnifying party in writing of the claim or the commencement of that
action; provided, however, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may have under this
Section 6 except to the extent that it has been materially prejudiced
(through the forfeiture of substantive rights or defenses) by such failure;
and provided, further, that the failure to notify the indemnifying party
shall not relieve it from any liability which it may have to an indemnified
party otherwise than under this Section 6. If any such claim or action
shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any
other similarly notified indemnifying party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. After notice
from the indemnifying party to the indemnified party of its election to
assume the defense of such claim or action, the indemnifying party shall
not be liable to the indemnified party under this Section 6 for any legal
or other expenses subsequently incurred by the indemnified party in
connection with the defense thereof other than the reasonable costs of
investigation; provided, however, that an indemnified party shall have the
right to employ its own counsel in any such action, but the fees, expenses
and other charges of such counsel for the indemnified party will be at the
expense of such indemnified party unless (1) the employment of counsel by
the indemnified party has been authorized in writing by the indemnifying
party, (2) the indemnified party has reasonably concluded (based
<PAGE>
upon advice of counsel to the indemnified party) that there may be legal
defenses available to it or other indemnified parties that are different
from or in addition to those available to the indemnifying party, (3) a
conflict or potential conflict exists (based upon advice of counsel to the
indemnified party) between the indemnified party and the indemnifying party
(in which case the indemnifying party will not have the right to direct the
defense of such action on behalf of the indemnified party) or (4) the
indemnifying party has not in fact employed counsel reasonably satisfactory
to the indemnified party to assume the defense of such action within a
reasonable time after receiving notice of the commencement of the action,
in each of which cases the reasonable fees, disbursements and other charges
of counsel will be at the expense of the indemnifying party or parties. It
is understood that the indemnifying party or parties shall not, in
connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees, disbursements and other
charges of more than one separate firm of attorneys (in addition to any
local counsel) at any one time for all such indemnified party or parties.
Each indemnified party, as a condition of the indemnity agreements
contained in Sections 6(a) and 6(b), shall use all reasonable efforts to
cooperate with the indemnifying party in the defense of any such action or
claim. No indemnifying party shall be liable for any settlement of any such
action effected without its written consent (which consent shall not be
unreasonably withheld), but if settled with its written consent or if there
be a final judgment for the plaintiff in any such action, the indemnifying
party agrees to indemnify and hold harmless any indemnified party from and
against any loss or liability by reason of such settlement or judgment. No
indemnifying party shall, without the prior written consent of the
indemnified party (which consent shall not be unreasonably withheld),
effect any settlement of any pending or threatened proceeding in respect of
which any indemnified party is or could have been a party and indemnity
could have been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such proceeding.
7. Contribution. If the indemnification provided for in Section 6
is unavailable or insufficient to hold harmless an indemnified party under
Section 6(a) or 6(b), then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or
payable by such indemnified party as a result of such loss, claim, damage
or liability, or action in respect thereof, (i) in such proportion as shall
be appropriate to reflect the relative benefits received by the Company
from the offering and sale of the Securities, on the one hand, and a Holder
with respect to the sale by such Holder of Securities, Exchange Securities
or Private Exchange Securities, on the other, or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company,
on the one hand, and such Holder, on the other, with respect to the
statements or omissions that resulted in such loss, claim, damage or
liability, or action in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Company, on
the one hand, and a Holder, on the other, with respect to such offering and
such sale shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Securities (before deducting expenses)
received by or on behalf of the Company as set forth in the table on the
cover of the Offering Memorandum, on the one hand, bear to the total
proceeds received by such Holder with respect to its sale of Securities,
Exchange Securities or Private Exchange Securities, on the other. The
relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to the
Company or information supplied by the Company, on the one hand, or to any
Holders* Information supplied by such Holder, on the other, the intent of
the parties and their relative knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. The
parties hereto agree that it would not be just and equitable if
contributions pursuant to this Section 7 were to be determined by pro rata
allocation or by any other method of allocation that does not take into
account the equitable considerations referred to herein. The amount paid or
payable by an indemnified party as a result of the loss, claim, damage or
liability, or action in respect thereof, referred to above in this Section
7 shall be deemed to include, for purposes of this Section 7, any legal or
other expenses reasonably incurred by such indemnified party in connection
with investigating or defending or preparing to defend any such action or
claim. Notwithstanding the provisions of this Section 7, an indemnifying
party that is a Holder of Securities, Exchange Securities or Private
Exchange Securities shall not be required to contribute any amount in
excess of the amount by which the total price at which the Securities,
Exchange Securities or Private Exchange Securities sold by such
indemnifying party to any purchaser exceeds the amount of any damages which
such indemnifying party has otherwise paid or become liable to pay by
reason of any untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
8. Rules 144 and 144A. The Company shall use its
reasonable best efforts to file the reports required to be filed by it
under the Securities Act and the Exchange Act in a timely manner and,
<PAGE>
if at any time the Company is not required to file such reports, it will,
upon the written request of any Holder of Transfer Restricted Securities,
make publicly available other information so long as necessary to permit
sales of such Holder's securities pursuant to Rules 144 and 144A. The
Company covenants that it will take such further action as any Holder of
Transfer Restricted Securities may reasonably request, all to the extent
required from time to time to enable such Holder to sell Transfer
Restricted Securities without registration under the Securities Act within
the limitation of the exemptions provided by Rules 144 and 144A (including,
without limitation, the requirements of Rule 144A(d)(4)). Upon the written
request of any Holder of Transfer Restricted Securities, the Company shall
deliver to such Holder a written statement as to whether it has complied
with such requirements. Notwithstanding the foregoing, nothing in this
Section 8 shall be deemed to require the Company to register any of its
securities pursuant to the Exchange Act.
9. Underwritten Registrations. If any of the Transfer Restricted
Securities covered by any Shelf Registration Statement are to be sold in an
underwritten offering, the investment banker or investment bankers and
manager or managers that will administer the offering will be selected by
the Holders of a majority in aggregate principal amount of such Transfer
Restricted Securities included in such offering, subject to the consent of
the Company (which shall not be unreasonably withheld or delayed), and such
Holders shall be responsible for all underwriting commissions and discounts
in connection therewith.
No person may participate in any underwritten registration
hereunder unless such person (i) agrees to sell such person's Transfer
Restricted Securities on the basis reasonably provided in any underwriting
arrangements approved by the persons entitled hereunder to approve such
arrangements and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents
reasonably required under the terms of such underwriting arrangements.
10. Miscellaneous. (a) Amendments and Waivers. The provisions of
this Agreement may not be amended, modified or supplemented, and waivers or
consents to departures from the provisions hereof may not be given, unless
the Company has obtained the written consent of Holders of a majority in
aggregate principal amount of the Securities, the Exchange Securities and
the Private Exchange Securities, taken as a single class. Notwithstanding
the foregoing, a waiver or consent to depart from the provisions hereof
with respect to a matter that relates exclusively to the rights of Holders
whose Securities, Exchange Securities or Private Exchange Securities are
being sold pursuant to a Registration Statement and that does not directly
or indirectly affect the rights of other Holders may be given by Holders of
a majority in aggregate principal amount of the Securities, the Exchange
Securities and the Private Exchange Securities being sold by such Holders
pursuant to such Registration Statement.
(b) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class
mail, telecopier or air courier guaranteeing next-day delivery:
(1) if to a Holder, at the most current address given by such
Holder to the Company in accordance with the provisions of this
Section 10(b), which address initially is, with respect to each
Holder, the address of such Holder maintained by the Registrar under
the Indenture, with a copy in like manner to Chase Securities Inc.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated, and Bear, Stearns
& Co. Inc.;
(2) if to an Initial Purchaser, initially at its address set
forth in the Purchase Agreement; and
(3) if to the Company, initially at the address of the Company
set forth in the Purchase Agreement.
All such notices and communications shall be deemed to have been
duly given: when delivered by hand, if personally delivered; one business
day after being delivered to a next-day air courier; five business days
after being deposited in the mail; and when receipt is acknowledged by the
recipient's telecopier machine, if sent by telecopier.
(c) Successors And Assigns. This Agreement shall be binding upon
the Company and its successors and assigns.
(d) Counterparts. This Agreement may be executed in any number of
counterparts (which may be delivered in original form or by telecopier) and
by the parties hereto in separate
<PAGE>
counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
(e) Definition of Terms. For purposes of this Agreement, (a)
the term "business day" means any day on which the New York Stock Exchange,
Inc. is open for trading, (b) the term "subsidiary" has the meaning set
forth in Rule 405 under the Securities Act and (c) except where otherwise
expressly provided, the term "affiliate" has the meaning set forth in Rule
405 under the Securities Act.
(f) Headings. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.
(g) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
(h) Remedies. In the event of a breach by the Company or by any
Holder of any of their obligations under this Agreement, each Holder or the
Company, as the case may be, in addition to being entitled to exercise all
rights granted by law, including recovery of damages (other than the
recovery of damages for a breach by the Company of its obligations under
Sections 1 or 2 hereof for which liquidated damages have been paid pursuant
to Section 3 hereof), will be entitled to specific performance of its
rights under this Agreement. The Company and each Holder agree that
monetary damages would not be adequate compensation for any loss incurred
by reason of a breach by it of any of the provisions of this Agreement and
hereby further agree that, in the event of any action for specific
performance in respect of such breach, it shall waive the defense that a
remedy at law would be adequate.
(i) No Inconsistent Agreements. The Company represents, warrants
and agrees for the period commencing on the date hereof and ending on the
date on which there are no Transfer Restricted Securities outstanding that
(i) it has not entered into, shall not, on or after the date of this
Agreement, enter into any agreement that is inconsistent with the rights
granted to the Holders in this Agreement or otherwise conflicts with the
provisions hereof, (ii) it has not previously entered into any agreement
which remains in effect granting any registration rights with respect to
any of its debt securities to any person and (iii) without limiting the
generality of the foregoing, without the written consent of the Holders of
a majority in aggregate principal amount of the then outstanding Transfer
Restricted Securities, it shall not grant to any person the right to
request the Company to register any debt securities of the Company under
the Securities Act unless the rights so granted are not in conflict or
inconsistent with the provisions of this Agreement.
(j) No Piggyback on Registrations. Neither the Company nor any of
its security holders (other than the Holders of Transfer Restricted
Securities in such capacity) shall have the right to include any securities
of the Company in any Shelf Registration or Registered Exchange Offer other
than Transfer Restricted Securities.
(k) Severability. The remedies provided herein are cumulative and
not exclusive of any remedies provided by law. If any term, provision,
covenant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, illegal, void or unenforceable, the remainder
of the terms, provisions, covenants and restrictions set forth herein shall
remain in full force and effect and shall in no way be affected, impaired
or invalidated, and the parties hereto shall use their reasonable best
efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the
intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that
may be hereafter declared invalid, illegal, void or unenforceable.
<PAGE>
Please confirm that the foregoing correctly sets forth the
agreement among the Company and the Initial Purchasers.
Very truly yours,
JONES APPAREL GROUP, INC.
by: /s/ Wesley R. Card
-----------------------
Wesley R. Card
Chief Financial Officer
Accepted:
CHASE SECURITIES INC.
by: /s/ John W. Judson
-----------------------------
Authorized Signatory
MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED
by: /s/ Cynthia L. Bates
-----------------------------
Authorized Signatory
BEAR, STEARNS & CO. INC.
by: /s/ Jacques de Saint Phalle
-----------------------------
Authorized Signatory
<PAGE>
ANNEX A
Each broker-dealer that receives Exchange Securities for its own
account pursuant to the Registered Exchange Offer must acknowledge that it
will deliver a prospectus in connection with any resale of such Exchange
Securities. The Letter of Transmittal states that by so acknowledging and
by delivering a prospectus, a broker-dealer will not be deemed to admit
that it is an "underwriter" within the meaning of the Securities Act. This
Prospectus, as it may be amended or supplemented from time to time, may be
used by a broker-dealer in connection with resales of Exchange Securities
received in exchange for Securities where such Securities were acquired by
such broker-dealer as a result of market-making activities or other trading
activities. The Company has agreed that, starting on the date hereof and
ending on the close of business on the earlier to occur of (i) the date on
which all Exchange Securities held by broker-dealers eligible to use the
Prospectus to satisfy their prospectus delivery obligations under the
Securities Act have been sold and (ii) the date 180 days after the
consummation of the Registered Exchange Offer (the "Expiration Date"), it
will make this Prospectus available to any broker-dealer for use in
connection with any such resale. See "Plan of Distribution".
<PAGE>
ANNEX B
Each broker-dealer that receives Exchange Securities for its own
account in exchange for Securities, where such Securities were acquired by
such broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in
connection with any resale of such Exchange Securities. See "Plan of
Distribution".
<PAGE>
ANNEX C
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange Securities for its own
account pursuant to the Registered Exchange Offer must acknowledge that it
will deliver a prospectus in connection with any resale of such Exchange
Securities. This Prospectus, as it may be amended or supplemented from time
to time, may be used by a broker-dealer in connection with resales of
Exchange Securities received in exchange for Securities where such
Securities were acquired as a result of market-making activities or other
trading activities. The Company has agreed that, starting on the date
hereof and ending on the close of business on the earlier to occur of (i)
the date on which all Exchange Securities held by broker-dealers eligible
to use the Prospectus to satisfy their prospectus delivery obligations
under the Securities Act have been sold and (ii) the date 180 days after
the consummation of the Registered Exchange Offer (the "Expiration Date"),
it will make this prospectus, as amended or supplemented, available to any
broker-dealer for use in connection with any such resale. In addition,
until [ ] 199[ ], all dealers effecting
transactions in the Exchange Securities may be required to deliver a
prospectus.
The Company will not receive any proceeds from any sale of
Exchange Securities by broker-dealers. Exchange Securities received by
broker-dealers for their own account pursuant to the Registered Exchange
Offer may be sold from time to time in one or more transactions in the
over-the-counter market, in negotiated transactions, through the writing of
options on the Exchange Securities or a combination of such methods of
resale, at market prices prevailing at the time of resale, at prices
related to such prevailing market prices or at negotiated prices. Any such
resale may be made directly to purchasers or to or through brokers or
dealers who may receive compensation in the form of commissions or
concessions from any such broker-dealer or the purchasers of any such
Exchange Securities. Any broker-dealer that resells Exchange Securities
that were received by it for its own account pursuant to the Registered
Exchange Offer and any broker or dealer that participates in a distribution
of such Exchange Securities may be deemed to be an "underwriter" within the
meaning of the Securities Act and any profit on any such resale of Exchange
Securities and any commission or concessions received by any such persons
may be deemed to be underwriting compensation under the Securities Act. The
Letter of Transmittal states that, by acknowledging that it will deliver
and by delivering a prospectus, a broker-dealer will not be deemed to admit
that it is an "underwriter" within the meaning of the Securities Act.
For a period starting on the date hereof and ending on the close
of business on the earlier to occur of (i) the date on which all Exchange
Securities held by broker-dealers eligible to use the Prospectus to satisfy
their prospectus delivery obligations under the Securities Act have been
sold and (ii) the Expiration Date, the Company will promptly send
additional copies of this Prospectus and any amendment or supplement to
this Prospectus to any broker-dealer that requests such documents in the
Letter of Transmittal. The Company has agreed to pay all expenses incident
to the Registered Exchange Offer (including the expenses of one counsel for
the Holders of the Securities) other than commissions or concessions of any
broker-dealers and will indemnify the Holders of the Securities (including
any broker-dealers) against certain liabilities, including liabilities
under the Securities Act.
<PAGE>
ANNEX D
CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10
ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR
SUPPLEMENTS THERETO.
Name:
Address:
If the undersigned is not a broker-dealer, the undersigned represents that
it is (i) acquiring the Exchange Securities in the ordinary course of its
business, (ii) has no arrangement or understanding with any person, nor
does it intend to engage in, a distribution (as that term is interpreted by
the Securities and Exchange Commission) of Exchange Securities and (iii) it
is not an affiliate (as that term is interpreted by the Securities and
Exchange Commission) of the Company. If the undersigned is a broker-dealer
that will receive Exchange Securities for its own account in exchange for
Securities that were acquired as a result of market-making activities or
other trading activities, it acknowledges that it will deliver a prospectus
in connection with any resale of such Exchange Securities; however, by so
acknowledging and by delivering a prospectus, the undersigned will not be
deemed to admit that it is an "underwriter" within the meaning of the
Securities Act.
Exhibit 5.1
[Letterhead of Ira M. Dansky]
December 9, 1998
Board of Directors
Jones Apparel Group, Inc.
250 Rittenhouse Circle
Bristol, Pennsylvania 19007
Ladies and Gentlemen:
I have acted as counsel for Jones Apparel Group, Inc., a
Pennsylvania corporation (the "Company"), in connection with the filing by
the Company with the Securities and Exchange Commission (the "SEC") of a
registration statement on Form S-4 (the "Registration Statement") under the
Securities Act of 1933, as amended (the "Act"), relating to the proposed
issuance, in exchange (the "Exchange Offer") for any and all of the
Company's outstanding 6.25% Senior Notes due 2001, which have certain
transfer restrictions (the "Restricted Notes"), of up to $265,000,000
aggregate principal amount of the Company's 6.25% Senior Notes due 2001
(the "Exchange Notes"), which will be freely transferable. The Exchange
Notes are to be issued pursuant to the indenture dated as of October 2,
1998 (the "Indenture") by and among the Company, as issuer, and The Chase
Manhattan Bank, as trustee (the "Trustee").
In that connection, I have examined originals, or copies
certified or otherwise identified to my satisfaction, of such documents,
corporate records and other instruments as I have deemed necessary for
purposes of this opinion, including the Indenture.
Based on the foregoing, I am of opinion as follows:
1. The Indenture has been duly authorized, executed and delivered
by the Company and, assuming the due authorization, execution and delivery
thereof by the Trustee, the Indenture constitutes a legal, valid and
binding obligation of the Company enforceable against the Company in
accordance with its terms (subject to applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or other similar laws
affecting creditors' rights generally from time to time in effect and to
general principles of equity, including concepts of materiality,
reasonableness, good faith and fair dealing,
<PAGE>
regardless of whether such enforceability is considered in a proceeding in
equity or at law).
2. The Exchange Notes have been duly authorized by the Company,
and when executed and authenticated in accordance with the provisions of
the Indenture and delivered in exchange for the Restricted Notes pursuant
to the Exchange Offer, will constitute valid and binding obligations of the
Company, enforceable against the Company in accordance with their terms and
entitled to the benefits of the Indenture (subject to applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer or
other similar laws affecting creditors' rights generally from time to time
in effect and to general principles of equity, including concepts of
materiality, reasonableness, good faith and fair dealing, regardless of
whether such enforceability is considered in a proceeding in equity or at
law). In expressing the opinion set forth in this paragraph 2, I have
assumed that the form of the Exchange Notes will conform to that included
in the Indenture.
I am admitted to practice in the State of New York, and I express
no opinion as to any matters governed by any law other than the law of the
State of New York and the Federal law of the United States of America.
In rendering this opinion, I have relied upon the opinion dated
December 9, 1998, of Mesirov Gelman Jaffe Cramer & Jamieson, LLP, a copy of
which appears as Exhibit 5.2 to the Registration Statement, as to all
matters of law covered therein relating to the laws of the Commonwealth of
Pennsylvania.
I hereby consent to the reference to me under the heading "Legal
Matters" in the Registration Statement and in the related Prospectus and to
the filing of this opinion as an Exhibit to the Registration Statement. In
giving this consent, I do not thereby admit that I am included in the
category of persons whose consent is required under Section 7 of the Act or
the rules and regulations of the Commission.
This opinion is being delivered to you in my capacity as the
General Counsel of the Company and solely for the purpose of being included
as an exhibit to the Registration Statement. This opinion addresses matters
only as of the date hereof and is solely for the benefit of the
<PAGE>
addressees hereof and may not be relied upon in any manner for any other
purpose without my prior written consent.
Sincerely,
/s/ Ira M. Dansky
-----------------------
Ira M. Dansky
General Counsel
Exhibit 5.2
December 9, 1998
Ira M. Dansky, Esq.
Jones Apparel Group, Inc.
1411 Broadway
New York, NY 10018
Re: Jones Apparel Group, Inc.
Registration Statement on Form S-4
Dear Mr. Dansky:
As special Pennsylvania counsel to Jones Apparel Group,
Inc., a Pennsylvania corporation (the "Company"), we have been
requested to render this opinion in connection with the Company's
Registration Statement on Form S-4 (the "Registration
Statement"), which is being filed with the Securities and
Exchange Commission (the "SEC") on December 9, 1998, under the
Securities Act of 1933 (the "Act").
The Registration Statement relates to the proposed offer to
exchange (the "Exchange Offer") up to $265,000,000 aggregate
principal amount of new 6.25% Senior Notes due 2001 (the
"Exchange Notes"), which will be freely transferable, for any and
all outstanding 6.25% Senior Notes due 2001 issued in a private
offering on October 2, 1998 (the "Restricted Notes"), which have
certain transfer restrictions.
For purposes of this opinion we have examined the Company's
Registration Statement; the Consent of Board of Directors of the
Company dated September 28, 1998; the Indenture dated October 2,
1998, by and between the Company and The Chase Manhattan Bank, as
trustee (the "Trustee"); the Certificate of Ira M. Dansky,
Esquire, General Counsel of the Company, dated December 9, 1998;
and such other documents as we deem necessary for the purpose of
rendering this opinion. With respect to the foregoing documents,
we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us an originals and
the conformity to originals of all documents submitted to us as
certified or reproduced copies.
As special Pennsylvania counsel to the Company, we are not
necessarily familiar with all of the Company's affairs. As a
further basis for this opinion, we have made such inquiry of the
Company as we have deemed necessary or appropriate for the
purpose of rendering this opinion.
<PAGE>
2
Based on the foregoing, we are of the opinion that:
1. The Indenture has been duly authorized, executed and
delivered by the Company and, assuming the due
authorization, execution and delivery thereof by the
Trustee, the Indenture constitutes the legal, valid and
binding obligation of the Company enforceable against
the Company in accordance with its terms.
2. The Exchange Notes to be issued by the Company in
exchange for the Restricted Notes have been duly
authorized and when executed and authenticated in
accordance with the provisions of the Indenture and the
Exchange Offer, will constitute valid and binding
obligations of the Company enforceable in accordance
with their terms, and will be entitled to the benefits
of the Indenture. In expressing the opinion set forth
in this letter, we have assumed that the form of the
Exchange Notes will conform to that included in the
Indenture.
Our opinion set forth in this letter are subject to the
effect of (i) bankruptcy, insolvency, reorganization,
arrangement, moratorium, fraudulent conveyance or other similar
laws relating to or affecting the rights of creditors generally,
and (ii) limitations imposed by general principles of equity,
regardless of whether the relevant matter is considered in
proceedings at law or in equity, including with respect to
certain covenants and provisions of the Indenture, where the
Trustee's enforcement of such covenants or provisions under the
circumstances or, in the specified manner, would violate a
creditor's or secured party's implied covenant of good faith and
fair dealing or would be commercially unreasonable.
Enforceability of the Indenture may also be limited to the extent
that remedies are sought for a breach that a court concludes is
immaterial or does not affect the Trustee.
We are members of the Bar of the Commonwealth of
Pennsylvania and do not hold ourselves out as being experts on
laws other than the laws of the United States of America and the
laws of the Commonwealth of Pennsylvania.
This opinion is given as of the date hereof and is limited
to the facts, circumstances and matters set forth herein and to
laws currently in effect. No opinion may be inferred or is
implied beyond matters expressly set forth herein, and we do not
undertake and assume no obligation to update or supplement this
opinion to reflect any facts or
<PAGE>
3
circumstances which may hereinafter come to our attention or any
change in law which may hereafter occur.
This opinion is furnished for your benefit and the benefit
of the holders of the Restricted Notes referred to in the
Registration Statement and may not be used or relied upon by any
other person or entity or in connection with any other
transaction without our prior written consent.
We hereby consent to the reference to this Firm under the
heading "Legal Matters" in the Registration Statement and in the
related Prospectus and to the filing of this opinion as an
Exhibit to the Registration Statement.
Sincerely,
/s/ Mesirov Gelman Jaffe
Cramer & Jamieson LLP
Exhibit 12.1
<TABLE>
JONES APPAREL GROUP, INC.
RATIO OF EARNINGS TO FIXED CHARGES
<CAPTION>
Nine Year
Months Ended
Ended December 31,
September 27, ----------------------------------------------------
1998 1997 1996 1995 1994 1993
------------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Income before income taxes $199,587 $194,609 $127,763 $ 99,668 $ 87,345 $ 79,019
Fixed charges
Interest expense 3,762 3,584 3,040 1,908 1,212 716
Portion of rent expense
representing interest 6,404 7,379 6,290 5,115 3,715 2,915
Financing cost amortization - - - - - -
------- -------- ------- --------- -------- -------
Total fixed charges excluding
capitalized interest 10,166 10,963 9,330 7,023 4,927 3,631
Capitalized interest 671 370 181 181 20 29
------- -------- ------- --------- -------- -------
Total fixed charges 10,837 11,333 9,511 7,204 4,947 3,660
------- -------- ------- --------- -------- -------
Income before income taxes
and fixed charges $209,753 $205,572 $137,093 $106,691 $ 92,272 $ 82,650
======== ======== ======== ======== ======== ========
Ratio of earnings to fixed
charges 19.4 18.1 14.4 14.8 18.7 22.6
======== ======== ======== ======== ======== ========
</TABLE>
Exhibit 23.1
CONSENT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
Jones Apparel Group, Inc.
New York, New York
We hereby consent to the incorporation by reference in the
Prospectus constituting a part of this Registration Statement of
our report dated February 6, 1998, relating to the consolidated
financial statements and schedule of Jones Apparel Group, Inc.
and subsidiaries, which is incorporated by reference in that
Prospectus.
We also consent to the reference to us under the caption
"Experts" in that Prospectus.
/s/ BDO Seidman, LLP
---------------------
BDO Seidman, LLP
New York, NY
December 8, 1998
Exhibit 23.2
Consent of Independent Auditors
We consent to the reference to our firm under the caption
"Experts" in the Registration Statement Form S-4 of Jones Apparel
Group, Inc. for the registration of $265,000,000 of Senior Notes
and to the incorporation by reference therein of our report dated
March 26, 1998, except for Note 17 as to which the date is
September 10, 1998, with respect to the consolidated financial
statements of Sun Apparel, Inc. included in Jones Apparel Group,
Inc.'s Current Report on Form 8-K dated September 24, 1998, filed
with the Securities and Exchange Commission.
ERNST & YOUNG LLP
San Antonio, Texas
December 7, 1998
Exhibit 25.1
-------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) -------
----------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
---------------------------------------------
Jones Apparel Group, Inc.
(Exact name of obligor as specified in its charter)
Pennsylvania 06-0935166
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
250 Rittenhouse Circle
Bristol, Pennsylvania 19007
(Address of principal executive offices) (Zip Code)
----------------------------------------
6.25% Senior Notes Due October 1, 2001
----------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington,
D.C., 20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty
Street, New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee as now
in effect, including the Organization Certificate and the Certificates of
Amendment dated February 17, 1969, August 31, 1977, December 31, 1980,
September 9, 1982, February 28, 1985, December 2, 1991 and July 10, 1996
(see Exhibit 1 to Form T-1 filed in connection with Registration Statement
No. 333-06249, which is incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to
Commence Business (see Exhibit 2 to Form T-1 filed in connection with
Registration Statement No. 33-50010, which is incorporated by reference. On
July 14, 1996, in connection with the merger of Chemical Bank and The Chase
Manhattan Bank (National Association), Chemical Bank, the surviving
corporation, was renamed The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being
contained in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4
to Form T-1 filed in connection with Registration Statement No. 333-06249,
which is incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the
Act (see Exhibit 6 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14,
1996, in connection with the merger of Chemical Bank and The Chase
Manhattan Bank (National Association), Chemical Bank, the surviving
corporation, was renamed The Chase Manhattan Bank).
7. A copy of the latest report of condition of the Trustee,
published pursuant to law or the requirements of its supervising or
examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939
the Trustee, The Chase Manhattan Bank, a corporation organized and existing
under the laws of the State of New York, has duly caused this statement of
eligibility to be signed on its behalf by the undersigned, thereunto duly
authorized, all in the City of New York and State of New York, on the 9th
day of December, 1998.
THE CHASE MANHATTAN BANK
By /s/ Sheik Wiltshire
----------------------------------------
Sheik Wiltshire, Second Vice President
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business September 30, 1998, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin ............................. $ 11,951
Interest-bearing balances ..................... 4,551
Securities:
Held to maturity securities ........................ 1,740
Available for sale securities ...................... 48,537
Federal funds sold and securities purchased under
agreements to resell .......................... 29,730
Loans and lease financing receivables:
Loans and leases, net of unearned income ...... $127,379
Less: Allowance for loan and lease losses ..... 2,719
Less: Allocated transfer risk reserve ......... 0
Loans and leases, net of unearned income, --------
allowance, and reserve ......................... 124,660
Trading Assets ...................................... 51,549
Premises and fixed assets (including capitalized
leases)......................................... 3,009
Other real estate owned ............................. 272
Investments in unconsolidated subsidiaries and
associated companies ........................... 300
Customers' liability to this bank on acceptances
outstanding .................................... 1,329
Intangible assets ................................... 1,429
Other assets ........................................ 13,563
--------
TOTAL ASSETS ........................................ $292,620
========
<PAGE>
LIABILITIES
Deposits
In domestic offices ............................. $98,760
Noninterest-bearing ............................. $39,071
Interest-bearing ................................ 59,689
In foreign offices, Edge and Agreement, -------
subsidiaries and IBF's .......................... 75,403
Noninterest-bearing ............................. $ 3,877
Interest-bearing ................................ 71,526
Federal funds purchased and securities sold under agree-
ments to repurchase .................................. 34,471
Demand notes issued to the U.S. Treasury ............. 1,000
Trading liabilities .................................. 41,589
Other borrowed money (includes mortgage indebtedness
and obligations under
capitalized leases):
With a remaining maturity of one year or less ... 3,781
With a remaining maturity of more than one year .
through three years....................... 213
With a remaining maturity of more than three years 104
Bank's liability on acceptances executed and outstanding 1,329
Subordinated notes and debentures ..................... 5,408
Other liabilities ..................................... 12,041
TOTAL LIABILITIES ..................................... 274,099
-------
EQUITY CAPITAL
Perpetual preferred stock and related surplus 0
Common stock ........................................... 1,211
Surplus (exclude all surplus related to preferred stock) 10,441
Undivided profits and capital reserves ................. 6,287
Net unrealized holding gains (losses)
on available-for-sale securities ....................... 566
Cumulative foreign currency translation adjustments .... 16
TOTAL EQUITY CAPITAL ................................... 18,521
------
TOTAL LIABILITIES AND EQUITY CAPITAL ................... $292,620
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named
bank, do hereby declare that this Report of Condition has
been prepared in conformance with the instructions issued
by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
We, the undersigned directors, attest to the correctness
of this Report of Condition and declare that it has been
examined by us, and to the best of our knowledge and
belief has been prepared in conformance with the
instructions issued by the appropriate Federal
regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR. )
EXHIBIT 99.1
LETTER OF TRANSMITTAL
JONES APPAREL GROUP, INC.
OFFER TO EXCHANGE
6.25% SENIOR NOTES DUE 2001
FOR ANY AND ALL OUTSTANDING 6.25% SENIOR NOTES DUE 2001
PURSUANT TO THE PROSPECTUS, DATED [ ]
THE EXCHANGE OFFER WILL
EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON [ ], 1999, UNLESS THE
EXCHANGE OFFER IS EXTENDED.
TO: THE CHASE MANHATTAN BANK (THE "EXCHANGE AGENT")
By Mail, Overnight Mail or Hand
Delivery before 4:30 p.m.:
The Chase Manhattan Bank
450 West 33rd Street
15th Floor
New York, New York 10001-2967
Attention: Global Trust Services
By Facsimile:
(212) 946-8161
Attention: Sheik Wiltshire
For Information or Confirmation
by Telephone:
(212) 946-3082
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OR TRANSMISSION TO A
FACSIMILE NUMBER OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID
DELIVERY. THE METHOD OF DELIVERY OF ALL DOCUMENTS, INCLUDING CERTIFICATES,
IS AT THE RISK OF THE HOLDER. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH
RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. YOU SHOULD READ
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL CAREFULLY BEFORE
YOU COMPLETE THIS LETTER OF TRANSMITTAL.
The undersigned acknowledges that he or she has received the
Prospectus, dated [ ] (the "Prospectus") of Jones Apparel
Group, Inc., a Pennsylvania corporation (the "Company"), and this Letter of
Transmittal and the instructions hereto (the "Letter of Transmittal"),
which together constitute the Company's offer (the "Exchange Offer") to
exchange $1,000 principal amount of each of its 6.25% Senior Notes due 2001
(the "Exchange Notes") the offering of which has been registered under the
Securities Act of 1933, as amended (the
<PAGE>
"Securities Act"), pursuant to a Registration Statement of which the
Prospectus is a part, for each $1,000 principal amount of its outstanding
6.25% Senior Notes due 2001 (the "Restricted Notes"), of which $265,000,000
aggregate principal amount is outstanding, upon the terms and subject to
the conditions set forth in the Prospectus. The term "Expiration Date"
Shall mean 5:00 p.m., New York City time, on [ ], 1999, unless the
Company, in its sole discretion, extends the Exchange Offer, in which case
the term shall mean the latest date and time to which the Exchange Offer is
extended by the Company. Capitalized terms used but not defined herein have
the meaning given to them in the Prospectus.
This Letter of Transmittal is to be used if either (1) certificates
representing Restricted Notes are to be physically delivered to the
Exchange Agent herewith by Holders (as defined below), (2) tender of
Restricted Notes is to be made by book-entry transfer to an account
maintained by the Exchange Agent at The Depository Trust Company ("DTC"),
pursuant to the procedures set forth in "The Exchange Offer--Procedures for
Tendering" in the Prospectus by any financial institution that is a
participant in DTC and whose name appears on a security position listing as
the owner of Restricted Notes or (3) tender of Restricted Notes is to be
made according to the guaranteed delivery procedures set forth in the
Prospectus under "The Exchange Offer--Guaranteed Delivery Procedures."
Delivery of this Letter of Transmittal and any other required documents
must be made to the Exchange Agent.
DELIVERY OF DOCUMENTS TO DTC IN ACCORDANCE WITH DTC PROCEDURES
DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.
The term "Holder" as used herein means any person in whose name
Restricted Notes are registered on the books of the Company or any other
person who has obtained a properly completed bond power from the registered
holder.
All Holders of Restricted Notes who wish to tender their Restricted
Notes must, prior to the Expiration Date: (1) complete, sign, and deliver
this Letter of Transmittal, or a facsimile thereof, to the Exchange Agent,
in person or to the address set forth above; and (2) tender (and not
withdraw) his or her Restricted Notes or, if a tender of Restricted Notes
is to be made by book-entry transfer to the account maintained by the
Exchange Agent at DTC, confirm such book-entry transfer (a "Book-Entry
Confirmation"), in each case in accordance with the procedures for
tendering described in the Instructions to this Letter of Transmittal.
Holders of Restricted Notes whose certificates are not immediately
available, or who are unable to deliver their certificates or Book-Entry
Confirmation and all other documents required by this Letter of Transmittal
to be delivered to the Exchange Agent on or prior to the Expiration Date,
must tender their Restricted Notes according to the guaranteed delivery
procedures set forth under the caption "The Exchange Offer--Guaranteed
Delivery Procedures" in the Prospectus. (See Instruction 2.)
Upon the terms and subject to the conditions of the Exchange Offer,
the acceptance for exchange of the Restricted Notes validly tendered and
not withdrawn and the issuance of the Exchange Notes will be made promptly
following the Expiration Date. For the purposes of the Exchange Offer, the
Company shall be deemed to have accepted for exchange validly tendered
Restricted Notes when, as and if the Company has given written notice
thereof to the Exchange Agent.
The undersigned has completed, executed and delivered this Letter of
Transmittal to indicate the action the undersigned desires to take with
<PAGE>
respect to the Exchange Offer.
PLEASE READ THE ENTIRE LETTER OF TRANSMITTAL AND THE PROSPECTUS
CAREFULLY BEFORE CHECKING ANY BOX BELOW. THE INSTRUCTIONS INCLUDED IN THIS
LETTER OF TRANSMITTAL MUST BE FOLLOWED. QUESTIONS AND REQUESTS FOR
ASSISTANCE OR FOR ADDITIONAL COPIES OF THE PROSPECTUS, THIS LETTER OF
TRANSMITTAL AND THE NOTICE OF GUARANTEED DELIVERY MAY BE DIRECTED TO THE
EXCHANGE AGENT. SEE INSTRUCTION 12.
HOLDERS WHO WISH TO ACCEPT THE EXCHANGE OFFER AND TENDER THEIR
RESTRICTED NOTES MUST COMPLETE THIS LETTER OF TRANSMITTAL IN ITS ENTIRETY
AND COMPLY WITH ALL OF ITS TERMS.
List below the Restricted Notes to which this Letter of Transmittal
relates. If the space provided below is inadequate, the Certificate Numbers
and Principal Amounts should be listed on a separate signed schedule,
attached hereto. The minimum permitted tender is $1,000 in principal amount
of each of the 6.25% Senior Notes due 2001. All other tenders must be in
integral multiples of $1,000.
<PAGE>
DESCRIPTION OF 6.25% SENIOR NOTES DUE 2001
BOX I
NAME(S) AND
ADDRESS(ES)
OF
REGISTERED
HOLDER(S)*
(PLEASE FILL
IN, IF
BLANK)
- -------------------- -------------------- -----------------------------------
(A) (B)
CERTIFICATE AGGREGATE PRINCIPAL
NUMBERS(S) AMOUNT TENDERED
(IF LESS THAN ALL)**
______________ ______________ ______________
______________ ______________ ______________
______________ ______________ ______________
TOTAL
PRINCIPAL
AMOUNT OF
RESTRICTED
NOTES ______________
- ------------------------------------------------------------------------------
*Need not be completed by book-entry holders.
**Need not be completed by Holders who wish to tender all Restricted Notes
listed.
<PAGE>
PLEASE READ CAREFULLY THE ACCOMPANYING INSTRUCTIONS
BOX II BOX III
SPECIAL REGISTRATION INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 4,5 AND 6) (SEE INSTRUCTIONS 4, 5 AND 6)
To be completed ONLY if To be completed ONLY if
certificates for Restricted Notes certificates for Restricted Notes
in a principal amount not tendered, in a principal amount not tendered,
or Exchange Notes issued in or Exchange Notes issued in
exchange for Restricted Notes exchange for Restricted Notes
accepted for exchange, are to be accepted for exchange, are to be
issued in the name of someone other delivered to someone other than the
than the undersigned. undersigned.
Issue certificate(s) to: Deliver certificate(s) to:
Name______________________________ _________________________________
(PLEASE PRINT) (PLEASE PRINT)
__________________________________ _________________________________
(PLEASE PRINT) (PLEASE PRINT)
Address___________________________ Address__________________________
__________________________________ _________________________________
(INCLUDING ZIP CODE) (INCLUDING ZIP CODE)
__________________________________ _________________________________
(TAX IDENTIFICATION OR SOCIAL (TAX IDENTIFICATION OR SOCIAL
SECURITY NUMBER) SECURITY NUMBER)
IMPORTANT: THIS LETTER OF TRANSMITTAL OR A FACSIMILE HEREOF (TOGETHER WITH
THE CERTIFICATE(S) FOR RESTRICTED NOTES OR A CONFIRMATION OF BOOK-ENTRY
TRANSFER OF SUCH RESTRICTED NOTES AND ALL OTHER REQUIRED DOCUMENTS) OR, IF
GUARANTEED DELIVERY PROCEDURES ARE TO BE COMPLIED WITH, A NOTICE OF
GUARANTEED DELIVERY, MUST BE RECEIVED BY THE EXCHANGE AGENT PRIOR TO THE
EXPIRATION DATE.
[ ] CHECK HERE IF RESTRICTED NOTES ARE BEING DELIVERED BY DTC TO AN
ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH DTC AND COMPLETE THE
FOLLOWING:
Name of Tendering Institution_____________________________
[ ] The Depository Trust Company
Account Number_____________________________________________
Transaction Code Number____________________________________
Holders whose Restricted Notes are not immediately available or who
cannot deliver their Restricted Notes and all other documents
required hereby to the Exchange Agent on or prior to the Expiration
Date may tender their Restricted Notes according to the guaranteed
delivery procedures set forth in the Prospectus under the caption
"The Exchange Offer--Guaranteed Delivery Procedures." (See
Instruction 2.)
<PAGE>
[ ] CHECK HERE IF RESTRICTED NOTES ARE BEING DELIVERED PURSUANT TO A
NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT
AND COMPLETE THE FOLLOWING:
Name(s) of tendering Holder(s)______________________________________
Date of Execution of Notice of Guaranteed Delivery__________________
Name of Institution which Guaranteed Delivery_______________________
Transaction Code Number_____________________________________________
[ ] CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10
ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS
OR SUPPLEMENTS THERETO.
Name:______________________________________________________________
Address:___________________________________________________________
If the undersigned is not a broker-dealer, the undersigned
represents that (1) it is acquiring the Exchange Notes in the ordinary
course of its business, (2) it has no arrangements or understanding with
any person, nor does it intend to engage in, a distribution (as that term
is interpreted by the SEC) of Exchange Notes and (3) it is not an affiliate
(as that term is interpreted by the SEC) of the Company. If the undersigned
is a broker-dealer that will receive Exchange Notes for its own account in
exchange for Restricted Notes that were acquired as a result of
market-making activities or other trading activities, it acknowledges that
it will deliver a prospectus in connection with any resale of such Exchange
Notes; however, by so acknowledging and by delivering a prospectus, the
undersigned will not be deemed to admit that it is an "underwriter" within
the meaning of the Securities Act.
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ ACCOMPANYING INSTRUCTIONS CAREFULLY
Ladies and Gentlemen:
Subject to the terms and conditions of the Exchange Offer, the
undersigned hereby tenders to Jones Apparel Group, Inc. (the "Company") the
principal amount of Restricted Notes indicated above.
Subject to and effective upon the acceptance for exchange of the
principal amount of Restricted Notes tendered hereby in accordance with
this Letter of Transmittal, the undersigned sells, assigns and transfers
to, or upon the order of, the Company all right, title and interest in and
to the Restricted Notes tendered hereby. The undersigned hereby irrevocably
constitutes and appoints the Exchange Agent as its agent and
attorney-in-fact (with full knowledge that the Exchange Agent also acts as
the agent of the Company and as Trustee and Registrar under the Indenture
for the Restricted Notes and the Exchange Notes) with respect to the
tendered Restricted Notes with full power of substitution (such power of
attorney being deemed an irrevocable power coupled with an interest),
subject only to the right of withdrawal described in the Prospectus, to (1)
deliver certificates for such Restricted Notes to the Company or transfer
ownership of such Restricted Notes on the account books maintained by DTC,
together, in either such case, with all accompanying evidences of transfer
and authenticity to, or upon the order of, the Company and (2) present such
Restricted Notes for transfer on the
<PAGE>
books of the Company and receive all benefits and otherwise exercise all
rights of beneficial ownership of such Restricted Notes, all in accordance
with the terms of the Exchange Offer.
The undersigned acknowledges that the Exchange Offer is being made
in reliance upon interpretative advice given by the staff of the SEC to
third parties in connection with transactions similar to the Exchange
Offer, so that the Exchange Notes issued pursuant to the Exchange Offer in
exchange for the Restricted Notes may be offered for resale, resold and
otherwise transferred by holders thereof (other than a broker-dealer who
purchased such Restricted Notes directly from the Company for resale
pursuant to Rule 144A, Regulation S or any other available exemption under
the Securities Act or a person that is an "affiliate" of the Company within
the meaning of Rule 405 under the Securities Act) without compliance with
the registration and prospectus delivery provisions of the Securities Act,
provided that such Exchange Notes are acquired in the ordinary course of
such holders' business and such holders are not participating, do not
intend to participate and have no arrangement or understanding with any
person to participate, in the distribution of such Exchange Notes.
The undersigned agrees that acceptance of any tendered Restricted
Notes by the Company and the issuance of Exchange Notes in exchange
therefor shall constitute performance in full by the Company of its
obligations under the Exchange and Registration Rights Agreement (as
defined in the Prospectus) and that, upon the issuance of the Exchange
Notes, the Company will have no further obligations or liabilities
thereunder (except in certain limited circumstances).
The undersigned represents and warrants that (1) the Exchange Notes
acquired pursuant to the Exchange Offer are being acquired in the ordinary
course of business of the person receiving Exchange Notes (which shall be
the undersigned unless otherwise indicated in the box entitled "Special
Delivery Instructions" above) (the "Recipient"), (2) neither the
undersigned nor the Recipient (if different) is engaged in, intends to
engage in or has any arrangement or understanding with any person to
participate in the distribution (as that term is interpreted by the SEC) of
such Exchange Notes, and (3) neither the undersigned nor the Recipient (if
different) is an "affiliate" of the Company as defined in Rule 405 under
the Securities Act.
If the undersigned is a broker-dealer, the undersigned further (1)
represents that it acquired Restricted Notes for the undersigned's own
account as a result of market-making activities or other trading
activities, (2) represents that it has not entered into any arrangement or
understanding with the Company or any "affiliate" of the Company (within
the meaning of Rule 405 under the Securities Act) to distribute the
Exchange Notes to be received in the Exchange Offer and (3) acknowledges
that it will deliver a prospectus meeting the requirements of the
Securities Act (for which purposes, the delivery of the Prospectus, as the
same may be hereafter supplemented or amended, shall be sufficient) in
connection with any resale of Exchange Notes received in the Exchange
Offer. Such a broker-dealer will not be deemed, solely by reason of such
acknowledgment and prospectus delivery, to admit that it is an
"underwriter" within the meaning of the Securities Act.
The undersigned understands and agrees that the Company reserves the
right not to accept tendered Restricted Notes from any tendering holder if
the Company determines, in its sole and absolute discretion, that such
acceptance could result in a violation of applicable securities laws.
<PAGE>
The undersigned hereby represents and warrants that the undersigned
has full power and authority to tender, exchange, assign and transfer the
Restricted Notes tendered hereby and to acquire Exchange Notes issuable
upon the exchange of such tendered Restricted Notes, and that, when the
same are accepted for exchange, the Company will acquire good and
unencumbered title thereto, free and clear of all liens, restrictions,
charges and encumbrances and not subject to any adverse claim. The
undersigned also warrants that it will, upon request, execute and deliver
any additional documents deemed to be necessary or desirable by the
Exchange Agent or the Company in order to complete the exchange, assignment
and transfer of tendered Restricted Notes or transfer of ownership of such
Restricted Notes on the account books maintained by a book-entry transfer
facility.
The undersigned understands and acknowledges that the Company
reserves the right in its sole discretion to purchase or make offers for
any Restricted Notes that remain outstanding subsequent to the Expiration
Date or, as set forth in the Prospectus under the caption "The Exchange
Offer--Procedures for Tendering," to terminate the Exchange Offer and, to
the extent permitted by applicable law, purchase Restricted Notes in the
open market, in privately negotiated transactions or otherwise. The terms
of any such purchases or offers could differ from the terms of the Exchange
Offer.
The undersigned understands that the Company may accept the
undersigned's tender by delivering written notice of acceptance to the
Exchange Agent, at which time the undersigned's right to withdraw such
tender will terminate. For purposes of the Exchange Offer, the Company
shall be deemed to have accepted validly tendered Restricted Notes when, as
and if the Company has given oral (which shall be confirmed in writing) or
written notice thereof to the Exchange Agent.
The undersigned understands that the first interest payment
following the Expiration Date will include unpaid interest on the
Restricted Notes accrued through the date of issuance of the Exchange
Notes.
The undersigned understands that tenders of Restricted Notes
pursuant to the procedures described under the caption "The Exchange
Offer--Procedures for Tendering" in the Prospectus and in the instructions
hereto will constitute a binding agreement between the undersigned, the
Company and the Exchange Agent in accordance with the terms and subject to
the conditions of the Exchange Offer.
If any tendered Restricted Notes are not accepted for exchange
pursuant to the Exchange Offer for any reason, certificates for any such
unaccepted Restricted Notes will be returned (except as noted below with
respect to tenders through DTC), at the Company's cost and expense, to the
undersigned at the address shown below or at a different address as may be
indicated herein under "Special Delivery Instructions" as promptly as
practicable after the Expiration Date.
All authority conferred or agreed to be conferred by this Letter of
Transmittal shall survive the death, incapacity or dissolution of the
undersigned, and every obligation of the undersigned under this Letter of
Transmittal shall be binding on the undersigned's heirs, personal
representatives, successors and assigns. This tender may be withdrawn only
in accordance with the procedures set forth in this Letter of Transmittal.
By acceptance of the Exchange Offer, each broker-dealer that
receives Exchange Notes pursuant to the Exchange Offer hereby acknowledges
and agrees that upon the receipt of notice by the Company of the happening
of
<PAGE>
any event that makes any statement in the Prospectus untrue in any material
respect or that requires the making of any changes in the Prospectus in
order to make the statements therein not misleading (which notice the
Company agrees to deliver promptly to such broker-dealer), such
broker-dealer will suspend use of the Prospectus until the Company has
amended or supplemented the Prospectus to correct such misstatement or
omission and has furnished copies of the amended or supplemented prospectus
to such broker-dealer.
Unless otherwise indicated under "Special Registration
Instructions," please issue the certificates representing the Exchange
Notes issued in exchange for the Restricted Notes accepted for exchange and
return any certificates for Restricted Notes not tendered or not exchanged,
in the name(s) of the undersigned (or, in either such event in the case of
Restricted Notes tendered by DTC, by credit to the account at DTC).
Similarly, unless otherwise indicated under "Special Delivery
Instructions," please send the certificates representing the Exchange Notes
issued in exchange for the Restricted Notes accepted for exchange and any
certificates for Restricted Notes not tendered or not exchanged (and
accompanying documents, as appropriate) to the undersigned at the address
shown below the undersigned's signature(s), unless, in either event, tender
is being made through DTC. In the event that both "Special Registration
Instructions" and "Special Delivery Instructions" are completed, please
issue the certificates representing the Exchange Notes issued in exchange
for the Restricted Notes accepted for exchange in the name(s) of, and
return any certificates for Restricted Notes not tendered or not exchanged
to, the person(s) so indicated. The undersigned understands that the
Company has no obligations pursuant to the "Special Registration
Instructions" or "Special Delivery Instructions" to transfer any Restricted
Notes from the name of the registered Holder(s) thereof if the Company does
not accept for exchange any of the Restricted Notes so tendered.
Holders who wish to tender the Restricted Notes and (1) whose
Restricted Notes are not immediately available or (2) who cannot deliver
their Restricted Notes, this Letter of Transmittal or any other documents
required hereby to the Exchange Agent prior to the Expiration Date, may
tender their Restricted Notes according to the guaranteed delivery
procedures set forth in the Prospectus under the caption "The Exchange
Offer--Guaranteed Delivery Procedures." See Instruction 1 regarding the
completion of the Letter of Transmittal.
<PAGE>
PLEASE SIGN HERE WHETHER OR NOT
RESTRICTED NOTES ARE BEING PHYSICALLY TENDERED HEREBY
AND WHETHER OR NOT TENDER IS TO BE MADE
PURSUANT TO THE GUARANTEED DELIVERY PROCEDURES
This Letter of Transmittal must be signed by the registered
holder(s) as their name(s) appear on the Restricted Notes or, if tendered
by a participant in DTC, exactly as such participant's name appears on a
security listing as the owner of Restricted Notes, or by person(s)
authorized to become registered holder(s) by a properly completed bond
power from the registered holder(s), a copy of which must be transmitted
with this Letter of Transmittal. If Restricted Notes to which this Letter
of Transmittal relate are held of record by two or more joint holders, then
all such holders must sign this Letter of Transmittal. If signature is by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative
capacity, then such person must (1) set forth his or her full title below
and (2) unless waived by the Company, submit evidence satisfactory to the
Company of such person's authority so to act. (See Instruction 4.)
X------------------------------- ------------------------------
DATE
X------------------------------- ------------------------------
DATE
Signature(s) of Holder(s) or
Authorized Signatory
Name(s): Address:
------------------------ ---------------------------
Name(s): Address:
------------------------ ---------------------------
PLEASE PRINT (INCLUDING ZIP CODE)
Capacity: Telephone Number:
------------------------ ------------------
(INCLUDING AREA CODE)
Social Security No.
-------------
PLEASE COMPLETE SUBSTITUTE FORM W-9 HEREIN
<PAGE>
BOX IV
SIGNATURE GUARANTEE (SEE INSTRUCTION 1)
CERTAIN SIGNATURES MUST BE GUARANTEED BY AN ELIGIBLE INSTITUTION
- -----------------------------------------------------------------------------
(NAME OF ELIGIBLE INSTITUTION GUARANTEEING SIGNATURES)
- -----------------------------------------------------------------------------
(FIRM ADDRESS (INCLUDING ZIP CODE) AND TELEPHONE NO. (INCLUDING AREA CODE))
- -----------------------------------------------------------------------------
(AUTHORIZED SIGNATURE)
- -----------------------------------------------------------------------------
(PRINTED NAME)
- -----------------------------------------------------------------------------
(TITLE)
Date:
-------------------
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER
1. Guarantee of Signatures. Signatures on this Letter of Transmittal
need not be guaranteed if (a) this Letter of Transmittal is signed by the
registered holder(s) of the Restricted Notes tendered herewith and such
holder(s) have not completed the box set forth herein entitled "Special
Registration Instructions" or the box entitled "Special Delivery
Instructions" or (b) such Restricted Notes are tendered for the account of
a member firm of a registered national securities exchange or of the
National Association of Securities Dealers, Inc. or a commercial bank or
trust company having an office or correspondent in the United States (each,
an "Eligible Institution"). (See Instruction 6.) Otherwise, all signatures
on this Letter of Transmittal or a notice of withdrawal, as the case may
be, must be guaranteed by an Eligible Institution. All signatures on bond
powers and endorsements on certificates must also be guaranteed by an
Eligible Institution.
2. Delivery of this Letter of Transmittal and Restricted Notes.
Certificates for all physically delivered Restricted Notes or confirmation
of any book-entry transfer to the Exchange Agent at DTC of Restricted Notes
tendered by book-entry transfer, as well as, in each case (including cases
where tender is affected by book-entry transfer), a properly completed and
duly executed copy of this Letter of Transmittal or facsimile hereof and
any other documents required by this Letter of Transmittal, must be
received by the Exchange Agent at its address set forth herein prior to
5:00 p.m., New York City time, on the Expiration Date. The method of
delivery of the tendered Restricted Notes, this Letter of Transmittal and
all other required documents to the Exchange Agent is at the election and
risk of the Holder and the delivery will be deemed made only when actually
received by the Exchange Agent. If Restricted Notes are sent by mail,
registered mail with return receipt requested, properly insured, is
recommended. In all cases, sufficient time should be allowed to ensure
timely delivery. No Letter of Transmittal or Restricted Notes should be
sent to the Company.
The Exchange Agent will make a request to establish an account with
respect to the Restricted Notes at DTC for purposes of the Exchange Offer
promptly after receipt of this Prospectus, and any financial institution
that is a participant in DTC may make book-entry delivery of Restricted
Notes by causing DTC to transfer such Restricted Notes into the Exchange
Agent's account at DTC in accordance with DTC's procedures for transfer.
However, although delivery of Restricted Notes may be effected through
book-entry transfer at DTC, the Letter of Transmittal, with any required
signature guarantees or an Agent's Message (as defined in the next
paragraph) in connection with a book-entry transfer and any other required
documents, must, in any case, be transmitted to and received by the
Exchange Agent at the address specified on the cover page of the Letter of
Transmittal on or prior to the Expiration Date or the guaranteed delivery
procedures described below must be complied with.
A Holder may tender Restricted Notes that are held through DTC by
transmitting its acceptance through DTC's Automatic Tender Offer Program,
for which the transaction will be eligible, and DTC will then edit and
verify the acceptance and send an Agent's Message to the Exchange Agent
<PAGE>
for its acceptance. The term "Agent's Message" means a message transmitted
by DTC to, and received by, the Exchange Agent and forming part of the
Book-Entry Confirmation, which states that DTC has received an express
acknowledgment from each participant in DTC tendering the Restricted Notes
and that such participant has received the Letter of Transmittal and agrees
to be bound by the terms of the Letter of Transmittal and the Company may
enforce such agreement against such participant.
Holders who wish to tender their Restricted Notes and (1) whose
Restricted Notes are not immediately available, or (2) who cannot deliver
their Restricted Notes, this Letter of Transmittal or any other documents
required hereby to the Exchange Agent prior to the Expiration Date or
comply with book-entry transfer procedures on a timely basis must tender
their Restricted Notes according to the guaranteed delivery procedures set
forth in the Prospectus. See "Exchange Offer--Guaranteed Delivery
Procedures." Pursuant to such procedure: (1) such tender must be made by or
through an Eligible Institution; (2) prior to the Expiration Date, the
Exchange Agent must have received from the Eligible Institution a properly
completed and duly executed Notice of Guaranteed Delivery (by facsimile
transmission, overnight courier, mail or hand delivery) setting forth the
name and address of the Holder of the Restricted Notes, the certificate
number or numbers of such Restricted Notes and the principal amount of
Restricted Notes tendered, stating that the tender is being made thereby
and guaranteeing that, within three New York Stock Exchange trading days
after the Expiration Date, this Letter of Transmittal (or facsimile hereof)
together with the certificate(s) representing the Restricted Notes and any
other required documents will be deposited by the Eligible Institution with
the Exchange Agent; and (3) such properly completed and executed Letter of
Transmittal (or facsimile hereof), as well as all other documents required
by this Letter of Transmittal and the certificate(s) representing all
tendered Restricted Notes in proper form for transfer (or a confirmation of
book-entry transfer of such Restricted Notes into the Exchange Agent's
account at DTC), must be received by the Exchange Agent within three New
York Stock Exchange trading days after the Expiration Date, all in the
manner provided in the Prospectus under the caption "The Exchange
Offer--Guaranteed Delivery Procedures." Any Holder who wishes to tender his
or her Restricted Notes pursuant to the guaranteed delivery procedures
described above must ensure that the Exchange Agent receives the Notice of
Guaranteed Delivery prior to 5:00 p.m., New York City time, on the
Expiration Date. Upon request to the Exchange Agent, a Notice of Guaranteed
Delivery will be sent to Holders who wish to tender their Restricted Notes
according to the guaranteed delivery procedures set forth above.
All questions as to the validity, form, eligibility (including time of
receipt), acceptance of tendered Restricted Notes, and withdrawal of
tendered Restricted Notes will be determined by the Company in its sole
discretion, which determination will be final and binding. All tendering
holders, by execution of this Letter of Transmittal (or facsimile thereof),
shall waive any right to receive notice of the acceptance of the Restricted
Notes for exchange. The Company reserves the absolute right to reject any
and all Restricted Notes not properly tendered or any Restricted Notes the
Company's acceptance of which would, in the opinion of counsel for the
Company, be unlawful. The Company also reserves the right to waive any
irregularities or conditions of tender as to particular Restricted Notes.
The Company's interpretation of the terms and conditions of the Exchange
Offer (including the instructions in this Letter of Transmittal) shall be
final and binding on all parties. Unless waived, any defects or
irregularities in connection with tenders of Restricted Notes must be cured
within such time as the Company shall
<PAGE>
determine. Neither the Company, the Exchange Agent nor any other person
shall be under any duty to give notification of defects or irregularities
with respect to tenders of Restricted Notes, nor shall any of them incur
any liability for failure to give such notification. Tenders of Restricted
Notes will not be deemed to have been made until such defects or
irregularities have been cured to the Company's satisfaction or waived. Any
Restricted Notes received by the Exchange Agent that are not properly
tendered and as to which the defects or irregularities have not been cured
or waived will be returned by the Exchange Agent to the tendering Holders
pursuant to the Company's determination, unless otherwise provided in this
Letter of Transmittal as soon as practicable following the Expiration Date.
The Exchange Agent has no fiduciary duties to the Holders with respect to
the Exchange Offer and is acting solely on the basis of directions of the
Company.
3. Inadequate Space. If the space provided is inadequate, the
certificate numbers and/or the number of Restricted Notes should be listed
on a separate signed schedule attached hereto.
4. Tender by Holder. Only a Holder of Restricted Notes may tender such
Restricted Notes in the Exchange Offer. Any beneficial owner of Restricted
Notes who is not the registered Holder and who wishes to tender should
arrange with such registered holder to execute and deliver this Letter of
Transmittal on such beneficial owner's behalf or must, prior to completing
and executing this Letter of Transmittal and delivering his or her
Restricted Notes, either make appropriate arrangements to register
ownership of the Restricted Notes in such beneficial owner's name or obtain
a properly completed bond power from the registered holder or properly
endorsed certificates representing such Restricted Notes.
5. Partial Tenders; Withdrawals. Tenders of Restricted Notes will be
accepted only in integral multiples of $1,000. If less than the entire
principal amount of any Restricted Notes is tendered, the tendering Holder
should fill in the principal amount tendered in the third column of the box
entitled "Description of 6.25% Senior Notes due 2001" above. The entire
principal amount of any Restricted Notes delivered to the Exchange Agent
will be deemed to have been tendered unless otherwise indicated. If the
entire principal amount of all Restricted Notes is not tendered, then
Restricted Notes for the principal amount of Restricted Notes not tendered
and a certificate or certification representing Exchange Notes issued in
exchange for any Restricted Notes accepted will be sent to the Holder at
his or her registered address, unless a different address is provided in
the "Special Delivery Instructions" box above on this Letter of Transmittal
or unless tender is made through DTC, promptly after the Restricted Notes
are accepted for exchange.
Except as otherwise provided herein, tenders of Restricted Notes may
be withdrawn at any time prior to 5:00 p.m., New York City time, on the
Expiration Date. To withdraw a tender of Restricted Notes in the Exchange
Offer, a written or facsimile transmission notice of withdrawal must be
received by the Exchange Agent at its address set forth herein prior to
5:00 p.m., New York City time, on the Expiration Date. Any such notice of
withdrawal must (1) specify the name of the person having deposited the
Restricted Notes to be withdrawn (the "Depositor"), (2) identify the
Restricted Notes to be withdrawn (including the certificate number or
numbers and principal amount of such Restricted Notes, or, in the case of
Restricted Notes transferred by book-entry transfer the name and number of
the account at DTC to be credited), (3) be signed by the Depositor in the
same manner as the original signature on the Letter of Transmittal by which
such Restricted Notes were tendered (including any required signature
guarantees) or be accompanied by documents of transfer sufficient to have
the Registrar with respect to the Restricted Notes
<PAGE>
register the transfer of such Restricted Notes into the name of the person
withdrawing the tender and (4) specify the name in which any such
Restricted Notes are to be registered, if different from that of the
Depositor. All questions as to the validity, form and eligibility
(including time of receipt) of such notices will be determined by the
Company, whose determination shall be final and binding on all parties. Any
Restricted Notes so withdrawn will be deemed not to have been validly
tendered for purposes of the Exchange Offer and no Exchange Notes will be
issued with respect thereto unless the Restricted Notes so withdrawn are
validly retendered. Any Restricted Notes which have been tendered but which
are not accepted for exchange by the Company will be returned to the Holder
thereof without cost to such Holder as soon as practicable after
withdrawal, rejection of tender or termination of the Exchange Offer.
Properly withdrawn Restricted Notes may be retendered by following one of
the procedures described in the Prospectus under "The Exchange
Offer--Procedures for Tendering" at any time prior to the Expiration Date.
6. Signatures on the Letter of Transmittal; Bond Powers and
Endorsements. If this Letter of Transmittal (or facsimile hereof) is signed
by the registered holder(s) of the Restricted Notes tendered hereby, the
signature must correspond with the name(s) as written on the face of the
Restricted Note without alteration, enlargement or any change whatsoever.
If any of the Restricted Notes tendered hereby are owned of record by
two or more joint owners, all such owners must sign this Letter of
Transmittal.
If a number of Restricted Notes registered in different names are
tendered, it will be necessary to complete, sign and submit as many copies
of this Letter of Transmittal as there are different registrations of
Restricted Notes.
If this Letter of Transmittal (or facsimile hereof) is signed by the
registered Holder or Holders (which term, for the purposes described
herein, shall include a book-entry transfer facility whose name appears on
a security listing as the owner of the Restricted Notes) of Restricted
Notes tendered and the certificate or certificates for Exchange Notes
issued in exchange therefor is to be issued (or any untendered principal
amount of Restricted Notes to be reissued) to the registered Holder, then
such Holder need not and should not endorse any tendered Restricted Notes,
nor provide a separate bond power. In any other case, such Holder must
either properly endorse the Restricted Notes tendered or transmit a
properly completed separate bond power with this Letter of Transmittal with
the signatures on the endorsement or bond power guaranteed by an Eligible
Institution.
If this Letter of Transmittal (or facsimile hereof) is signed by a
person other than the registered Holder or Holders of any Restricted Notes
listed, such Restricted Notes must be endorsed or accompanied by
appropriate bond powers in each case signed as the name of the registered
Holder or Holders appears on the Restricted Notes.
If this Letter of Transmittal (or facsimile hereof) or any Restricted
Notes or bond powers are signed by trustees, executors, administrators,
guardians, attorneys-in-fact, or officers of corporations or others acting
in a fiduciary or representative capacity, such persons should so indicate
when signing, and unless waived by the Company, evidence satisfactory to
the Company of their authority so to act must be submitted with this Letter
of Transmittal.
<PAGE>
Endorsements on Restricted Notes or signatures on bond powers required
by this Instruction 6 must be guaranteed by an Eligible Institution.
7. Special Registration and Delivery Instructions. Tendering Holders
should indicate, in the applicable box or boxes, the name and address to
which Exchange Notes or substitute Restricted Notes for principal amounts
not tendered or not accepted for exchange are to be issued or sent, if
different from the name and address of the person signing this Letter of
Transmittal. In the case of issuance in a different name, the taxpayer
identification or social security number of the person named must also be
indicated.
8. Backup Federal Income Tax Withholding and Substitute Form W-9.
Under the federal income tax laws, payments that may be made by the Company
on account of Exchange Notes issued pursuant to the Exchange Offer may be
subject to backup withholding at the rate of 31%. In order to avoid such
backup withholding, each tendering holder should compete and sign the
Substitute Form W-9 included in this Letter of Transmittal and either (a)
provide the correct taxpayer identification number ("TIN") and certify,
under penalties of perjury, that the TIN provided is correct and that (1)
the Holder has not been notified by the Internal Revenue Service the
("IRS") that the Holder is subject to backup withholding as a result of
failure to report all interest or dividends or (2) the IRS has notified the
Holder that the Holder is no longer subject to backup withholding; or (b)
provide an adequate basis for exemption. If the tendering Holder has not
been issued a TIN and has applied for one, or intends to apply for one in
the near future, such Holder should write "Applied For" in the space
provided for the TIN in Part I of the Substitute Form W-9, sign and date
the Substitute Form W-9 and sign the Certificate of Payee Awaiting Taxpayer
Identification Number. If "Applied For" is written in Part I, the Company
(or the Paying Agent under the Indenture governing the Exchange Notes)
shall retain 31% of payments made to the tendering Holder during the 60-day
period following the date of the Substitute Form W-9. If the Holder
furnishes the Exchange Agent or the Company with its TIN within 60 days
after the date of the Substitute Form W-9, the Company (or the Paying
Agent) shall remit such amounts retained during the 60-day period to the
Holder and no further amounts shall be retained or withheld from payments
made to the Holder thereafter. If, however, the Holder has not provided the
Exchange Agent or the Company with its TIN within such 60-day period, the
Company (or the Paying Agent) shall remit such previously retained amounts
to the IRS as backup withholding. In general, if a Holder is an individual,
the TIN is the Social Security number of such individual. If the Exchange
Agent or the Company are not provided with the correct TIN, the Holder may
be subject to a $50 penalty imposed by the Internal Revenue Service.
Certain Holders (including, among others, all corporations and certain
foreign individuals) are not subject to these backup withholding and
reporting requirements. In order for a foreign individual to qualify as an
exempt recipient, such Holder must submit a statement (generally, IRS Form
W-8), signed under penalties of perjury, attesting to that individual's
exempt status. Such statements can be obtained from the Exchange Agent. For
further information concerning backup withholding and instructions for
completing the Substitute Form W-9 (including how to obtain a taxpayer
identification number if you do not have one and how to complete the
Substitute Form W-9 if Restricted Notes are registered in more than one
name), consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9. Failure to complete the
Substitute Form W-9 will not, by itself, cause Restricted Notes to be
deemed invalidly tendered, but may require the Company (or the Paying
Agent) to withhold 31% of the amount of any payments made on account of the
Exchange Notes. Backup withholding is not an additional federal income tax.
Rather, the federal
<PAGE>
income tax liability of a person subject to backup withholding will be
reduced by the amount of tax withheld. If withholding results in an
overpayment of taxes, a refund may be obtained from the IRS.
9. Transfer Taxes. The Company will pay all transfer taxes, if any,
applicable to the exchange of Restricted Notes pursuant to the Exchange
Offer. If, however, certificates representing Exchange Notes or Restricted
Notes for principal amounts not tendered or accepted for exchange are to be
delivered to, or are to be registered in the name of, any person other than
the registered Holder of the Restricted Notes tendered hereby, or if
tendered Restricted Notes are registered in the name of a person other than
the person signing this Letter of Transmittal, or if a transfer tax is
imposed for any reason other than the exchange of Restricted Notes pursuant
to the Exchange Offer, then the amount of any such transfer taxes (whether
imposed on the registered Holder or on any other persons) will be payable
by the tendering Holder. If satisfactory evidence of payment of such taxes
or exemption therefrom is not submitted with this Letter of Transmittal,
the amount of such transfer taxes will be billed directly to such tendering
Holder. See the Prospectus under "The Exchange Offer--Solicitation of
Tenders; Fees and Expenses."
Except as provided in this Instruction 9, it will not be necessary for
transfer tax stamps to be affixed to the Restricted Notes listed in this
Letter of Transmittal.
10. Waiver of Conditions. The Company reserves the right, in its sole
discretion, to amend, waive or modify specified conditions in the Exchange
Offer in the case of any Restricted Notes tendered.
11. Mutilated, Lost, Stolen or Destroyed Restricted Notes. Any
tendering Holder whose Restricted Notes have been mutilated, lost, stolen
or destroyed should contact the Exchange Agent at the address indicated
herein for further instructions.
12. Requests for Assistance, Copies. Requests for assistance and
requests for additional copies of the Prospectus or this Letter of
Transmittal may be directed to the Exchange Agent at the address specified
in the Prospectus. Holders may also contact their broker, dealer,
commercial bank, trust company or other nominee for assistance concerning
the Exchange Offer.
(DO NOT WRITE IN SPACE BELOW)
CERTIFICATE SURRENDERED RESTRICTED NOTES TENDERED RESTRICTED NOTES ACCEPTED
- ----------------------- ---------------------- ----------------------
- ----------------------- ---------------------- ----------------------
Received__________ Accepted by__________ Checked by_________ Delivery
Prepared by__________ Checked by__________ Date__________
IMPORTANT TAX INFORMATION
Under federal income tax laws, a Holder whose tendered Restricted
Notes are accepted for payment is required to provide the Exchange Agent
(as payer) with such Holder's correct TIN on Substitute Form W-9 below or
otherwise establish a basis for exemption from backup withholding. If such
Holder is an individual, the TIN is his social security number. If the
Exchange Agent is not provided with the correct TIN, a $50
<PAGE>
penalty may be imposed by the Internal Revenue Service, and payments made
pursuant to the Exchange Offer may be subject to backup withholding.
Certain Holders (including, among others, all corporations and certain
foreign persons) are not subject to these backup withholding and reporting
requirements. Exempt Holders should indicate their exempt status on
Substitute Form W-9. A foreign person may qualify as an exempt recipient by
submitting to the Exchange Agent a properly completed Internal Revenue
Service Form W-8, signed under penalties of perjury, attesting to that
Holder's exempt status. A Form W-8 can be obtained from the Exchange Agent.
See the enclosed "Guidelines for Certification of Taxpayer Identification
Number on Substitute Form W-9" for additional instructions.
If backup withholding applies, the Exchange Agent is required to
withhold 31% of any payments made to the Holder or other payee. Backup
withholding is not an additional federal income tax. Rather, the federal
income tax liability of persons subject to backup withholding will be
reduced by the amount of tax withheld. If withholding results in an
overpayment of taxes, a refund may be obtained from the Internal Revenue
Service.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup withholding on payments made with respect to the
Exchange Offer, the Holder is required to provide the Exchange Agent with
either (a) the Holder's correct TIN by completing the form below,
certifying that the TIN provided on Substitute Form W-9 is correct (or that
such Holder is awaiting a TIN) and that (1) the Holder has been notified by
the Internal Revenue Service that the Holder is subject to backup
withholding as a result of failure to report all interest or dividends or
(2) the Internal Revenue Service has notified the Holder that the Holder is
no longer subject to backup withholding or (b) an adequate basis for
exemption.
WHAT NUMBER TO GIVE THE EXCHANGE AGENT
The Holder is required to give the Exchange Agent the TIN (e.g.,
social security number or employer identification number) of the registered
Holder of the Restricted Notes. If the Restricted Notes are held in more
than one name or are held not in the name of the actual owner, consult the
enclosed "Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9" for additional guidance on which number to report.
CERTIFICATION OF PAYEE AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify, under penalties of perjury, that a Taxpayer Identification
Number has not been issued to me, and that I mailed or delivered an
application to receive a Taxpayer Identification Number to the appropriate
Internal Revenue Service Center or Social Security Administration Office
(or I intend to mail or deliver an application in the near future). I
understand that if I do not provide a Taxpayer Identification Number to the
payer, 31% of all payments made to me on account of the Exchange Notes
shall be retained until I provide a Taxpayer Identification Number within
60 days, such retained amounts shall be remitted to the Internal Revenue
Service as backup withholding and 31% of all reportable payments made to me
thereafter will be withheld and remitted to the Internal Revenue Service
until I provide a Taxpayer Identification Number.
SIGNATURE _________________________________DATE
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU ON ACCOUNT OF THE
EXCHANGE NOTES. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR
CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM
W-9 FOR ADDITIONAL DETAILS.
<PAGE>
TO BE COMPLETED BY ALL TENDERING HOLDERS
(SEE INSTRUCTION 5)
PAYER'S NAME: JONES APPAREL GROUP, INC.
SUBSTITUTE PART I--TAXPAYER SOCIAL SECURITY
FORM W-9 IDENTIFICATION NUMBER
NUMBER (TIN)
-------------------
OR
DEPARTMENT OF THE ENTER YOUR TIN IN EMPLOYEE
TREASURY INTERNAL THE APPROPRIATE BOX. IDENTIFICATION
REVENUE SERVICE FOR INDIVIDUALS, NUMBER
THIS IS YOUR SOCIAL
SECURITY NUMBER --------------------
(SSN). FOR SOLE
PROPRIETORS, SEE THE
INSTRUCTIONS IN THE
ENCLOSED GUIDELINES.
FOR OTHER ENTITIES,
IT IS YOUR EMPLOYER
IDENTIFICATION
NUMBER (EIN). IF
YOU DO NOT HAVE A
NUMBER, SEE HOW TO
GET A TIN IN THE
ENCLOSED GUIDELINES.
REQUEST FOR TAXPAYER
IDENTIFICATION
NUMBER AND
CERTIFICATION
NOTE: IF THE
ACCOUNT IS IN MORE
THAT ONE NAME, SEE
THE CHART ON PAGE 2
OF THE ENCLOSED
GUIDELINES ON WHOSE
NUMBER TO ENTER.
------------------------------------------------
PART II-FOR PAYEES EXEMPT FOR BACKUP WITHHOLDING
(See Part II instructions in the enclosed
Guidelines.)
- ------------------------------------------------------------------------
<PAGE>
PART III--CERTIFICATION-- UNDER PENALTIES OF PERJURY, I CERTIFY THAT;
(1) The number shown on this form is my correct Taxpayer Identification
Number (or I am waiting for a number to be issued to me), and
(2) I am not subject to backup withholding because: (a) I am exempt from
backup withholding, or (b) I have not been notified by the Internal
Revenue Service (IRS) that I am subject to backup withholding as a
result of a failure to report all interest or dividends, or (c) the
IRS has notified me that I am no longer subject to backup
withholding.
Signature __________________________________ Date ______, 1999
CERTIFICATION INSTRUCTIONS--You must cross out item 2 above if you have
been notified by the IRS that you are currently subject to backup
withholding because of underreporting interest or dividends on your tax
return. For real estate transactions, item 2 does not apply. For mortgage
interest paid, the acquisition or abandonment of secured property,
cancelation of debt, contributions to an individual retirement arrangement
(IRA), and generally payments other than interest and dividends, you are
not required to sign the Certification, but you must provide your correct
TIN.
EXHIBIT 99.2
NOTICE OF GUARANTEED DELIVERY
FOR 6.25% SENIOR NOTES DUE 2001
OF JONES APPAREL GROUP, INC.
As set forth in the Prospectus dated (the "Prospectus")
of Jones Apparel Group, Inc. (the "Company") and in the Letter of
Transmittal (the "Letter of Transmittal"), this form or a form
substantially equivalent to this form must be used to accept the Exchange
Offer (as defined below) if the certificates for the outstanding 6.25%
Senior Notes due 2001 (the "Restricted Notes") of the Company and all
other documents required by the Letter of Transmittal cannot be delivered
to the Exchange Agent by the expiration of the Exchange Offer or compliance
with book-entry transfer procedures cannot be effected on a timely basis.
Such form may be delivered by hand or transmitted by facsimile
transmission, telex or mail to the Exchange Agent no later than the
Expiration Date, and must include a signature guarantee by an Eligible
Institution as set forth below. Capitalized terms used herein but not
defined herein have the meanings ascribed thereto in the Prospectus.
TO: THE CHASE MANHATTAN BANK ("THE EXCHANGE AGENT")
By Mail, Overnight Mail or Hand
Delivery before 4:30 p.m.:
The Chase Manhattan Bank
450 West 33rd Street
15th Floor
New York, NY 10001-2967
Attention: Global Trust Services
By Facsimile:
(212) 946-8161
Attention: Sheik Wiltshire
For Information or Confirmation
by Telephone:
(212) 946-3082
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OR TRANSMISSION TO A
FACSIMILE NUMBER OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID
DELIVERY. THE METHOD OF DELIVERY OF ALL DOCUMENTS, INCLUDING CERTIFICATES,
IS AT THE RISK OF THE HOLDER. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH
RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. YOU SHOULD READ
THE INSTRUCTIONS ACCOMPANYING THE LETTER OF TRANSMITTAL CAREFULLY BEFORE
YOU COMPLETE THIS NOTICE OF GUARANTEED DELIVERY.
<PAGE>
This Notice of Guaranteed Delivery is not to be used to guarantee
signatures. If a signature on a Letter of Transmittal is required to be
guaranteed by an Eligible Institution under the instruction thereto, such
signatures must appear in the applicable space provided on the Letter of
Transmittal for Guarantee of Signature(s).
<PAGE>
Ladies and Gentlemen:
The undersigned acknowledges receipt of the Prospectus and the related
Letter of Transmittal which describes the Company's offer (the "Exchange
Offer") to exchange $1,000 in principal amount of new 6.25% Senior Notes
due 2001 (the "Exchange Notes") for each $1,000 in principal amount of
Restricted Notes.
The undersigned hereby tenders to the Company the aggregate principal
amount of Restricted Notes set forth below on the terms and conditions set
forth in the Prospectus and the related Letter of Transmittal pursuant to
the guaranteed delivery procedure set forth in the "The Exchange
Offer-Guaranteed Delivery Procedures" section in the Prospectus and the
accompanying Letter of Transmittal.
The undersigned understands that no withdrawal of a tender of
Restricted Notes may be made on or after the Expiration Date. The
undersigned understands that for a withdrawal of a tender of Restricted
Notes to be effective, a written notice of withdrawal that complies with
the requirements of the Exchange Offer must be timely received by the
Exchange Agent at one of its addresses specified on the cover of this
Notice of Guaranteed Delivery prior to the Expiration Date.
The undersigned understands that the exchange of Restricted Notes for
Exchange Notes pursuant to the Exchange Offer will be made only after
timely receipt by the Exchange Agent of (1) such Restricted Notes (or
Book-Entry Confirmation of the transfer of such Restricted Notes into the
Exchange Agent's account at The Depository Trust Company ("DTC")) and (2) a
Letter of Transmittal (or facsimile thereof) with respect to such
Restricted Notes, properly completed and duly executed, with any required
signature guarantees, this Notice of Guaranteed Delivery and any other
documents required by the Letter of Transmittal or a properly transmitted
Agent's Message. The term "Agent's Message" means a message transmitted by
DTC to, and received by, the Exchange Agent and forming part of the
confirmation of a book-entry transfer, which states that DTC has received
an express acknowledgment from a participant in DTC tendering the
Restricted Notes and that such participant has received the Letter of
Transmittal and agrees to be bound by the terms of the Letter of
Transmittal and the Company may enforce such agreement against such
participant.
All authority conferred or agreed to be conferred by this Notice of
Guaranteed Delivery shall not be affected by, and shall survive, the death
or incapacity of the undersigned, and every obligation of the undersigned
under this Notice of Guaranteed Delivery shall be binding on
<PAGE>
the heirs, executors, administrators, trustees in bankruptcy, personal and
legal representatives, successors and assigns of the undersigned.
<PAGE>
PLEASE COMPLETE
Principal Amount of Restricted If Restricted Notes will be
Notes Tendered: delivered by book-entry
transfer at DTC, insert
- ------------------------------ Depository Account No.:
----------------------------
Certificate No.(s) of
Restricted Notes (if
available):
- ------------------------------
- ------------------------------
- ------------------------------
PLEASE SIGN AND PRINT NAME(S) AND ADDRESS(ES)
Signature(s) of Registered Name(s) of Registered
Holder(s) or Authorized Holder(s)
Signatory: ------------------- -----------------------------
- ------------------------------ -----------------------------
- ------------------------------ -----------------------------
Address(es):-----------------
Date: ----------------------- -----------------------------
Area Code and Telephone
No.:
-----------------------------
This Notice of Guaranteed Delivery must be signed by the registered
Holder(s) of Restricted Notes exactly as its (their) name(s) appear on
certificates for Restricted Notes or on a security position listing as the
owner of Restricted Notes, or by person(s) authorized to become registered
Holder(s) by endorsements and documents transmitted with this Notice of
Guaranteed Delivery. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer or other person acting in a fiduciary
or representative capacity, such person must provide the following
information.
Name(s):------------------------------------------------------------------
- --------------------------------------------------------------------------
Capacity:-----------------------------------------------------------------
Address(es):--------------------------------------------------------------
- --------------------------------------------------------------------------
DO NOT SEND RESTRICTED NOTES WITH THIS FORM. RESTRICTED NOTES SHOULD
BE SENT TO THE EXCHANGE AGENT TOGETHER WITH A PROPERLY COMPLETED AND DULY
EXECUTED LETTER OF TRANSMITTAL.
<PAGE>
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a member firm of a registered national securities
exchange or of the National Association of Securities Dealers, Inc. or a
commercial bank or trust company having an office or a correspondent in the
United States, or otherwise an "eligible guarantor institution" within the
meaning of Rule 17Ad-15 under the Securities Exchange Act of 1934, as
amended, hereby (1) represents that each holder of Restricted Notes on
whose behalf this tender is being made "own(s)" the Restricted Notes
covered hereby within the meaning of Rule 13d-3 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), (2) represents that
such tender of Restricted Notes complies with Rule 14e-4 of the Exchange
Act and (3) guarantees that, within three New York Stock Exchange trading
days from the expiration date of the Exchange Offer, a properly completed
and duly executed Letter of Transmittal (or a facsimile thereof), together
with certificates representing the Restricted Notes covered hereby in
proper form for transfer (or confirmation of the book-entry transfer of
such Restricted Notes into the Exchange Agent's account at DTC, pursuant to
the procedure for book-entry transfer set forth in the Prospectus) and
required documents will be deposited by the undersigned with the Exchange
Agent.
The undersigned acknowledges that it must deliver the Letter of
Transmittal and Restricted Notes tendered hereby to the Exchange Agent
within the time period set forth above and the failure to do so could
result in financial loss to the undersigned.
Name of Firm:
--------------------- --------------------------------
Authorized Signature
Address: Name:
-------------------------- --------------------------
Telephone No.: Title:
-------------------- -------------------------
Date:
--------------------------
PLEASE DO NOT SEND CERTIFICATES FOR RESTRICTED NOTES WITH THIS FORM.
CERTIFICATES FOR RESTRICTED NOTES SHOULD ONLY BE SENT WITH YOUR LETTER OF
TRANSMITTAL.
